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A new national business name registration system
by Meher Gaven
Businesses currently need to register their business name within each of the States or Territories that they operate within. Many business owners find this a cumbersome process. In March this year a plan was released to establish a national business name registration system. The Australian government has introduced a draft Bill called the Business Name Registration Bill 2011 and two associated Bills, with the system proposed to commence in mid 2012. This project is a joint initiative between the State and Territory and Federal governments. Implementation and the commencement of the national system is dependant on the States passing legislation to put the system into place.
What are the key features?
The key features to the national business name registration system are:
· The Australian Securities and Investments Commission (ASIC) will have sole responsibility for registration, renewal and oversight of business name registration in Australia.
· There will be only one registration process that will allow a business to operate in all States and Territories of Australia.
· The need to register a business name in each State and Territory will be abolished.
· Business owners will be required to have an Australian Business Number (ABN) upon registering a business name. Business owners will be given the option to apply for an ABN within their application to register their business name.
· Current business name registrants who do not have an ABN will be able to renew their business name, but all new applications for a business name will need to obtain an ABN.
· Business owners who do not have an ABN will be allowed to renew their business name under the national system, but all new applications for a business name will need an ABN.
· The fees for registration and renewal will generally be lower than under the current regimes. The proposed fee is $30 for one year and $70 for three years. The savings will be considerable for those businesses that currently operate in different States and Territories.
· ASIC will offer both online and paper based registration options.
Why should I register a business name at all?
If you are currently using a business name (and you are not trading under your entity name) it is compulsory to register a business name in the State or Territory that you operate your business.
What if I have already registered my business name or I am thinking about doing so?
Those businesses that have already registered their business name will automatically be placed into the national system upon commencement. There will be no additional fees associated with this process.
Businesses that have the same name, but are currently trading in different States will be distinguished on the register with a State qualifier that will appear after the name. For example, a business called 'Artworks Are Us' operating in NSW will be called 'Artworks Are Us (NSW)' and the same named business operating in Queensland will be called 'Artworks Are Us (Qld)'.
Once the national system is up and running, a business will be prevented from registering the same business name, if, before the commencement of the national system, another party had already registered the business name in any State or Territory. Therefore, if businesses are likely to commence trading in additional States or Territories or have not yet to register their business name in any State or Territory, they should seriously consider registering their business name before the national system is implemented.
Does this system change the need to register a trade mark?
No. Registration of a business name does not give the business owner any rights to use the name or to enforce rights against another person using the same name. Only registration of a trade mark provides this type of protection and this is a completely separate process. Having a registered trade mark entitles you to sue others if they use your trade mark in connection with the provision of the same or similar goods or services. Registration of a business name does not give business owners any such proprietary right.
Before registering a business name, it is the business owner’s responsibility to check that your business name does not infringe someone else’s trade mark. If it does, a different name should be chosen. Registering a business name is not a defence to trade mark infringement. A searchfacility of the trade mark database will be provided during the online registration process.
For more information about registering a trade mark go to www.ipaustralia.gov.au.
Benefits to the public at large
Consumers will be able to conduct a free online search for certain details about businesses, including:
· The name behind the business;
· If the entity is a company, an address indicating the principal place of business;
It is also proposed that business operators will be required to include their business name and ABN in all written communications made on behalf of the business. This may go some way to ensuring that business owners are made more accountable for representations they make.
Finally
The new national system seems likely to simplify and provide consistency to the process of business name registration. Not only will it mean significant savings in time and money for business operators, but it will also be a more efficient use of government resources.
Need more information?
For more information on the national system, visit the Commonwealth Department of Innovation, Industry, Science and Research's website at www.innovation.gov.au/businessnames or ASIC’s website at www.asic.gov.au.