Choosing a Business Name

Choosing a Business Name
One of the most important steps when starting a new business is choosing the right name.  There are, of course, a number of common concerns about the quality of a business name.  It must appeal to your target market.  It ought to suit your business and industry and work well in marketing.  It should be catchy and memorable, helping your business stand out from the competition.  It should be able to be used online easily and not already have an existing social media presence.  However, there are also a number of legal concerns when it comes to choosing and potentially registering a business name. 
 
The first question you should ask yourself is whether or not your business is a corporation. If you are not incorporated then your business name will not constitute its own separate legal entity but will simply be the name you conduct business under, or a “trade name”.  You will also not be allowed to use the words incorporated, limited or corporation (or their abbreviations) in your trade name.[1]  In Alberta when you run a business as the sole owner under a name other than your personal name you must register this trade name.[2] You may also register your trade name in a partnership, limited partnership, limited liability partnership, or sole proprietorship that uses only the owner’s legal name with no additions - but you aren’t required to do so under the Partnership Act.  You are also not required to provide a NUANS (Newly Upgraded Automated Name Search) business name report when registering a business name, but it is generally recommended.  While a business name does not have to be unique, you can still be taken to court by an existing business with a similar trade name.  
 
If you are incorporated there are additional requirements as you will often carry out business under the name of your corporation.  An Alberta corporation name must consist of 3 elements: distinctive, descriptive, and legal.[3]  For example, ‘XYZ Consulting Ltd.’.  A distinctive element must be the unique word(s) of the business name. The made up title or potentially even the location of the business, in this example ‘XYZ’ is the distinctive element.  The descriptive element describes what a business is or does, in this case ‘consulting’.  Finally, a corporation name must have a legal element at the end of their name to indicate to the world their status as a corporation and put clients on notice that it is a limited liability business.  These legal elements are listed in the Business Corporations Act as Limited, Incorporated, Corporation, Ltd., Inc., or Corp..[4]  In this example the legal element is ‘Ltd.’. Corporate names must also be unique.[5]  So if you don’t wish to use the assigned ‘number name’ from the Corporate Registry you must get an Alberta NUANS report on your proposed name.[6]  This is required for federal incorporation as well.[7]  You may also choose to register a business name for your corporation, as a corporation may carry on business under a name other than its corporate name.[8]  However, this business name cannot use the legal elements listed above, must still be unique and must still comply with the trade name rules under the Partnership Act.
 
Overall, naming your business remains a crucial decision in any start-up but keeping in mind these simple requirements can help the decision a bit simpler.

Kiara Brown is a member of the BLG Business Venture Clinic, and is a 3rd year student at the Faculty of Law, University of Calgary.
References:
[1] Business Corporations Act, RSA 2000, c B-9, s. 10(3).
[2] Partnership Act, RSA 2000, c P-3, s. 110(1).
[3] Alberta Government, Incorporate an Alberta corporation, https://www.alberta.ca/incorporate-alberta-corporation.aspx
[4] Supra note 1 at s. 10(1)
[5] Ibid at s. 12(1)
[6] NUANS Corporate name search, https://www.nuans.com/eic/site/075.nsf/eng/home
[7] Government of Canada, Steps to incorporating, https://www.ic.gc.ca/eic/site/cd-dgc.nsf/eng/cs06642.html#toc-02
[8] Supra note 1 at s. 10(9)