Choosing a Corporate Name – Some Practical Considerations – Part 4

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The Need Carefully to Review NUANS

However, whether proceeding under the Canada Business Corporations Act or the Ontario Business Corporations Act, the applicant for a corporate name is always strongly advised to check the NUANS carefully with his lawyer to consider whether the risk of violating the rights of a third party is too high.  For example, if one wishes to use the name John’s Tech Ball Bearings Inc. and a NUANS search discloses that “New Tech Ball Bearings” is an existing trademark, this will raise an issue that the proposed name is too close to that mark, especially since the Trade Marks Act (Canada) grants an exclusive right to a registered trade mark owner to use the mark anywhere in Canada in connection with the goods or services covered by the registration.

There are many other twists and turns in the area of corporate names, one of which is that in some cases, it may be advisable to adopt the desired name by way of a local business style rather than as a corporate name.  Thus, it may make sense for example that a numbered company be formed and register as a business style “John’s Tek Ball Bearings”.  Provincially-registered trade styles can violate trade mark rights just as corporate names can, so caution is still advised.  Business or trade styles are registered in Ontario under the Business Names Act and similar legislation exists under the laws of each province and territory to permit similar local filings of so-called assumed, divisional or trade names.

Out-of-pocket costs to obtain a NUANS are relatively minimal.   It will sometimes be useful to obtain two or even three such reports before a company can be satisfied that it has chosen a name that is both effective from a market standpoint and will not be exposed to significant risk in the future of being confusingly similar with another’s name or trade mark or otherwise unlawful.

Where Must The Name Be Used

A last point is that the corporation name must by law be set out (in full) in all contracts, orders for goods or services, invoices and negotiable instruments (therefore on cheques).  It is not required, therefore, that the name be set out in business cards or on the door of the company premises.  A business style can however appear in such formats.

If you require assistance in selecting a corporate name for your business, contact us.

About the Author
Gary Gillman holds undergraduate law degrees in Civil Law and Common Law from McGill University in Montreal, Quebec. He is a member of the Quebec Bar and has been a member of the Ontario Bar since 1983. He was trained and practiced for many years in nationally-known law firms in Montreal and Toronto, principally in numerous areas of corporate and commercial law. In 1995, he obtained a Master’s Degree (LL.M) with Distinction in European Management and Employment law from the University of Leicester in England. His training in the law of European economic and political integration allows him to help clients understand international business and legal trends, the North American Free Trade Agreement and economic globality. Gary regularly attends and speaks at professional conferences and keeps current on all the legal areas he covers. Gary has authored during his career numerous legal articles and papers for professional or trade journals. Gary co-authors the quarterly Gillman Financial Regulatory Report, a business law and financial law newsletter of our firm.