CIPC to re-examine how it approves company names

April 1st, 2018

The Commissioner of the Companies and Intellectual Property Commission, advocate Rory Voller, spoke at the Companies Tribunal seminar on 16 February in Johannesburg.

By Kgomotso Ramotsho

The Companies Tribunal held a Company Name Disputes seminar on the 16 February in Johannesburg. Among the speakers was the Commissioner of the Companies and Intellectual Property Commission (CIPC), advocate Rory Voller. In his presentation Mr Voller mentioned that the Companies Act of 71 of 2008 (the 2008 Act) will be going through some changes this year. He said the CIPC will be examining how it approves company names, because one of the changes is to lessen some of the rules when it comes to company names.

Mr Voller said the CIPC wants to make it easier for people to apply for company names. He said that the CIPC has to go through its processes to make sure it sticks to the policy of what is intended in the Companies Act. Mr Voller pointed out that CIPC has to be mindful of corporate identity theft. He said there were a number of scandals involving corporate identity theft a few years ago.

Mr Voller noted that a big challenge the CIPC is faced with are people who try and take known trade marks and put their own company names in them and that creates conflict. ‘There is a lot of emphasis that entrepreneurs place on their company names,’ Mr Voller added.

Mr Voller said under the 2008 Act names are reserved for six months while previously, names were reserved for four months. He added that the 2008 Act does not make provision for shortened form names because of the business name rules that came about in terms of the Consumer Protection Act 68 of 2008. He pointed out that another change in the 2008 Act is the transfer of company names.

Companies Tribunal member, Prof Kasturi Moodaliyar, said that since the inception of the tribunal, the majority of the cases that have been received are with name disputes. She added that, to date the number of name dispute cases, has been increasing. She noted that in the 2015/2016 financial year there have been 176 applications of such cases, of which 157 were finalised. She said that it was not alarming that the company name disputes had increased as many company names have some economic or sentimental value attached to them. ‘Company names are also vital for branding and they distinguish the company from others and are also used for identity of products of a particular use or service,’ she said.

Prof Moodaliyar added that most applications of name disputes received by the tribunal are based on s 11(2)(b) and s 11(2)(c)(1) of the 2008 Act. She said that a company name dispute can occur when the name is the same or confusingly similar among, existing companies, close corporations, registered business or a well-known trade mark in terms of the Trade Marks Act 194 of 1993 or protected under the Merchandise Marks Act 17 of 1941.

Prof Moodaliyar said it will therefore be possible to file a name dispute, where the names suggest or falsely implies that the company is associated with another person or entity. She pointed out that s 160 of the 2008 Act concerns name objections. She noted that provision has been made for applications to be lodged with the Companies Tribunal of South Africa. She added that name objections can emanate from one of the following two scenarios:

  • In terms of s 160(1) of the 2008 Act, the commission can serve a written notice in the applicant to any person who has an interest in the name.
  • An applicant includes anyone who is seeking the reservation of the name, the registration of the defensive name of the company name or anyone who wishes to transfer the registration of the name or registration of the defensive name.

Prof Moodaliyar pointed out that a dispute lodged with the tribunal will determine if the name dispute is confusing or similar to that of the applicant. She said that companies are urged to bring disputes to the tribunal.

President of South African Institute of Intellectual Property Law, Debbie Marriott, spoke at the Companies Tribunal Seminar in Johannesburg.

President of South African Institute of Intellectual Property Law (SAIIPL), Debbie Marriott, said that company names are assets and they are essentially a brand that helps consumers identify the entity or company that they are dealing with. She added that names serve as a badge of origin, the same way they are used to identify specific products that the company provides.

Ms Marriott said that company names were labelled as undesirable in the previous Companies Act, if it contained another person’s name or trade mark. It would be rejected if it was seen to be calculated to cause damage or if it was to cause deception, confusion or if it resulted in the tarnishing of another company. She added that many company name objectives were lodged over the years on the basis that there were prior registered or prior used trade marks, which people had built-up. She noted that any person can lodge a company name objection, if the person has an interest in the name. She pointed out that this particular person would be a licensee and not necessarily just a person who owned the trade mark.

Ms Marriott said the person objecting to the company name would have to apply for objection and then the tribunal will consider whether the name satisfies the 2008 Act. She added that the regulation says company name objections must be filed with the CIPC, who will within five business days serve the application to the respondent. She pointed out that it is important that the applicant verify the address of the respondent as registered on the CIPC records. She said should the respondent not be served within five days after the application the objection might be blocked on procedural grounds.

Kgomotso Ramotsho Cert Journ (Boston) Cert Photography (Vega) is the news reporter at De Rebus.

This article was first published in De Rebus in 2018 (April) DR 10.