business owners regularly use a descriptive business name for their business. A descriptive business name is a business name that significantly describes the nature or products or services provided by the business. Consider, for example, Thuisbezorgd.nl (Takeaway.com) who run websites that deliver meals to homes. But to what extent is such a company name actually protected? And can another company then still use the same descriptive term? In this blog, Jan Willem van Aken discusses the possibility of using a descriptive company name and provides some tips on choosing a company name.
When is a company name protected?
A business name is - in short - the name used to designate a company. By regularly using a (descriptive) company name in commerce, it is protected under the Trade Name Act. The Trade Name Act also refers to it as a trade name.
Protection of a company name does not require that the name be registered in, for example, the Chamber of Commerce Trade Register . Purely by using the name to indicate a company, for example on letterhead, in an e-mail signature or on a facade, protection as a company name arises.
Use protected company name?
Because a (descriptive) company name enjoys protection, the company with the "older" company name can prohibit the company with the "younger" company name from using the same or similar company name for a comparable company. Indeed, under the Trade Name Act, it is forbidden to use a (descriptive) company name previously used by another company, if this could cause confusion . This is the case if a customer might think he is dealing with another party or has the idea that there is an economic link between the companies.
When does confusion arise with a company name?
Similar name
To determine whether there is a likelihood of confusion, the first step is to compare the company names and assess their similarity.
Location
The location of the businesses in question is also important. If two cafes with the same company name are located in Maastricht and Groningen, a likelihood of confusion will not be assumed so quickly. It is different if there are cafes with the same company name in Arnhem and Nijmegen, for example.
Notice! Because of the online activity of many businesses, all of the Netherlands may also be classified as a protected area.
Type of business
In addition, the nature of the business is important. Two completely different companies may rather use the same or a similar company name without there being a likelihood of confusion.
5 tips to prevent infringement of an existing business name
Tip 1: Check if your chosen company name is already being used
Check the trade register
You can check the Trade Register of the Chamber of Commerce to see if your chosen business name has already been registered by another company.
Note! Registration in the Trade Register does not determine the protection of the company name under the Trade Name Act. Thus, a company name can be protected even if it is not registered in the Trade Register.
Check other sources
Thus, in addition to a check of the Trade Register, other sources must be consulted. Nowadays, almost all companies do operate online. A company name can generally be found on its website.Googlingcan also help you find out whether the company name you want is already being used by another company.
In addition, you can consult the trademark register , for example. It is important to keep in mind that the search will only return results of identical company names. However, similar company names can also pose a risk of confusion.
Tip 2: Check the name and location of competing companies
The rule of thumb to apply is as follows: the further away the company with the similar (descriptive) business name is from you, the less likely it is to be confused.
Suppose a company with a similar business name to yours is located on the other side of the country. Then, in principle, because of the geographic distance, the likelihood of confusion will be small. Still, just applying the rule of thumb is not enough.
In addition to the place of establishment, the public you are addressing with your products or services is also relevant. You may be located far from each other, but address the same audience and cause confusion among them. This is even more likely if you have a website on which you offer your products and services. Then it is quickly assumed that you operate nationwide.
Tip 3: Deviate from existing company names
The further you deviate from pre-existing (descriptive) company names, the less likely it is to cause confusion.
Small difference, sometimes sufficient
In the case of a descriptive business name, a small difference may be sufficient. As an example, we refer to the case between two companies that both organized sports camps. One company used the company name "Trainingskampen.nl" and the other "Trainingskamp.com." When comparing the company names, one company name is written in the singular and the other in the plural. Furthermore, the extensions differ from each other, namely .nl and .com. These discrepancies in the company names contributed to the fact that, according to the court, there was no confusion to be feared between these company names.
Small difference, sometimes insufficient
However, a slight difference in the company name is not always enough to avoid confusion. This is evidenced by the case where the companies in question used the company names "HetRecruitingKantoor" and "Recruitment Kantoor." These company names diverge from each other to a minor extent by the article "it" and a space. These deviations - in conjunction with the other circumstances - were not sufficient in this case to eliminate the feared likelihood of confusion among the public, according to the court.
Tip 4: Add a distinctive element to the descriptive company name
A business name may be descriptive in its entirety. Descriptive company names such as the "Nijmegen Fisherman's Shop" and the "Arnhem Bikeshop" are permitted. The only requirement from the Trade Name Act is that the (descriptive) business name must not cause confusion with other business names.
Despite the lack of a legal requirement, we still recommend adding a distinctive element to the descriptive company name. Your customers will then be better able to find and recognize your company.
Tip 5: Choose a business name whose domain name is still available
A business website on the Internet allows you to expand your customer base. By using the same domain name as your desired business name for this website, you can make your business easily findable on the Internet. However, this domain name must be available. Hence, we recommend that you check whether the domain name is still available before you start using the company name (and register it in the Chamber of Commerce Trade Register). Is the domain name already registered? Then we recommend that you come up with another business name.
Do you have a unique (descriptive) company name in mind and want to make sure you can use it? Or do you need help checking whether your company name is protected? Feel free to contact us using the form below. We will be happy to help you further.
