Is your NFP using an unregistered business name?

Did you know that when your Not For Profit organisation (NFP) pursues its activities in Australia and it has an Australian Business Number it is carrying on a business.

In many cases, NFPs will use a name similar to their legal name under which they are registered with the Australian Securities and Investments Commission (ASIC) or relevant State regulator, such as the Office of Fair Trading or Consumer Protection, to carry on their business activities.

For example, ‘Here To Help Inc’ (the legal name registered with the Office of Fair Trading) would carry on its business activities using the name ‘Here To Help’ (without the ‘Inc’) or ‘Professional Jet Skiers Association Limited’ (the legal name registered with ASIC) would carry on its business activities using the name ‘Professional Jet skiers Association’ (without the ‘Limited’).

In other cases, NFPs may use a name different to their legal name.  For example ‘Here To Help Inc’ may carry on its business activities using the name ‘Here To Help Maintenance Services’.

From 31 October 2018, your NFP must register the name under which it carries on business. 

If your NFP carries on business using an unregistered business name it may be fined up to $6,300.

My NFP has a trading name listed on the business names register. Is this a registered business name?

Your NFP registered its business name in a state or territory and this name was transferred to the ASIC Business Names Register on 28 May 2012.  These names were listed as ‘trading names’ on the ASIC Business Names Register.

You will need to renew your trading name and pay the registration renewal fee. You will see your NFP’s ‘trading name’ listed under a search of your NFP’s Australian Business Number record.

If you wish to use this trading name you will need to renew your registration before 31 October and pay the registration renewal fee. On payment of the registration renewal fee your trading name will be listed as a business name under your NFP’s Australian Business Number record. If you do not do this before 31 October 2018 the trading name will be cancelled.

My NFP has a licence from ASIC to omit the word ‘Limited’ from its name and we use that name.  Do I need to register a business name?

No. Your NFP may carry on business using its corporate name.

A company limited by guarantee NFP may apply to ASIC to change its name to omit the word ‘Limited’ from the end of its name.

A licence to omit the word ‘Limited’ is only available to a company that is:

  1.  registered under the Australian Charities and Not-for-profits Act 2012 (Cth), and

  2. its constitution prohibits the company paying fees to its directors and requires the directors to approve all other payments the company makes to its directors.

If you think your NFP meets the above criteria and would prefer to obtain a licence to change its name to omit the word ‘Limited’ please contact us so we may assist your NFP in the application process.

Are there any restrictions on registering my business name?

There are a few things your NFP should consider before registering its business name. Your NFP cannot register a name that is identical or nearly identical to an existing business name and some terms are restricted.

Some words and phrases cannot be used without the approval of a government minister.  Examples include:

  • ‘trust’ or ‘trustee’
  • ‘charity’ or ‘charitable’
  • ‘consumer’ or ‘chamber of commerce
  • ‘university’

ASIC may also refuse a name if it’s considered offensive or suggests illegal activity.

Your NFP can’t use words that could mislead people about its activities. This includes associations with the Australian government, the Royal Family, or any ex-servicemen’s organisations.

What rights does my NFP obtain when it registers a business name?

Registration of a business name grants your NFP with a licence to use that business name only for the purpose of your NFP carrying on a business.

A business name does not give your NFP exclusive rights to carry on its business activities or ownership over that name.

Registering a particular name does not stop another person, organisation or NFP from registering a similar name. It also does not give your NFP the exclusive right to use the name or part of the name.

Registering a business name will not stop someone who has registered the name as a trademark from using it.  In fact, using a business name that is similar to someone else’s registered trade mark may lead to your NFP infringing trade mark rights.  You should always conduct a trade mark search before deciding on a business name.

The obligation to register a business name is separate to protecting any intellectual property rights in a name or brand, such as registering a trademark.

How do I register my business name?

You must lodge an application to register your NFP’s business name at www.asic.gov.au.

To apply, you will need to create an ASIC Connect account (if you do not already have one) and must provide certain information, including:

  • your NFP’s ABN;
  • your NFP’s proposed business name;
  • your preferred registration period (1 or 3 years);
  • your NFP’s details;
  • a street address for the principal place of business; and
  • a street address for service of documents from ASIC.

NFP Lawyers is offering until 1 November 2018 a fixed fee package of $950 plus GST to:

  • review your NFP’s trading and business names;
  • advise on potential trade mark infringement for one (1) business name;
  • advise on one (1) business name availability; and
  • subject to the above**, obtain registration of one (1) business name* for 3 years.

* The cost for each additional business name is $450 plus GST.

 

Joanne Redburn

Email: Joanne.Redburn@nfplawyers.com.au

NFP Lawyers
Level 2, 121 Logan Road, Woolloongabba Qld 4102
PO Box 6116, Woolloongabba Qld 4102
Phone: (07) 3160 0010