Can you use a dissolved company name?

Thinking about using the name of a dissolved company for your new business? Unsure if this is legal, or if it’s a wise move? This article breaks it down for you. Discover when you can legally use a dissolved company name and whether it’s a smart idea.

Can a dissolved company name be reused?

Yes, a dissolved company name can be reused. When a company is officially dissolved, it has been legally terminated and therefore no longer exists. As such, there are no legal rights attached to the name, and it can be used for your business.

• How to dissolve a company 
• Guidelines for creating a limited company name
• How to restore a dissolved company

If you use a dissolved company name, your business will receive a different company registration number and won’t be legally associated with the dissolved company. You’ll need to check the name meets Companies Act 2006 regulations.

What naming rules or restrictions might apply?

If you want to use the business name of a dissolved company, you must undergo the same checks as for using an original name. You’ll need to check that Companies House doesn’t deem the name to be too close to – or ‘same as’ – the name of another company. You can check this online using the Companies House company name availability checker.

You’ll also need to check whether the name could infringe on a trademark. You can search for a trademark online on the UK Intellectual Property Office’s trademarks register.

You might not be able to use the name if it has been subject to an order from the Company Names Tribunal or a direction from Companies House.

What is Section 216, and when does it apply?

Section 216 is part of the Insolvency Act 1986. Along with section 217 of the Act, its purpose is to tackle a phenomenon known as phoenix syndrome. This refers to a situation where a group of directors or a business keeps trading by liquidating or dissolving a series of companies, leaving the debts of those companies unpaid. Abusive phoenixism is when this pattern is used to commit fraud or to evade debts.

Sections 216 and 217 apply if you were the director of a company that has been dissolved and want to set up a new company using the same name as the dissolved company in the following 5 years.

When a company is dissolved, there are restrictions on who can reuse that company’s name. If you were a director of the dissolved company in the 12-month period before it was dissolved, you can’t reuse the company name for another business for the next 5 years. The restriction also applies to names considered ‘same as’ the name of the dissolved company.

When is it legal to use a dissolved company name?

If you weren’t a director of the dissolved company whose name you want to use, you may be able to use the name legally. Just ensure that you have verified the name isn’t deemed ‘same as’ another company name and that it doesn’t infringe on any trademarks.

What risks are associated with reusing a dissolved company name?

There could be reputational risks associated with reusing a dissolved company’s name. If the company failed because of bad practice, for example, potential customers or clients may associate the company name with that poor behaviour, or they might confuse your business with the failed business. These negative associations could affect the success of your company.

Consider why the company failed – do you want your business to have connections with that history? Research the dissolved company using information that’s publicly available on the Companies House register of companies. You can view the dissolved company’s accounts under the ‘filing history’ tab of the search results. You could also check whether the dissolved company had any County Court Judgements (CCJs).

You could also search for any negative press coverage of the company or bad customer reviews to get a sense of the dissolved company’s reputation.

Final tips before registering a dissolved company name

• Check that the name you want to use is available using the Companies House or 1st Formations’ company name availability checker.
• Check whether the name infringes any trademarks using the UK Intellectual Property Office’s trademarks register.
• Check whether the name has been subject to an order from the Company Names Tribunal or a direction from Companies House.
• Consider whether the rules on phoenix syndrome contained in sections 216 and 217 of the Insolvency Act 1986 apply to you. For example, if you were a director of the previously dissolved company, you may not be able to use its name for your new company.
• Consider the reputational risks of using the name of a failed company. Research why the company was dissolved – consider whether you want your company to be associated with those reasons.

Ready to register your company?

By following these steps, you can confidently choose and register a company name that best suits your goals. Remember, reusing a dissolved company name is legal in most cases. However, be sure to check for restrictions, consider trademark and reputation issues, and ensure compliance with the relevant regulations.

If you’re ready to move forward, 1st Formations can guide you through the company registration process quickly and easily. We’ll help you get started with the right name and structure for your business.