Transfer of Business Name
The Business Name registration regime is now administered nationally through the Australian Securities and Investments Commission. Previously each State had its own legislation and procedures governing Business Names, their registration and transfer. Where a Business is internally restructuring it may be that a new entity will hold the registration of the Business Name.
Certainly when a Business is sold the Business Name is almost always transferred to the Purchaser.
These procedures were previously arranged by way of transfer documents which were prepared, signed and lodged at the relevant government department. There is now an online procedure to arrange these transfers and it is necessary to obtain an ASIC Key to perform the procedures.
Once the Key is obtained by using the ASIC website you are able to link the business name to that account and complete the documentation online.
When this office is acting for a buyer or seller of a business we will ensure that transfer of Business Name is properly co-ordinated and registered. If assistance is required in relation to this or any other Business matter, please contact Lewis Webb or Dennis Grogan.
Any Intellectual Property held by the Business should be described and dealt with. If the Intellectual Property is being absolutely assigned there will be particular transfer documentation which must be obtained in anticipation.
Strictly the Business name is not Intellectual Property but is more in the nature of goodwill. Accordingly it is important however, for a Vendor to be asked whether there are other Business names.
It is more in the nature of Goodwill, a Vendor should be asked whether there are other Business names which have been obtained in relation to the Business and not currently used by it.
One matter which needs to be delicately dealt with is where the name being transferred is the name of the Vendor company and accordingly the Vendor must change its name to allow that transfer to be effected. There are a number of methods of achieving this without the Purchaser losing the Business name and ensuring that the asset is transferred at settlement.
Most methods require bona fides on both sides to ensure that everything is properly done. I have had no difficulty with a method whereby the company registers its name as a Business name and that is transferred on completion. A Purchaser will require evidence that the Vendor will change its name and the production on settlement of a reservation of company name together with a resolution passed by the company to change its name with undertakings in relation to lodgement seems to work. It is not a cheap process with the disbursements approaching $500.00.
One final note on Business names: A task force has been set up to report on a national registry of Business names which will probably operate in league with the Australian Business Number. Submissions have been called for and it would be hoped that a National Regime will allow some more flexibility and less cost where a client wishes to hold trading names only in various jurisdictions.
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