To register a business name or a company in Kenya one of the requirements is to provide the registrar with unique names that you propose to be registered. The requirement is that you must provide a unique name that is not similar or close to the existing business, otherwise, the names get rejected.At times the company name reserved has to changed , expecially where it was not the prefeerd name.

A business name is an identity for the business, it has to be a unique, simple and functional name that denotes what the business does. At times, people register companies and business names in Kenya and the name that is picked and reserved by the registrar is not their preference, another scenario is when a business rebrands and changes the name.

In this article, we will explore how a registered business can change its registered name.

An Overview

• An overview of Business Formation
• Circumstances under which a Business can change its Name
• How to Change of Registered Business Name
• Repercussions after Change of Registered name for a business

An Overview of Business Formations

In Kenya a business that is run as a for-profit making business entity can either be registered as;

1. Sole Proprietorship
2. Partnership
3. Limited Company

A sole proprietorship is the simplest form of business where an individual applies for registration of a business name for the business he runs as the sole proprietor. 

A Partnership is registered as a business entity run by several partners who come together to register the business. A partnership deed is prepared to show the rights and obligations of the parties. A common characteristic of a partnership is that the profits or loess from the business are shared amounts by the partners based on the profit-sharing ratio et in their partnership deed.

On the other hand, a Limited Company is a business formed by a group of shareholders, the Kenyan Companies Act also allow the registration of a Limited Company with a sole shareholder and director for a Private Limited Company. A common characteristic of Limited companies is that they are considered a separate legal entity from their owners (called shareholders). This means that the company can enter into contracts, sue and be sued, and own assets in its name. The shareholders’ liability for the company’s debts and losses is limited to the amount of shareholding they have in the company.

The registration of these business formations requires the openers to provide the name that will be registered by the registrar of business in Kenya.

Coming up with a Business Name

At times when registering a business, entrepreneurs may face a challenge in finding the best name for their business. The process requires intense thinking, creativity and research.

Tips on Coming up with a business name to register a business name, a partnership or a Company.

 The following can be a guideline you can consider when finding out a suitable name to register or when changing a registered name.

1.Use of Owner’s names.

Even though the business should be a separate entity from the owners, some businesses have used the owners’ names, which, in the end, came out as strong brand names for their businesses.

Examples include Ford: Named after Henry Ford, the founder of the Ford Motor Company, and Honda: Named after Soichiro Honda, the founder of the Honda Motor Company.

2. Names Initials

The owners or shareholders can also coin an abbreviation of the initials of their name to come up with a name. An example is HP, a name you have come across on computer brands. Did you know that HP is an abbreviation of the Founder’s Names initials? HP: Hewlett-Packard Company, founded by William Hewlett and David Packard in 1939.

3.Use of Location

Come up with a name that reflects a regional, national, or international outlook. This will be depending on things like the location of the customers for your business.

4.Descriptive Name

You can use a descriptive name that reflects what your company does or the products and services you offer.

Circumstances and Situations under which a Business can change its Name

A business may change the Registered name under two scenarios:

1. From External Directive by the Registrar
2. Internally through a Special Resolution

Change of Name from the Registrar Directive

The Registrar may direct a company to change its name if of the opinion —

(a) Misleading information was given for the company’s registration under a particular name, and that an undertaking or assurance was given for that purpose, but indication of the company’s activities has not been fulfilled; or

(b) The name by which a company is registered gives an indication of the nature of its activities that is so misleading as to be likely to cause harm to the public.

Change of Name for a Business by the Owners

A company can change its name through a special resolution. The business or company can change its name for different reasons, including but not limited to:

1. Changing industries, strategies, or products or ownership (in case directors’ names were used to come up with the company name)
2. When the legacy is no longer tenable (e.g., the founders or partners in a business name are deceased or the partners have left)
3. Brand confusion
4. Company name too closely tied to a specific location (e.g., if the name has a specific location such as Nairobi, yet the business wishes to open more outlets or expand to other locations)
5. For a company to change its registered or trading name, its Articles must provide a section allowing the change of name.

For a company to change its registered or trading name, its Articles must provide a section allowing change of name. The decision to change the name has t be approved by a majority through a special resolution held by the company. This resolution must be filed with the registrar of companies within fourteen days after it has been passed.

Repercussions after Change of Registered name for a business

When a company or business name makes a change to its name, several things will be affected. The business name is the business identity, and when the name is changed, the company will have to change things that identify it with its former names.

The following must be changed:

• Company registration with statutory agencies must be updated to reflect the new name. The new names must be updated with the Kenyan Revenue Authority (KRA), National Social Security Authority (NSSF), National Hospital Insurance Fund (NHIF), and any other agencies that the company had been registered with.
• The company must update its existing systems to reflect the new names, such as accounting systems to generate receipts and invoices under the new name. Business correspondence systems must also be updated, e.g., letterheads, business cards, and branded stationery.
• The company bank should be notified of the change for an update or the creation of an account reflecting the new names. Any unused cheques should be returned, and a new chequebook with a new name obtained.
• The company should also notify its customers and suppliers of the changes.
• A new domain for the new name should be registered, and the website mapped to the new domain. The old domain address can be redirected to the new domain. Get your business a website from our affiliate company at a fantastic offer process here.

Issuance of a Certificate of Change of Name

The Companies Act 2015 states the following upon change of company name.

• As soon as practicable after registering the new name, the Registrar shall issue a certificate of change of name to the company.
• A change of a company’s name has an effect from the date on which the certificate of change of name is issued.
• The change does not affect any rights or obligations of the company or invalidate any legal proceedings by or against it.
• Any legal proceedings that might have been continued or commenced against it by its former name may be continued or started against it by its new name.

Wrap Up

A company’s registered name is its identity. At any time, the name can be changed when the registrar requests the owners to change the name or when the owners decide to change the name through a special resolution.

Businesses change their names for different reasons, one of the major reasons being when the business is undergoing rebranding or when the business changes ownership.

The Companies Act provides the process for changing a registered name. When a company changes its name, a new certificate of change of name is issued. The business can then update its records to reflect the new name.

For more information or assistance in changing the name of your business or company, please get in touch with our team of experts. Email us at info@anzianoconsultants.com or call us at +254706600875.