Compliance When Changing Your Company Name

A Complete Guide on Compliance When Changing Your Company Name

Introduction

Changing the name of a company can be a transformative process. It may be driven by various reasons, such as rebranding, mergers, or simply the need for a fresh start. However, it is important to understand the compliance aspects associated with such a change. Compliance when changing your company name involves adhering to legal, regulatory, and operational requirements to ensure a smooth transition while maintaining transparency and integrity. In this blog, we will provide a simplified guide on the compliance aspects of changing your company name under the Companies Act of 2013, offering valuable insights and a checklist to help you through the process.

Understanding the Company Act of 2013

To change your company name, it is crucial to adhere to the regulations outlined in the Companies Act of 2013. The act emphasizes the following key considerations when selecting a new company name:

Uniqueness: The proposed name should not be identical or resemble the name of any existing registered company.
Legality: The name should comply with all applicable laws and must not be considered illegal.
Government Opinion: The new name should not be deemed undesirable by the central government.
No Government Connection: The name should not imply any connection between the company and the central, state, or local governments.
Additional Requirements: The company name should not include any terms or expressions that may be prohibited or mandated by law.

Process of Changing the Company Name

To successfully change your company name while meeting compliance requirements, follow these steps:

Notice and Board Meeting: Provide at least 7 days’ notice before holding a board meeting to discuss the proposed name change. Pass the necessary board resolution to consider and accept the new name.

RUN Application: File a RUN (Reserve Unique Name) application through the MCA (Ministry of Corporate Affairs) website. Attach the board resolution and, if needed, a No Objection Certificate (NOC) from the trademark owner.

Special General Meeting: Once the proposed name is approved, hold a special general meeting to gain approval for changing the Memorandum of Association.

Submission of Documents: Within 30 days of passing the special resolution, submit Form MGT-14 (for altering the Memorandum of Association) along with required documents:

Certified copy of the special resolution
Notice of Extraordinary General Meeting (EGM) with an explanatory statement
Altered Memorandum of Association and Articles of Association

Issuance of New Certificate: Following the successful acceptance of Form INC-24, the registrar will issue a new certificate of incorporation with the updated company name.

Compliance After Company Name Change

Once the name change process is complete, it’s important to fulfill certain compliance obligations:

Update Legal Documents: Reflect the new company name on every copy of the Memorandum of Association. Ensure all invoices, letterheads, paperwork, and records incorporate both the new and old names.

Display Name: Display both the new and previous company names outside the registered office for one year from the date of the name change.

Bank Accounts and Licenses: Update the new name on all bank accounts and licenses obtained from various agencies.

Government Authorities and Utilities: Inform all concerned authorities and stakeholders about the company name change. Additionally, update the new name with providers of essential utility services like phone bills, and internet connections.

Tax and PAN: Arrange for a new Permanent Account Number (PAN) and update the Tax Deduction and Collection Account Number (TAN) with the new name.

Conclusion

Changing your company name can be an exciting opportunity for growth and transformation. However, it is essential to approach the process with a thorough understanding of compliance requirements. By considering the legal, regulatory, and operational aspects discussed in this article, you can navigate the name change process successfully while maintaining transparency and integrity. Remember to seek legal and professional advice to ensure compliance with all applicable laws and regulations.