How to choose a company name for your business ?
The company name is a central element in corporate law. It defines a company and distinguishes it from other businesses. The company name is often considered the legal identity of a business and can be a determining factor in how it is perceived by the public.
We will explore the definition of this essential legal concept through concrete examples to better understand its impact on the company’s reputation and strategy.
Whether you are an aspiring entrepreneur or a marketing professional, this article will give you a better understanding of its importance.
What exactly is a company’s name ?
Definition of a company’s name
The company name is the name by which the business is designated. It is also called the corporate name or trade name.
It is one of the elements to be indicated in the Commercial Register when creating the company. It identifies the company as a legal entity or individual business.
The company name applies to all legal forms:
- limited liability company (LLC) ;
- corporation (Corp.) ;
- sole proprietorship (SP) ;
- association and foundation.
Company names must contain information that says enough about the type of business as well as the people who make up the partnership as explained in Article 945 of the Swiss Code of Obligations).
It must not be misleading or cause confusion.
Examples of company names
All the companies you know have company names. To find them, you can visit the Central Business Names Index in Switzerland (Zefix).
Here are some examples of company names:
- “Nestlé SA” is, for example, the company name of one of the main companies in the Nestlé Group.
- “Swisscom AG,” also known as “Swisscom SA” in French, is the company name of Swisscom.
- The company name of our trust company is Karpeo LLC.
- Mr. Albert, a self-employed worker, can call his ironwork business “Albert Steel”: this will be his company name.
Branches of Swiss companies in Switzerland must include the term “branch of Nyon” in their company name if the branch is located in Nyon.
Note : There are very specific rules governing the choice of company names in Switzerland. Let’s see how to avoid any missteps.
How to choose a company name in Switzerland ?
There are a multitude of rules when choosing a company name for a business.
1. Obligation to include the last name for sole proprietorships
All sole proprietorships must contain the last name of the person operating it.
Thus, in our previous example, Mr. Albert must absolutely include his last name in the company name of his sole proprietorship.
2. Prohibition of misleading about the company’s activity
A company name must not mislead.
For example, a butcher shop operated by Madame Pitter “Pittet Butchery” could not be called “Bittet Golden Bakery.” Madame Pittet’s business is butchery, not bakery. By choosing a name that refers to a bakery, Madame Pittet would be misleading. The Commercial Register would refuse it.
3. Geographical designations
It is entirely possible to use geographical designations in a company name.
The name of the municipality in which the company operates can be freely chosen by a business. Thus, if your restaurant is located in Lausanne, you could call it “Pizzassima of Lausanne LLC.” Note : if the headquarters is in Geneva, it would not be possible to name your pizzeria this way.
Similarly, you can use terms such as names of mountains, lakes, or rivers, as long as these elements do not mislead.
4. Special characters
A company name must be written in Latin characters: all letters and all numbers are allowed. There is no specific rule of spelling or grammar to be respected, even though this is widely recommended for reasons of the company’s brand image.
The use of special characters is forbidden, except when these characters are necessary for the understanding or reading of the company’s name. The ! and ? as well as symbols (*, £, $, #, %, @ etc.) and pictograms are not allowed. The characters ; () / – “ ” and ‘ are only allowed under very specific conditions.
FAQs on the topic of company name
Why does a company need a company name ?
A company needs a company name to be identified and to formalize its existence as a distinct legal form. The company name is used for commercial transactions, tax declarations, and other official activities of companies.
How to choose a company name for your Swiss business ?
Your company’s name should be distinctive, memorable, and easy to pronounce. It must be available and not in conflict with other companies already registered. We advise you to check the availability of the company name on Zefix and on the website of the Federal Institute of Intellectual Property before choosing it.
Can a company change its company name ?
Yes, it is possible to change a company’s name for an existing business by following the appropriate administrative procedures. This involves a change of company name with the commercial register. Be aware, this type of modification can lead to additional costs and complications. We advise you to carefully weigh the pros and cons before deciding to change your company name.
How is the company name used in the daily life of the company ?
A company’s name is used to identify it in its commercial interactions with customers, suppliers, and other stakeholders. It appears, for example, on sales invoices, contracts, purchase orders, and other official documents. The company name is also often used to identify the company in business directories and online search engines.
Is the company name of a business the same as its trade name ?
No, the company name and the trade name of a business are not always the same. The trade name is the name under which a business is known by its customers and the public. The company name is the official name under which it is registered. A business can have multiple trade names for different products but only one company name.
Can the company name of a business be different from its brand name ?
Yes, the company name of a business can be different from its brand name. The brand name is the name under which a business sells its products while the company name is the official name under which it is registered. A business can have several different brand names for different products but it will have only one company name (for example, Nestlé and its various brands).
Can the same company name be used for multiple businesses ?
No, each business must have a unique company name. It is not possible to use the same company name for multiple businesses as this would create confusion for customers and other stakeholders.
Conclusion
The company name of a business is what will define it throughout its lifetime. It is important that this choice is well-considered and that the name complies with the requirements of the Commercial Register.
The teams at Karpeo support you in choosing the trade name for your business. We assist you in setting up your company in Switzerland (LLC or Corp) as well as registering your sole proprietorship with the Commercial Register.
The experts at our Swiss accounting firm will be able to answer your questions.
