Brief of Change Company Name
A company is a legal entity, is required to have a name of its own to establish a separate identity in the market. The name of a company is a symbol of its independent corporate existence of it. The initial clause in the Memorandum of Association or MoA of the company states the name by which a company will be known to the public. The company is allowed to adopt any suitable name provided that the name is not undesirable.
Change in the Name clause of the Company involves the Alteration of Memorandum of Association and Articles of Association of a Company. Section 13 and Section 14 of the Companies Act, 2013 regulates the procedure of amendment in the Memorandum of Association and Articles of Association respectively, and is also applicable to all the Companies.
Section 13 of the Companies Act, 2013, deal with a change in the name of a company which says that the name of a company can be changed by passing a special resolution and also with the complete approval of the Central Government of the country. An approval from the Central Government is not required if the change is related to the addition or deletion of the word "Private" to the name of the company.
The Process of Changing Company Name in India:
- Board Resolution
- Name Availability
- Special Resolution
- Applying to Registrar
- Issuance of Certificate of Incorporation
- Incorporating Company Name in MoA and AoA
When all the partners are mutually agreed a Board Meeting should be called for the passing of a resolution to change the company name. In the Board Meeting, the Board of Directors will thoroughly discuss and approve the change in the name of the company.
After the approval for the same Director or the CS of the company will be authorized to check name availability with the Ministry of Corporate Affairs. And, also the Director or CS of the company will be authorized to call for an Extra-Ordinary General Meeting for passing the special resolution for a change company name.
The authorized Director or Company Secretary is required to apply in the RUN form to the Ministry of Corporate Affairs for checking the availability of the name and approving the name of the company. This process is the same as the process that is adopted at the time of initial name approval of the company.
Registrar of Companies will be sending a letter stating that the proposed name by the members is available. Please note that this will not be considered as the final approval of the company name, it is simply a confirmation from the Registrar of Companies that the proposed name is available.
The name proposed should not be similar to any other existing company name, and it should not include the word “state.” The other basic conditions existing at the time of initial name approval also exists in this situation.
Once the proposed new name is approved by the Ministry of Corporate Affairs, the company is required to call for an Extra-ordinary General Meeting. A special resolution should be passed for the changing of name and make the required change in the company's Memorandum of Association and Articles of Association.
Applying to Registrar
A special resolution is required to be filed with the Registrar of Companies within 30 days of passing the special resolution. With the passed resolution, Form MGT-14 should also be filed which contains the complete details about the past special resolution in the extraordinary general meeting.
Following documents are required to be submitted with MGT-14:
- A certified true copy of the Special Resolution;
- Notice of the Extraordinary General Meeting;
- Explanatory statement to the Extraordinary General Meeting;
- The altered Memorandum of Association;
- The altered Articles of Association;
Once Form MGT-14 is filed, the company is required to file form INC-24 with the Registrar of Companies for taking approval of the central government for change company name along with the fees prescribed for the same.
Form INC-24 is required to be filed after form MGT-14. Since form INC-24 specifically asks for the SRN of MGT-14 form filed with Registrar of Companies. SRN of RUN is also required to be mentioned in form INC-24. Along with form INC-24, a copy of the minutes of the Extra-Ordinary General Meeting where a special resolution was passed, also needed to be submitted.
In form INC-24, reasons for the change company name, details about the total number of members who attended the Extraordinary General Meeting, the total number of members voting in favor or against the special resolution and the total percentage of shareholding is also required to be mentioned.
Certificate of Incorporation
If the Registrar of Companies is completely satisfied with the documents submitted, he/she will issue a new Certificate of Incorporation to the existing company.
The change company name process will not be considered as completed until the new Certificate of Incorporation is issued by the Registrar of Companies.
Incorporating Company Name in MoA and AoA
Once the new Certificate of Incorporation is received from the Registrar of Companies, the changed company name should be incorporated in all the copies of MoA and AoA.
Important points for Change Company Name
The other important points for Change Company Name in India are as follows:
- The new approved name should be reserved for 60 days.
- The change company name should not be allowed for the following Companies:
- The company which has not filed the annual returns in e-Form MGT-7 or financial statements in e-Form AOC-4;
- The company which has failed to pay or repay the matured deposits or debentures or interest thereon.
- It is not primarily important that the changed company name must reflect the primary object of the Company. However, the same is always recommendable by the authorities.
- In the case of conversion of a Company from private to public, the deletion of the word “private” does not involve any change in the name clause procedure of the company.
Documents required for Change Company Name
The essential documents required for Change Company Name in India are as follows:
- Digital Signature Certificate of one of the authorized directors to be provided;
- A copy of the latest amended Memorandum of Association and Articles of Association of the company;
- Certificate of Incorporation of the company to be provided;
- Copy of PAN card of the company should be provided;
- Complete Minutes of the members meeting.
What is the need to change Company Name in India?
The primary need to Change Company Name is as follows:
- Voluntary Change
- Change in the Business Objective
- Enhance the Brand Value
- Discard Boundaries Assumed by Name
The directors or the shareholders can voluntarily decide to change the company name mutually for any justified reason. The names can be used to reflect the vision or any other characteristic of the company. To make the company name relatable and easy for the day to day consumer can also be one reason to change the company name.
Change in the Business Objective
Change in company name may be required due to a change in the business objective. If the company name does not truly reflect the new altered objective, it can then be changed in line with the new objective. The company is required to apply for a change in the company name if the Registrar has been directed to do so in such a case.
Enhance the Brand Value
Name always assumes the brand value of the company and the intention to improvise the brand value is often a primary reason to change the company name. Also, in industries where the trends change over a certain period, an appropriate company name can be chosen to be by the trend and also create a distinct identity. Change a company name can prove to be a good marketing strategy for enhancing brand value.
Discard Boundaries Assumed by Name
By the use of certain words representing geographical region or offerings, the company name defines the boundary of operations. Expansion by capturing the wide market includes demands that include certain removing boundaries assumed by the company name. Further, if the company name has become irrelevant to the products or services offered it should be changed to target the right consumers.
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Frequently Asked Questions
The procedure for the change company name in India is as follows:
- Organise a Board Meeting;
- Confirming the Availability of the Proposed Name;
- Convene an Extraordinary General Meeting;
- Filing of the Special Resolution and Application to the Registrar of Companies;
- Obtaining the Certificate of Incorporation.
In case any company wants to change its object clause, it can do so bypassing the necessary resolution and file eForm MGT-14.
- The existing company is required to reserve the name through the ‘RUN’ form.
- After the name is approved form MGT-14 (necessary resolution for the alteration of Memorandum of Association and Articles of Association (MOA and AOA) is required to be filed. a
- Form INC-24, i.e., application for approval of the Central Government for the change company name is needed to be filed to give effect to change in the name of the company.