As the great William Shakespeare once asked “what is in a name” in his play Romeo and Juliet. For Juliet it does not mean a thing to her as long as he loves Romeo. However, in business it really means a lot!
When your register your business name with the Department of Trade and Industry (DTI) there are certain rules you need to follow.
The Don’ts in Business Names:
It is the applicant’s responsibility to ensure that the proposed business name is:
- not and will not be used for a business that is illegal, offensive, scandalous, or contrary to propriety (Pop’s Jueteng Betting Station, Boobs Massage and Spa);
- not the same or nearly the same as an existing registered business, company, partnership, corporation, cooperative; nor infringing on any trademark, service mark and trade name (Anne Dok’s Lechon, Jolibee, Starbax Cafe);
- not composed of generic or geographic words (The Drugstore, Mindanao);
- not a name which by law or regulation cannot be appropriated (OTOP, Intelligence, State College);
- not used to designate or distinguish, or to suggest a quality of any class of goods, articles, merchandise, or service (Best Taho Factory, A-1 Auto Repair Shop);
- not used by the government in its non-proprietary functions (NBI Private Investigation Services, DTI Trading);
- not a name or abbreviation of any nation, inter-governmental or international organization (Philippine Manpower Pooling Agency, UNESCO Marketing, WHO Health Services); and
- not deceptive, misleading or one that misrepresents the nature of the business (“GOLD Construction Services” where nature of business is recruitment).
Now let say you now have a business that does not contain the above restriction.
Let’s say : SUI GENERIS!
You need to also consider the territorial scope of the BUSINESS NAME.
So madami na ang nasabi tungkol dito sa territorial scope na ito tulad ng:
“Pag gusto mo makamura i- barangay level mo na lang, kesa national.” or
“Dahil online selling ka i-national mo kasi ibebenta mo sya nationwide”
So let us clarify,
Para saan nga ba tong TERRITORIAL SCOPE and why would it matter?
Basically the TERRITORIAL SCOPE is your authority to exclusively use the BUSINESS NAME within a jurisdiction.
For example : I want to register the business name “SUI GENERIS MERCHANDISE” but only register it as barangay since I am on a budget. To be exact my address is 3A Saint Paul Street BARANGAY BAGO BANTAY Project 8, Quezon City.
In our example, the DTI will only allow me to make use of SUI GENERIS provided I do not have any SIMILAR or CONFUSINGLY SIMILAR REGISTERED name (before me) within the SAME barangay (BAGO BANTAY), the SAME city where my barangay is located (QUEZON CITY), the SAME region (NCR) , or no other person has registered the name BEFORE me using NATIONAL in scope. Let say it it gets approved. So what will be the implications, if any?
Will I only be allowed to transact (sell) only within my barangay? No. Basis is this:
The last sentence of the above photo states that no matter what territorial scope you chose you may still transact with anyone in and out of the country.
So what does the territorial scope limit? It limits the place where you can establish a stores, shops, branches, manufacturing or processing plants. So going back to my example I am only allowed to put up shop within my barangay and no where else (if you will be technical about it).So if you plan to put up many branches/stores all over the Philippines the BARANGAY scope is NOT for you.
Also it only limits the exclusivity of the use of the name. In our example, it means, anyone outside my barangay that is not part of QUEZON CITY or NCR can still use SUI GE0NERIS since I only registered it under barangay level. So any one from REGION 8 can make use of SUI GENERIS name (either barangay, city, region or national in scope).
So I have someone with the same name , who cares?
Well, your goodwill and business reputation cares. Let say the other person using SUI GENERIS was defrauding its customers either by providing the same product but below standard quality or not providing at all. People might now confuse this bad person’s business with yours and that will take a toll on your business and later on your TRUE NAME since you are a sole proprietor and of you wouldn’t like that.
Would this happen if you have chosen NATIONAL? NO! Because your name is exclusively yours no one in any part of the country can use it because you already registered as NATIONAL.
Our friendly advice.
Always choose NATIONAL because:
- It does not limit you as to where you can place your store (should you decide to have a brick and mortar store).
- It protect you and your business for any untoward incidents.
Php 2,000 (+30 documentary stamp tax) can be costly to you (pero nakakabili ng kung ano ano sa online shopping) but you could reap the rewards of PEACE OF MIND and EXCLUSIVITY later on.
Want a copy of the Implementing Rules and Regulation on Business Name Law. Get it here:
Do you know what is the difference between establishing a SOLE PROPRIETORSHIP (DTI registered) and a CORPORATION (SEC registered)? Read it here : FAQs in Business Registration- Part 1-Sole Prop vs. Corporation?.
Need assistance in business registration? We can help you avoid all the hassle and stress of business registration. Wania and Partners has already helped many start ups in establishing their business and sustaining it. Contact us for more details.
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