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Company Law Reform Bill [HL]


Company Law Reform Bill [HL]
Part 34 — Business names
Chapter 1 — Restricted or prohibited names

400

 

827     

Name giving misleading indication of activities

(1)   

A person must not carry on business in the United Kingdom under a name that

gives so misleading an indication of the nature of the activities of the business

as to be likely to cause harm to the public.

(2)   

A person who uses a name in contravention of this section commits an offence.

5

(3)   

Where an offence under this section is committed by a body corporate, an

offence is also committed by every officer of the body who is in default.

(4)   

A person guilty of an offence under this section is liable on summary

conviction to a fine not exceeding level 3 on the standard scale and, for

continued contravention, a daily default fine not exceeding one-tenth of level

10

3 on the standard scale.

Supplementary

828     

Savings for existing lawful business names

(1)   

This section has effect in relation to—

sections 821 to 825 (sensitive words or expressions), and

15

section 826 (inappropriate indication of company type or legal form).

(2)   

Those sections do not apply to the carrying on of a business by a person who—

(a)   

carried on the business immediately before the date on which this

Chapter came into force, and

(b)   

continues to carry it on under the name that immediately before that

20

date was its lawful business name.

(3)   

Where—

(a)   

a business is transferred to a person on or after the date on which this

Chapter came into force, and

(b)   

that person carries on the business under the name that was its lawful

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business name immediately before the transfer,

   

those sections do not apply in relation to the carrying on of the business under

that name during the period of twelve months beginning with the date of the

transfer.

(4)   

In this section “lawful business name”, in relation to a business, means a name

30

under which the business was carried on without contravening—

(a)   

section 2(1) of the Business Names Act 1985 (c. 7) or Article 4(1) of the

Business Names (Northern Ireland) Order 1986 (S.I. 1986/1033 N.I. 7)),

or

(b)   

after this Chapter has come into force, the provisions of this Chapter.

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Company Law Reform Bill [HL]
Part 34 — Business names
Chapter 2 — Disclosure required in case of individual or partnership

401

 

Chapter 2

Disclosure required in case of individual or partnership

Introductory

829     

Application of this Chapter

(1)   

This Chapter applies to an individual or partnership carrying on business in

5

the United Kingdom under a business name.

(2)   

For the purposes of this Chapter a “business name” means a name other than—

(a)   

in the case of an individual, his surname without any addition other

than a permitted addition;

(b)   

in the case of a partnership—

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(i)   

the surnames of all partners who are individuals, and

(ii)   

the corporate names of all partners who are bodies corporate,

   

without any addition other than a permitted addition.

(3)   

The following are the permitted additions—

(a)   

in the case of an individual, his forename or initial;

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(b)   

in the case of a partnership—

(i)   

the forenames of individual partners or the initials of those

forenames, or

(ii)   

where two or more individual partners have the same surname,

the addition of “s” at the end of that surname;

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(c)   

in either case, an addition merely indicating that the business is carried

on in succession to a former owner of the business.

830     

Information required to be disclosed

   

The “information required by this Chapter” is—

(a)   

in the case of an individual, his name;

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(b)   

in the case of a partnership, the name of each member of the

partnership;

   

and in relation to each person so named, an address in the United Kingdom at

which service of any document relating in any way to the business will be

effective.

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Disclosure requirements

831     

Disclosure required: business documents etc

(1)   

A person carrying on business in the United Kingdom under a business name

must state the information required by this Chapter, in legible characters, on

all—

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(a)   

business letters,

(b)   

written orders for goods or services to be supplied to the business,

(c)   

invoices and receipts issued in the course of the business, and

(d)   

written demands for payment of debts arising in the course of the

business.

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Company Law Reform Bill [HL]
Part 34 — Business names
Chapter 2 — Disclosure required in case of individual or partnership

402

 

   

This subsection has effect subject to section 832 (exemption for large

partnerships if certain conditions met).

(2)   

A person carrying on business in the United Kingdom under a business name

must secure that the information required by this Chapter is immediately

given, by written notice, to any person with whom anything is done or

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discussed in the course of the business and who asks for that information.

(3)   

The Secretary of State may by regulations require that such notices be given in

a specified form.

(4)   

Regulations under this section are subject to negative resolution procedure.

832     

Exemption for large partnerships if certain conditions met

10

(1)   

Section 831(1) (disclosure required in business documents) does not apply in

relation to a document issued by a partnership of more than 20 persons if the

following conditions are met.

(2)   

The conditions are that—

(a)   

the partnership maintains at its principal place of business a list of the

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names of all the partners,

(b)   

no partner’s name appears in the document, except in the text or as a

signatory, and

(c)   

the document states in legible characters the address of the

partnership’s principal place of business and that the list of the

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partners’ names is open to inspection there.

(3)   

Where a partnership maintains a list of the partners’ names for the purposes of

this section, any person may inspect the list during office hours.

(4)   

Where an inspection required by a person in accordance with this section is

refused, an offence is committed by any member of the partnership concerned

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who without reasonable excuse refused the inspection or permitted it to be

refused.

(5)   

A person guilty of an offence under subsection (4) is liable on summary

conviction to a fine not exceeding level 3 on the standard scale and, for

continued contravention, a daily default fine not exceeding one-tenth of level

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3 on the standard scale.

833     

Disclosure required: business premises

(1)   

A person carrying on business in the United Kingdom under a business name

must, in any premises—

(a)   

where the business is carried on, and

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(b)   

to which customers of the business or suppliers of goods or services to

the business have access,

   

display in a prominent position, so that it may easily be read by such customers

or suppliers, a notice containing the information required by this Chapter.

(2)   

The Secretary of State may by regulations require that such notices be

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displayed in a specified form.

(3)   

Regulations under this section are subject to negative resolution procedure.

 
 

Company Law Reform Bill [HL]
Part 34 — Business names
Chapter 3 — Supplementary

403

 

Consequences of failure to make required disclosure

834     

Criminal consequences of failure to make required disclosure

(1)   

A person who without reasonable excuse fails to comply with the requirements

of—

section 831 (disclosure required: business documents etc), or

5

section 833 (disclosure required: business premises),

   

commits an offence.

(2)   

Where an offence under this section is committed by a body corporate, an

offence is also committed by every officer of the body who is in default.

(3)   

A person guilty of an offence under this section is liable on summary

10

conviction to a fine not exceeding level 3 on the standard scale and, for

continued contravention, a daily default fine not exceeding one-tenth of level

3 on the standard scale.

(4)   

References in this section to the requirements of section 831 or 833 include the

requirements of regulations under that section.

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835     

Civil consequences of failure to make required disclosure

(1)   

This section applies to any legal proceedings brought by a person to whom this

Chapter applies to enforce a right arising out of a contract made in the course

of a business in respect of which he was, at the time the contract was made, in

breach of section 831(1) or (2) (disclosure in business documents etc) or section

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833(1) (disclosure at business premises).

(2)   

The proceedings shall be dismissed if the defendant (in Scotland, the defender)

to the proceedings shows—

(a)   

that he has a claim against the claimant (pursuer) arising out of the

contract that he has been unable to pursue by reason of the latter’s

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breach of the requirements of this Chapter, or

(b)   

that he has suffered some financial loss in connection with the contract

by reason of the claimant’s (pursuer’s) breach of those requirements,

   

unless the court before which the proceedings are brought is satisfied that it is

just and equitable to permit the proceedings to continue.

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(3)   

References in this section to the requirements of this Chapter include the

requirements of regulations under this Chapter.

(4)   

This section does not affect the right of any person to enforce such rights as he

may have against another person in any proceedings brought by that person.

Chapter 3

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Supplementary

836     

Application of general provisions about offences

   

The provisions of sections 778 to 784 (general provisions about offences) apply

in relation to offences under this Part as in relation to offences under the

Companies Acts.

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