The Consumer Protection Act and the Registration of Business (Trading) Names

The Consumer Protection Act, No 68 of 2008, (“the Act”) will come into force on 01 April 2011.

The Act will prohibit any use of any unregistered business names, unless such a person trades under the business’s registered name, a close corporation, company, or his / her own name as is recorded in that person’s identity document.

Therefore all “trading as” names will have to be registered under that name under the Act.

 

The Act deals with the registration of business names, and the process is clearly stipulated in the regulations.

A business name must not be (amongst some other criteria) misleading and not be confusingly similar to that of a registered company or close corporation or registered trademark already in existence.

It should be noted that the requirements as mentioned above will only become effective a minimum of one year after the Act has come into force (not earlier than 25 October 2011).

It is advisable that all unregistered business names should within a reasonable period of time be registered with CIPRO, as such registration would provide the necessary protection to its proprietors.

If a business uses the name of another business, the other business may approach a court for an order directing a person to stop using a business name.

It will be interesting to “watch this space” since in almost all the instances the registered company names and trading names of businesses are different and a lot of conflict in the rights to use a name will in all likelihood occur.

To some extent the saying “the early bird might catch the worm” may be applicable as litigation in respect of the rights to use of names may result and can get quite expensive and it might not be worthwhile for businesses, especially for smaller businesses to approach a court.