The Companies Act 2013, guides the name alteration process for a company. A company name can be changed for a wide number of reasons like rebranding, change in ownership, change in nature, etc. However, a lack of knowledge and expertise makes it hard for business owners to opt for it. Here’s everything you need to know about how to change the name of a company. We have covered all the necessary questions (and their answers) for you.
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Everything You Need to Know About Changing the Name of Your Company
Eligibility Criteria for Changing Your Company Name
Post incorporation, a company can change its name anytime, under the two following circumstances (subject to the provisions of Section 13(2) of the Companies Act 2013):
- Change of name from a private limited company to a public limited company, and vice versa.
- Change of name from a priorly established name to something completely brand new (e.g., from ABC Pvt. Ltd. to MNO Pvt. Ltd.).
However, it must be understood that such a change in name doesn’t amount to a legal change of entity or the creation of a new company. To be more precise, any change whatsoever does not affect the obligations and rights of the company, and render any defective legal proceedings, or close off any ongoing legal proceedings.
Why to Change the Name of Your Company?
A company can practically change its name for no reason at all. However, we have listed the most important reasons to change the name of a company, after analyzing a wide magnitude of reasons.
Change in the Nature of Business:
A company can change its name when its business objective changes (e.g., from product development to marketing of the developed products). However, in such cases, it becomes necessary for the company to change its main object in the MOA as well.
Rebranding or Marketing:
A company can also change its name to position its brand in the market better. This is because an attractive company name tends to grab customer attention.
Shift of Ownership:
During instances of changed authority or management, a company name change can further be opted (generally by the new owner, because of differences in preferences).
To Avoid and Resolve any IPR conflict:
Copyright and trademark-related conflicts (e.g., two company names with significant similarities) have become very common nowadays because of the growing number of new businesses that are being incorporated daily. To avoid such issues (if identified) or to resolve some ongoing legal issues, a company can opt for a name change.
6-Step Guide to Change the Name of the Company
Now, coming to the focal point, here’s your step-by-step guide to changing the name of your company:
Step 1: Facilitating a Board Resolution
For the selection of the new company name, the board of directors must come together for an open discussion. Herein, all the Board of Directors must approve this notion. Later on, a resolution must either be passed by any of the directors or the Company Secretary that an application for the same should be sent to the MCA, after the finalization of the name.
Step 2: Checking the Availability and Reserving the Proposed Name
After the selection of the new company name, a reservation application should be sent to the ROC by the RUN (Reserve Unique Name) facility.
After this, the ROC (Registrar of Companies) usually evaluates the proposed name to see whether it has already been used by some other entity (including LLPs, public companies, domain, etc.) or not. Herein, ROC either approves or rejects the name. Understand the Process of LLP Registration in India: 5 Simple Steps
In case of rejection, another name should be proposed by the company. If selected, ROC issues a “name reservation certificate”. If rejected call +91-6361112335 to apply for Name Approval with best practices.
Step 3: Holding an Extraordinary General Meeting and Passing of a Special Resolution
Once the new name gets approved by the ROC, the company in context, must immediately hold an extraordinary general meeting (EGM), wherein the approval of all the associated shareholders must be sought after.
Herein, a special resolution comes into play, which explains the reason behind such a name change. It also explains how such a name change is going to impact the associated shareholders. In this context, at least 75% of the shareholders must approve the proposed name change, for a special resolution to pass.
Step 4: Filing an Application for Name Approval (MGT-14)
Immediately after the approval of the special resolution, the BOD of the company must file it to the ROC for further approval. To file the same, the company must use the MGT-14 Form. The form must be submitted within 30 days, since the passage of the EGM resolution.
Along with the MGT-14 Form, the company must also submit the special resolution, the minutes of meetings, other associated documents of the EGM, and the explanatory statement.
Step 5: Seeking the Approval of the Central Government (INC-24)
In the next step, the company must seek the approval of the Central Government. To do the same, the company must file an application using the INC-24 Form to the ROC. This would facilitate the official name change.
Along with the form, the company must submit an amended copy of the AOA (Articles of Association) and the MOA (Memorandum of Association), the EGM Notice, and the Approved Special Resolution.
Step 6: Issuance of Certificate and Making Necessary Changes
The ROC grants a brand new “Certificate of Incorporation” as a finalization of the changed name, after the approval of the INC-24 Form and MGT-14 Form. After the issuance, the company can officially use its new name.
Documents Required to Change the Name of Company
The following list of documents are required to change the name of a company:
- Filled MGT-14 Form.
- Filled INC-24 Form.
- EGM Notice and Explanatory Statement.
- Certified Copies of the EGM Resolution.
- Amended Copies of AOA and MOA.
- Attendance Copy of the EGM.
- Filled RUN Form.
- Board Resolution Copy.
- Previous Certificate of Incorporation.
- Previous AOA and MOA in the word format.
- List of Board of Directors.
- List of Shareholders.
- DSC of the Board of Directors.
- List of the Proposed Company Names (in a preferential order).
- Rubber Stamps and Letterheads of the Person in Authority.
Timeline and Costs To Company Name Change
The entire process of changing the name of a company takes up to 15 to 30 working days (if considered from step 1 to step 6 as a whole), as it requires multi-departmental approvals.
The following costs are incurred by the ROC during the name change process of a company:
- RUN Form: Rs. 1,000/-
- INC-24 Form: Rs. 1,000 – Rs. 20,000/- (based on the capital of the company; also depends on company type)
- MGT-14 Form: Rs. 300/- – Rs. 600/- (based on the capital of the company)
Extra charges are incurred by the middle agent (a consultancy firm/ a chartered accountant/ a lawyer), who would perform the task on behalf of the company (if applicable). Choose the Company Registration Services of Actax India to opt for services like this, at a competitive price range like never before!
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Follow-Up Acts after the Company Name Change
The responsibility of a business owner or a person in authority does not end with the attainment of the “Certificate of Incorporation”. Rather, there exists a lot of follow-up activities that the company must take care of, as its name changes.
Activities to Be Taken Care of After Name Change:
- Amendment of the AOA and MOA, to replace the old name with the new one (in case of a change in business nature, the same should be incorporated in the MOA and the AOA).
- Alternation of the Company Seals, Business Cards, and Letterheads, as per the new name.
- Changing the Company Bank Accounts, the Bills of Exchange, and the Promissory Notes, as per the new company name.
- Updating the Social Media Accounts and Company Website.
- Changing the Company’s TAN and PAN, other Statutory Registers, Business Contracts, Permits, and License.
General Prohibitions
Section 4(2) of the Companies Act 2013, displays the general prohibitions, which state the conditions wherein the name of a company cannot be changed. These are:
- A company name closely resembling the name of another company.
- A company name that is identical to a previously existing (as identified by law) company.
- A company name that would be offensive or would amount to an offense in the eyes of the law.
- A company name that is deemed undesirable by the Central Government.
Some Famous Cases of Company Name Change
Some successful case studies regarding the change of company names can be cited to showcase the feasibility and authenticity of the company name change processes in India.
BSES to REL
The famous company, Reliance Infrastructure Limited (R-Infra), started as Bombay Suburban Electric Supply (BSES). In 2002, BSES became Reliance Energy Limited (REL), when the latter entity took over BSES. As REL grew in size and revenue, it kept on changing its name. In 2008, REL changed its name to Reliance Infrastructure Limited (R-Infra).
Infosys Technologies to Infosys
At the very beginning, Infosys used to be a Private Limited Company. However, as its share kept on increasing, it had to change its name from Infosys Technologies Private Limited to Infosys Technologies Limited in 1992 (real-life example of the first clause of Section 13(2) of the Companies Act 2013). In 2011, it further changed its name to Infosys Limited due to the expansion of its business nature.
Godrej Soap Company Limited to Godrej Industries
Similarly, Godrej Industries also started as the Godrej Soap Company Limited. It kept on changing its name, due to the expansion of its business nature.
Check Company Name Availability through the Following Tools:
- Use this website https://www.mca.gov.in/mcafoportal/showCheckCompanyName.do for free to check the availability of your chosen company name. This is an official MCA website, ensuring 100% authenticity.
- Also, use this website https://indiacompanyincorporation.com/tools/company-name-search/ for free, as an easy alternative to check the availability of your chosen company name.
Conclusion: Easily Change the Name of Your Company. It is Easy in India!
Changing a company name is not only feasible but also cheap and speedy in India, and this applies to those undergoing company registration in Mumbai as well. It takes less than a month at worst to change the name of your company. The ROC fees are also reasonable and depend on your paid-up capital, making it even more equitable. So, you can change it at your own pace, any way you like and any time you want.
You can always opt for Actax India to choose such name-changing services. At Actax India, we not only offer you a competitive pricing scheme but also ensure a smooth and speedy process.
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