What’s in the name is not a very popular saying these days. When talking about a business concern particularly a Company, name is its identity and selecting a right name for your business is really important. The name may be such which reflects the business activity or it might be something simple and easy. There are numerous factors which are considered while finalizing a suitable name because in Long run the name will be a Brand.
Sometimes, there arises a need to change the existing name of a Company due to change in its objects, corporate restructurings etc. Whatever might be the reason, Change of name of a Company can only be done after complying with laws applicable to the Company. The legal provisions and procedure is discussed in detail in this article.
A Company which has defaulted in filing its Annual Return or Financial Statements or any document to be filed with Registrar of Companies will not be allowed to change its name.
Similarly, A Company which has not repaid its matured deposits/debenntures defaulted in filing its Annual Return or Financial Statements or any document to be filed with Registrar of Companies will not be allowed to change its name.
Clause 32 of Listing Agreement
Are You a Listed Company?
Following pre-requistes need to be complied with:-
1. Last name Change was done at least 1 year before.
2. At least 50% of total revenue in the preceding 1 year period should be from new activity suggested by new name.
The amount invested in the new activity/project is at least 50% of the assets of the company.
3. A Certificate from Auditor is required to confirm compliance with aforesaid provision.
Under RBI Regulations
Are you an NBFC/ Banking Company?
Under IRDA Regulations
Are you entering into Insurance Business?
As per erstwhile Department of Company Affairs circular 19/2003 dated 25.04.2003, since IRDA(Insurance Brokers) regulations, 2002 allowed Pvt. Companies to become insurance brokers ROC may allow change of name for doing insurance business subject to change of its objects to include insurance broking business also.
Hold a Board Meeting
1. Consideration of proposal of change of name and deciding max. 6(six) alternative names. The proposed name shall be in accordance with Section 4 and rule 8 of Companies (Incorporation), rules, 2014.
2. Authorizing any Director/CS to apply to ROC for making name availability application in e-form INC-1.
3. Call Extra-Ordinary General Meeting to approve change in name subject to CG approval (Power delegated to ROC vide )as per Section 13(2) and alter objects if the new name suggest some activity and it is not included in MOA, approve Notice and authorize any Director/CS to issue the same.
1. Pass Special resolution for alteration of Name clause of MOA.
2. Pass Special resolution for alteration of Object clause to keep name in consonance with the Objects of the Company, if the name is indicative of any object and it is not included in MOA already.
3. After EGM, file e-form MGT-14 along with certified copy of resolution and explanatory statement, altered MOA & AOA.
4. After filing e-form MGT-14, file e-form INC-24 with CG (Power delegated to ROC) for its approval to name change along with certified copy of resolution and explanatory statement, Notice and Minutes of the EGM.
Former name should also be there outside registered and every office and on all Letter heads, bill heads etc. for a period of 2 Years from change of name. (Section 12(3) proviso)
IN CASE OF SECTION 8 COMPANY
As per Section 8(4) before any Alteration to MOA of a Section 8 Company prior approval shall be taken from CG (Power delegated to ROC).
Hence in addition to procedure mentioned above after obtaining name availability letter file e-form GNL-1 for obtaining ROC’s prior approval for alteration in MOA of a Section 8 Company.
IN CASE OF LISTED COMPANY
Apart from pre-requisites discussed initially in this article, following compliances need to be taken care of:-
1. Two days prior intimation to Stock Exchange before Board Meeting (clause 19).
2. Intimation to Stock Exchange after Board Meeting within 15 minutes (clause 20).
3. Sending 3 Copies of Notice of EGM to STX (clause 31(c)).
4. Sending of proceedings of EGM (clause (31)(d)).
5. Net sales/income, expenditure and net profit/loss after tax figures pertaining to line of business suggested by new name shall be disclosed separately in the financial results for 3 succeeding years (clause 32).
6. Old name shall be disclosed on website for a period of 1 year (clause 32).
CONVERSION OF PUBLIC COMPANY INTO PRIVATE OR VICE-VERSA
As per Section 13(2) Proviso provision of change of name need not be followed if change in name is mere addition/deletion of word private due to conversion of Public Company into Private or vice-versa.
Disclaimer: The entire contents of this article have been prepared on the basis of relevant provisions and information existing at the time of preparation. Though utmost effort has been made to provide authentic information, it is suggested to kindly cross check the relevant provisions for better understanding. The observations of the author are personal view and the author does not take any responsibility of the same and this cannot be quoted without the written consent of the author.