When establishing a company in Kenya, the crucial initial step involves identifying and reserving the entity’s official name. The company name is the definitive aspect of the business, creating its unique identity and distinguishing it from all other entities. It is essential that the name is carefully considered to align with the nature of the business and facilitate easy recognition by customers. Furthermore, a suitable company name must be distinctive, authentic, and sufficiently memorable to stand out from competitors.
The Name Reservation Process
Company registration in Kenya is conducted through the eCitizen online platform. Applicants are required to provide a minimum of three preferred names, listed in order of priority. This allows the Registrar of Companies to perform a search for availability. The first available name is automatically assigned to the business or company and reserved for a period of thirty days pending formal incorporation. This reservation period may be extended by the registrar for a further duration not exceeding sixty days in total.
Grounds for Name Rejection
It must be noted that the reservation of a preferred company name is not guaranteed. There are several circumstances under which the registrar may reject the proposed names submitted by the applicant.
Similarity to an Existing Name
The registrar may decline to reserve a proposed company name if it is similar to that of an already registered business or corporation, or if it closely resembles a name that has already been reserved for another company. This prohibition extends to names similar to registered trademarks.
However, a proposed similar name may be reserved for registration if specific conditions are satisfied:
- The existing company, or the promoters of the proposed company, must consent to the use of the proposed name for the applicant company.
- The applicant company forms, or is intended to form, part of the same group as the existing company or the proposed company.
- The applicant company provides the Registrar with a copy of a statement from the corporation specifying both the consent mentioned above and confirmation that the applicant company forms, or is to form, part of the same group as the existing company.
Additionally, the registrar may reject an application to reserve and register a name on these further grounds:
- The name is the same as one listed in the Registrar’s Index of Limited Liability Partnerships or Partnerships.
- The name has a close phonetic resemblance to the name of an already registered company, business name, limited liability partnership, or partnership.
- The name differs from an already registered company, business name, limited liability partnership, or partnership only by the addition of the name of a place, locality, or region within Kenya.
- The name is identical to or closely resembles the name of a company or limited liability partnership that has been dissolved or struck off the relevant register, or where a business entry has been cancelled under the Registration of Business Names Act 2015.
- The Registrar has reasonable grounds to believe its use would involve the commission of a criminal offense.
- The Registrar has reasonable grounds to believe the name is offensive, undesirable, or contrary to the public interest.
Unauthorized Characters or Abbreviations
Rejection may occur if the name consists of abbreviations or initials not authorized under the Companies Act 2015. The Companies Act General Regulations 2015 clearly define the permitted characters for a company name as: alphabetical characters (A-Z), numerical characters (0-9), and punctuation marks (such as apostrophe, brackets, exclamation mark).
Certain signs and symbols—namely, $*$, $=$, $\#$, and $\%$-—may be used in a company name provided that they do not constitute one of the first three characters of the name. It is important to note that a company name must not exceed 160 permitted characters.
Offensive or Undesirable Names
The registrar is mandated to reject a proposed company name if it is determined to be offensive or undesirable. The following criteria are applied when making this determination:
- The name includes “cooperative,” “society,” or “trade union” or any variation or synonym of those words.
- The name suggests an association with, or the patronage of, the State or any of its agencies, unless circumstances justify its use.
- The name suggests an association with, or the patronage of, a foreign government or an embassy, high commission, or consulate representing such a government in Kenya.
- The name suggests an association with, or the patronage of, a county government.
- The name comprises an acronym that would render its use vague or uncertain.
- The name includes a name that is identical or confusingly similar to a registered trademark, unless a document indicating consent from the trademark owner is provided.
- The Registrar believes on reasonable grounds that there is a reasonable possibility that the name could offend members of a particular community or ethnic or racial group.
Requirement for Registrar Approval
Finally, a company name may be rejected if it requires the approval of the registrar and that approval has not been obtained. The Companies Act 2015 stipulates that the registrar’s approval is necessary for a company to be registered under a name that would likely give the impression that the company is connected with a State organ, a county government, or any public authority prescribed by the regulations.
