The Requirements for an Acceptable Company Name

A large proportion of small and medium-sized businesses in Cyprus are directly or indirectly associated with the food service industry, making it advisable for students and professionals in the field to understand basic aspects of business law. One of the first concerns typically faced by aspiring entrepreneurs is the name of their business—a matter of vital importance that is inextricably linked to the reputation of their endeavor. This article sets out the current legislation regarding acceptable company names.

First, it must be clarified that a business may operate as a partnership, trade name, or simply as a natural person. In other words, registering a company is not mandatory.

However, if the business chooses to operate as a company, being an artificial legal person, it must be given a name. The company name must be stated in the memorandum of association, which is submitted to the Registrar of Companies upon the company’s registration.

According to Article 18 of Cap. 113, “no company shall be registered with a name which, in the opinion of the Council of Ministers, is undesirable.” (This authority has been delegated to the Registrar of Companies.)

Therefore, before taking any steps to incorporate a company, prior approval of the proposed company name by the Registrar of Companies is necessary. The Registrar will not approve a name that:

• Is similar to the name of an existing company.
• Is considered misleading or offensive to the public.
  See: Little v Australian Securities Commission (1996) (use of the name “Virgin Mary Pty Ltd” for an entertainment center).
• Implies a connection to a government ministry, department, municipal or other local authority, or any organization or body established by law or by the government of any foreign country, unless such a connection is real.

Regarding the first case, in Epsilon Electromechanical Limited v Ministry of Commerce and Industry and another (1992) 4A A.A.D. 723, the court ruled that a name which excessively resembles the name of an already registered company is considered undesirable (“is too like the name by which a company in existence is previously registered…”). The adverb “too” implies an evident similarity.

In Marinos Papargyrou v Registrar of Companies and Official Receiver, Case No. 1168/2005, October 10, 2006, the Court analyzed that the Registrar of Companies in Cyprus exercises their discretion in the same manner as the UK Registrar of Companies.

In O. Ghalanos & Son Ltd v Republic of Cyprus, via the Registrar of Companies, Case No. 678/8709/09/1989: (1989) 3C A.A.D. 2004, it was decided that:

“The term ‘undesirable’ cannot be judged arbitrarily or subjectively by the Registrar. The decision must be based on objective criteria, and the power must be exercised in a reasonable manner. There is no room for unfettered discretion. The administrative authority (Registrar of Companies) has no power to act at will.”

Lastly, protection of a company name is also offered through unfair competition law, provided that there is a risk of consumer confusion. In the case Zefkas Bros (Fig Tree Bay) Restaurant LTD v A. Pavlou Anastasiou, 2. A. Igoumenou, 2007, concerning two restaurants at Fig Tree Bay beach in Protaras, the original “Fig Tree Bay” restaurant, which had operated since 1953, failed to prove consumer confusion with “Blue Peter Beach Restaurant Fig Tree Bay,” which operated from 1984. Additionally, there was no misleading conduct by the defendants regarding their geographic location, and it was established that the beach had not been named after the appellant’s restaurant—it was already the geographic and toponymic name of the Protaras beach in Paralimni.

This article is for informational purposes only and should not be considered legal advice.