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Measures to cut the list of 鈥榮ensitive鈥� names that startup businesses must get approval for, prior to setting up, have been announced today by Business Minister Jo Swinson.

Businesses that want to use words such as 鈥楢uthority鈥�, 鈥楤oard鈥�, 鈥楨uropean鈥�, 鈥楪roup鈥�, 鈥業nternational鈥� and 鈥楴ational鈥� will no longer have to get prior approval from Companies House, or a specified body. The same also applies to their Welsh and Gaelic equivalents. This red tape cutting exercise will result in a quicker process for companies wishing to use a 鈥榮ensitive鈥� word or expression in their registered name.

The consultation on the Company and Business Names regime received 254 responses when launched earlier this year. There are currently over 150 words and expressions on the 鈥榮ensitive鈥� list, which will now be reduced by a third. These changes will come into force next year.

The words and expressions to be retained are those which, when misused, are likely to cause confusion as to what the business actually does or has the legal authority to do. These words, amongst others, include 鈥楢ccredited鈥�, 鈥楤ank鈥�, 鈥楥hamber of鈥�, 鈥楥harity鈥�, 鈥業nstitute鈥�, 鈥楪overnment鈥�, and 鈥楿niversity.鈥� The word 鈥楽heffield鈥� is to be retained on the list after responses to the consultation showed support to keep it. The same applies to national words such as 鈥楨nglish鈥�, 鈥楽cottish, 鈥楴orthern Irish鈥�, 鈥榃elsh鈥� and 鈥楥ymru.鈥�

Business Minister Jo Swinson said:

Making life easier for startup businesses will help to create a stronger economy. Rules on certain types of words shouldn鈥檛 be an additional hurdle, so reducing the list of company names needing approval makes sense.

However, we also need to make sure that businesses can鈥檛 pass themselves off as something they鈥檙e not. We have struck a balance which reduces the regulations on new businesses, but that also keeps historic and sensitive names rightfully on the list.

Companies House currently receive about 30,000 applications to incorporate per month. About 4,800 of these contain prescribed words and approximately 70% of these are ultimately accepted.

Notes to editors

1. The government response to the Company and Business Names Consultation includes the full list of words that have been retained or removed from the list.

2. Company names can be rejected if it is offensive or which could constitute an offence. It can also be rejected if it suggests a connection with government or a local authority.

3. All companies and businesses would still be required to indicate their company type or legal form (e.g. plc, ltd 鈥� unless they qualify for an exemption).

4. No business may be carried on in the UK under a name that gives so misleading an indication of the nature of its activities as to be likely to cause harm to the public.

5. A new company could be required to change its name, following a complaint, if it was too similar to another on the register.

6. A specified body refers to an organisation from which a company must obtain permission to use a particular word or expression in their registered name e.g. the FCA grants approval to use the word 鈥楤ank鈥� in a company or business name.

7. The inclusion of 鈥楽heffield鈥� in the original Company and Business Names Regulations 1981 was the result of a campaign at the time.

8. The government鈥檚 economic policy objective is to achieve 鈥榮trong, sustainable and balanced growth that is more evenly shared across the country and between industries鈥�. It set 4 ambitions in the 鈥楶lan for Growth鈥�, published at Budget 2011:

• to create the most competitive tax system in the G20
• to make the UK the best place in Europe to start, finance and grow a business
• to encourage investment and exports as a route to a more balanced economy
• to create a more educated workforce that is the most flexible in Europe

Work is underway across government to achieve these ambitions, including progress on more than 250 measures as part of the Growth Review. Developing an Industrial Strategy gives new impetus to this work by providing businesses, investors and the public with more clarity about the long-term direction in which the government wants the economy to travel.