Why do Companies Change Names? What is the procedure for this?
Companies change their names for various reasons, including rebranding, mergers or acquisitions, expanding into new markets, or resolving trademark issues. In India, the procedure for changing a company’s name involves complying with the Companies Act, of 2013, and adhering to the regulations set by the Ministry of Corporate Affairs (MCA).
For Example Which Successfully Rebranded Their Names
Burbn > Instagram
All the same, a report by The Atlantic notices the disappointment of the application because of a few muddled in-application highlights. The originators then, at that point, changed the application a few times to at long last zero in on the photosharing viewpoint and made what we know today as Instagram.
onfinity > PayPal
The computerized installments industry is supposed to develop into a $1 Tn in India by 2023. Before the appearance of development in this area, worldwide installments player PayPal was inseparable from online installments.
Reasons for Name Change
Companies may change their names for strategic purposes, such as repositioning their brand or reflecting a change in their business focus. Mergers or acquisitions often result in name changes to align with the new entity’s identity. Additionally, companies might alter their names to avoid conflicts with existing trademarks or to comply with regulatory requirements.
Board Approval
The first step is to convene a board meeting to propose and approve the name change. A special resolution is passed, and the directors must ensure the proposed name is compliant with MCA guidelines.
Availability and Reservation of New Name
The company must conduct a name availability search on the MCA portal to confirm that the desired name is unique and not already registered. Once an available name is chosen, an application for name reservation is filed with the MCA, providing up to six preferred names in order of priority.
Holding an Extraordinary General Meeting (EGM)
Once the name is approved by the Registrar of Companies (RoC), an EGM is held to obtain shareholders’ approval for the name change through a special resolution. Shareholders are provided with a notice of the meeting, along with an explanatory statement detailing the reasons for the name change.
Filing Documentation
Following shareholder approval, the company must file the necessary documents, including a copy of the special resolution, notice of the EGM, altered Memorandum of Association (MoA), and Articles of Association (AoA), to the RoC within 30 days of passing the resolution.
Obtaining RoC Approval
The RoC reviews the submitted documents and, if satisfied, issues a fresh Certificate of Incorporation with the new name. The change of name becomes effective upon receiving this certificate.
Updating Legal Documents
Upon obtaining the new Certificate of Incorporation, the company must update all legal and statutory documents, including licenses, permits, tax registrations, bank accounts, and contracts, with the new name.
Public Notice
To inform stakeholders and the public about the name change, the company should publish a public notice in newspapers and update its website, signage, and other marketing materials accordingly.
By following these steps and fulfilling the necessary requirements, companies in India can successfully change their names while adhering to the legal framework and regulations set forth by the MCA.
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