Tips For Naming Your Corporation
Earlier you may have seen Makris Legal’s blog post regarding tips for naming your limited liability company, if not you can click here to check it out. When the time comes to forming a new corporation, many people first think about what they want to name the corporation. Like all entities, Florida sets out the minimum requirements for the name of a corporation pursuant to Florida law.
Pursuant to Florida Statute § 607.0401, Florida has requirements on what must be included and what cannot be included in the name of a corporation. The first and most common requirement, which is different from naming an LLC, is the entity must contain the word “corporation”, “company”, or the abbreviation “Corp.”, “Inc.”, or “Co.”. Additionally, the name can also include the designation “Corp”, “Inc”, or “Co” or indicate that it is a corporation instead of a natural person, partnership, LLC or some other entity. For example, Larry the Landlord one day decides that he wants to diversify his investments and decided to open Greek restaurant with a focus on desserts, and he names the corporation “Larry’s Loukoumathes, Inc.”. Since Larry’s corporation has the abbreviation “Inc.” it complies with the first naming requirement pursuant to Florida law. However, if Larry tried to form the corporation calling it “Larry’s Loukoumathes” the entity would most likely not form and instead he would need to use the original name and then file a fictious name/DBA.
When it comes to naming a corporation, the name cannot contain language that states or implies that the corporation is organized for a purpose other than that permitted by Florida law or the articles of incorporation. The corporation is also not allowed to state or imply that the corporation is connected with a state or federal agency or a corporation or other entity chartered under the laws of the United States.
Similar to the requirements for naming an LLC, a corporation name must be distinguishable from the names of other entities or filings that are on file with the department of state. Florida law sets out the ways that a name is not considered distinguishable from another entity:
1. If the name has a suffix.
2. If the name has a definite or indefinite article.
3. If the name contains the word “and” and the symbol “&”.
4. If the name is the singular, plural, or possessive from of a word.
5. If the name has a punctuation mark or a symbol.
After going through Florida’s minimum requirements for a corporation’s name, there are also practical tips that should be followed to get the most out of the name of the corporation. To start, it is wise to avoid names that are hard to spell and names that can limit the business as it grown. When it comes to getting potential customers, they may get confused when trying to search for the corporation. Additionally, when it comes to choosing a name for the corporation picking a narrow name can cause problems down the road when trying to expand. For example, Larry the Landlord opened his dessert-focused Greek restaurant, “Larry’s Loukoumathes, Inc.” and notices business is booming. Larry then decides he wants to expand his business to cater to the lunch and dinner crowd and starts offering lunch and dinner options. After a few weeks, Larry notices his restaurant is not attracting a lunch or a dinner crowd. One reason for this is because the name of Larry’s restaurant sounds like the name of a dessert-focused restaurant and not a restaurant that offers different kinds of foods. One way Larry can fix this is by renaming his restaurant to “Larry’s Greek Restaurant, Inc.” which would help clear up his customers’ confusion and attract new customers.
Another way to decide the name of a corporation is to create a few different names and get feedback on those names. When choosing a name, choose about 5 or 10 names and then run them by friends, family members, trusted colleagues, etc. One can also test the name with their target audience. By doing this, it gives the corporation owner the opportunity to see if the name they are choosing is good. For example, when General Motors unveiled the Chevy Nova, General Motors did not realize that “Nova” in Spanish translates to “not going” or “no go” which could have negatively impacted sales for the car. Additionally, it is best to do research on the name to make sure that the name of the corporation does not translate into anything negative in another language.
In essence, when choosing the name of a new corporation and after understanding Florida’s minimum requirements for corporation names, it is always best to conduct research on the name and test it out in order to choose the best name for the corporation. By doing this it will help a new corporation owner choose a name that is not confusing, translates to a negative meaning or phrase, and help customers choose a name that will help grow their corporation. For help choosing a name for your corporation and help set up the entity, click here to contact an attorney.