As it stands currently, you can’t just name your limited company however you like. Along with obviously not being able to use a name already in use, there are a list of “sensitive” words that people are prohibited from using on the grounds that use of certain words may mislead people or cause offence. Considering the list includes such terms as “police”  and “government”, you can see why it’s in place.

At the moment, it’s a pretty hard and fast rule that none of the words can be used – but that might be about to change. The Department for Business, Innovation and Skills has suggested the the list is causing too many unnecessary delays and should either be scrapped or scaled down.

There have been two suggested changes to the list. The first being to get rid of it completely and allow people to use any words when forming a company without gaining prior permission (with the exception of terms that may cause offence, are already in use, or suggest some kind of government connection). This means the process of naming your business will become considerably less bureaucratic.

Company formation rules

The other suggestion is to slash the list and include only words in “which there is a clear criterion for approval and clear value in retention.” While not cutting down red tape as much as option number one, it will still streamline the process a bit more if your name doesn’t raise any red flags.

This measure is being considered as part of the Government’s efforts to reduce the volume of regulations involved in running a company (BIS claim there are 115 in total), to encourage people to start up businesses and also make the lives of those running them a little bit easier. Admittedly, having to spend a bit of time thinking up an acceptable name for your limited company probably won’t make people give up on the idea altogether, but anything that cuts through the red tape can only be a good thing.

See here for more details on the current rules on allowable company names.