Companies requiring name alteration must follow the prescribed Company Name Change procedure underpinned by the Ministry of Corporate Affairs (MCA). This write-up discusses the same in detail, letting you know every legal aspect associated with the company name change.
Why Do Companies Opt For A Name Change?
There could be many reasons why a company wishes to alter its name. Some common reasons that encourage a company to change its name include
- The existing name doesn’t fit the expansion or merger strategy.
- The existing name is not helping with customer retention.
- End-users find it difficult to associate the offerings with the company name.
- The company is eager to revamp its branding strategy.
- The company is willing to target a new customer base.
Casting light on the Company Name Change Procedure
The company name change procedure entails the following steps:
- Company name reservation via RUN services available on the MCA portal.
- Filing of MGT-14 with MCA. MGT-14 informs the authority that the necessary resolution has been passed for making changes in MoA and AoA.
- Filing e-form INC-24
Note: Keeping in view subsection (3) of Section 13 of the Companies Act, 2013, an applicant must file form INC-24 for the company name change. In response, the authority shall grant the incorporation certificate in form INC-25 post the name change.
Mandatory Documentation for Change of Company Name
Keeps the following documents ready before indulging with the company name change procedure:
- Certificate of Incorporation (COI)
- Altered AOA and MOA
- List of directors and shareholders of the company
- Digital Signature (DSC) of the authorized director
- Proof concerning the registered business address
Step-By-Step Company Name Change Procedure
The section below briefs out the company name change procedure in detail. Make sure to pay attention to the documentation part, as most of the mistakes occur with the paperwork.
Step 1: Passing a Board Resolution
This step requires the company to convene the board meeting and pass the resolution for the company name change. The directors must direct the concerned officials to perform a name search on the MCA portal.
Step 2: Perform a name search to check the availability.
The designated officials, such as CS or the director, will file the request under the services called RUN (Reserve Unique Name) on the MCA portal. The said service would clarify whether the proposed name is registered or not.
Note: Before initiating the name search via RUN services, make sure that the proposed name;
- Doesn’t contain offensive words.
- Should comply with norms under the Companies (Incorporation) Rules, 2014.
- Is not registered or has some trademark protection
Step 3: Passing special resolution.
Once the proposed name is approved, the next step for the company is to convene the Extraordinary General Meeting (EGM). Through EGM, the directors will authorize the company’s action concerning the name change and alternation in the charter documents, such as Articles of Association or Memorandum of Association
Step 4: File form MGT-14
This step requires the company to file a special resolution with RoC within thirty days of approving the resolution. Along with this, the company is also required to file form MGT-14, which should enclose information about the special resolution.
The listed below are the documents that will serve as an annexure to Form MGT-14:
- Certified copy concerning the special resolution
- EGM notification shared with the board members
- Explanatory statement that was attested to the EGM,
- Altered Articles of Association
- Altered Memorandum of Association
After filing MGT-14, the next step for the company is to file form INC-24 for availing of consent from the central government for the name change. Make sure you have the “service request number” of MGT-14 before filing the INC-24.
The list below reflects the mandatory document for INC-24 filing:
- A certified copy of minutes of the meeting of EGM in which members approved the special resolution
- EGM notification
- Copy of resolution agreement reflecting the voting status of the members
- Copy of the approval from Reserve Bank, SEBI, IRDA, and so on.
- Altered MoA and AoA
- Any other optional attachments
The INC-24 form must reflect the following information without fail:
- Reasons for the name change
- Details pertaining to the number of members present in the EGM,
- Voting status of the members showing who were against and favor of the resolution
- Percentage of shareholding of member
Step 4: Grant of the incorporation certificate
If the Registrar of Companies doesn’t find any loophole in the application and attested documents, the new incorporation certificate shall be accorded to the applicant.
Compliance Need To Be Fulfilled Post Completion of Company Name Change Procedure
Upon receiving the new incorporation certificate, the company must make apt changes in the charter documents, such as AOA and MOA. Apart from that, the following documents should also reflect the changes regarding name alteration.
- The common seal of the company and official company seal
- Promissory notes and bills of exchange
- Company bank account name
- Tax authorities, EPF, and ESI department
- Company website and social media accounts
- Company PAN and TAN
- Company letterheads, business cards, etc.
- Company statutory registers
- Employment and business contracts
- Update business licenses or permits
As it is clear from the above the company name change procedure is not a straightforward affair. One must undergo a set procedure, as mentioned by the MCA, to secure approval for the name change from RoC. A service like RUN on the MCA portal will help companies with name availability, which is vital to avert any legal nuisances. It’s noteworthy that the name change facility is not available to companies being flagged by authorities for non-compliance pertaining to annual filing, repayment of loans, deposits, or debentures, and disclosing financial statements.
Read Our Article: Change In The Name Of The Company: Step By Step Procedure