Passing Off

Before you register your business name and domain name, remember that registration is no guarantee that you are entitled to use them. If you elect to register a business name, a domain name, or both, that is the same as or very similar to an existing one you could face a ‘passing off’ challenge.

What is ‘passing off’?

‘Passing off’ is the legal jargon for a company using either a business name or a domain name which is likely to cause confusion. In other words, using a name which is likely to make people believe they are dealing with another company. Originally the principle applied solely to business names and trademarks but its use has been extended to include domain names.

How does passing off apply to business names?

Passing off enables business names to be protected, even if they are not registered. Taking sole traders as an example, they are not required to register a company name with Companies House so there is nothing stopping one new sole trader in a town or city giving his business the same name as an established sole trader. The passing off principle gives the established sole trader the means to challenge the new sole trader’s use of the name on the grounds that it might confuse customers in the town or city in which they operate.

Passing off criteria

To determine if passing off applies, courts will normally look at whether one of the companies at the centre of a challenge was already well established at the time of the dispute, whether the two businesses are operating in the same industry, based in the same geographical area and targeting the same customers. As it is not based on statute law rulings will vary according to the circumstances of individual cases, but the basic principle is that if a potential customer could easily confuse the businesses, the newer of the two will have to change its name.

How does passing off apply to domain names?

The same rules apply to domain names. If you have a domain name very similar to that owned by another business then you can be challenged for passing off. As with business names, the success of any challenge will depend on whether you are in the same industry, whether you are in the same geographical area and whether customers are likely to be confused or misled. If you are judged to be ‘passing off’ your business then you can be forced to change your domain name.

Protecting yourself from passing off

There is no time limit for launching legal action on the grounds of passing off so you are always at risk. The damage that a passing off challenge could cause to your business is considerable so it is important to do your research before you register business names and domain names.
A search for available company names and a trademark search will inform you if anyone has already been granted legal protection for any of the words in your business name idea. Similarly you should also do a domain name search. When you buy a domain name, be sure to get all the different top level domain variations that exist for your choice. This makes sure that nobody else has an existing website with them, and that nobody can set up such a site in the future.

Check available company names and domain names with a single search using Business Name Checker.