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Disclosure rules
1. Do the disclosure rules apply to all businesses?
If the Act applies to you (see chapter 1, question 3) then you must comply with all the disclosure rules.
For example, if Mr W Jones trades as 'W Jones Bakery', then the disclosure rules of the Business Names Act apply.
Disclosure rules also apply to incorporated companies that trade under a different name, for example, ABC Foods Limited as ABC Foods.
Incorporated companies must also comply with the disclosure rules in the Companies Act. These apply to what must be stated on company stationery and are shown in the guidance booklet, 'Company Formation'.
2. What details must be disclosed about a business?
You will need to disclose (as appropriate):
- the corporate name; or
- the name of each partner; or
- the individual person's name; and
- in relation to each person named, an address at which documents can be served.
3. Where must this information be shown?
You will need to show the information clearly in all:
- the places where you carry on your business and where you deal with customers or suppliers;
- business letters;
- written orders for the supply of goods or services;
- invoices and receipts;
- written demands for the payment of business debts.
Appendix D gives some examples of ways in which you can show the information on your stationery. As long as the details are 'clearly legible' they can be handwritten or printed.
4. Must it be displayed in a particular way?
As long as it can be easily seen and read, it does not matter how you show the information. (An example of a notice is given in Appendix E.) In large premises, you may need to think carefully about the size of the notice and where you display it to make sure that all your customers and suppliers will see it. You can put up more than one notice if you wish.
Do not send a copy of your display notice to Companies House.
5. Must the information be given to anyone else?
If asked for, the names and addresses that must be disclosed must also be given immediately, in writing, to anyone with whom you are doing business.
Names that suggest a banking activity
Following the repeal of the Banking Act 1987, company names that include bank, banker, banking or deposit no longer need approval. However, using words that suggest a banking activity implies that the person using the name is carrying on a banking business and is therefore accepting deposits - a regulated activity under the Financial Services and Markets Act 2000. Therefore, the person would normally need to be an 'authorised person' or to have exemption under the Act.
Use of a banking name by a person who is neither authorised nor exempt under the Act could be material to whether an offence has been committed under section 24 of the Act. A person may, however, be able to establish that the way that he carries on his business means that those who deal with him would not understand him to be an authorised person.
It should not be assumed that a decision by Companies House to register a particular banking name means that its use in certain circumstances would not contravene section 24. If you are in any doubt, you should seek independent legal advice. |
6. What if there are a lot of partners - must all the names be disclosed?
If the business has more than 20 partners, you need not put all the partners' names on your business documents. However, you must give the address of the principal place of business and say that a full list of the partner' names and addresses can be inspected there.
7. What happens if I do not comply with the requirements?
You commit a criminal offence if you use a business name that requires prior approval, and you have not obtained that approval.
Similarly, you are committing a criminal offence if you do not disclose the business details that the Act requires.
Remember, if you do not make your business details available, or you do not display them, you may not be able to enforce a contract that you have entered into. |
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