Reusing a Company Name After Liquidation

Does this sound familiar?

You want to continue a viable part of the business through a new company. The old trading name has customer recognition. You have heard that you can simply buy the assets and carry on.

The short answer

Specific restrictions can apply after a company enters insolvent liquidation. Section 216 of the Insolvency Act 1986 can restrict a person who was a director or shadow director in the relevant period from being involved for five years in a business using a prohibited name, unless a statutory exception or court permission applies.

A prohibited name can include the liquidated company's registered name and, depending on the facts, another name so similar as to suggest an association.

Why this matters personally

Breach can be a criminal offence. Section 217 can also create personal responsibility for certain company debts. The rules are technical and the exceptions have conditions and time limits, so obtain legal advice before using, acquiring or advertising under a similar name.

What may be urgent

List every registered, trading and domain name used by the old company
Identify the directors and shadow directors during the relevant period
Preserve proposed sale and valuation documents
Obtain advice before incorporating, marketing or trading
Check whether any proposed exception actually applies and has been followed

What to avoid

Assuming a minor spelling change makes the name safe
Starting to market before the legal position is checked
Treating an asset purchase as automatic permission to use the name
Using another person as the apparent director while continuing to manage the business

What happens next?

Review director investigations, company administration, or request a confidential callback.

Authoritative sources

This guide provides general information for directors of companies registered in England and Wales. It is not legal, financial, accounting or insolvency advice.