Business name registration is a necessary
evil if you operate in Australia as a business under anything than a personal
or company name. If you trade as a trust, a partnership, or just want to
operate under another name, then you must register a business name.
The idea of the system is to ensure that
customers, suppliers and the public at large can identify the entities which
are trading. It is important to understand that registering a business name
does not create any rights in the name registered – for that, you would need to
register a trade mark with IP Australia. The process is fairly simple in most
cases, and the fees (while never welcome) are not excessive.
The big problem arises when a business wants
to operate in several locations within Australia. Each state and territory has
a separate system. In most cases, you are also required to have a local
business address specified. In the era of internet based sales, it is not
always easy to tell if you are trading in a particular state or territory. What
is a reasonable system for one state becomes an messy and expensive exercise when
you are required to register in six states and two territories.
Another complication is that the system
currently operates independently of the Australian Business Number (ABN)
system, which is required for tax, GST and related purposes.
Following from a decision at COAG (Council of
Australian Governments, including Federal, State and Territories), a bill has
been introduced into the Federal Parliament to create a single national
business name system. States will refer their powers to the Commonwealth, and
ASIC will operate a single, on-line system. Existing names will be
grandfathered, with provisions to deal with the co-existence of (e.g.)
‘Beachside Fish & Chips’ in multiple states.
Also, the system will require that an ABN be
provided for each registration, so that the business name and ABN systems are
aligned.
It will take all the states to pass their
corresponding legislation before the new scheme is in operation, so it is
likely to be a year or two away. The outcome should be a much more efficient,
on-line, one stop national business name system, which will simplify
requirements for anyone in or starting a new business.
by Peter
Franke
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