Company Name Reservation Is Not Trademark Protection: BRS Approval Versus KIPI Registration

Registering a company and protecting a brand are separate legal acts, and foreign entrants often confuse them. A Kenyan company name is cleared by the Companies Registry at the Business Registration Service (BRS), and a trademark is registered by KIPI. Company name reservation gives you a short-lived hold on a name against other companies; it gives you no right to stop anyone using or registering the same word as a brand. This article explains what reservation does, how the Registry tests names against trademarks, and what to do if a company already carries your brand.

Two registers, two different rights

The Companies Registry administers the Companies Act, 2015 and the business names and limited liability partnership laws. KIPI administers the Trade Marks Act (Cap. 506). Each applies its own test. Section 7 of the Trade Marks Act gives the registered proprietor of a valid mark the exclusive right to use it in relation to the registered goods or services, and makes it infringed by the use of an identical or confusingly similar mark in the course of trade. Nothing in a certificate of incorporation confers that right. A company can be validly registered under a name that infringes someone else’s trademark.

What name reservation actually gives you

Under section 48 of the Companies Act, the Registrar may, on written application, reserve a name pending registration of a company or a change of name. The reservation lasts thirty days, or a longer period not exceeding sixty days if the Registrar allows it for a special reason, and during that time no other company is entitled to be registered by that name. The section speaks only of other companies. It does not create a property right in the name and it does not restrain anyone from filing a trademark application for the same word or from using it as a brand. In our experience of the portal, the proposed name is entered as part of the incorporation filing itself, so any trademark check has to be done before you file.

How the Registry tests a name against trademarks

Section 49 of the Act stops the Registrar registering a company by a name that would be an offence, consists of unauthorised abbreviations, or is in the Registrar’s opinion offensive or undesirable, applying criteria set by regulation. Section 57 bars registration of a name that is the same as one in the index of company names. The Companies (General) Regulations, 2015 then fill in the detail:

• Regulation 11 lists the names that will not be registered. They include a name that is the same as one in the index of company names, business names, limited liability partnerships or partnerships, a close phonetic resemblance to such a name, a name differing only by the addition of a place in Kenya, a name identical or closely resembling a reserved name, and a name the Registrar reasonably believes is offensive, undesirable or contrary to public interest.
• Regulation 12(f) makes it one of the criteria for an offensive or undesirable name that it includes a name identical or confusingly similar to a registered trade mark, unless a document signed by the owner of the trade mark and indicating consent to its use is provided.

BRS’s own guidance to applicants says the name should not be the same as or similar to a registered trademark and suggests searching the trademarks registry as well. Note the wording of regulation 12(f): it refers to a registered trade mark. On that wording, a mark that is only the subject of a pending application, or an unregistered brand, is not protected by it. That is our reading of the text, and it is a reason to file the trademark application before or at the same time as the company is incorporated. Our article on trademark clearance at KIPI explains how to check the trademark register first.

If a company already carries your brand

The Registrar has express powers to direct a change of name, but they are narrow. Under section 58, a direction can be given only within twelve months after registration (or a longer period the Registrar specifies in writing), where the company was registered by a name the same as, or too similar to, a name in the index of company names. Under section 60, the Registrar may direct a change where misleading information was given for registration or the name misleads about the company’s activities, but not more than five years after registration; the company has twenty-one days to comply, and non-compliance is an offence with a fine of up to KES 200,000. Neither section mentions trademarks. Whether the Registrar will act after registration on the regulation 12(f) ground is a point to put to the Registry, and we would not rely on it alone.

A trademark owner should also consider a civil claim for infringement or passing off. In Litein Tea Factory Company Limited & another v Davis Kiplangat Mutai & 5 others [2015] KEHC 6196 (KLR), a ruling on an interim injunction application, the plaintiffs relied on their reservation of the name “Chelal Tea Factory Company Limited” and on their registered trademark “Chelal Tea Factory” against a company later registered by that name. Gikonyo J observed that a claim confined to the registration of the company name would have called for judicial review, but that the suit alleged trademark infringement and other torts as well, so the plaintiffs could bring all their claims together. The case was decided under the previous Companies Act, whose reservation provision is now section 48. See our articles on trademark infringement and the enforcement ladder.

A sequence for foreign entrants

Clear the brand first, then decide who will own it. File the trademark application in the name of the entity that will hold the brand, whether the parent or the Kenyan subsidiary, since moving it later requires an assignment and recordal; see trademark change of name and address at KIPI. Next, propose the company name, keeping in mind the regulation 11 tests and, if the name matches someone else’s registered mark, the need for the owner’s signed consent. Then register the matching domain name; see domain name disputes in Kenya. Overseas owners should also read our guide to protecting a brand in Kenya.