Part 2 Chapter 2 Flashcards
What are the specific obligations of traders?
- Adopt a business name
- Keep proper records of their commercial activity
- Comply with registration obligations at the commercial register
- Prepare the annual report and accounts
- Other obligations
What is a business name?
Commerce is carried out under a business name, it is mandatory for individuals and for commercial companies.
Exclusively of words, limitations in relation to expressions that can be part of business name, foreign words accepted. (No figurative elements).
What are the types of business names?
- Composed only of the name of one of one or more people.
- Composed by an expression that indicates the branch of activity with or without fantasy expression
- Composed by a mixture of the two previous types
Can business names be the names of the sole traders?
Composed of full name or an abbreviation (in general one word is not enough). Expressions or abbreviations indicating academic degrees, professional qualifications or nobility titles, to which the trader is entitles to can be added before the name
What are the fundamental principles applied to business names?
- Principle of truth
- Principle of novelty or exclusivity
- Principle of capacity to distinguish
- Unity Principle
- Principle of lawfulness
What does principle of truth entail?
Must be truthful, not misleading, in relation to identification, nature or activity of its holder.
Meaning that what is accepted or not allowed due to the principle of truth?
- Can include names of members/partners not of random people
- No expressions, abbreviations misleading as to its legal nature
- No elements that suggest activity different from those that are in fact carried out by the trader
- Alteration of name within one year if one of the partners decides to stop being a partner, unless written consent is issued by partner that left.
What does Principle of novelty and exclusivity entail?
Business names must be distinctive, not confusingly similar in relation to those already registered or licensed in the same exclusivity scope, even in cases where the law allows for the use of elements that are part of business names already registered or with the name or notoriously known orgs.
Are commercial companies and civil companies entitled to the exclusive use of their name throughout the national territory?
Yes
What if sole traders have the same civil names and use them to make their business names
Then since a sole trader cannot hold exclusive rights to those, individual traders can use their civil name as business name because they are entitled to it.
However, if a sole trader adds onto the business name with the addition of something not limited to a full or abbreviated civil name, they then have exclusive rights to its use from he date of the definitive registration and within the municipality where their main establishment is located.
In what situations are business names not new?
When given the spelling of the words, phonetic effect of the expressions, core, or font used, may lead to the average public to not be able to distinguish between them and confuses them, taking one trader for another, or, even thought not confusing them, wrongly believe that they refer to distinct yet specifically related traders.
What is the criteria for judgements on the distinction and inability for confusion or error of business names?
Taking into account the type of person, its domicile or headquarters, the affinity or closeness of the activities and the territorial scope thereof.
These are the elements part of an auxiliary criteria for the evaluation of a potential confusion.
Is the Principle of novelty or exclusivity valid for non-competitors as well?
Yes, for example if two companies that perform different activities have similar business names and have their head office in the same street, it may lead to confusion, judgements on the distinction must also into account, trademarks, logotypes already registered.
What is the Principle of capacity to distinguish
Business names, as distinctive signs of traders, exist to differentiate/to allow others to distinguish one trader from another.
Requirements to fulfil the Principle of capacity to distinguish
No business names made up exclusively, of words in current use that allow identification or relate to activity, technique or product as well as toponyms and indications of geographical origin shall be accepted.
What can be accepted by the Principle of capacity to distinguish?
Business names of the individual traders and the names of commercial companies that include the names of the partners do not raise problems as they have distinctive capacity. However, company names composed of fantasy expressions/descriptions of the economic activity, can face issues.
What is the unity principle
Traders can have only one business name (except for sole traders that own individual limited liability establishments)
What does the lawfulness principle stipulate?
Business names cannot include:
1. Expressions which are prohibited by law or offensive to morals
2. Expressions that disrespect freedom of ideological, political or religious choice
3. Expressions that disrespect or illegitimately appropriate national symbols, personalities, periods in time or institutions whose name or meaning is to be safeguarded for historical, patriotic, scientific, institutional, cultural or other reasons
Means of protecting business names:
- Right to the business name is guaranteed under art 62 RRNPC
- Exclusive rights are granted with the final registration
- Protection of the business name is guaranteed through preventive and repressive means.
What does preventive means entail?
Issuance by the RNPC, of a certificate of admissibility of a name or denomination. In reality, this certificate constitutes a mere presumption of exclusivity
However, without this certificate it is not possible to incorporate a commercial company or to change the company name.
What does mean of repression entail?
- RNPC declares loss of the right to use business names or company names, notably for infringement of the principles of truth and novelty
- Courts declare a commercial name null and void or revoke the exclusive rights
- Trader whose registered name is abusively used by others, has right to:
- Request author of the illegal use be prohibited from using it
- Seek compensation for losses and damages
- Initiate administrative offenses against the infringer
How does one go about altering a business name or company name?
As long as principles of truth, novelty, exclusivity are respected, traders can change business name
Transfer of a business name
It is possible but you must in addition to the name purchase the establishment it is linked to.
Explain what keeping proper records of their commercial activity entails
Traders are under obligation to keep records of commercial activity as to keep the correspondence and all relevant documents for a period of 10 years.
