If you purchase the whole or substantially whole business from the liquidator, you may be able to reuse the company’s name. You buy the business assets from the liquidator This process is known as applying for ‘court leave’ – essentially, requesting official permission to use the same or a similar name. You can apply to court to reuse the name of your liquidated company, but you must do so within seven days of liquidation. The Insolvency Act prohibits the reuse of limited company names apart from in these three specific scenarios: What are the rules surrounding the reuse of company names? Regulations prevent the reuse of the same or similar company name after that company has been liquidated, but there are three exceptions to these regulations. They’re in place to prevent dishonest directors deliberately trying to misrepresent themselves and a company, and mislead former creditors or the public at large. The rules on reusing company names are laid out in Section 216 of the Insolvency Act, 1986. These include personal liability for any debts of your new company, financial penalties, and even imprisonment in the most serious cases.
There are potential drawbacks when you reuse a company name, however – the rules are very strict, and it’s important to be aware of the potential consequences of getting it wrong. You don’t have to spend time building a new brand and can use the goodwill of the old company to your benefit. When you start a new company following liquidation, using the same name or one that sounds similar can help you get the business off the ground quickly as it’s already a recognised commercial entity. Why reuse the name of a liquidated company?
As licensed insolvency practitioners we can talk you through your options when it comes to repaying your outstanding Bounce Back Loan, as well as handling all negotiations with creditors on your behalf. If you are a limited company director worried about how you are going to repay your Bounce Back Loan, we are here to help.
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