Should You Register Your Business Name in Ontario?
When it is mandatory to register a business name, or more formally, your Master Business Licence (the proper legal term)?
Considerations for Registering Your Master Business Licence
Ontario has some of Canada’s highest personal incomes and a potential market of more than 14 million people, making it one of the most lucrative provinces to set up and run a business. A vital component to running a business is compliance in trade within provincial and federal laws. One such law is the Business Names Act, RSO, 1990 (the “BNA”).
Do You Need to Register Your Business Name?
Under the BNA, if you are operating a business in a name other than your own, you must register the business name with the province. Registration applies to:
- Sole proprietorships, conducting business under a name other than the full name of the sole proprietor;
- Partnerships, conducting business under a name other than the full names of the partners (EXCEPT FOR partnerships operating under the Limited Partnerships Act);
- Corporations, conducting business under a name other than the corporate name;
- Existing partnerships or limited partnerships registering a business in a name that is different to the name of the registered firm;
- Limited Liability Partnerships (LLPs); and,
- Extra-provincial LLPs and extra-provincial limited liability companies.
Many sole proprietors trade under their own name, meaning registration is NOT required. However, if an existing corporation wishes to operate under a different business name – for example, if ‘ABC Widgets Inc.’ wants to trade as ‘ABC Widgets’ – it must register ‘ABC Widgets’ as a business name, despite similarities between the two names.
It is important to understand that the business name itself does not become a separate legal person; the legal person remains the individual, partnership or corporation that registered the business name.
What Business Name Can You Choose?
A business name is important. It can describe what you do (for example, ‘Widget Makers LLP’), or where you do it (for example, ‘Toronto Widget Makers LLP’). You will typically want it to be distinctive, easily identifiable, and, over time, associated to the quality and trustworthiness of your business.
Further, registration of your business name builds in the proprietary rights of the name. These are established by publication and use of the business name in connection with the business’s goods and/or services.
As such, choosing a business name may require some time and thought. As you do so, you should bear in mind the restrictions on what business name you can select, pursuant to the BNA. These restrictions include the following:
- It should be unique, and not already an existing business name;
- It should not be obscene; and,
- It should not have royal connotations.
Additionally, the business name should describe your business in some way. For a more detailed list of restrictions on business names, visit the Government of Ontario’s website (LINK: https://www.ontario.ca/page/registering-your-business-name).
In order to comply with the BNA, it is wise to conduct extensive name searches when deciding upon your business name, including:
- Business Name Searches: You can conduct a search using ServiceOntario (serviceontario.ca), by searching business directories or by using the government’s Enhanced Business Name Search service;
- Trademark Name Searches: You can conduct a search using the Canadian Trademarks Database, a free search of all registered trademarks in Canada;
- Searches for Incorporated Businesses: You can conduct a NUANS (New Upgraded Automated Name Search) search, which is important if you wish to conduct business outside of Ontario in other Canadian provinces, as it shows all existing business names used in Canada; and,
- Internet Searches: You should also conduct a Google search, or use any other internet search tool.
It is important to note that the cost for Service Ontario name searches range between $8 and $26 depending on the type of report, and that the search is of non-incorporated business names only, meaning the names are not protected by law.
The NUANS search is a requirement if you are considering incorporating your business, as it compares your name with those already in existence. A NUANS report costs $20, plus HST, but for a free pre-screen name search, visit https://www.arvic.com.
(You might like to read our related article ‘Where to Incorporate Your Toronto Small Business: Provincially or Federally?’)
How Long Does a Business Registration Name Last?
Once registered, a business name’s registration will remain for FIVE YEARS and must be renewed before expiry. Once renewed, the business name will again remain registered for five years.
Registration is made through ServiceOntario, and, if made electronically, will cost $60. If you use a service provider to register for you, the service provider will charge a separate service fee in addition to this fee. Alternative forms of registration include:
- In person registration by visiting a Service Ontario location that provides assistance with Business Registration ($60); or,
- Registration by mail through completing the form and mailing to:
Ministry of Government Services Central Production and Verification Services Branch
393 University Avenue
($80, and it takes 4 to 6 weeks to receive your Master Business License).
If you submit both electronic and other versions, the electronic version will prevail should any conflict arise.
Why Would You Choose to Use a Service Provider to Register Your Business Name?
You may be asking yourself: Why choose a service provider to register your business name when you can do it yourself? The brief answer: Forms and fines.
The BNA states that an application for a business name registration that includes a statement that is ‘false or misleading with respect to any material fact is guilty of an offence and on conviction is liable to a fine of not more than $2,000 or, if the person is a corporation, to a fine of not more than $25,000’.
Further, the BNA states that ‘Every director or officer of the corporation and every person acting as its representative in Ontario who authorized, permitted or acquiesced in such an offence is also guilty of an offence and on conviction is liable to a fine of not more than $2,000’.
A service provider has experience in registering many businesses, and this experience can help ensure that you do not make a mistake that could lead to costly fines.
COIN – Special Rules for Corporations That Own Business Names
If you want the public to know your corporation owns the business name, then the corporation’s name must be included on all contracts, orders, invoices and negotiable instruments, something we refer to as ‘COIN’ (Contracts; Orders; Invoices; and, Negotiable instruments).
On such paperwork, the relationship between the corporation and the business name is typically denoted in one of two ways:
- “Business Name” a division of “Corporate Name”
- “Corporate Name” carrying on business as “Business Name”.
If you are considering starting a new business in Ontario, or you are an existing business seeking to expand by carrying on under a different business name, it is likely that you will need to register a Master Business Licence (unless you plan to conduct business under your own full name).
Registration of business names is done via ServiceOntario, and must be renewed every five years. You can file your application electronically or in person, with electronic forms prevailing in the event of any conflict.
When registering your business name, it is critical that the information you provide is accurate and not misleading. The law does not accept ignorance as an excuse for mistakes, meaning an innocent mistake can result in financial penalties.
Your business name is your initial advertising tool that is critical to building your brand and expanding your business. As such, it is crucial to familiarize yourself with the BNA from the outset to ensure compliance and avoid hefty fines that may stunt your business’s future growth.
If you wish to learn more or need assistance with registering a business name in Ontario, please don’t hesitate to contact us.