4. Getting down to business
4.1 Registering a business name
If your association is going to operate any business component of its activities under its incorporated name (eg Harmony Community Development Association Inc.), there is no need to register the association's name as a business name. You will only need to register a business name if the association wants to trade under a different name (including a shortened version of the association name, such as "Harmony Community") for part or all of its business.
For example, Twinkle Toes Child Neighbourhood Inc, a group providing support to single mothers, decides to run a business under the name "Nappies2U" that provides a commercial service to working parents. It would need to register this name as a business name.
On the other hand, having a registered business name does not mean that a group has become incorporated and created a separate legal entity. The two processes are separate.
A registered business name is a trading name under which an organisation, group of people or an individual can conduct their business activities within the state of registration.
An incorporated association will only have one name for the purposes of incorporation, but may conduct its businesses under more than one registered business name (provided business is being carried on under each of those names).
A registered business name cannot be the same name as the name of incorporation.
Registration is granted in the state or territory in which the business will operate. In Western Australia, the Business Names Act 1962 regulates registration. Under this Act, a name can be refused if it is offensive, misleading or could be confused with an existing business name, registered company name or incorporated association etc.
Business names must be renewed every three years. Once registered, a name cannot be changed. In these circumstances, an association would need to cancel the existing registered name and apply for a new one, at the normal cost.
Registering a business name requires the proprietor to:
- carry on business under the registered name at all times (it cannot be held for future use);
- exhibit the certificate of registration in a conspicuous position at the principal place of business;
- display the registered business name in a conspicuous position on the outside of every place of business, and on all stationery invoices etc; and
- always use the correct registered business name in full; and
- use the correct name in all advertising, invoices and publications.
Business names are registered at Commerce.
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Commerce uses three forms for establishing or changing a business name: Form 1 - Application for registration of a business name [Notices of changes in particulars (eg address, ownership) must be made within one month or a late fee applies.] These forms can be downloaded at www.commerce.wa.gov.au/bnonline. |
A preliminary search to see if a name is currently registered can be done on the National Names Index. This is accessible on the Australian Securities and Investments Commission website. The index lists all Australian corporate and registered names and some incorporated associations.
The fact that a name is not already registered does not necessarily mean, however, that it will be available for registration. A full search for availability can only be undertaken at the time of lodging a form for application. You should not print any material with your desired business name until the name has been registered, in case it is not approved.
4.2 Operating interstate
As incorporated associations are created under State laws, you may encounter problems if your association wants to operate interstate or nationally. A formal application for registration as a Registered Australian Body can be made to the Australian Securities and Investments Commission which, if granted, will give an association recognition outside of Western Australia. The association will be subject to the legal requirements of the Corporations Act 2001 when conducting business interstate.
Please note that the ownership of the business name registered under the Business Names Act 1962 only has effect in Western Australia. If your association is carrying out interstate business under a business name, you will need to apply to register that name in the relevant state.
4.3 Bank signatories
Even if there is no intention to run a business, an association will generally need people who can sign on behalf of the association, set up accounts, sign cheques, etc. Often, although not necessarily, these people are members of the management committee. Sometimes the authorised signatories and signing procedures are nominated in the rules of the association. If the rules do not cover this, the association needs to resolve who the signatories are and the requirements for signing documents and cheques.
Generally, some combination of 3-4 signatures is agreed to provide financial and security safeguards. The necessary paperwork can then be set up with the bank or credit union.
Decisions regarding accounts and signatures should be properly resolved and recorded in the minutes. Resolutions are dealt with in Section 4 - Meetings.
