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How many names does an enterprise need?

The article with title: “How many names does an enterprise need?” written by Lawyer Tran Thanh Tung – Partner of Phuoc & Partners is published in Saigon Economic Times dated 22/07/2010.

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Two names, three names or more?

Presently, according to the Law on Enterprises, an enterprise is allowed to register three names: (i) Name in Vietnamese; (ii) name in foreign language (often called trade name or external trade name) and (iii) abbreviation name. With the regulation stipulating that trade name shall be a corresponding name translated from name in Vietnamese, the enterprise actually has just two names: name in Vietnamese and abbreviation name.

The reason is that the trade name is not stable and subject to the language into which the name is translated – in English it is A, in French it is B, in Japanese it is X, etc.

However, an enterprise practically needs more names, such as name in Vietnamese, name in foreign language, trade name in Vietnamese, trade name in foreign language, abbreviation name in Vietnamese, abbreviation name in foreign language. Some enterprises even use the brand name as a kind of trade name. This is an actual demand that needs to be considered.

A specific case as example: Full name in Vietnamese of “Ngan hang Thuong mai Co phan Cong Thuong Viet Nam” is translated into English as “Vietnam Joint Stock Commercial Bank for Industry and Trade”, the trade name in Vietnamese “Ngan hang Cong Thuong Viet Nam” is translated into English as “Vietnam Bank for Industry and Trade”, and abbreviation name is “Vietinbank”. Furthermore, when refer to this bank, people often call it Ngan hang Cong Thuong. Herein, “Cong thuong” is a distinguishable part of the name of the bank, used as a kind of trade name.

In the aforesaid example, we can see that name of an enterprise is not only encapsulated in the three names allowed by the Law on Enterprises. Note that the specific laws (such as law on credit institutions, law on lawyers, law on notary, etc.) do not bind as tightly as the Law on Enterprises does with regard to the naming; therefore, the enterprises established and operated under the specific laws may have more than three names. This also causes the unfairness, at least in the naming between enterprises under specific laws and ones under the Law on Enterprises. The limitation of three names (which is actually just two) imposed on enterprises by the Law on Enterprises is a tight shirt making the enterprises feel sultry and annoyed.

Enterprise name or trade name?

Apart from names under the Law on Enterprises, enterprises also have another kind of name – trade name, under the Law on Intellectual Property. Trade name is defined by law as the name of the organization or individual used in business to distinguish it from other organizations or individuals in the same business field and area – i.e. the geographical area wherein that organization or individual has got its fellow traders, customers or reputation.

Also according to the law, trade name will be protected if it is distinguishable from names of other organizations or individuals in the same field and business area, such as: (i) contains component parts as proper name (except that proper name is known generally through using); (ii) does not coincide or is not similar to an extent that can cause confusion with a trade name previously used by another one in the same field and business area; (iii) does not coincide or is not similar to an extent that can cause confusion with the brand of another one or with the geographical indication that has been protected in prior to the use of that trade name.

With that regulation, trade name has many features similar to those of enterprise name under the Law on Enterprises. The Law on Enterprises also requires that enterprise name shall have at least two components, i.e. type of enterprise and proper name, as well as the name shall not coincide or cause confusion with a registered enterprise name. In addition, both Law on Enterprises and Law on Intellectual Property do not allow to use names of state agencies, political organizations, socio-political organizations, socio-political-professional organizations, social organizations, socio-professional organizations or other entities as enterprise name or trade name.

However, the question to be raised out is that whether trade name is enterprise name. Currently, there has not been any document confirming this issue. Enterprise name and trade name, although having similar features in the way of naming, are protected in two different ways: enterprise name is protected by the Law on Enterprises as a component part of the enterprise’s legal status, while trade name is protected by the Law on Intellectual Property as an intellectual property object. In addition, the bases for establishing the right to enterprise name and to trade name are different: the right to enterprise name arises when the enterprise is granted with the Business Registration Certificate, while the industrial property rights to the trade name is established on the basis of lawful use without registration with any agency. Therefore, logically speaking, the enterprise name is the trade name, but the trade name is not entirely the enterprise name. The scope of trade name can be wider than enterprise name’s.

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The next question is that whether an enterprise has more than one or only one trade name. This issue is being left open. As the above analysis, the Law on Intellectual Property does not prohibit an enterprise from using two or more trade names at the same time. As such, an enterprise has the right to use more than one trade name, provided that the enterprise can prove the lawful use of its trade names in accordance with the Law on Intellectual Property. Regarding enterprise name and trade name, laws of Australia recognize that enterprises have the right to register their own trade names under Business Name Act and an enterprise may register more than one trade names at the same time. This may be a direction to which Vietnamese law-makers may refer while dealing with the relationship between trade name and enterprise name.

As analyzed above, the owners currently have few options in naming their enterprises under the Law on Enterprises in order to meet reasonable demands of the reality. Furthermore, provisions on name of enterprise is prescribed in both Law on Enterprises and Law on Intellectual Property, and since these two law systems are quite separated, contradiction in the naming and using enterprise name and trade name will obviously arise. Therefore, there should be documents linking and uniting the provisions on enterprise name and trade name in order to help enterprises avoiding complications in using their types of names.

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