I have been in the restaurant business for the last 30 years. Six months ago, another restaurant opened next to me. The restaurant’s name is the Kula Chakula bila Mafuta Restaurant. In English, this means “Come eat fat-free food restaurant”. The restaurant’s name may say it is fat-free food, but it sells deep-fried chicken, chips, chips mayai, everything that has fat in it. I do not mind competing with the restaurant. However, its name is creating confusion amongst people, who end up going there believing that the food is fat-free. Is this name not misleading to people, and what can I do about it? My second question is: can a company, after registration, change its name?
2 January 2012
The Companies Act may come to your protection if, in the Minister of Trades and Industries’ opinion, the registered name of a company gives so misleading an indication of the nature of its activities that it is likely to cause harm to the public. If so, the Minister may direct the company to change its name.
If such a direction is not challenged in Court, then the Minister’s direction must be complied with within six weeks from the date of the direction, or such longer period as the Registrar of Companies may think fit to allow.
The Companies Act further states that the company may, within three weeks from the date of such a direction, apply to the Court to set the direction aside. If this happens, the Court may set the direction aside or confirm it. If the Court confirms the direction, then it shall specify a period within which the direction must be complied with. If a company fails to company with such a direction, it is liable to a fine and for continued contravention to a default fine.
Our advice is that you should write to the Minister of Trade and Industries. You should explain the situation, and stress the harm that, in your opinion, this misleading restaurant name is causing to the public.
We answer your second question in the affirmative: a company may, by special resolution, and with the approval of the Registrar, signified in writing, change its name. If the Registrar refuses to give their approval, they shall give their reasons for doing so. The Registrar shall enter the new name on the register in place of the former name. They shall also issue the company a certificate of change of name, and shall notify the name change in the Gazette.
It must be noted that a change of name by a company, under any of the circumstances described above, shall not affect any rights or obligations of the company. Nor shall it
render defective any legal proceedings initiated by or against the company. Any legal proceedings that might have been continued or commenced against a company by reference to its former name may be continued or commenced against it by reference to its new name.