Company, Limited Liability Partnership and Business Names (Sensitive Words and Expressions) Regulations 2009

The noble Lord, Lord De Mauley, quite rightly asked why, given our normal aversion to lists—I cannot think where he got that idea from, unless it was the subject of our recent debates together—we have this list. It is because we believe that it is clearer to those who wish to adopt a name. This approach is set out in the Companies Act 2006, as approved by Parliament. It is an extension of that approach and we believe that it is right in today’s circumstances. It may not be ideal but we believe, on a balance of what is best to protect the public, that there is value in the list. Both the noble Lord, Lord De Mauley, and the noble Lord, Lord Cotter, asked about colleges and I shall give a more extensive answer on that issue. From 1 October 2009, it has been an offence under the Companies Act 2006 to carry on business in the UK under a name that gives so misleading an indication of the nature of the activities of the businesses as to be likely to cause harm to the public. The new offence addresses the issue of bogus colleges in a more inclusive and immediate way. We therefore decided against adding "college" to the list of words for which the Secretary of State’s prior approval is required for inclusion in either a company’s registered name or any person’s business name. The issue of bogus colleges being used in visa scams and various other fraudulent activities has been addressed by the creation of the new UK Border Agency register of sponsors, which lists all organisations that the UK Border Agency has approved to employ migrants or sponsor migrant students. We have focused on that area specifically because it is where the major problem occurred. There are hundreds, possibly thousands, of businesses currently trading under names that include the word "college". "College" is used not only by education providers but by many professional bodies—for example, the Royal College of Physicians—as well as by other businesses such as educational suppliers and, believe it or not, pubs. The vast majority do so without any suggestion of harm to the public. If "college" were prescribed, because of the savings provisions in the Companies Act 2006 all businesses that were lawfully using the word in their name on 30 September 2009 would be exempt from the requirement for prior approval. The exemption would also protect any bogus colleges already in existence. However, the new offence will catch all bogus colleges and so offers greater protection. The noble Lord, Lord De Mauley, rightly drew domain names to our attention—in the 21st century, these are as key an asset to a business as the business name. A requirement for prior approval applies to the name used by any person to carry on business in the UK, including domain names. The noble Lord pointed out that for an unincorporated company there was a value in registering it, but I think that that was more by way of comment. I hope that I have addressed all noble Lords’ concerns. I am grateful for their contribution to the debate. We are, I believe, all agreed that the rules for company and business names should be kept to a minimum. The purpose of the regulations is to protect the public from financial or other harm resulting from their being misled by a company or business name. The sensitive words regulations list words and expressions that might be used in names to convey authority, status or pre-eminence. The public authorities regulations list only those where an implied connection might be used to induce vulnerable persons to reveal private information or to make payments. Motion agreed.