New rules on CIO/SCIO names
This update has been sent by voluntary sector legal expert Sandy Adirondack.
For all CIOs/SCIOs: Inclusion in index of company names
Since 1 January 2018 the names of all charitable incorporated organisations registered in England and Wales (CIOs) and Scottish CIOs (SCIOs) are included in the index of company names maintained by Companies House, even though CIOs and SCIOs are not companies. The index already includes names of all companies registered in the UK, as well as community benefit societies, registered co-operatives and other incorporated bodies, and CIOs/SCIOs are now included as well.
Inclusion in the index will help protect CIOs and SCIOs from a company or other CIO/SCIO using the same or a too-similar name, because an organisation in the index cannot have a name which is the same as, or too similar to, another organisation in the index. This is a good thing, but means that a CIO, SCIO or company will not be allowed to use a name already on the register. For example if a charitable company is registered as St Mary’s Nursery, a CIO or SCIO could not be registered with that name and might have to put its location or some other distinguishing word in its name.
Anyone planning to set up (or change the name of) a CIO, SCIO, company, community benefit society or co-operative should always check the index of company names to be sure the name is not already in use. (Similarly, anyone setting up or changing the name of any charity – whether incorporated or unincorporated – should check the Charity Commission and OSCR registers to be sure the charity name is not already in use.)
To search the index of company names, click on ‘Find a company’ at www.companieshouse.gov.uk. For CIOs and SCIOs, there will be a separate number on the index of company names, starting with CE for CIOs registered in England and Wales, and CS for SCIOs, in addition to their registration numbers with the Charity Commission or Office of the Scottish Charity Regulator (OSCR). This CE/CS number is purely for purposes of the company names index; it should not be used by the CIO/SCIO and should not be included on headed paper, websites, emails and other documents where a registered number is displayed; these documents should include only the Charity Commission or OSCR registration number. (This does not apply to charitable companies. Their headed paper etc must include both their charity number and company number, as they have two separate registrations.)
The Charity Commission, in its guidance on CIO names, refers to the index of company names as the index of business names, but this is not its proper name. Under company law, a business name is a trading name or operating name that is not the company’s registered name. OSCR refers to the index by its full name, the registrar’s index of company names. ‘Registrar’ here refers to the registrar of companies.
For new CIOs/SCIOs: Companies House approval for name
A significant downside of the new rules is that CIOs and SCIOs registering since 1 January 2018 which want to use a “sensitive word or expression”, as defined in company law, in their name will need to get a statement from Companies House before applying to the Charity Commission or OSCR for registration. The Charity Commission refers to this as a statement of non-objection, while OSCR refers to it as Companies House approval or permission. Some words or expressions also require a statement of non-objection from another body or government department; for example a name which includes ‘fund’ or ‘bank’ in its name would need a statement from the Financial Conduct Authority.
The Resources section below has links to Charity Commission and OSCR guidance for obtaining the necessary statements from Companies House and (if required) other bodies, and links to Companies House guidance on sensitive words and expressions, with lists of the words and expressions and what needs to be sent to Companies House when applying for the statement.
Sensitive words include association, British, charitable, charity, federation, foundation, fund, society, trust and many others that might be used in CIO/SCIO names, so anyone setting up a CIO/SCIO needs to be aware of the rules. Where a statement or statements of non-objection/approval are required, they should be included in the Name section of the application form. An application to set up a CIO or SCIO which does not include the necessary statement(s) of non-objection or approval cannot be processed.
The Commission’s guidance says the Companies House statement is not required where the only sensitive word in a proposed CIO name is association, charitable, charity, foundation or trust. An email sent out by the Charity Commission’s registration team on 1 February refers only to charity and charitable as not needing CC consent; this appears to be incorrect in relation to CIOs. However, for SCIOs, the FAQs linked to OSCR’s guidance say that only charity or charitable do not need the statement. The other words do need it.
And the whole point of CIOs/SCIOs was that they were supposed to give charities the benefits of limited liability and legal personality without having to comply with the burdens of company law!
For more see Sandy Adirondack’s legal update website.