Submitted by UCS on November 15, 2019

Name issues – A name is just a name, right?

“It ain’t what they call you, it’s what you answer to.”
― W.C. Fields

Choosing a name for your company? It will be one of the biggest decisions you’ll make when incorporating, because so much rides on the name you choose. It needs to be unique, but not so unique it can’t be pronounced. It should reflect the caliber of company you intend to create but shouldn’t be cliché’. The name choices are endless, but are there names you can’t choose? Are there words that are off limits? The answer to both these questions is “Yes”.

Delaware, along with most other states have regulations or rules regarding name restrictions. For Delaware, some restrictions depend on the type of entity you want to form (Corporation vs. Limited Liability Company) or on the purpose of the company. For example, an LLC could have the word “Trust” in their name, but a corporation could not unless it has the approval of the Bank Commissioner.

• Banks must be approved by the Bank Commissioner.
• Degree granting institutions must be approved by the Department of Public Instruction. Using the words “University” or “School” but don’t intend to grant degrees, your specific purpose must reflect that.
• The Insurance Commissioner is notified whenever an insurance company is formed and after the formation of any corporate name with the following words: Assurance, Bond, Bonding, Casualty, Fidelity, Guaranty, Healthplan, HMO, Indemnity, Insurance, RE, Reassurance, Risk, Risk Retention, Surety, Surplus Lines and Underwriters.
• Punctuation…for the most part if it can be found on a standard keyboard it is generally accepted by the Division. However, the following are not:
  • [] square brackets
  • ^ Upward arrow
  • % percentage sign
  • _ Underscore

The Delaware Division of Corporations is finalizing an internal policy for reviews of business entity names. The purpose of the policy is to update and clarify the standards in Delaware regarding the names of businesses, while preventing the naming of a business likely to mislead the public or to lead to a pattern and practice of abuse that might cause harm to the interests of the public or State of Delaware. The standards are that an entity:

• Does not contain words that discriminate against, disparage, or denigrate any of the protected classes, as provided under Federal Law (including the U.S. Civil Rights Act of 1964, as amended), to include but not limited to race, color, religion, sex including pregnancy, sexual orientation, national origin, disability, age (40 years or older), marital status or genetic information;
• Does not contain words that could facilitate, incite or foster any criminal act or offense as prohibited under Delaware law, as amended, to include but not be limited to those set forth in Title 11 of the Delaware Code:
  • Acts of terrorism, terroristic threatening or offensive touching (11 Del. C. Ch. 5)
  • Endanger the life or physical safety of an individual or threatening public safety (11 Del. C. Ch. 5);
  • Hate Crimes, Stalking, Cyberstalking, Bullying or Cyberbullying (11 Del. C. Ch. 5);
  • Narcotic drug, opioid or controlled substances (16 Del. C. Ch. 47) (Example: “Opioids-R-Us”);
  • Fraud (6 Del. C. Subtitle II, 11 Del. C. Ch. 5); or
  • Deadly weapon or dangerous instrument (11 Del. C. Ch. 5).
  • Obscene or libelous language (11 Del. C. Ch. 5);
• Does not contain words that could cause potential public deception or confusion or difficulty in administration (Example: five-hundred-letter entity name);
• Does not contain words likely to mislead the public about the nature of the business entity (8 Del. C. § 102; 6 Del. C. § 18-102 ); or
• Does not contain words likely to lead to a pattern and practice of abuse that might cause harm to the interests of the public or Delaware (8 Del. C. § 102; 6 Del. C. § 18-102).

UCS will provide an update once the Delaware Secretary of State finalizes the regulations. If you have questions about names that are acceptable in Delaware or anywhere across the United States, please contact you’re Customer Service Representative to discuss the possibilities for your corporate name.

About the Contributor to this Blog
Paula Lintner is the Delaware Branch Manager for United Corporate Services, Inc. Over the past 22 years, Paula has assisted hundreds of small business owners fulfill their dream of starting their own business. Additionally, Paula helps paralegals and attorneys navigate through the details of Delaware corporate transactions, as well as contributing to the product and process development within the teams she has been a part of. Her experiences and expertise have allowed her to develop an invaluable relationship with the Delaware Division of Corporations staff which she shares with all UCS clients.

Have a question or a suggestion for a blog? Contact Paula at paula.lintner@unitedcorporate.com.