« back

Business Law FLASHPOINTS May 2020

May 15, 2020Print This Post Print This Post

Donna M. Goelz, Howard & Howard Attorneys PLLC, Peoria
309-999-6324 | E-mail Donna M. Goelz

Below is an excerpt from §4.6 of BUSINESS LAW: CHOICE OF ENTITY (IICLE®, 2020).

Limitations in Selecting a Corporate Name in Illinois

The Business Corporation Act of 1983 imposes several limitations on the choice of a corporate name. For example, the name

  1. must contain the word “corporation,” “company,” “incorporated,” or “limited” or an abbreviation of one of the words;

  2. must not contain any word or phrase that indicates or implies that the corporation is organized to engage in a business that requires incorporation under a special statute (e.g., “housing,” “bank,” “savings and loan,” “trust,” “insurance,” “assurance,” “benefit,” “indemnity,” “railroad”); and

  3. must be distinguishable on the records in the office of the Secretary of State from the name of an existing Illinois corporation or Illinois limited liability company, the name of a foreign corporation or foreign LLC authorized to do business in Illinois, a name that has been reserved, or the assumed name of any corporation or LLC. 805 ILCS 5/4.05(a). (The corporate names need to be different but not significantly different. The name’s distinguishability only need be recognizable, not plainly so. Sound is expressly not considered in determining distinguishability. Punctuation will not distinguish two corporate names. 14 Ill.Admin. Code pt. 150, subpart D.)

A proposed name should be checked early in the incorporation process to determine whether it is available for use by the corporation. This can be done by reviewing the Certified List of Domestic and Foreign Corporations published annually by the Illinois Secretary of State and by contacting the Secretary of State’s Department of Business Services. The recorder’s office may also be checked to determine whether a similar partnership or assumed name has been filed. The Illinois Secretary of State’s online Corporation/LLC Database at www.cyberdriveillinois.com/departments/business_services/corp.html can also be searched for name availability. The search engine will produce similar names that are already registered with the Secretary of State. There is also the option of e-mailing the name request by clicking on the e-mail link located on the same website or by calling the Department of Business Services (217-782-6961) to verify name availability. This service should be used only as a starting point in determining a corporation’s name and should not be used in lieu of the other steps discussed above.

However, a name check with the Department of Business Services does not guarantee availability of the name. The Department of Business Services reserves final decision on availability until a name reservation form or articles of incorporation have been filed. Accordingly, after selecting and clearing the corporate name, it may be prudent to formally reserve the name for use by the corporation. This can be accomplished in Illinois by filing an application (Form BCA 4.10, Application for Reservation of Name, available at www.cyberdriveillinois.com/publications/pdf_publications/bca410.pdf) and paying the $25 filing fee. The name will be reserved for a period of 90 days, and the reservation may be renewed.

For more information about business law, see BUSINESS LAW: CHOICE OF ENTITY (IICLE®, 2020). Online Library subscribers can view it for free by clicking here. If you don’t currently subscribe to the Online Library, visit www.iicle.com/subscriptions.

Subscribe to FLASHPOINTSFree monthly e-updates in 15 practice areas.