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Trade name and legal name are often misused and sometimes lead to confusion to users.  Some business owners assume that their chosen business name and the name that they had registered to the state has unlimited use in relation to their business.  It may look or sound the same but we ask, is there any difference?  Will it have legal implications?  Understanding both concepts can give us directions on its proper usage and also to better represent the company. Working with Murray Priestley would help you get a plan of action that supports your business goals.

A trade name is what a company generally considers to engage in business dealings.  It is mostly for advertising and marketing purposes of the company to be distinguished from the rest of the companies.  The trade name supports the impact of memory and choice when it comes to advertising.  Thus, having a trade name that stands out is mainly for marketing purposes.

A trade name is also known as a ‘fictitious name’ or ‘doing business as’ (DBA).  As such, the trade name does not include ‘legal endings’ like Inc., LLC or Corp.  Most often, the trade name is what the general public sees or being oriented.  It is what we see on the signs, online pages and mostly in advertisements.

With the growing number of businesses, the right to use a trade name is being accorded to whoever has used it first publicly, the first to make the trade name visible and has continuous use of the same trade name.

On the other hand, a company’s legal name is the name of a person or an entity that owns the business.  When a business is a partnership, the legal name applied is what was provided in the partnership agreement.  It could be the last names of the partners.  For limited liability companies (LLCs) and corporations, a business’ legal name is the registered name with the state government.  More often, these names have ‘legal ending’ such as LLC, Inc. or LLP.

Simply put, the legal name is used in the articles of association and the name registered with the state government.  The legal name is mainly used to identify the legal person or an entity unlike the trade name which has a marketing purpose.  More importantly, the legal name is applied when communicating with the government or other businesses.  For instance, a legal name should be use when filing for tax returns, applying for government permits, property acquisition, using bank check payments and the like.

To site the difference, the American multi-technology company known publicly as Apple has the legal name of Apple Inc.  Canada-based telecommunication and wireless equipment company identified as Blackberry currently uses the legal name Blackberry Limited.  It was formerly known as Research In Motion Limited.  Garmin is the company recognized for its wearable GPS technology on sports activities and utilities.  It uses Garmin Ltd. as its legal name.  And the company that concentrates on imaging products and commonly known as Kodak has the legal name of Eastman Kodak Company.

Based on the examples, it can possible that the same legal name and trade name is used for consistency and oneness of the brand that the company carries.