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HB 2753 seeks to amend the Business Organizational Code General Provisions of Names of Entities by changing the language from "Identical and Deceptively Similar Names Prohibited" to "Distinguishable Names Required".
A name may only be reserved if it is distinguishable in the Secretary of State's records from: an existing filing entity, the name of a foreign filing entity that is registered under Chapter 9, an assumed name under which a foreign filing entity is registered to transact business in this state under Section 9.004(b)(1) because the foreign filing entity ’s name is not available, a name that is reserved under this subchapter, or a name that is registered under Subchapter D.
HB 2753 also would tighten the exception allowing written consent to make the written consent be officially filed with the Secretary of State, along with a filing instrument that changes the entity’s name or withdraws the reservation or registration of the name, as appropriate (or have submit a final judgment of a court of competent jurisdiction).
This legislation would take effect June 1, 2016.
NOTE: The filing process for consent is addressed by SB 1313 by Kirk Watson. Our recommendations on HB 2753 and SB 1313 are identical.
HB 2753 seeks to modernize the business naming standards in Texas by changing the statutory language from "Identical and Deceptively Similar Names Prohibited" to "Distinguishable Names Required." It tightens up a "consent loophole" by making the consenting entity file an instrument that changes the entity’s name or withdraws the reservation or registration of the name.
These substantive changes are meant to protect businesses and property rights, and to make the filing process more efficient. HB 2753's main goal is to enhance the administrative side of the oftentimes chaotic business-naming process by amending practices to reduce confusion and make for a friendlier business environment in Texas.