In the case of a sole proprietorship, if the business name differs from the owner's legal name, James is generally required to register the business name (often referred to as a "DBA" or "Doing Business As") with his local or state authorities. Therefore, the most accurate response from the options given would be:
James will need to register the business with his local city as the name of his business differs from his own.
The specific requirements for registration can vary depending on the local laws and regulations.