Yes, there can be multiple accounts with the same name.
You can choose any name you want as long as:
- it isn't offensive (e.g. stuffing insults into your user name will cause moderators to forcibly rename you and suspend you);
- you aren't impersonating someone. (Terms of service §4: “Under no circumstances will Subscriber use the Network or the Service to (…) (c) create a false identity or to impersonate another person”.)
Impersonation implies an element of confusion. It's ok to use the same username as someone else — for example, there are many users who go by their first name alone, which triggers many collisions, and that's fine. It's not ok to use someone's name and avatar: that shows a deliberate attempt to pass for another user.
Stéphane Chazelas (the original) writes his username with the Unicode character U+00E9 LATIN SMALL LETTER E WITH ACUTE. Stéphane Chazelas (the newcomer) uses U+0065 LATIN SMALL LETTER E followed by U+0301 COMBINING ACUTE ACCENT. These are two ways to encode the same text in Unicode.
Note that in this case, the newcomer is the same person as the original, so this is not a case of impersonation. It's ok for someone to have two accounts as long as the accounts don't interact (no voting on each other's posts, etc.) — it's tricky to carry out, and the Stack Exchange team declines responsibility if the accounts end up being merged, but it isn't against the rules.