1.

Legal and enforcement framework

1.1

Which legislative and regulatory provisions govern franchising in your jurisdiction?

1.2

Do they apply to foreign franchisors entering your jurisdiction or only to domestic franchises?

1.3

Do any special regimes apply in specific sectors?

1.4

Which bodies are responsible for enforcing the applicable laws and regulations? What powers do they have?

1.5

What is the regulator’s general approach in regulating the franchise sector?

1.6

Are there any trade associations for the franchise sector? If so, what are the conditions for membership? What are the commercial implications of not being a member?

2.

Franchise market

2.1

How mature is the franchise sector in your jurisdiction?

2.2

In which sectors is franchising most common?

2.3

Who are the biggest and most successful franchisors in your jurisdiction? How are they typically structured?

3.

Franchising models

3.1

Is master franchising or the multi-unit development model most common in your jurisdiction? Is there a perceptible trend in one direction or the other?

3.2

What other models of franchising are commonly used in your jurisdiction?

3.3

What are the potential advantages and disadvantages of these different models in your jurisdiction?

3.4

What specific considerations should be borne in mind in the case of cross-border franchising into your jurisdiction?

4.

Definitions and scope of application

4.1

How is ‘franchising’ defined in your jurisdiction?

4.2

What are the key requirements that apply to franchising?

4.3

Is registration of the franchise agreement, a trademark licence or other documentation required?

4.4

Are mandatory contract terms imposed?

4.5

What specific activities (if any) are prohibited under the franchising laws and regulations? What are the potential consequences of breach?

5.

Initial steps

5.1

Are there any restrictions on foreign franchisors entering your jurisdiction?

5.2

Are franchisors required to establish a local presence? If so, what is the most common corporate structure adopted by foreign franchisors entering your jurisdiction?

5.3

What requirements or restrictions apply with regard to the selection and recruitment of franchisees?

5.4

Are franchisees subject to any legal obligations when purchasing a franchise?

6.

Disclosure and due diligence

6.1

What pre-contractual disclosure requirements apply to franchisors in your jurisdiction?

6.2

What formal, substantive and procedural requirements apply with regard to the disclosure document in your jurisdiction?

6.3

What pre-contractual disclosure requirements apply to franchisees in your jurisdiction?

6.4

What are the consequences of any breach of the pre-contractual disclosure requirements?

6.5

What other due diligence should the parties undertake before entering into a franchise agreement?

6.6

Are there any restrictions imposed upon franchise brokers in your jurisdiction?

6.7

Are franchisors permitted to provide pre-sale information on operational performance (eg, financial performance representations or earnings claims), or are such statements regulated or banned?

7.

Franchise agreement

7.1

What formal, substantive and procedural requirements apply with regard to the franchise agreement in your jurisdiction? Are there any mandatory terms? What terms are typically included in the agreement?

7.2

Do any specific requirements apply regarding the governing law or jurisdiction of the franchise agreement?

7.3

Does the franchisor have any mandatory rights and obligations under the franchise agreement?

7.4

Does the franchisee have any mandatory rights and obligations under the franchise agreement

7.5

What restrictions can the franchisor impose on the franchisee’s activities under the terms of the franchise agreement (eg, purchasing requirements, non-compete obligations, exclusivity, price control)?

7.6

Is there a duty of good faith imposed upon the franchisor and franchisee?

7.7

What are the parties’ rights and obligations in relation to renewal of the franchise agreement, and what is the process for renewal?

7.8

What formal, substantive and procedural requirements apply with regard to termination of the franchise agreement in your jurisdiction?

7.9

Are there any restrictions on repatriating funds out of your jurisdictions?

7.10

Are there any withholding taxes that apply to franchising in your jurisdiction (not including the effect of double taxation treaties)?

8.

Operational standards

8.1

What legal status does the operations manual have in your jurisdiction?

8.2

How can the franchisor ensure compliance with its operational standards during the term of the franchise agreement?

8.3

Can the franchisor make unilateral changes to its operational standards during the term of the franchise agreement?

9.

Intellectual property

9.1

How are brands protected in your jurisdiction and what specific implications does this have in the franchising context?

9.2

How are other intellectual assets of the franchisor (eg, know-how, trade secrets) protected in your jurisdiction and what specific implications does this have in the franchising context?

10.

Employment

10.1

What is the applicable employment regime in your jurisdiction and what specific implications does this have in the franchising context?

10.2

Can franchisees be deemed to be employees of their franchisor?

11.

Competition

12.

E-commerce

13.

Consumer protection

13.1

What consumer protection measures are applicable in your jurisdiction and what specific implications do these have in the franchising context?

13.2

Are franchisees covered under any of these consumer protection measures?

14.

Data security and cybersecurity

14.1

What is the applicable data protection regime in your jurisdiction and what specific implications does this have in the franchising context?

14.2

What cybersecurity obligations are applicable in your jurisdiction and what specific implications does this have in the franchising context?

15.

Disputes

15.1

In which forums are franchising disputes typically heard in your jurisdiction (ie, courts or arbitration)?

15.2

Is mandatory non-binding mediation commonly used in franchising in your jurisdiction?

15.3

Is arbitration in your jurisdiction subject to any special requirements? Is your jurisdiction a party to the New York Convention?

15.4

Can class actions be brought in your jurisdiction? If so, what specific implications does this have in the franchising context?

15.5

Have there been any recent cases of note?

16.

Trends and predictions

17.

Tips and traps

Comparative Guides

Login to Mondaq.com

Why Register with Mondaq

Your Organisation