A closer look at the intention to introduce franchising legislation
On May 23rd, State Secretary Mona Keijzer informed the House of Representatives about the imminent franchise legislation. The National Franchise Guide previously published this article.
From a democratic perspective, it is a good thing that the choice has now been made to introduce formal legislation instead of an order in council. With this, the franchise relationship seems to be moving from the unnamed to the agreements named in law. That choice alone has legal consequences in the case of mixed agreements. The named agreement will take precedence from now on.
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Developments in competition law
Some time ago, the Netherlands Competition Authority (NMa) made a groundbreaking ruling that is of great importance to all franchise organizations in the Netherlands.
Transfer Arrangements
Franchise agreements usually include transfer arrangements
The right to the formula name upon termination of the franchise relationship
In practice, discussions regularly occur when the franchise relationship is terminated between a franchisor and one or more franchisees
The possibility of actively or not actively recruiting customers outside
Based on the relevant regulations, active recruitment activities by the franchisee are permitted
Customers, clientele and exceptions thereto
Some franchise constructions have the characteristic that the products or services in question are only supplied to certain consumers.
Intellectual property rights
In general, the nature of a franchise relationship implies that, on the basis of a franchise agreement