In practice, various forms of consultation circulate between franchisor and franchisee. This consultation is often structured in the form of accompanying regulations. We know these regulations in many shapes and sizes.

Good Franchise Council regulations are characterized by the possibility of allowing proportional and possibly regional representation to participate in the Franchise Council. Ideally, these members of the franchise council can be nominated or elected by their own supporters. However, it is certain to set up exaggerated regulations too elaborately. Good Franchise Council regulations are no more than a vehicle for the proper functioning of the Franchise Council. Franchise council regulations that are overly enthusiastic must be prevented from ending up in endless meeting sessions, both nationally and regionally. The question arises who benefits from this. The authority of the council itself is also central to various franchise regulations. Does the franchise council have advisory powers or can it actually force decisions by means of far-reaching control or, for example, a right of veto?

Linked to this is also the principle of the representative authority of the franchise council for the benefit of all franchisees. In practice, there is still the idea that the franchise council can simply bind the supporters. However, without very explicitly defined powers of the individual franchisee with regard to this power, this is by no means the case. When a franchisor makes agreements with the franchise council regarding a restyling, the individual franchisee is therefore not bound by this, unless this has been expressly agreed between the franchise council and the franchisee. Franchise rules don’t have to be too complicated. The regulations are short, practical and unambiguous. Composition and authority are easy to formulate. In any case, it must be prevented that the regulations are a prelude to Polish country days and thus completely overshoot their goal. The same also applies to the functioning of the franchise council itself.

Ludwig & Van Dam franchise attorneys, franchise legal advice

Other messages

Ludwig & Van Dam in Distrifood about the future of independent supermarket entrepreneurs

However, many retailers are now at a loss due to ...

No standstill period for prior collaboration based on the same formula

On December 29, 2023, ECLI:NL:RBDHA:2023:20931, the District Court of The ...

Go to Top