Suspension post non-competition clause in Bruna franchise agreement

On 25 September 2015, the preliminary relief judge of the Utrecht District Court suspended the post-non-compete clause in a Bruna franchise agreement.

Bruna had indicated that it no longer wanted any connection with the location. At Bruna’s request, the franchisee had become the tenant of the retail property, instead of Bruna. Subsequently, Bruna had terminated the franchise agreement. The franchisee wished to continue the business under its own name. However, Bruna forbade this with reference to the post-non-compete clause.

The franchisee stated that Bruna had no interest in invoking the post non-compete clause. After all, she did not find the location interesting. The preliminary relief judge ruled in favor of the franchisee. In all fairness, Bruna has no legal interest to be respected in adhering to the post-non-competition clause.

Last year, on 16 July 2014 (ECLI:NL:RBDHA:2014:8667), Bruna was also rightly pointed out in this way that if and as long as it does not itself establish a Bruna store in the business premises, after termination of the franchise agreement, it cannot require the entrepreneur to comply with the non-competition prohibition.

If a franchisor wishes to withdraw from a certain location, this would seem to provide an opportunity for franchisees to set aside the post-non-compete clause. However, this will strongly depend on the specific franchise formula.

mr. AW Dolphijn – Franchise lawyer

Ludwig & Van Dam Franchise attorneys, franchise legal advice. Do you want to respond? Mail to dolphijn@ludwigvandam.nl