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  • 1.

    Types of vehicle
    What forms of business entities are relevant to the typical franchisor?

  • 2.

    Regulation of business formation
    What laws and agencies govern the formation of business entities?

  • 3.

    Requirements for forming a business
    Provide an overview of the requirements for forming and maintaining a business entity.

  • 4.

    Restrictions on foreign investors
    What restrictions apply to foreign business entities and foreign investment?

  • 5.

    Taxation
    Briefly describe the aspects of the tax system relevant to franchisors. How are foreign businesses and individuals taxed?

  • 6.

    Labour and employment
    Are there any relevant labour and employment considerations for typical franchisors?

  • 7.

    Intellectual property
    How are trademarks and know-how protected?

  • 8.

    Real estate
    What are the relevant aspects of the real estate market and real estate law?

  • 9.

    Franchising in the market
    How widespread is franchising in your jurisdiction? In which sectors is franchising common?

  • 10.

    Legal definition
    What is the legal definition of a franchise?

  • 11.

    Franchise laws and agencies
    Which laws and government agencies regulate the offer and sale of franchises?

  • 12.

    Principal franchise requirements
    Describe the relevant requirements of these laws and agencies.

  • 13.

    Exemptions
    What are the exemptions and exclusions from any franchise laws and regulations?

  • 14.

    Franchisor eligibility
    Does any law or regulation create a requirement that must be met before a franchisor may offer franchises?

  • 15.

    Franchisee and supplier selection
    Are there any laws, regulations or government policies that restrict the manner in which a franchisor recruits franchisees or selects its or its franchisees’ suppliers?

  • 16.

    Pre-contractual disclosure
    What is the compliance procedure for making pre-contractual disclosure in your country? How often must the disclosures be updated?

  • 17.

    Pre-sale disclosure to sub-franchisees
    In the case of a sub-franchising structure, who must make pre-sale disclosures to sub-franchisees? If the sub-franchisor must provide disclosure, what must be disclosed concerning the franchisor and the contractual or other relationship between the franchisor and the sub-franchisor?

  • 18.

    Due diligence
    What due diligence should the parties undertake before entering a franchise relationship?

  • 19.

    What must be disclosed
    What information must the disclosure document contain?

  • 20.

    Continuing disclosure
    Is there any obligation for continuing disclosure?

  • 21.

    Disclosure requirements - enforcement
    How do the relevant government agencies enforce the disclosure requirements?

  • 22.

    Disclosure violations - relief for franchisees
    What actions can franchisees take to obtain relief for violations of disclosure requirements? What are the legal remedies for such violations? How are damages calculated? If the franchisee can cancel or rescind the franchise contract, is the franchisee also entitled to reimbursement or damages?

  • 23.

    Disclosure violations - apportionment of liability
    In the case of sub-franchising, how is liability for disclosure violations shared between franchisor and sub-franchisor? Are individual officers, directors and employees of the franchisor or the sub-franchisor exposed to liability? If so, what liability?

  • 24.

    General rules on offer and sale
    In addition to any laws or government agencies that specifically regulate offering and selling franchises, what are the general principles of law that affect the offer and sale of franchises? What other regulations or government agencies or industry codes of conduct may affect the offer and sale of franchises?

  • 25.

    General rules on pre-sale disclosure
    Other than franchise-specific rules on what disclosures a franchisor should make to a potential franchisee or a franchisee should make to a sub-franchisee regarding predecessors, litigation, trademarks, fees, etc, are there any general rules on pre-sale disclosure that might apply to such transactions?

  • 26.

    Fraudulent sale
    What actions may franchisees take if a franchisor engages in fraudulent or deceptive practices in connection with the offer and sale of franchises? How does this protection differ from the protection provided under franchise sales disclosure laws?

  • 27.

    Franchise relationship laws
    Are there specific laws regulating the ongoing relationship between franchisor and franchisee after the franchise contract comes into effect?

  • 28.

    Operational compliance
    What mechanisms are commonly incorporated in agreements to ensure operational compliance and standards?

  • 29.

    Amendment of operational terms
    May the franchisor unilaterally change operational terms and standards during the franchise relationship?

  • 30.

    Other laws affecting franchise relations
    Do other laws affect the franchise relationship?

  • 31.

    Policy affecting franchise relations
    Do other government or trade association policies affect the franchise relationship?

  • 32.

    Termination by franchisor
    In what circumstances may a franchisor terminate a franchise relationship? What are the specific legal restrictions on a franchisor’s ability to terminate a franchise relationship?

  • 33.

    Termination by franchisee
    In what circumstances may a franchisee terminate a franchise relationship?

  • 34.

    Renewal
    How are renewals of franchise agreements usually effected? Do formal or substantive requirements apply?

  • 35.

    Refusal to renew
    May a franchisor refuse to renew the franchise agreement with a franchisee? If yes, in what circumstances may a franchisor refuse to renew?

  • 36.

    Transfer restrictions
    May a franchisor restrict a franchisee’s ability to transfer its franchise or restrict transfers of ownership interests in a franchisee entity?

  • 37.

    Fees
    Are there laws or regulations affecting the nature, amount or payment of fees?

  • 38.

    Usury
    Are there restrictions on the amount of interest that can be charged on overdue payments?

  • 39.

    Foreign exchange controls
    Are there laws or regulations restricting a franchisee’s ability to make payments to a foreign franchisor in the franchisor’s domestic currency?

  • 40.

    Confidentiality covenant enforceability
    Are confidentiality covenants in franchise agreements enforceable?

  • 41.

    Good-faith obligation
    Is there a general legal obligation on parties to deal with each other in good faith during the term of the franchise agreement? If so, how does it affect franchise relationships?

  • 42.

    Franchisees as consumers
    Does any law treat franchisees as consumers for the purposes of consumer protection or other legislation?

  • 43.

    Language of the agreement
    Must disclosure documents and franchise agreements be in the language of your country?

  • 44.

    Restrictions on franchisees
    Describe the types of restrictions placed on the franchisees in franchise contracts.

  • 45.

    Competition law
    Describe the aspects of competition law in your country that are relevant to the typical franchisor. How are they enforced?

  • 46.

    Courts and dispute resolution
    Describe the court system. What types of dispute resolution procedures are available relevant to franchising?

  • 47.

    Arbitration - advantages for franchisors
    Describe the principal advantages and disadvantages of arbitration for foreign franchisors considering doing business in your jurisdiction.

  • 48.

    National treatment
    In what respects, if at all, are foreign franchisors treated differently from domestic franchisors?

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