National Regulation by country

Spip national legislation TABLE (before change in July 2010)

TABLE 1. LEGISLATION in the EU MEMBER STATES which DIRECTLY AFFECTS FRANCHISING

Country Reference of legislation Comment Link to the national franchise association website
FRANCE a) Loi n° 89-1008 du 31 décembre 1989 relative au développement des entreprises commerciales et artisanales et à l’amélioration de leur environnement économique, juridique et social (commonly called the « Loi Doubin »)
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Version in French

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Version in English source: Journal of International Franchising & Distribution, June 1991

b)Loi Doubin as consolidated on October 30 2007

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Version in French

c)Décret n° 91-337 du 4 avril 1991 portant application de l’article 1er de la loi n° 89-1008 du 31 décembre 1989 relative au développement des entreprises commerciales et artisanales et à l’amélioration de leur environnement économique, juridique et social

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Version in English
Pre-contractual legislation aimed at trade and commercial enterprises and networks. Includes franchise networks but is not exclusive to franchising.

the Loi Doubin relates to all forms of commercial partnerships whose contracts contain “tie clauses” (exclusivity clauses). This may be the case of franchise contracts which is why franchising is covered by this law, but the law is not exclusive to franchising.

The French Franchise Federation (FFF)conforms to the European Code of Ethics for Franchising (1972). In addition, it has adopted its own supplementary ethical provisions which apply to the members of the FFF.
SPAIN a) Ley 7/1996, de 15 de enero, de Ordenación del Comercio Minorista, Boletín Oficial del Estado, 15 del 17 gennaio 1996, Regulation of Retail Trading

b) Real decreto 2485/1998 de 13 de noviembre, por el que se desarrolla el artículo 62 de la Ley 7/1996, de 15 de enero, de Ordenación del Comercio Minorista, relativo a la regulación del régimen de franquicia, y se crea el Registro de Franquiciadores. Replaced by c) below

c) the decree was amended by Royal Decree N° 419/2006 of 7 April 2006 (Boletín Oficial del Estado, number 100 of 27 April 2006) which modifies Real Decreto 2485/1998 de 13 de noviembre, relativo a la regulación del régimen de franquicia y el registro de franquiciadores. Replaced by d) below

d) the decree was again amended by Royal Decree N° 201/2010 of 26th February 2010 por el que se regula el ejercicio de la actividad comercial en régimen de franquicia y la communicacion de datos al registro de franquiciadores. Version in Spanish:

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This law implements a pre-contractual disclosure obligation which targets trade and commercial enterprises and networks. It is similar in spirit to the French Loi Doubin, but is specific to franchising, which it defines.

Spain also requires that all franchise systems (national or foreign) operating on its territory be registered in a dedicated franchise registry.

The Spanish French Franchise (AEF) Federation conforms to the European Code of Ethics for Franchising (1972). In addition, it has adopted its own supplementary ethical provisions which apply to the members of the AEF.
ITALY Legge 6 maggio 2004 no. 129 : Norme per la disciplina dell’affiliazione commerciale
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_Versions in English

Decreto 2 settembre 2005, N° 204 :
Regolamento Recante Norme per la Disciplina Dell’Affiliazione commerciale du cui all’articolo 4,comma 2, della legge 6 maggio 2004, N° 129

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Version in English
Pre-contractual legislation aimed at commercial enterprises operating through networks of affiliated partners.
Similar in spirit to the French Loi Doubin

Frame law + its decree: similar in purpose to the French “Loi Doubin”

The Italian French Franchise (AIF) Federation conforms to the European Code of Ethics for Franchising (1972).
BELGIUM Applicable as of 01.01.2006 – Doc 51/1687/
Law on pre-contractual information in the framework of agreements of commercial partnership
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Version in English
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Version in French

Pre-contractual legislation aimed at enterprises operating through networks of commercial partners. Similar in spirit to the French Loi Doubin.
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Application Decree in French A mechanism for the revision of the law exists in the shape of an "Arbitration Committee". Its role is to assess the efficiency of the law as to its objectives and to suggest means of improving the law to better fit its objectives. This committee is made up of representatives of the government, the franchise community (franchisor and franchisees), legal experts, trade organisations.
PDF - 125.8 kb

Similar in purpose to the French “Loi Doubin”

The Belgian Franchise Federation (BFF) conforms to the European Code of Ethics for Franchising (1972).
SWEDEN Law N° 2006/484 applicable as of May 24, 2006
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Version in Swedish and English
Law on the Duty of a Franchisor to provide pre-contractual information The Swedish French Franchise (SFF) Federation conforms to the European Code of Ethics for Franchising (1972).
LITHUANIA 1 July 2001: In Chapter XXXVII, Vol. 6 of the new Civil Code of the Republic of Lithuania . Articles 6.766 – 6.779 relate to franchising. (1 Civil Code of the Republic of Lithuania No 74 of 6 September 2000.)
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Verion in English
This legislation is the exact copy of the Russian legislation for franchising (see below), except that in Lithuania, the CC speaks of “franchising” whereas in the Russian law, it refers to “commercial concession”

TABLE 2. LEGISLATION in the NON-EU countries which DIRECTLY AFFECTS FRANCHISING

Country Reference of legislation Comment Link to the national franchise association website
ALBANIA a) 1994 Civil Code (Kodi Civil i Republikës së Shqipërisë (Miratuar me ligjin nr. 7850, datë 29.7.1994)

b) Lege pentru aprobarea Ordonantei Guvernului N° 52/1997 privind regumul al franchisei

c) Decret privind promulgarea Lege pentru aprobarea Ordonantei Guvernului N° 52/1997 privind regumul al franchisei

AUSTRALIA a) 1974, Trade Practices Act (TPA)

b) July 1,1998, the TPA includes a Franchising Code
The Australian Competition and Consumer Commission (ACCC) oversees and regulates these matters.

c) The Code was amended in 2001 and may be reviewed again.

The Franchising Code instores:
- Disclosure of the pertinent information regarding the Franchisor
- Conditions contained within the Franchise Agreement
- Complaint handling and dispute resolution procedures
The Franchise Council of Australia endorses the Franchising Code of Conduct
BRAZIL Lei n. 8.955 de 15 de dezembro de 1994, enacted in 1995
Dispõe sobre o contrato de franquia empresarial (“franchising”), e dá outras providências
Covers disclosure The Brazilian Franchise Association
CANADA a) there is no federal legislation regulating the offer and sale of franchises, but

b) certain provinces do have franchise legislation:
- Alberta Act
- Ontario Act
- Prince Edward Island Act
- New Brunswick Act Collectively known as the [Canadian Franchise Acts>http://www.gov.pe.ca/law/regulation...]
- Quebec Civil Code

c) the ULCC (Uniform Law Conference of Canada) approved a Uniform Franchises Act in 2005 as well as a model Disclosure Regulation and Mediation Regulation.

The Canadian Franchise Association
CHINA 1 May 2007: Regulation for the Administration of Commercial Franchises
In complement, there are the
- Regulations for the Information Disclosure of Commercial Franchises, and the
- Regulations for the Archival Filing of Commercial Franchises The Ministry of Commerce (MOFCOM) and its provincial equivalents govern these matters.
CCFA
INDIA There are no specific laws governing franchising in India, except that the Finance Act, Chatper 5 (tax matters) gives a definition of franchising. FAI
INDONESIA a) Regulation N° 16:1997 on Franchising (Regulation Nr. 16)

b) Decree No. 259/MPP/Kep/7/1997, of 30 July 1997of the Minister of Industry and Trade Concerning the Provisions on and the Procedure for the Implementation of Franchised Business Registration.

Disclosure and relationship provisions Indonesian Franchise Association (AFI)
JAPAN There is no uniform definition of franchising in Japan but
a) if a franchise business falls under the term "chaining business", it falls under the Medium and Small retail Commerce Promotion Act (Law N° 110, 1973 – MSRCPA)

b) Franchise Guidelines under the Act concerning the Prohibition of Private Monopolisation and Maintenance of Fair Trade (Law N° 54, 1947), reviewed on April 24, 2002.

c) November 2005, Ord. on the Unfair trade practices in transactions by large retailers with its suppliers (replaces the Ord. on the Unfair trade practices in transactions by Department Stores)

c) the ordinance affects large retailers and, as the case may be, their franchisees The Japanese Franchise Association (JFA) provides a definition of franchising.
KOREA a) 1 November 2002, amended on 3 August 2007: Fairness in Franchise Transactions in Franchise Business Act (Franchise Act)

b) 1997: Guidelines on International contracts passed by the Korean Fair Trade Commission which regulates franchising in Korea

Korean Franchise Association
MALAYSIA 8 October 1999, The Franchise Act.
The offer and sale of franchises in Malaysia is regulated by the Ministry of Entrepreneurial and Cooperative Development. Requirement for franchise businesses to be registered before offering franchises for sale.
Malaysian Franchise Association
MEXICO a) Industrial Property Law/ Ley de la Propriedad Industrial, art. 142 defines franchising + pre-contractual disclosure Ley de la Propriedad Industrial, in Diario Oficial, 27 June 1991, effective as of 28 June 1991 amended in 2006.

b) Reglamento de la Ley de la Propriedad Industrial, in Diario Oficial, 23 November 1994. Brings into effect on 8 December 1994the Law of 1991.

Pre-contractual disclosure requirements + filing of franchisor information + registration of trademark rights which are transmitted to the franchisee. Mexican Franchise Association
PHILIPPINES Industrial Property Code, section 4.2, sections 87-92; Philippines Franchise Association
ROMANIA Ordinance Nr. 52/1997 of 28.8.1997 on the legal regime governing franchising; published in the Official Monitor, 13 April 1998, Year X, Nr. 147 Covers disclosure
RUSSIA Civil Code, Chapter 54, articles 1027-1040
and Chapter 69, articles 1235-1238
Russian Franchise Association
UKRAINE Civil Code, Chapter 76 (articles 1115-1129): chapter on "Commercial concession" which also means franchising Similar approach to the Russian Commercial Concession (Civil & Commercial Codes)
USA a) at Federal level:
FTC’s Rule on Franchising was revised end of January 2007; in force as of July 1, 2008.

b) at State level:
14 States have either registration and/or disclosure laws;
20 States have franchise relationship laws (termination, renewal and transfer of franchise rights).

International Franchise Association (IFA)
VIETNAM a) 2006: Commercial Law which came into effect o¬n January 1, 2006

b) 2006: Government Decree n° 35-2006-ND-CP dated March 31, 2006 which provides details o¬n Implementation of Commercial Law with Respect to Franchising Activities and

c) 2006: Trade Ministry Circular n° 9-2006-TT-BTM dated May 25, 2006 which provides Guidelines o¬n Registration of Franchising Activities.

Covers both disclosure and relationship issues (ie. termination).
Requires reciprocal disclosure from parties: franchisor to franchisee and franchisee to franchisor. Registration requirements.