Franchising

Note: a description about Franchising is also available in the Competition Law Portal of the European Encyclopedia of Law.

Franchising in the European Antitrust Law

Meaning of Franchising provided by the “Glossary of terms used in EU competition policy” (European Commission. Directorate-General for Competition. Luxembourg: Office for Official Publications of the European Communities, cop. 2002): A special type of agreement whereby one undertaking (the franchiser) grants to the other (the franchisee), in exchange for direct or indirect financial consideration, the right to exploit a package of industrial or intellectual property rights (franchise) for the purposes of producing and/or marketing specified types of goods and/or services. This package typically relates to trademarks, trade names, shop signs, utility models, designs, copyrights, know-how or patents. A franchise agreement usually contains obligations relating to (1) the use of a common name/shop sign and a uniform presentation of contract premises and/or means of transport, (2) the communication by the franchiser to the franchisee of know-how, (3) the continuing provision by the franchiser to the franchisee of commercial and technical assistance during the life of the agreement.