Legal Subtleties of Opening a Franchise Business
Posted: Thu Jan 23, 2025 9:18 am
In accordance with Russian legislation, the franchisor and franchisee may enter into a commercial concession contract or a licensing agreement.
A commercial concession agreement involves the transfer of a certain set of exclusive rights from the copyright holder to the user, i.e. from the franchisor to the franchisee. An integral part of the agreement is the granting of rights to use the trademark.
To legally carry out business activities japan mobile phone numbers database under a franchise, it is necessary to register the transfer of rights to use a trademark and a set of exclusive rights with Rospatent.
Without this stage, in the event of a conflict between the parties, the court will not be able to apply the rules of franchising regulation. It is especially important for the owner to pay attention to this, because if there is no registration of the transfer of rights to the brand and intellectual property, the court may oblige the return of all payments that the person paid during the period of use, even if he successfully used these services and received income from them.
Legal Subtleties of Opening a Franchise Business
The commercial concession agreement also specifies other rights granted by the franchisor: to use databases, computer programs, inventions, etc. The document may specify restrictions for both parties: a ban on competition between them, setting a pricing policy, and the obligation to transfer payments for participation in advertising campaigns. This agreement can only be concluded between legal entities or individuals (individual entrepreneurs, sole proprietors).
If the owner is not ready to transfer the right to use the trademark to the franchisee (or it is not registered), then a license agreement is applied. Under the contract, the franchisee receives the right to use various objects of the seller's intellectual property (IT system, working methods and logo). A license agreement can be concluded between individual entrepreneurs, legal entities and individuals.
The main difference between a license agreement and a commercial concession is that the latter involves close cooperation (for example, quality control of services by the franchisor). The former grants the franchisee only the right to use certain intellectual property of the seller.
To address this deficiency, additional supply and service contracts may be added to the document to further define the owner's obligations to sell goods or advise partners.
Regardless of the form of the agreement, before signing it, the franchisee and the franchisor must discuss in detail the terms of interaction.
A commercial concession agreement involves the transfer of a certain set of exclusive rights from the copyright holder to the user, i.e. from the franchisor to the franchisee. An integral part of the agreement is the granting of rights to use the trademark.
To legally carry out business activities japan mobile phone numbers database under a franchise, it is necessary to register the transfer of rights to use a trademark and a set of exclusive rights with Rospatent.
Without this stage, in the event of a conflict between the parties, the court will not be able to apply the rules of franchising regulation. It is especially important for the owner to pay attention to this, because if there is no registration of the transfer of rights to the brand and intellectual property, the court may oblige the return of all payments that the person paid during the period of use, even if he successfully used these services and received income from them.
Legal Subtleties of Opening a Franchise Business
The commercial concession agreement also specifies other rights granted by the franchisor: to use databases, computer programs, inventions, etc. The document may specify restrictions for both parties: a ban on competition between them, setting a pricing policy, and the obligation to transfer payments for participation in advertising campaigns. This agreement can only be concluded between legal entities or individuals (individual entrepreneurs, sole proprietors).
If the owner is not ready to transfer the right to use the trademark to the franchisee (or it is not registered), then a license agreement is applied. Under the contract, the franchisee receives the right to use various objects of the seller's intellectual property (IT system, working methods and logo). A license agreement can be concluded between individual entrepreneurs, legal entities and individuals.
The main difference between a license agreement and a commercial concession is that the latter involves close cooperation (for example, quality control of services by the franchisor). The former grants the franchisee only the right to use certain intellectual property of the seller.
To address this deficiency, additional supply and service contracts may be added to the document to further define the owner's obligations to sell goods or advise partners.
Regardless of the form of the agreement, before signing it, the franchisee and the franchisor must discuss in detail the terms of interaction.