The U.K. does not have
specific Franchise Laws.
The rules to follow are:
You must establish a
fixed term – the length
of term varies from
franchise to franchise
and is often related to
the level of the initial
purchase price and/or
the level of fees
payable
You must give the
franchisee the right to
renew the term, which
will be subject to
certain conditions being
met. It will be
important to ensure the
right to renew is not
lost due to any trivial
breaches of the
agreement. If the
franchisor imposes
minimum performance
targets, consider
whether these are
appropriate, especially
if based on the
performance of other
franchisees
The franchisee must be
awarded a clearly
identifiable territory
and the rights connected
with that territory e.g.
is it exclusive and does
the franchisor, or other
franchisees, have rights
to operate in the
territory in certain
circumstances must be
explained in detail.
The franchisee will have
the right to use the
franchisor’s
intellectual property.
The franchisor’s name,
trademark (brand)
and training and a
warranty from the
franchisor that it is
entitled to grant
license of such
intellectual property
You must provide the
franchisee confirmation
that you the
franchisor has taken
appropriate steps to
secure its intellectual
property to protect the
trademark (brand) and
will prevent
infringement of the
franchisee rights to
that property.
You as the franchisor
will have the obligation
to the franchisee to
provide adequate
training in the
operation of the
business. You are
obligated to assist the
franchisee in setting up
and opening the
business. You will be
obligated to assist the
franchisee to identify a
proper location from
which to operate the
franchise. You will also
be obligated to provide
the franchisee with
supplies to operate the
business or to identify
suppliers for equipment
and inventory and other
necessary products and
you must provide ongoing
support to the
franchisee.
You must give the right
to sell the franchise by
the franchisee. The
franchisee will be
subject to certain
reasonable conditions
prior to the sale of the
franchised business
In case of illness the
franchisee shall have
the right to sell the
business without being
penalized because of
health problems. The
franchisee's heirs shall
also have the same
rights in case of the
demise of the
franchisee.
All of these items
should be spelled out in
the Franchise Agreement.
