Licensing AND Franchising Agreements
Licensing AND Franchising Agreements
AND
FRANCHISING AGREEMENTS
LICENSING AGREEMENT
Quality control
To franchisor:
Territorial issues:
- Not to sell contract goods to somebody, who would resell it
in the located area(obligation for both franchisor and
franchisee)
- Not to sell contract goods dealers outside the franchising
framework / not to include new franchisee in located area
- Not to change the location of shops
Article 81
Price Issues:
- Sell at (minimum) prices laid down by franchisor
Direct competition:
- Not to sell competing goods (or in certain extend)
- Not to work in competing business after end of franchising
agreement
Case study
In previous decisions
The ECJ held that:
In principle, a franchising
agreement whose purpose
it was to protect the
franchisor's know-how or
the identity and reputation
of the distribution network
did not infringe Art 81(1).
Clauses, however, which resulted in a division of
markets between franchisor and franchisee or
between franchisees could restrict competition
contrary to Article.
Regulation 4087/88
-applied only to industrial franchises involving the
manufacturing goods
-contained list of restrictions of competition
-set out white list/ black list clauses
Regulation 2790/99
-applies to exclusive distribution, non exclusive
distribution, exclusive purchasing, franchising
selective distribution
-does not apply to production franchises
-no limited white list
The Guidelines on Vertical Restrains