Franchise – Commercial Agency Contract
It is a fact, that during the course of a franchise network a series of legal matters arise, which may concern its members. Often these have to do with failures within a franchise network due to the Franchisor's wrong choices, for example improper development or strategic planning of the franchise system, wrong choice of locations, lack of know-how and infrastructure etc.
"I& M Markoulakos and Associates Law Firm", having acquired a thorough knowledge on the grounds of the potential conflicts arising during the operation of a franchise network and their possible solutions, invites you to be informed about the most significant and common problems and to present you with a number of solutions, in order to more efficiently defend the financial interests of your company, having our firm as your trusted ally and enjoying the reliable advises of our associates.
The most common cases of irregular development of a franchising contract that you may possibly already know and have faced are principally:
1) Supplies reduction. Supplies halt, leading to a breach of the cooperation between franchisor-franchisee,etc.
2) Ending the contract whether due to a termination or due to absence of a renewal of the franchising contract, because, for example, of a surplus of the contracting branches. Following the termination of the franchising agreement, the franchisee is entitled to damages for the clientele he brought in the network where he participated. Following the pulling-out of the franchisee from the network he is not able to enjoy the rewards by the increase of the clientele resulting from his efforts. On the other hand, the franchisor, by taking on all of the clientele, gains profit by the clients whom the franchisee had attracted to the product on the first place and at the same time he saves the supplies he had to provide to the latter, if the agreement had not been terminated. The damages that the franchisee could claim are determined based on the expected duration following the termination of the contract of the customer relations he made possible.
3) The franchisee's commitment not to exercise any competitive activity against the franchisor following the termination of the contract. It happens very often that the franchisee has undertaken the commitment not to exercise any competitive activity upon the termination of the contract within the same or similar field of work and moreover not only within the area where the latter had his branch but in general in an undetermined way. Nonetheless, such a condition clearly affects the franchisee's interests, as in the event of a termination of the contract he is obligated to remain unemployed, whereas on the other hand the franchisor is being protected by the competition with no consideration.
4) Causing unfair competition by the franchisor in cases where the latter franchises the same products and services through other companies (many times within the same Group the franchisor belongs to), thus violating the franchisee's exclusivity in promoting said products and services over specific territorial limits
5) The indirect price-fixing by the franchisor concerning the products resale prices as well as concerning the purchase obligation of certain products by the franchisor
Being well aware of the tough challenges that franchise enterprises, with the same or similar business activity as your own, are called to face on a daily basis, we assure you that we are by your side in order to give you the solutions, handle, if needed, your court representation, or the out-of-court damages negotiations and ensure your company's interests by maintaining the best possible relations with the franchisor. We should highlight that in case of an extrajudicial dispute settlement, any past due amounts to the franchisor may be offset with the respective damages the franchisor has to pay to you on the aforementioned grounds and you may receive additional money as well.
In "I& M Markoulakos and Associates Law Firm" we have the know-how as well as long-standing experience in providing legal services covering the entire range of law, always acting with the due respect towards our clients and especially, establishing personal relationships with them in order to truly comprehend their personalized needs.
Being well aware of the tough challenges that franchise enterprises with the same or similar business activity as your own are called to face on a daily basis, as well as the need for you to be informed over these matters, we invite you to join us on Sunday the 30/3/2014, at 10:00am, at the hotel PARK, 10 Alexandra Avenue in Athens ina meeting we shall host for you and for other similar companies in order, on the one hand to inform you of all of the above and, on the other hand, to listen to the dangers and the problems your enterprise is facing with its franchisor and to propose to you solutions thereon.
For any further information you can contact our experienced personnel and arrange a meeting with any of our specialized associates free of charge.