The franchise business model was introduced into the PRC in the late 1980s, bringing revolutionary change to the commodity circulation system and offering the possibility of rapid growth.
Partner
AllBright Law Offices
Legal characteristics
In a franchise business, a franchisor grants to a franchisee, by means of a franchise contract, the right to use its registered trademark, corporate logo, patents, know-how and other business resources. The franchisee carries on business according to the standard business model of the franchisor, and pays the franchisor a franchise fee in accordance with the franchise contract.
The franchise business can be divided into (i) direct and (ii) indirect (or regional) franchising. Direct franchising means that a franchisor grants an applicant a franchise, and the franchisee sets up a franchise network to carry on business in accordance with the franchise contract, but is not allowed to sublicense others to deal in the franchised products. Indirect franchising means that a franchisor grants a franchisee an exclusive franchise in a designated area, and the franchisee may sublicense to other franchisees, or set up its own franchise network to do business in the designated area.
You must be a
subscribersubscribersubscribersubscriber
to read this content, please
subscribesubscribesubscribesubscribe
today.
For group subscribers, please click here to access.
Interested in group subscription? Please contact us.
你需要登录去解锁本文内容。欢迎注册账号。如果想阅读月刊所有文章，欢迎成为我们的订阅会员成为我们的订阅会员。
Harry He is a partner of AllBright Law Offices. His main practice areas are foreign direct investment, M&A and labour disputes.
14/F Citigroup Tower
33 Hua Shan Shi Qiao Road
Pudong, Shanghai
Postal code: 200120
Tel: +86 21 6105 9000
Fax: +86 21 6105 9100
Email: harryhe@allbrightlaw.com
