These obligations apply to the extension or renewal of a franchise agreement, as well as to the conclusion of the initial franchise agreement. While the specific language differs between different franchise systems in the renewal period of a franchise agreement, there are a number of similarities in almost every agreement we see. As a general rule, franchisees should not be required to pay a renewal fee, although they may be required to contribute to the franchisee`s legal and administrative costs when issuing a renewal contract. These costs should be low and the franchise agreement itself should either determine the maximum costs that the franchisee could recover or at least contain a statement that these costs are reasonable. At the same time, the franchisee may be asked to provide additional training, refresh the premises or his vehicle. For a franchisee, the renewal or renewal of their existing agreement allows the franchisee to continue to operate the business, maintain their good and, when the time comes, sell their business and/or transfer their rights, hopefully, for a reasonable return. The renewal right does not allow franchisees to continue working with the original contract. All duly developed franchise agreements require franchisees to enter into, at the time of extension, the franchisee`s franchise agreement, which may deviate significantly from the contract that a franchisee originally entered into. Just as franchisees are considering entering into a franchise agreement, they now need to plan before the end of their lifespan whether they should stay or leave.

Franchisors could also consider requiring the franchisee to sign clause 10 – legal and independent business advisory certificates at the time of the extension and extension, although this is not a mandatory requirement under the Code, so that it can be proven that the franchisee has read and understood the revised documents, as they may be available in a slightly different form than the original documents. Franchise Code of Ethics does not require a franchise agreement to allow British Franchise Associations (bfa) to maintain the franchise relationship over the long term as long as the parties meet their obligations. As a general rule, as long as the conditions set out in the agreement are met, the franchisee is obliged to grant an extension. The new franchise agreement should be concluded under the current terms of the franchisee`s standard franchise agreement. The franchisee should not introduce unattractive business terms to prevent the extension. What if the parties did not go through the renewal process? Additional Renewal Rights – While most (but not all) franchises grant the franchisee the right to renew, the number of renewals to which a franchisee is entitled varies greatly between franchise agreements. For example, some franchise agreements only grant the franchisee an extension period. At the end of this extension period, the franchisee cannot be required to offer new renewal rights to the franchisee (unless otherwise protected by law). Therefore, we always want to ensure that our customers have the right to obtain multiple renewal conditions (e.g. B four conditions of renewal) or, if possible, the right to obtain an unlimited number of successive conditions of renewal of a certain length. . .

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