How Much Do You Know About Franchising Disputes?

At the just concluded China franchise conference, many franchisees, franchisees and interested parties are concerned about the relevant legal issues. The sponsors have held a special symposium on the franchise law to provide professional legal services for franchisees and franchisees.

At the seminar, Wu Jingqing, a lawyer with rich experience in franchise law, introduced the common types of disputes and solutions in the franchise process.

By introducing the franchise case of the firm over the years, Wu Jingqing lawyers divided the disputes between franchisees and franchisees in the franchise process into the following types: contract disputes, trademark infringement disputes, unfair competition disputes and disputes caused by third party causes.

Such disputes are mainly caused by imperfect contract terms, breach of contract by one party or breach of contract by both parties.

Wu's lawyer said that in 1999, her office had taken over a case, and a franchisee engaged in sporting goods processing and sales signed a franchisee in a southern city in 1997 with a contract period of 5 years.

Two years after the contract was executed, the franchisee pferred the franchisee to the third party without giving notice to the franchisee.

The franchisee considers that as an independent legal person of the franchise, the franchisee can freely control the franchisee. The franchiser believes that the franchisee can pfer the franchisee without permission. Because of the unawareness of the third party's operation, operation ability and development potential, the franchise brand may be affected by the pfer.

Wu explained that after reviewing the relevant legal documents, it was found that the franchised contracts between the two sides did not have a prior agreement on the above conditions, so there was no legal restriction on future activities.

Lawyer: the legal relationship of franchising is actually the contractual relationship, which is the premise and basis of franchise. The parties who sign the concession contract must pay attention to the details of the contract.

When starting a business, there will often be a process of pformation from individual to legal person.

In this process, unexpected things will happen.

Entrepreneurs must first understand the relevant laws and regulations.

If there are conditions, you may as well consult the experts in this field.

One party's breach of contract mainly refers to a breach of contract on one side of the franchise contract, resulting in an obstacle to the performance of the contract.

Such disputes include two kinds of breach of contract and the default of franchisees.

According to the case, Wu Jingqing analyzed that the default behavior of the franchisee was as follows: (1) when the franchisee and the franchisee had the product delivery contract relationship, the franchisee did not purchase the goods unauthorized according to the contract in order to reduce costs and increase profits; (two) the Union did not pay all kinds of fees on time or in full, especially the royalties.

The franchisee's breach of contract mainly refers to the failure to perform the contractual obligation and provide the franchisee with the corresponding licensing support.

For example, Haotian law firm encountered a class action lawsuit in June 2000, and more than 20 of the franchisees signed a contract with a fast cleaning company at the licensing exhibition, because the low commitment, short-term training and quick return promised by the franchisor were undoubtedly very tempting.

However, after more than 20 franchisees purchased the equipment, the franchisee was unable to provide technical support according to the agreement.

The lawyer advised: if the franchisee lacks professional knowledge, even if he recruits the franchisee and signs the contract, he will not be able to perform the contract.

Breach of contract between two parties is usually caused by one party's breach of contract.

For example, if a franchiser has a concession agreement in the contract, if the franchisee does not have timely support for technology, training and other franchises due to various reasons, the franchisee therefore refuses to pay the related expenses, and the franchiser will further breach the contract if he considers the services such as trademarks and trade names already provided in the earlier stage, thus forming a vicious circle.

In the case of trademark infringement disputes, Wu lawyer Wu said that there are less direct trademark infringement cases, and disputes over the right to exclusive use of trademarks and the right to name of enterprises continue.

There are two main situations: first, unintentional infringement.

China's trademark exclusive rights management and enterprise name right management belong to the Trademark Bureau and the industrial and commercial bureaus at all levels, and there is a lack of convergence between them. This may cause the trademark used by a certain merchant in different cities and regions to coincide with the name of another merchant.

Although it is an unintentional act, the infringer still has to bear tort liability.

The two is intentional infringement.

For the infringement of the "brand ride", the State Administration of industry and Commerce and the trademark office have formulated the corresponding handling principles, namely, the protection of prior rights, that is, trademarks and enterprise names, who will be protected before registration or registration.

But well known trademarks do not apply to this principle.

In the dispute of unfair competition, Wu lawyer said that there were relatively few disputes of unfair competition among the peers. However, after the termination of the franchise contract, there were more disputes over the unfair competition between the original franchisee and the franchisee.

This is because many franchisees continue to engage in the same industry as franchisees after the expiration of the franchise contract, resulting in unfair competition.

Another kind of competition is that the employees of a concession enterprise are engaged in competitive industries with franchising enterprises after they leave their posts, using some business secrets and professional skills that the franchisee has acquired.

Lawyer: when chartered business contract is drawn up, the franchisee shall agree that the franchisee shall not engage in the same industry as the franchisee within a certain period after the termination of the concession contract.

Wu Jingqing disputes that the dispute between the third parties is caused by third parties. The lawyer believes that such disputes are more frequent in the catering industry. This is mainly due to disputes between the franchisees in the operation and the third parties, resulting in a chain reaction between the franchisee and the franchisee, the franchisee and the third party, the franchisee and the third party.

For example, a fast-food franchisee in the process of operation, because of food quality problems and consumers disputes, the franchiser think that the responsibility is in the headquarters, because the product is headquarters distribution; and the headquarters thinks its distribution products have no problem, and the food quality problem is the franchisee's improper handling in the parking and operation process.

Under such circumstances, the third party consumers will ignore the presence of the legal body of the franchisee and negotiate with the franchisee directly.

Such cases should be divided into two specific situations: if the franchisee does not have any problems in the delivery process, the franchisee should assume the responsibility as an independent legal entity; if there is any problem in the process, the franchisee should be jointly and severally liable.