Column Franchise+ – “Disputes about franchise fees”
Lately, it has also hit the biggest franchise organizations in the Netherlands. For example, at the formulas of Albert Heijn, Hema, Etos, Bruna and Olympia, considerable litigation was and is still being done between the franchisor and the franchisees. The point is always that the franchisees believe they have no or insufficient insight into the structure of the calculated franchise fee.
At Albert Heijn, the dispute is about whether the franchisor should not deduct disguised purchase bonuses from the fees owed. After the franchisees have been ruled against by the court, the case is now on appeal to the Court of Appeal.
At Hema, the franchisor and the franchisees are unable to reach an agreement on a fee for e-commerce services. To this end, the franchisor has collected amounts of which the franchisees claim that this does not do justice to the situation. The court ruled that for the time being, Hema may not set off the fee it charges for e-commerce services against the credit balances of franchisees.
The franchisees of the Etos formula rightly argued that they paid a fee to the franchisor for the exclusive use of the collectively specific Etos products. The franchisor also wanted to offer these Etos products outside the Etos stores. Although the franchisor eventually gave in, it subsequently merely renamed these products. The court ruled that with the franchisor’s commitment to phase out these comparable products, the likelihood of confusion among the public could not be determined for the time being.
At Bruna, a reduction in the fee was offered in exchange for more hard franchising. This met with some resistance because of, among other things, the lack of transparency. At an individual level, the necessary disputes have been and are being fought out in court.
The franchisees of the Olympia franchise formula had successfully argued in court that the franchisor was using a covert way to earn additional income from the franchisees’ business. It has been established in court that there was an impermissible hidden fee. The franchisor of the Happy Nurse formula has also been sentenced in the same way.
The above things must stop. Clarity in advance is the key to this and underlines the importance of making clear agreements in advance about exactly what the fee should be paid for and how that fee should be calculated exactly. The franchisor will also have to offer the necessary transparency in this regard. That way, you can prevent quarrels about the franchise fee in the future.
mr. AW Dolphin – franchise lawyer
Ludwig & Van Dam Franchise attorneys, franchise legal advice. Do you want to respond? Go to dolphijn@ludwigvandam.nl .
![232court-min](https://www.ludwigvandam.nl/wp-content/uploads/2020/12/232court-min.jpg)
Other messages
Consultation: forms and possibilities
In practice, consultation between the franchisor and the franchisee often takes place through a franchise council.
New rental law
On August 1, 2003, the new rental legislation came into effect.
Clarity regarding financial obligations of franchisees
Franchisees generally have various long-term financial obligations towards the franchisor.
The possibilities regarding claiming a rent reduction then
Following on from earlier published articles of my hand, I will once again deal with a tenancy law issue below.
Catering agreements
The Netherlands Competition Authority (NMa) recently made a decision regarding the beer supply agreements submitted by Heineken for exemption.
European Code of Honor on Franchising
Article 3 of the European Code of Honor on Franchising deals with this in quite some detail