Customers, clientele and exceptions thereto
Some franchise constructions have the characteristic that the products or services in question are only supplied to certain consumers. Is this allowed?
If a prohibition is imposed on all franchisees by the franchisor to restrict sales to certain end-users, this is permissible only if there is an objective justification linked to the product. For example, this could be a general ban on the sale of hazardous substances to certain customers or for safety or health reasons. Only then is such a ban allowed.
The situation is different when others than end users (consumers like you and me) are excluded. Consider, for example, a franchise formula in which the franchisees are assigned an exclusive clientele whereby the franchisees are not allowed to supply wholesalers. Only to end users may be delivered. In principle, such an arrangement is possible. However, so-called passive sales should remain possible. This means responding to spontaneous requests from individual customers. This may be the case, for example, as a result of general advertising and promotion in the media and on the Internet that reaches customers within exclusive customer groups of other franchisees. If the potential customer then wants to go to a franchisee in another exclusive area, this is possible at any time.
The franchisor and franchisee are advised to clearly record such situations in advance in the franchise agreement, so that no misunderstandings or undesirable situations can arise. For the record, it should be pointed out that what is described here is mandatory law, from which it is absolutely not allowed to deviate. If this does take place, this can form grounds for nullity of the franchise agreement. Other measures, for example by the Netherlands Competition Authority (NMa), are also possible. Mr Th.R. Ludwig
For information: Theodoor Ludwig or Derk van Dam
Ludwig & Van Dam franchise attorneys, franchise legal advice
Other messages
Column Franchise+ – Franchisor acts unlawfully by providing a forecast through a third party
Disputes about forecasts between franchisor and franchisee remain a hot topic in franchising. After the Street-One judgment, it seems that franchisors feel safe
Column Franchise+ – Outsourcing forecasting to an administrative office does not benefit the franchisor
Disputes about forecasts between franchisor and franchisee remain a hot topic in franchising. After the Street-One judgment, it seems that franchisors feel safe
Outsourcing prognosis to an administrative office does not benefit the franchisor
Disputes about forecasts between franchisor and franchisee remain a hot topic in franchising.
Contribution Mr. AW Dolphijn in Contracting magazine 2018, no. 1: “The unilateral amendment clause in the franchise agreement.”
A contribution by mr Dolphijn has been published in the magazine Contracteren entitled: “The unilateral amendment clause in the Franchise Agreement”.
Supermarket letter – 22
No Dutch Franchise Code, but legislation on franchising.
No Dutch Franchise Code, but legislation on franchising
The State Secretary has announced that the Dutch Franchise Code ("NFC") will not be enshrined in law. However, there will be legislation on franchising.