No right to extension of franchise agreement – July 6, 2020 – mr. AW Dolphin
May a franchisor refuse to renew the franchise agreement
if the franchisee does not agree to amended terms and conditions of a
new franchise agreement to be concluded? The District Court of Limburg ruled in
a judgment in summary proceedings of 29 May 2020, ECLI:NL:RBLIM:2020:3860, which in
the case presented, the franchisor was allowed to part with the
franchisee.
The franchisee took the position that the franchisor
acts unlawfully or misuses its authority and
dominant position, by imposing unreasonable conditions for renewal
and by refusing to further negotiate renewal on a reasonable basis
terms or give them more time to sell. If the
franchisee would be forced to cease operation, there would be
enormous damage.
The franchisor had always taken the initiative to change the existing
franchise agreements. She pointed out that
request for extension had to be made no later than six months before its expiry
be submitted and how it should be done. Franchisee has it
never requested such an extension on its own initiative and in a timely manner.
The franchisee had changed positions over time.
Initially they did not want to extend, then they did, but not on
conditions according to the new agreement, then they wanted the
selling branches.
The franchisee is ordered to terminate the use of
the franchise formula under penalty of a penalty.
It strongly depends on the situation whether and how
franchise agreement is legally terminated and how the
negotiations have to be qualified, who does this (on each occasion).
takes the initiative and what the position of the parties is.
mr. AW Dolphijn – franchise lawyer
Ludwig & Van Dam Franchise attorneys, franchise legal advice. Want
you respond? Go to dolphijn@ludwigvandam.nl
Other messages
Column Snack courier no. 8: “With 7 steps you comply with the privacy law”
Much has already been written about the General Data Protection Regulation (GDPR). The law has been applicable since 25 May, but many companies have not yet had their privacy policy in order.
Forced to switch to a different franchise formula at the existing location?
If a franchise formula ceases to exist, for example if it is incorporated into another organization, the question may be whether the franchisee is also obliged to be incorporated into
Column Franchise+ – 50 percent more franchise lawsuits
The 2018 Legal Franchise Statistics published by Ludwig & Van Dam Advocaten shows that there has been a 50% increase in the number of judgments in court cases rendered in 2017 compared to
A closer look at the intention to introduce franchising legislation
On May 23rd, State Secretary Mona Keijzer informed the House of Representatives about the imminent franchise legislation. The National Franchise Guide previously published this article.
Consumer Protection Applies to Franchisee
The consumer enjoys broad protection on the basis of the Civil Code.
Update Franchise Law
On 23 May 2018, the government indicated that it would prepare a legal regulation that creates a framework for four sub-areas of cooperation between franchisors and franchisees that are crucial