Recommendations by the franchisor in general terms are permitted – dated March 6, 2020 – mr. AW Dolphin
The Amsterdam Court of Appeal ruled on January 21, 2020,
ECLI:NL:GHAMS:2020:116, which is the information provided by a franchisor
about increasing turnover, cost savings, more clientele and customer loyalty
is too general in nature to invoke acquisition fraud or error
make it succeed. There is no question of deception by the franchisor and the
The (prospective) franchisee cannot be blamed by the franchisor for this
wrong leg.
In that context, it has also been ruled that a potential franchisee is allowed
be expected to know that the franchise formula is focused on business
as revenue increase and cost savings, but that concrete results of
depend on many circumstances, such as, for example, the manner
on which the franchisee conducts his business.
It is true that, if the franchisor has concrete information about
turnover forecasts and the like, he acts unlawfully if he does so
information is incorrect and he knows this, or his carelessness leads to
which led to errors. The court refers to the judgment
HR 24-02-2017, ECLI:NL:HR:2017:311 regarding Street One. In this case it is
however, such concrete information is not provided by the franchisor
provided. That is also stated in the agreement in so many words, it said
court of justice.
The boundary between praise in general terms and
on the other hand, culpable deception and misrepresentation,
remains a tricky issue.
mr. AW Dolphijn – franchise lawyer
Ludwig & Van Dam Franchise attorneys, franchise legal advice. Want
you respond?
Go to dolphijn@ludwigvandam.nl
Other messages
Article De Nationale Franchise Gids: “Information obligations of the intended franchisee under the Franchise Act” – dated August 7, 2020 – mr. AW Dolphin
Although the purpose of the Franchise Act is to protect franchisees against franchisors, a number of obligations have also been laid down for franchisees.
Legislative text of the Franchise Act – dated July 24, 2020 – mr. AW Dolphin
The legal text of the Franchise Act was published in the Staatsblad on 1 July 2020. The full legal text reads as follows:
Law Franchise – dated July 23, 2020 – mr. AW Dolphin
The Franchise Act will have a considerable impact on both franchisors and franchisees.
Contractual dissolution requirements not observed? No legal dissolution of the franchise agreement – dated July 23, 2020 – mr. C. Damen
Can a franchisor terminate the franchise agreement if it has failed to comply with its own contractual requirements?
Legal ban on unilaterally changing opening hours by the franchisor – July 13, 2020 – mr. J. Strong
Legislative proposal of the State Secretary which, in short, means that the shopkeeper may not be bound by unilateral changes to the opening hours during the term of the agreement.
No right to extension of franchise agreement – July 6, 2020 – mr. AW Dolphin
Can a franchisor refuse to renew the franchise agreement if the franchisee does not agree to amended terms of a new franchise agreement?