Definition: Franchise agreement

Distributive trade

"Franchise agreement" means an agreement whereby one undertaking, the franchisor, grants the other, the franchisee, in exchange for direct or indirect financial consideration, the right to exploit a franchise for the purposes of marketing specified types of goods and/or services; it includes at least obligations relating to: 

- the use of a common name or shop sign and a uniform presentation of contract premises and/or means of transport, 

- the communication by the franchisor to the franchisee of know-how, 

- the continuing provision by the franchisor to the franchisee of commercial or technical assistance during the life of the agreement.
European Union, Commission Regulation (EEC) No 4087/88 of 30 November 1988 on the application of Article 85 (3) of the Treaty to categories of franchise agreements

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