Search box

Definition: Affiliation to a franchising chain

General concept

A franchising chain gathers retailers linked to suppliers (producers or wholesalers) by a contract in compliance with the European charter of franchising. In return for a financial contribution, the retailer benefits from technical aid and from the supply of goods generally distributed in a limited fashion. The franchisee cannot take part in the strategic decisions of the franchiser.

Several types of franchise can be distinguished according to their object: industrial franchise concerns the manufacturing of goods, distribution franchise concerns the sale of goods, and service franchise concerns the supply of services.
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 (Official Journal of the European Communities No L 359, 28/12/1988, p. 46)