Studies On The Legal System Of Franchise Information Disclosure

Franchising as one kind of new commercial management pattern first appears from the middle leaf of last century in US. It already developed into a kind of business model with extreme potential in the knowledge economy time, and even predicted to be the leading economic type of the 21st century. Although franchising was introduced to China only nearly 20 years, it had actually performed a vital role in the market economy, and become a big hot spot in the economical domain. But in a market which is far from being matured, the franchisees are easily to be taken advantage of by the illegal franchisors who want to expand and get profit illegally. Among these, the risk of inadequate information is especially faced with by the prospective franchisees. With the rapid development of the franchise system of China and the pouring of foreign franchise system, some business men took advantage of franchise to deceive in case of lack of relevant laws and regulations. After study the legislation and academic theories abroad, the author finds out that the key problem of protecting the investors and preventing franchise risk is to establish information disclosure system. February 6^th,2007, Premier Wen Jiabao signed Regulations on Administration of Business Franchises, which was implemented on May 1^th, opened a new page of the law-based franchise system.The paper is divided into five parts. The first part is about the basic concepts of franchise and information disclosure system. Firstly, the origin, current development and concept and features of franchise are introduced. The concept of franchise and other similar ones are also made distinctions hereof and franchise are divided into different categories according to different standards. Secondly, the legal remedies of malpractices in franchise markets are introduced, among them the information disclosure system is the core. Then the basic aspects of information disclosure system are introduced, including the origin, legal value and disclosure standards of information disclosure system. Finally, the information disclosure system is theoretically analyzed and the necessity of this system is stated hereof. The second part is a further research on the features and contents of information disclosure, including the subject, time, way etc. of disclosure, simultaneously introduced relative provisions of the newly established Regulations on Administration of Business Franchises and Measures for Administration on Information Disclosure of Commercial Franchise. The third part elaborated on legal obligations and remedies of the violations of information disclosure obligation, including civil obligations and remedies, criminal obligations and remedies and the specific "cooling off period" system. The fourth part focuses on comparison legal study of information disclosure system of franchise. Firstly, the legislations of franchise are stated outlined. Secondly, relevant legislations of different countries are studied, including governmental level, self-disciplinary regulations and legal documents of professional associations and international organizations. The last part is about the legislation of our country and an outlook of the development of the new law. Firstly, the process of franchise legislation of China is introduced. Secondly, the newly established Regulations on Administration of Business Franchises is introduced in detail. Finally, the author further thinks of the perfection of information disclosure system and legislation trend in China.