On Legal Problems Of Commercial Franchise Contracts

As a new business model,franchise has been widely used in various industries around the world.With the sustained and rapid development of our country's economy,franchising is favored by more and more investors,and has aroused widespread concern from all walks of life.The franchise has developed from scratch in our country,from its inception to maturity,from non-standard to gradual standardization,and has developed over the past 30 years.However,compared with its rapid development,China's legislation on the field of franchising is relatively lagging behind,and the supporting laws and regulations on franchising are not comprehensive enough,and the regulation and management of franchising are relatively rough.The promulgation and implementation of the "Regulations on the Management of Commercial Franchise"(hereinafter referred to as "the Regulations")in May 2007 marked the beginning of the introduction of franchising activities into the track of rule of law and standardized management.In order to ensure the implementation of the "Regulations",the Ministry of Commerce promulgated the "Administrative Measures for the Recording of Commercial Franchise" and the "Administrative Measures for the Disclosure of Commercial Franchise Information" on December 12,2011 and February 23,2012.The specific details of the event were further clarified and standardized,but compared to the franchise model with complex content and long duration,whether it is current legislation,specific judicial application or government supervision,there are imperfections,ambiguities and inconsistencies.Problems in place.Since the introduction of franchise,after the washing and development of the domestic market,the franchise model has continued to expand and continue to innovate and change.The change will inevitably bring about changes in the corresponding rules,and new concession systems,new franchise relationships,and new concession rules are constantly emerging.In general,the "Regulations" and the two supporting "Measures" can no longer meet the development needs of the current franchise.The prominent problems concerning the application of franchising laws are as follows: First,the legislation is incomplete,the existing regulatory documents issued by the State Council are low in level and effectiveness,and are separate from the actual operation of the commercial market.They are not very operable and lack independent franchising.Operational laws and regulations and supporting supervision measures;second,there are also some disputes in the judicial application of franchise disputes,mainly reflected in the subject qualification,filing and disclosure mechanism,contract nature,tort liability,etc.;third,the supervision of franchising Insufficient regulations,low penalties for illegal franchising,and inadequate industry filing supervision;in addition,some market participants,especially licensees,have limitations and inadequate understanding of franchising,and understanding and risks of legal regulations on franchising Inadequate awareness of prevention and control has led to recurring disputes and related rights and interests that are difficult to protect and worthy of attention.This article uses the literature research method and empirical analysis method to start with the concept of franchise,analyzes the characteristics of franchise and its advantages and disadvantages,and then analyzes the legal issues involved in franchise in detail and illustrates it through judicial practice cases,focusing on the current discussion.The provisions on legal liability related to franchising,and finally put forward suggestions for the current status of franchising legislation.It is considered that the most urgent task is to strengthen legislative protection.It is necessary to learn from more mature foreign legislative experience and to improve the franchise law in accordance with the actual development of franchising in China.System and rules of responsibility.The first is to improve the legal status of franchise legislation.The franchise law can be made to fill gaps in the franchise legislation.At the same time,coordination with other laws can be strengthened to clarify the connection between other laws and the franchise law and reduce conflicts of law application.In terms of specific provisions,the judicial application of franchising laws should be clarified.Regarding the validity of the contract of the franchisor's business qualification,it should be clear that "two stores for one year" is a mandatory compulsory regulation,and the contract cannot be regarded as invalid.It is necessary to refine the information disclosure requirements and clarify the limits of contract termination.It is necessary to improve the contract filing mechanism and make it clear that filing is not the basis for contract entry into force.It is necessary to improve the regulations on tort liability,especially third party torts.To clarify the nature of the franchise contract.When the content of the contract is inconsistent with the name,the nature of the contract should be determined based on the content of the contract.The third is to address the lack of administrative supervision of the franchise.The government should obtain market access,information disclosure,contract filing,etc.Conduct all-round and whole-process supervision in the aspects;fourthly,in the course of operation,as a market entity,it is necessary to pay attention to preventing the risks of franchising,improve the completeness of the contract,and preset the dispute resolution mechanism and risk protection mechanism,especially in the intellectual property rights Agreements,geographical restrictions,and control provisions should be clearly agreed to protect their legitimate rights and interests.