The Legal Framework for Franchise Agreements

Abstract

The franchise contract is a relatively recent contract, and despite this novelty, its role in developing the economies of countries has been very significant. Through this contract, technology for services and technology for goods has been transferred from developed countries to developing countries. This process is carried out through the franchise contract, whereby technology is transferred from the first party, the franchisor, to the second party, the franchisee. The franchisee in this contract becomes the representative of the franchisor in his country. This contract produces many effects, the most important of which is burdening the franchisee with many obligations, especially since his contractual position is weaker than that of the franchisor, and there is a lack of legislative regulation for this contract in the franchisee's country. This necessitates the intervention of the national legislator by enacting laws that regulate this contract, in order to limit the dominance of large franchisee companies.