ICC Model International Franchising Contract

International franchising has been seriously hampered by laws and regulations which differ from country to country. In this context, the ICC Model International Franchising Contract provides franchisors and franchisees with a uniform framework for agreement within which their rights and responsibilities can be protected.

The ICC Model Contract strikes a fair balance between the interests of the franchisor and franchisee and proposes to candidate franchisors and franchisees flexible drafting solutions that accurately respond to business needs for legal certainty and compliance with common practice.

In doing so, the Contract:

• takes into account the most commonly used clauses in franchise agreements;
• suggests alternative clauses where no single solution is possible;
• allows the parties to insert their own requirements on certain points;
• provides annexes which the parties can modify without changing the basic text of the agreement;
• provides a system to resolve disputes; and
• includes a detailed commentary explaining the various provisions.

Table of contents

Foreword

By Maria Livanos Cattaui, former Secretary General of ICC

Franchising has proved over many years to be an extremely successful commercial vehicle for the distribution of products and services, making a considerable contribution to growth in business sectors that use this type of distribution channel. However, there have long been doubts about the feasibility of introducing a simple and user-friendly model contract that would reflect the diversity of franchising contracts and would encourage users to choose this type of contractual agreement.

The ICC Model International Franchising Contract clearly demonstrates that a franchising agreement, like agency, distributorship and intermediary agreements can usefully be expressed in a modal contract based on the most common clauses found in international franchise contracts.

The ICC Model Franchising Contract proposes to candidate franchisors and franchisees flexible drafting solutions that accurately respond to business needs for legal certainty and compliance with common practice. For the sake of clarity and ease of use an explanatory commentary has been added to the contact, presenting alternative drafting solutions and identifying pitfalls.

This model contract is intended to apply to international direct franchises, which are a new and rapidly expanding franchising instrument. ICC's initiative supplements UNIDROIT's more traditional approach on drafting international franchise contracts, which takes the form of a comprehensive guide on master franchise arrangement.

The contract meets a long-felt need, as has been confirmed by ICC's extensive consultation of all business sectors.

The ICC Model International Franchising Contract is the result of many months of work carried out under the auspices of the ICC commission on International Commercial Practice cahired by Fabio Bortolotti (Italy). Based on a preliminary study of several hundred franchise contracts conducted by Professor Didier Ferrier (France), the model contract was elaborated by the Working Party on Franchising under the chairmanship of Didier Matray (Belgium). The model contract benefited from the active participation of the following other working party members: Jean Bastin (Belgium), Heinrich Kopecky (Austria), Christoph Liebsher (Austria), Peter Marsh (UK), Klaus Meyer-Swantee (The Netherlands), Patrick Mousset (Canada), Christophe Martin Radtke (France), Hamar Repa (Austria), Mathew Shay (US), Francoise Vidts (Belgium), and Martin Weber (Switzerland). Andrew Sherman (US) wrote the initial draft of the commentary.