Many entrepreneurs often fail to carefully examine the legal risks of joining projects before joining, which leads to a lot of money, time, manpower and material resources, but they suffer heavy losses and are difficult to safeguard their rights. Therefore, the lawyer puts forward the following verification suggestions on the relevant legal risks that may be involved in joining:
1. Check whether affiliated companies and shareholders are credible.
1. Check whether the franchised company has the franchise conditions of "two stores and one year"
According to the Regulation on the Administration of Commercial Franchise, the franchisor should have at least two direct stores in franchise activities, and the operating time should exceed 1 year. Franchisees should carefully understand the number, address, business hours and operation of the direct stores of the franchise company, and whether they belong to the branches, business premises or affiliated companies of the franchise company.
2. Check whether the franchise company has been filed by the commercial franchisor.
According to the Regulations on the Administration of Commercial Franchise, franchisers must put on record when they engage in franchise activities. Franchisees can log on to the website of the competent department of commerce, enter the name of the franchise company and the franchise brand for inquiry.
3. View industrial and commercial registration information of affiliated companies.
Franchisees can inquire about the industrial and commercial registration of the franchised company through the national enterprise credit information publicity system or enterprise search, Kaixinbao, Tianyancha and other websites, including the company's establishment time, registered capital, registered address, establishment of branches and shareholders. Unreliable franchisees often change their shells to operate, and franchisees can further inquire about the foreign investment of company shareholders and make a comprehensive judgment on the changes of company shareholders.
4. Check the relevant industry licenses of the affiliated companies.
If it is a franchise company engaged in catering projects, it will generally use model stores, template stores or direct stores to attract franchisees. Franchisees can check whether the franchise company has a food-related license certificate through the website of the local market supervision and management department to understand the actual situation of its catering activities.
5. Check the lawsuits of affiliated companies.
Unreliable franchisees are inviting foreign investors to join even before they run away. Under normal circumstances, these franchisees will encounter franchise contract litigation disputes about three months after opening the door to attract investment. These lawsuits can be found on websites such as Kaixinbao, Enterprise Search and China Judgment Document Network. For franchisees operating in a new shell, it is suggested to check back other companies invested by shareholders or former shareholders to understand their lawsuits. In addition, franchisees can check the implementation and credit status of franchisees through China Executive Information Open Network. If the franchisee has been included in the list of people who have lost their trust and is still inviting foreign capital to join, it can basically be determined to be unreliable.
Second, check the operating resources of affiliated companies.
According to the Regulations on the Administration of Commercial Franchise, the franchised company shall have business resources such as registered trademarks, corporate logos, patents and proprietary technologies. For franchisees, the core purpose of joining is to obtain the right to use the operating resources of the franchisees. Therefore, before joining the company, franchisees should ask the franchisees to produce the registered trademark certificate, patent certificate or authorization certificate, and search and query the authenticity and category of the registered trademark certificate and patent certificate through the national trademark network or patent website, as well as whether the obligee is a franchisee. If the joining company is not the owner or only has the right to use, and the registration category has nothing to do with the joining project, then you should be cautious when joining.
Third, be alert to the trap of joining the contract.
Many unreliable franchisees will set contract traps and loopholes in their franchise contracts, with the purpose of evading legal provisions, excluding franchisees' legitimate rights and interests and exempting them from legal responsibilities, such as the following situations:
1. Confuse the concept of franchising and evade supervision. In order to avoid the supervision of the Regulations on the Administration of Commercial Franchise, franchise rights will not appear in franchise contracts. At the same time, franchise companies often divide franchise contracts into several parts, which are generally divided into service contracts, brand licensing contracts, confidentiality contracts, supply contracts and so on. And share the franchise fee to the contract with short service period and less obligation, which hinders the franchisee's later rights protection.
2. Agree on an ultra-short concession period. According to the Regulations on the Administration of Commercial Franchise, the franchise period stipulated in the franchise contract shall not be less than 3 years. However, unless the franchisee agrees. In fact, many franchisees only agree on the contract term of 1 year, in order to shorten the legal term and reduce the contractual obligations. In order to paralyze franchisees, franchisees will promise franchisees permanent brand authorization and continue to perform the contract in the form of subsequent collection of brand management fees and store management fees.
3. Disagree or agree on an ultra-short cooling-off period. According to the Regulation on the Administration of Commercial Franchise, the franchise contract shall stipulate a "cooling-off period" with a reasonable period, during which the franchisee may terminate the contract. In order to avoid or attack franchisees' rights protection, franchisees generally stipulate various clauses in franchise contracts to limit and exclude franchisees' cooling-off period, and set high penalty clauses to make franchisees daunting.
4. The service scope and content are not clear, regardless of whether it is responsible or not. It is suggested that franchisees must clearly agree with franchisees on the specific contents and methods of providing franchise guidance, technical support, business training and other services, so as to prevent franchisees from completely neglecting their duties and becoming shopkeepers after taking the franchise fee, causing economic losses to franchisees.
5. The price of materials and equipment is high and the quality is poor. Under normal circumstances, franchisees will require franchisees' stores to be purchased by franchisees, and set default terms to restrict franchisees' external purchases. In fact, this contract clause is understandable, because regular franchisees need to unify the quality of products and services on the basis of brand management. However, unreliable franchisees generally use this clause to force franchisees to buy materials and equipment with poor price and quality in bulk, resulting in high operating costs for franchisees and inability to continue their operations. Therefore, the franchisor must clearly agree with the franchisee on the quality, price and liability for breach of contract of the product or service.
6. If oral promises and promises are not fulfilled, the contract shall prevail. Merchants of franchisees often make false propaganda, deceive and mislead franchisees through various promises and guarantees. When signing a contract, franchisees trust franchisees too much and often don't pay attention to whether promises and guarantees are contract terms. Even if the rights are protected in the later period, it will face problems such as insufficient evidence, insufficient effectiveness and denial by franchisees. Therefore, in order to prevent this from happening, franchisees should not only conduct on-the-spot investigation before signing the contract, but also pay attention to clearly stipulate the propaganda contents of the franchise company's promises and guarantees in the franchise contract to protect their own interests to the maximum extent.
If you have any dispute about joining the rights protection, please consult a lawyer for details.