1. TYPOLOGY OF DISTRIBUTION AGREEMENTS
PRODUCER
AGENT
Agency agreement
RESELLER
(Wholesaler/retailer)
DISTRIBUTOR
FRANCHISEE
Exclusive transfer of business method
Exclusive purchasing
Exclusive supplying
Exclusive supply
Selective distribution
Exclusive distribution
Franchising
Master franchising
CONSUMER
© D. Ferrier

2. FRANCHISING
DEFINITION FRANCHISOR - TRANSFERS INTELLECTUAL PROPERTY RIGHTS RELATING TO TRADE MARK AND KNOW-HOW FOR DISTRIBUTION
- PROVIDES COMMERCIAL AND TECHNICAL ASSISTANCE
EFFECT POSITIVE INCREASE COMPETITION (RULE OF REASON ?)
NEGATIVE - RESTRICTION OF FRANCHISEE’S COMMERCIAL FREEDOM
- EVICTION OF OTHER DISTRIBUTORS
- RESTRICTION OF INTRA BRAND AND INTER BRAND COMPETITION
© D. Ferrier

3. Assessment of appreciable restriction of competition
FRANCHISING
Assessment of appreciable restriction of competition
Undertakings
Turnover  (40 M €)
Market share  (5% / 15% / 30%)
Agreement
Obligations and practices affecting trade between Member States or restricting competition
(eg. : territorial exclusivity)
Appreciable restriction
Context
(eg : cumulative effect of parallel networks)
© D. Ferrier

4. FRANCHISING ECONOMIC APPROACH (BER 2790-99)
MARKET POSITION
NO PRESOMPTION OF ILLEGALITY
SELF EXAMINATION (INDIVIDUAL EXAMINATION)
[>50 %]
[CUMULATIVE EFFECT: POSSIBLE DISAPPLICATION OF THE BER]
30 %
« SAFE HARBOUR »
15 %
« DE MINIMIS »
[<5 %]
[NO SIGNIFICANT CONTRIBUTION TO THE CUMULATIVE EFFECT]
© D. Ferrier

5. FRANCHISING
REGULATION HARD CORE RESTRICTIONS - ABSOLUTE TERRITORIAL EXCLUSIVITY
- RESALE PRICE MAINTENANCE
- RESTRICTION OF CROSS SUPPLY BETWEEN FRANCHISEES (?)
EXCLUDED RESTRICTIONS - NON COMPETE OBLIGATION FOR PERIOD EXCEEDING FIVE YEARS (?)
- OBLIGATION NOT TO RESELL AFTER TERMINATION GOODS OR SERVICES EXCEEDING :
▪ PREMISES, ▪ GOODS OR SERVICES CONTRACT
▪ PERIOD OF ONE YEAR
AND NOT NECESSARY TO PROTECT KNOW HOW
EXEMPTION OBLIGATIONS
REQUIRED TO : - PROTECT IPR
- MAINTAIN IDENTITY AND UNIFORMITY OF THE NETWORK
© D. Ferrier

6. FRANCHISING IPR RELATED OBLIGATIONS EXEMPTED
ARE COVERED BY THE BER OBLIGATION ON THE FRANCHISEE :
NOT TO USE KNOW-HOW LICENSED BY THE FRANCHISOR FOR PURPOSES OTHER THAN THE EXPLOITATION OF THE FRANCHISE, SO:
NOT TO ENGAGE IN ANY SIMILAR BUSINESS
NOT TO ACQUIRE FINANCIAL INTERESTS IN THE CAPITAL OF A COMPETING UNDERTAKING
NOT TO DISCLOSE TO THIRD PARTIES THE KNOW-HOW PROVIDED BY THE FRANCHISOR, SO :
NOT TO ASSIGN THE RIGHTS AND OBLIGATIONS UNDER THE FRANCHISE AGREEMENT WITHOUT THE FRANCHISOR’S CONSENT
TO COMMUNICATE TO THE FRANCHISOR ANY EXPERIENCE GAINED IN EXPLOITING THE FRANCHISE, SO :
TO GRANT HIM AND OTHER FRANCHISEES A NON-EXCLUSIVE LICENCE FOR THE KNOW-HOW RESULTING FROM THAT EXPERIENCE
TO INFORM THE FRANCHISOR OF INFRINGEMENTS OF LICENSED IPR, AND TO ASSIST THE FRANCHISOR IN ANY LEGAL ACTIONS AGAINST INFRINGERS
© D. Ferrier