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Sub Franchise Agreement

Sub Franchise Agreement Template for Netherlands

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Key Requirements PROMPT example:

Sub Franchise Agreement

"I need a Sub Franchise Agreement under Dutch law for my restaurant chain expansion, where I'll be the master franchisee granting rights to a sub-franchisee to operate three locations in Amsterdam, with operations planned to commence in March 2025."

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Document background
The Sub Franchise Agreement is a critical document used in multi-tiered franchise structures where a master franchisee has the right to grant sub-franchises within the Netherlands. This agreement type became particularly significant after the introduction of the Dutch Franchise Act 2021, which imposed specific requirements for franchise relationships, including mandatory disclosure obligations and cooling-off periods. The document serves to establish the legal and operational framework for sub-franchising while ensuring compliance with both the master franchise agreement and Dutch law. It typically includes comprehensive provisions covering business operations, brand standards, territory rights, fees, support services, and termination conditions. The agreement is essential for businesses expanding through sub-franchising in the Netherlands and must carefully balance the interests of all parties while maintaining system-wide consistency.
Suggested Sections

1. Parties: Identification of the master franchisee (as sub-franchisor) and the sub-franchisee

2. Background: Context of the agreement, including reference to the master franchise agreement and authority to grant sub-franchises

3. Definitions: Defined terms used throughout the agreement, including system-specific terminology

4. Grant of Sub-Franchise: Scope of rights granted, territory, and exclusivity provisions

5. Term and Renewal: Duration of the agreement and conditions for renewal

6. Fees and Payments: Initial fees, ongoing royalties, advertising contributions, and payment terms

7. Obligations of Sub-Franchisor: Support, training, and ongoing assistance commitments

8. Obligations of Sub-Franchisee: Operational requirements, compliance with system standards, and reporting obligations

9. Intellectual Property: Usage rights and restrictions for trademarks, trade secrets, and system materials

10. Training and Support: Initial and ongoing training requirements and support services

11. Marketing and Advertising: Marketing obligations, advertising fund contributions, and local marketing requirements

12. Records and Reporting: Financial recording requirements, reporting obligations, and audit rights

13. Quality Control: Standards maintenance, inspection rights, and compliance requirements

14. Transfer and Assignment: Restrictions and conditions for transfer of the sub-franchise

15. Termination: Grounds for termination, procedures, and consequences

16. Post-Termination: Obligations after termination including non-compete and confidentiality

17. Governing Law and Dispute Resolution: Choice of law, jurisdiction, and dispute resolution procedures

18. General Provisions: Standard boilerplate clauses including notices, amendments, and severability

Optional Sections

1. Equipment and Inventory: Required when the franchise system includes specific equipment or inventory requirements

2. Insurance Requirements: Detailed insurance obligations when not covered in general obligations

3. Real Estate Provisions: Required when the sub-franchise involves specific location requirements or property leasing

4. Data Protection: Detailed GDPR compliance provisions when significant personal data processing is involved

5. E-commerce Rights: Required when online sales or digital presence is part of the franchise system

6. Development Schedule: Include when the sub-franchisee has obligations to open multiple units

7. Master Franchisee Approval Rights: Required when the master franchisee needs specific approvals from the master franchisor

8. Local Adaptation: Required when the sub-franchise needs specific modifications for local market conditions

Suggested Schedules

1. Schedule 1 - Territory Description: Detailed description and/or maps of the granted territory

2. Schedule 2 - Initial Fees and Ongoing Payments: Detailed breakdown of all financial obligations

3. Schedule 3 - Operations Manual Summary: Overview of the operations manual and key operational requirements

4. Schedule 4 - Brand Standards: Detailed specifications for use of trademarks and brand elements

5. Schedule 5 - Initial Training Program: Description of required initial training and support

6. Schedule 6 - Approved Suppliers: List of approved suppliers and products

7. Schedule 7 - Form of Confidentiality Agreement: Standard confidentiality agreement for employees

8. Schedule 8 - Technical Specifications: Equipment, software, and technical requirements

9. Schedule 9 - Reporting Templates: Required formats for financial and operational reporting

10. Appendix A - Master Franchise Agreement Summary: Relevant excerpts or summary of the master franchise agreement affecting the sub-franchisee

11. Appendix B - Pre-Contractual Disclosure Document: Mandatory disclosure information as required by Dutch Franchise Act

Authors

Alex Denne

Head of Growth (Open Source Law) @ Genie AI | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents | Serial Founder & Legal AI Author

Linkedin in social icon imageX social icon image
alex.den.21@genieai.co
Relevant legal definitions
Affiliate
Approved Products
Approved Suppliers
Business
Business System
Commencement Date
Confidential Information
Development Schedule
Disclosure Document
Effective Date
Force Majeure
Franchise
Franchise System
Gross Revenue
Initial Fee
Initial Term
Intellectual Property Rights
Know-How
Manual
Marketing Fund
Master Franchise Agreement
Master Franchisee
Master Franchisor
Minimum Performance Requirements
Net Revenue
Opening Date
Operations Manual
Premises
Proprietary Marks
Renewal Term
Royalty Fee
Service Marks
Sub-Franchise
Sub-Franchise Network
Sub-Franchisee
Sub-Franchisor
System Standards
Territory
Trade Secrets
Training Program
Trademarks
Transfer
Working Day
Governing Law
Goodwill
Quality Standards
Renewal Fee
Reporting Period
Technology Standards
Term
Trade Name
Unit
Marketing Materials
Cooling-off Period
Local Adaptation Rights
Compliance Requirements
Disclosure Requirements
Pre-Contractual Information
Clauses
Definitions
Grant of Rights
Territory
Term and Renewal
Fees and Payments
Intellectual Property
Confidentiality
Non-Competition
Training
Quality Control
Operations Standards
Marketing and Advertising
Supply Chain
Reporting Requirements
Audit Rights
Insurance
Transfer and Assignment
Termination
Post-Termination Obligations
Force Majeure
Governing Law
Dispute Resolution
Notices
Entire Agreement
Severability
Waiver
Amendment
Assignment
Indemnification
Compliance with Laws
Data Protection
Brand Standards
Property Rights
System Protection
Development Rights
Support Services
Initial Setup
Performance Standards
Customer Service
Record Keeping
Cooling-off Rights
Disclosure Obligations
Local Adaptation
Approval Requirements
Relationship of Parties
Good Faith
Representations and Warranties
Third Party Rights
Sub-Licensing
Employee Matters
Taxation
Relevant Industries

Retail

Food & Beverage

Hospitality

Personal Services

Business Services

Education & Training

Healthcare

Automotive

Real Estate

Fitness & Wellness

Technology Services

Home Services

Relevant Teams

Legal

Operations

Commercial

Compliance

Business Development

Finance

Brand Management

Training & Development

Property

Marketing

International Expansion

Franchise Support

Relevant Roles

Franchise Development Manager

Legal Counsel

Commercial Director

Operations Director

Business Development Manager

Compliance Officer

Chief Executive Officer

Chief Operating Officer

Franchise Manager

Regional Director

General Counsel

Contract Manager

Business Owner

Franchise Consultant

Territory Manager

Brand Manager

Industries
Dutch Franchise Act 2021 (Wet franchise): Primary legislation governing franchise relationships in the Netherlands, including mandatory pre-contractual information exchange, goodwill compensation, and non-competition clauses
Dutch Civil Code (Burgerlijk Wetboek): Contains fundamental contract law principles, including formation, validity, performance, and termination of contracts
EU Competition Law (Article 101 TFEU): Regulates vertical agreements including franchise agreements, particularly regarding territorial restrictions and exclusivity arrangements
Dutch Competition Act (Mededingingswet): National competition law implementing EU principles, affecting vertical agreements and market restrictions
Dutch Trade Name Act (Handelsnaamwet): Governs the use and protection of trade names in the Netherlands, relevant for brand usage rights
EU Trademark Regulation: Regulates the use and protection of trademarks across the EU, crucial for franchise brand protection
Dutch Personal Data Protection Act (AVG/GDPR implementation): Governs the processing of personal data, relevant for customer databases and marketing activities
Dutch Commercial Property Lease Law (Huurrecht Bedrijfsruimte): Regulates commercial property leases if the franchise involves physical locations
Teams

Employer, Employee, Start Date, Job Title, Department, Location, Probationary Period, Notice Period, Salary, Overtime, Vacation Pay, Statutory Holidays, Benefits, Bonus, Expenses, Working Hours, Rest Breaks,  Leaves of Absence, Confidentiality, Intellectual Property, Non-Solicitation, Non-Competition, Code of Conduct, Termination,  Severance Pay, Governing Law, Entire Agreemen

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