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Vol 11 (2013) - Issue 3

Entering the U.S. franchise market: A summary of legal considerations

Susan Grueneberg, Partner, Snell & Wilmer L.L.P., Los Angeles, USA

Franchisors that have developed successful programs in their home countries will frequently consider expansion opportunities in other countries. In the past, the United States was not necessarily an attractive venue in light of the high degree of regulation of franchising. Increasingly, other countries have adopted laws governing the offer and sale of franchises and businesses and their counsel have become more comfortable navigating through disclosure and registration requirements. This article describes some of the steps a franchisor must take in preparing to enter the U.S. market, complying with U.S. franchise laws and managing the issues that will typically arise in the process.

Good faith: Enforcement in Australia

Alicia Hill, McInnes Wilson Lawyers, Brisbane, Australia

This paper examines a series of recent decisions from a number of Australian jurisdictions where the courts were asked to consider good faith in commercial contracts. It presents a brief summation of the relevant facts and issues of each case together with the findings in respect of good faith that were made. As will be evident, the outcomes delivered demonstrate that choice of law, forum and drafting techniques all play a part when relief is sought on the basis of a breach of good faith. The absence of any definitive High Court decisions means that the uncertainty about the utilisation of good faith standards in commercial relationships, including franchising relationships, will remain.

Key issues when advising master franchisees and area developers (and franchisors)

Ronald Gardner, Dady & Gardner, P.A., Minneapolis, USA, Ann Hurwitz, Baker Botts LLP, Dallas, USA, Francesca R. Turitto, Studio Legale Roma Lepri & Partners, Rome, Italy and Larry Weinberg, Cassels Brock & Blackwell LLP, Toronto, Canada

Franchisors can expand their operations internationally either through direct franchising or through establishing master franchise or area development agreements. This article provides an in-depth analysis of the legal and commercial issues franchisors, master franchisees and area developers must consider when planning and transitioning into and out of these agreements. The authors discuss a comprehensive range of factors affecting the pre-contractual phase, the contract negotiations, disputes between the parties and termination of the agreement.