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Vol 11 (2013) - Issue 5

Franchising disputes in India - Choices dictate the consequences

Divya Sharma, Bird & Bird LLP, London, UK

This article analyses the factors franchisors should take into account when choosing an appropriate dispute resolution mechanism for Indian franchising arrangements. The author considers the advantages and disadvantages of dispute settlement by Indian courts, foreign courts, arbitration inside India and arbitration outside India. The choice of dispute resolution mechanism can have significant commercial, financial and legal consequences, particularly in light of a recent decision of the Indian Supreme Court affecting franchisors’ ability to seek effective interim relief against Indian franchisees.

Book review - The law and regulation of franchising in the EU

John Baer, Greensfelder, Hemker & Gale, P.C., Chicago, USA

A review of “The Law and Regulation of Franchising in the EU.” by Dr. Mark Abell

The dark side of master franchising

Lee Plave, Plave Koch PLC, Reston, USA, Francesca Turitto, Studio Legale Roma, Lepri & Partners, Rome, Italy, Penny Ward, Baker & McKenzie, Sydney, Australia, Will K. Woods, Baker Botts LLP, Dallas, USA

This article analyses some of the key elements, perceived benefits and potential disadvantages of master franchising, one of the principal structures franchisors use to expand their brands internationally. The focus is on the risks and challenges of master franchise structures, including costs, selection of master franchisees, fees, term and renewal of sub-franchisee agreements, multi-level disclosure requirements, and transfer and termination of master franchisee agreements. The authors conclude that these risks and challenges vary among jurisdictions, among franchise systems and among master franchisees, and that no structure should be the default option for all.

Revised American Arbitration Association commercial arbitration rules: Effect on franchise disputes

Kevin Maher and Mo Alturk, Baker & McKenzie LLP, Dallas, USA

The American Arbitration Association issued several revisions to its Commercial Arbitration Rules in an effort to make the arbitration process more efficient and cost-effective. The revised rules relate to mandatory mediation, discovery procedures, dispositive motions, emergency relief and the use of technology. This article analyses these revisions and their potential impact on franchise transactions. The authors conclude that franchisors and franchisees should take note of the benefits the revised rules could represent in the event of a franchise dispute and in drafting or negotiating dispute resolution clauses in franchise agreements.