Franchising Around the World

There are many different ways to expand your business. One way to expand is through franchising. In today's business world, franchising is a common business method used around the world today. Basically you pay for the rights to use another person's business philosophy. The franchisor grants you these rights to distribute its products, techniques, and trademarks for a percentage for a percentage of the gross monthly income and of course a royalty fee. Since business is practiced around the world it is important to understand how other countries deal with franchises.

UK

In Britain, we have no franchise-specific laws. Any business that operates as a franchise is subject to the same laws that govern other businesses.

United States

It is not surprising that there are several franchising laws in the United States. In fact, franchisors are required by the Federal Trade Commission of the United States to provide a Uniform Franchise Offering Circular (UFOC). This law requires franchisors to disclose every bit of essential information to potential franchisees. Also, once an agreement is made between the franchisee and the franchisor, an official contract is drawn up and signed.

Russia

No franchise is valid in Russia unless it is written and registered. Also, franchisors cannot set standards or limits on the prices of the franchisee's goods.

Kazakhstan

Kazakhstan was one of the first countries in Central Asia to determine a definition and law for foreign franchising. According to estimates, the annual franchise income for the US alone is $.0.5 just from the Kazakhstan market. The government of Kazakhstan recognizes the value of franchising and continues to promote it throughout their country.

Obviously, after reading about some of the different ways in which companies seek to franchise you can understand how complicated it can get. It can be simple if you are just working out a deal with someone in your own country. However, what happens when you move to the international market? When this happens, it is helpful to understand how everything works from a legal perspective.

For example, you would not want to decide to bring your franchise to Russia and not realize you needed to register it so that it was valid and recognized by the government. If you are in the franchise business and considering expanding internationally, keep these factors in mind. It is always a good idea to do your research before you do something you will regret. However, once you have done your investigating, the right opportunities may lead to great business in the future.

Tom_Sangers

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