With the development of society according to the socialist-oriented market economy model, along with the trend of world integration, the commercial franchise is one of the important business forms in the Vietnamese economy. More and more foreign brands appear in Vietnam in the form of franchises. With the success of famous foreign brands, the commercial franchise has become a top choice for young Vietnamese who want to start a business as well as businesses that want to participate in the supply chain of the famous brand. However, it is not easy for everyone to get into a commercial franchise. Realizing that, Apolo Lawyers (Tel: (+8428) 66.701.709) offers our clients a service to register commercial franchise in Vietnam fastly and efficiently.

Vietnamese law regulates commercial franchises as follows:

1. What are a commercial franchise and a commercial franchise contract?

Although there are many different concepts of commercial franchises based on the specific views of the legislators in each country, it can be seen that the common view in all of the above concepts is that "Commercial franchise is that one independent party (franchisees) distributes and trades products or services under trademarks and other objects of intellectual property rights as  a synchronous business system, developed and owned by another party (the franchisor); to be authorized to do this, the franchisee must pay a fee and accept certain restrictions set forth by the franchisor"

From the definite of commercial franchise, we can understand commercial franchise contract is the agreement between the franchisee and the franchisor; according to this agreement, the franchisor gives permission and request the franchisee implements independently purchasing and selling goods, supplying service in accordance with these terms:

• The purchase and sale of goods and provision of service shall be carried out according to the business organization methods prescribed by the franchisor and shall be attached to the trademark, trade name, business secret, business logo, advertising,… of the franchisor.
• The franchisor receives a franchise fee and has the right to control and assist the franchisee in running the business.

2. The condition for the registration of commercial franchise

Franchisors are allowed to grant commercial franchise rights when the business system intended to be used for franchising has been in operation for at least 1 year.

Decree No.08/2018/ND-CP has abolished the stipulation on the condition that the franchisee must have a business registration in the line of business suitable to the subject of franchising. Therefore, Vietnam no longer stipulates conditions for franchisees.

3. The content of the commercial franchise contract

Typically, a franchise contract will have the following contents:

- Contents of commercial rights.

- Rights and obligations of the franchisor.

- Rights and obligations of the franchisee.

- Price, recurring franchise fee, and payment method.

- Validity period of the contract.

- Renewal, contract termination, and dispute resolution

4. The dossier of registration of commercial franchise

According to the regulation of Vietnamese law, the dossier of registration of commercial franchise includes:

• Application for registration of commercial franchising (under form MD-1 in Appendix II issued together with Circular 09/2006/TT-BTM);
• An introduction to commercial franchising (according to the form in Appendix III issued together with Circular 09/2006/TT-BTM);
• A copy of the business registration certificate or equivalent document of the foreign trader certified by the competent authority where the foreign trader is established in the case of commercial franchising from abroad to Vietnam.
• A copy from the original book or a certified copy or a copy to be presented with the original for comparison, of the following papers:
  • Title of protection of industrial property rights in Vietnam or abroad in case there is a transfer of the right to use industrial property objects that have been granted protection titles;
  • Papers proving the original approval of the franchisors of the re-franchise in case the trader registering for franchising is a secondary franchisor.

​>>> Read more: Conditions for the protection of industrial designs

>>> Read more: Procedure for acquiring the Trademark registration Certificates

5. Legal consultation service on registration of commercial franchise at Apolo Lawyers

With many years of experience in consulting for businesses, Apolo Lawyers will support customers to carry out the registration of commercial franchise procedures quickly with the most reasonable cost and above all, always commit to confidential customer information.

We will advise and perform the following tasks for customers such as:

• Legal advice on overview of franchising activities.
• Consulting on legal aspects for issues related to domestic franchising, franchising from abroad into Vietnam and from Vietnam to abroad, especially paying attention to customers Legal aspects related to commercial law, competition law, contract law, and intellectual property law.
• Consulting and working with foreign partners in the field of distribution in the form of franchising.
• Consulting on business registration and establishment of a business to carry out franchising activities.
• Drafting, amending, supplementing, recommending risks, proposing solutions, assisting in contract negotiation, and signing.
• Participating in franchise contract negotiations.
• Consulting on drafting documents for franchise registration.
• Carry out the procedures for registering commercial franchising activities under the authorization of customers at the Department of Industry and Trade and the Ministry of Industry and Trade
• Carry out additional registration procedures, and register for adjustment of franchise information when franchising activities are implemented.
• Advise and protect the interests of customers throughout the entire franchise process.

For further information, please contact us: Apolo Lawyers

APOLO LAWYERS