CANADA: an interesting case law of the Superior Court of Quebec about notice of termination period.

References: Superior Court of Quebec, 30-11-2015, case no: 500-17-073422-126, 3495019 Canada Inc. (C2C Uniforms) v. UAP Inc. [1] In 1973, Mr. Vincent Feign, opened a business with his brother under the name Aero Mode Ltd., which manufactured uniforms. After the bankruptcy of Aero Mode Ltd. in the late 1990s, Mr. Feign purchased the company’s assets and […]

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POLAND: Verdict of the Appeal Court in Warsaw, May 15th, 2015 (VI ACa 1937/13) – international distribution agreement.

The defendant argued that the reason of termination with immediate effect was the violation of the non-competition clause provided for in the agreement by the distributor. The plaintiff was of the opinion that firstly: the non-competition clause was not provided for in the contract at all and secondly: that the defendant have terminated the distribution […]

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KUWAIT: Kuwait agents lose ‘Exclusive Agent’ status. Kuwait National Assembly amends the Law of Commercial Agencies.

The Article 1 of the Amendment Act enables the traders and companies vis-a-vis a binding Agency Agreement to promote or distribute commodities or products or services in his or her capacity as the agent, distributor or owner of the franchise, or owner of the product license or the original importer in exchange for profit or […]

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LITHUANIA: An interesting case law about the right of compensation after termination of a service contract.

Lithuanian Supreme Court has ruled that trading intermediate has a right to get a compensation, even if the contract does not meet all features of the commercial representation agreement. Lithuanian Supreme Court has ruled that the commercial agency legal relationship could be established if there are met all of the following criteria:  1) The core […]

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U.S.A.: Amendments to California law require franchisors to buy franchisee’s assets when terminating franchise agreements in compliance with law and mandate written standards for disapproving transfers.

In 1980, California adopted the California Franchise Relations Act (CFRA).  It established a good cause standard for termination of a franchise, and set out conditions under which a franchisor could refuse to renew a franchise.  However, it did not address franchisors’ right to prohibit franchisees from selling their franchises to third parties. As of January […]

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NETHERLANDS: The franchise branch in the Netherlands is divided, there is insufficient support for the concept Dutch Franchise Code. Does the alternative DFA Franchise Code of Conduct perhaps offer a way out?

Introduction and background The Distribution, Franchise and Agency Association (Vereniging DFA), among others during meetings organised by the Ministry of Economic Affairs, through the (published) responses to the concept Dutch Franchise Code (concept NFC – ´Nederlandse Franchise Code´) and also in the media, has observed how the branch is struggling with the consultation draft of […]

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GERMANY: Distributorship contracts according to German law.

According to established law practice, the distributor is entitled to a claim for compensation upon the termination of the distributorship contract if the legal relationship between the distributor and the company exceeds a simple seller-buyer-concept and the distributor is integrated tightly into the distribution network of the supplier and if, furthermore, the distributor is obliged […]

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SWEDEN: franchise – an arbitration case of interpreting an agreement and kick-backs.

The facts of the case were the following. The franchise system operated in the service industry and marketed its services towards consumers. In the main, the franchise system was designed so that the franchisee solicited services on the franchisor’s (and its suppliers) behalf and the consumer paid for the services directly to the franchisor. The […]

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EU: Goodwill indemnity and recovery of additional damages? The European Court of Justice rules on Article 17 of the commercial agency directive.

The issue in dispute Article 17 of the Directive 86/653/EEC on commercial agents provides two alternative types of remuneration due to the agent upon contract termination: –      a goodwill indemnity for the customers brought by the agent, within a maximum amount of one year of commission, calculated on the last five years of the relationship, […]

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SPAIN: Distribution vs. purchase agreements; clientele compensation in case of breaching by the distributor.

The parties entered into a relationship in 2004 for almost four years with no written agreement. The relationship ended because an administrative procedure against the reseller (distributor) by the Health and Consume Department due to the presence of some irregularities in the storage of the products (cheese). The first question to solve was to decide […]

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CANADA: British Columbia quickly on its way to becoming sixth Canadian Province with franchise legislation.

  In early October the government of British Columbia (“BC”) introduced a bill that would enact a statute governing franchises in that province.   The possibility of franchise legislation in BC comes as no surprise as the government has been investigating the issue in the past couple of years.  It recently received a report from a […]

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AUSTRALIA: Proposed new law affecting distribution and other agreements.

The Treasury Legislation Amendment (Small Business and Unfair Contract Terms) Bill 2015, which amends the Australian Securities and Investments Commission Act 2001 and the Competition and Consumer Act 2010, passed both Houses of Parliament on 20 October 2015, and the new Act will commence in about 12 months. Under Australian law, a contract term will […]

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GERMANY: No compensation claim of the franchisee after termination of the franchise agreement in case of anonymous mass businesses and only factual continuity of the customer base.

  The factual situation underlying the decision was the following: The defendant is running a bakery chain with more than 930 bakery stores in Germany. More than 90 % of the bakery stores are operated by franchisees. The plaintiff was one of the defendant’s franchisees. After termination of the franchise agreement the defendant claimed for […]

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CANADA: Proposed Franchise Bill Introduced in British Columbia.

The possibility of franchise legislation in the province comes as no surprise given the government’s recent investigation into regulating franchising, and the recommendation of the British Columbia Law Institute’s (BCLI) Report on a Franchise Act for British Columbia. The private member’s bill proposing franchise legislation that was introduced last spring, did not progress past first reading. […]

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