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The issue of applicable law in international franchising

The issue of applicable law in international franchising. Silvia Bortolotti. Index. Contractual framework Choice of law Effectiveness of the choice Co-ordination with the choice of forum/arbitration Law applicable in the absence of choice. Contractual framework. Master franchising:

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The issue of applicable law in international franchising

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  1. The issue of applicable law in international franchising Silvia Bortolotti

  2. Index • Contractual framework • Choice of law • Effectiveness of the choice • Co-ordination with the choice of forum/arbitration • Law applicable in the absence of choice

  3. Contractual framework Master franchising: • contract between franchisor and master franchisee • contracts between the master franchisee and the sub-franchisees Area development / area representation: • contract between franchisor and area developer / area representative • contracts governing the franchise units

  4. Choice of law • Laws of the franchisor’s home country • Laws of the host country • Laws of a third country • Further solutions (e.g. lex mercatoria, UNIDROIT Principles)

  5. Effectiveness of the choice • Provisions that can be derogated from by the parties • Mandatory rules • Internationally mandatory rules

  6. Co-ordination with the choice of forum/arbitration • Application of internationally mandatory rules by national Courts • Enforcement of foreign judgements

  7. Conclusive remarks on choice of law • The choice of law (together with the choice of forum/arbitration) should not be overlooked while drafting and negotiating those types of contract • It is advisable to carefully verify the effectiveness of the specific contractual provisions within the host country

  8. Law applicable in the absence of choice Possible criteria provided by conflict of law rules: • characteristic performance • law of the franchisee's country • law of the place where the contract was concluded • law of the place of performance

  9. Thank you for your kind attention! Silvia Bortolotti

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