Ministry of Commerce Order [2004] No. 25
Chapter 1 General Provisions
Article 1: These Measures are formulated to regulate commercial franchising activities, protect the legitimate rights and interests of the parties, and promote the healthy and orderly development of commercial franchising.
The business name, business model and other business resources are granted to the Franchisee for use; the franchisee engages in business activities under a unified business system in accordance with the contract and pays franchise fees to the franchisor.
Article 3 These Measures shall apply to franchise activities carried out within the territory of the People's Republic of China.
Article 4 The franchisor may directly grant the franchise right to the franchisee in accordance with the contract, and the franchisee will invest in establishing a franchise outlet and carry out business activities, but The franchise right may not be sub-licensed again; or the exclusive franchise right in a certain area is granted to the franchisee, and the franchisee can sub-grant the franchise right to other applicants or set up its own franchise outlets in the area. .
Article 5: Franchise operations shall abide by the laws and regulations of the People's Republic of China, follow the principles of voluntariness, fairness, honesty, and credibility, and shall not damage the legitimate rights and interests of consumers.
The franchisor shall not illegally engage in pyramid schemes in the name of franchising.
The franchisor’s business activities in the form of franchising shall not lead to market monopoly or hinder fair competition.
Article 6 The Ministry of Commerce shall supervise and manage franchise activities nationwide, and the competent commerce departments at all levels shall supervise and manage franchise activities within their jurisdiction.
Chapter 2 Franchise Parties
Article 7 The franchisor shall meet the following conditions:
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(1) Enterprises or other economic organizations established in accordance with the law;
(2) Have the right to license others to use trademarks, trade names, business models and other business resources;
(3) Have The ability to provide long-term business guidance and training services to franchisees;
(4) Having at least two direct-operated stores in China that have been operating for more than one year or owned by Direct-operated stores established by its subsidiaries and holding companies;
(5) For franchise operations that require the franchisor to provide goods supply, the franchisor should have stable and guaranteed Quality goods supply system and the ability to provide related services.
(6) Have a good reputation and have no record of engaging in fraudulent activities through franchising.
Article 8 The franchisee shall meet the following conditions:
(1) An enterprise established in accordance with the law or other economic organizations;
(2) Have funds, fixed locations, personnel, etc. suitable for franchising.
Article 9 The franchisor shall enjoy the following rights:
(1) To ensure the integrity of the franchise system Uniformity and consistency of product and service quality, and supervise the business activities of the franchisee in accordance with the contract;
(2) For violations of the provisions of the franchise contract, Franchisees who infringe upon the legitimate rights and interests of the franchisor and undermine the franchise system shall have their franchise qualifications terminated in accordance with the contract;
(3) Collect franchise fees in accordance with the contract and deposit;
(4) Other rights stipulated in the contract.
Article 10 The franchisor shall perform the following obligations:
(1) In accordance with the relevant provisions of these Measures Disclose information in a timely manner;
(2) Grant the franchise right to the franchisee and provide a business symbol and operating manual representing the franchise system;
(3) Provide the franchisee with a license to developSales, business or technical guidance, training and other services necessary for operation;
(4) Provide goods supply to the franchisee in accordance with the contract. Except for exclusive products and goods that must be provided by the franchisor or the supplier designated by the franchisor to ensure franchise quality, the franchisor may not force the franchisee to accept the supply of its goods, but may stipulate the quality standards that the goods should meet, or propose Several suppliers for the franchisee to choose from;
(5) The franchisor shall be responsible for guaranteeing the product quality of its designated suppliers;
(6) Promotion and advertising as agreed in the contract;
(7) Other obligations as agreed in the contract.
Article 11 The franchisee shall enjoy the following rights:
(1) Obtain authorization from the franchisor Use business resources such as trademarks, trade names, and business models; (2) Obtain training and guidance provided by the franchisor; (3) Obtain the supply of goods provided or arranged by the franchisor in a timely manner according to the price agreed in the contract; (4) Obtain a franchise Promotional support carried out by all parties; (5) Other rights stipulated in the contract.
Article 12 The franchisee shall perform the following obligations:
(1) In accordance with the terms of the contract Agree to carry out business activities; (2) pay franchise fees and deposits; (3) maintain the unity of the franchise system and shall not transfer the franchise right without the permission of the franchisor; (4) provide the franchisor with true operating conditions in a timely manner, Financial status and other information stipulated in the contract; (5) Accepting the guidance and supervision of the franchisor; (6) Keeping the franchisor’s business secrets; (7) Other obligations stipulated in the contract.
Chapter 3 Franchise Contract
Article 13 The content of the franchise contract shall be agreed upon by the parties , generally including the following content:
(1) Name and domicile of the party; (2) Authorized content, term, location and whether it has exclusive rights to use the franchise nature; (3) Type, amount, payment method of franchise fee and method of collection and return of deposit; (4) Confidentiality clauses; (5) Franchise product or service quality control and responsibility; (6) Training and guidance; (7) Use of trade names; (8) Use of trademarks and other intellectual property rights; (9) DisposalConsumer complaints; (10) Publicity and advertising; (11) Change and termination of the contract; (12) Liability for breach of contract; (13) Dispute resolution clauses (14) Other terms agreed upon by both parties.
Article 14 Franchise fees refer to the fees paid by the franchisee to obtain the franchise right, including the following types:
(1) Franchise fee: refers to the one-time fee paid by the franchisee to the franchisor to obtain the franchise right;
( 2) Royalty fee: refers to the fee that the franchisee regularly pays to the franchisor according to a certain standard or proportion during the use of the franchise;
(3) Other agreed fees: refer to other fees paid by the franchisee to the franchisor for the supply of relevant goods or services provided by the franchisor in accordance with the contract.
The deposit refers to a certain fee charged by the franchisor from the franchisee to ensure that the franchisee performs the franchise contract. Upon expiration of the contract, the security deposit shall be returned to the franchisee.
Both parties to the franchise shall agree on the franchise fee and deposit based on the principles of fairness and reasonableness.
Article 15 The term of a franchise contract is generally not less than three years.
After the expiration of the franchise contract, the franchisor and the franchisee may negotiate and determine the renewal conditions of the franchise contract based on the principles of fairness and reasonableness.
Article 16 After the franchise contract is terminated, the original franchisee shall not continue to use the franchisor's registered trademark, trade name or other logo without the consent of the franchisor, and shall not Apply to register the franchisor's registered trademark as a trademark for similar categories of goods or services. You must not apply to register words that are the same or similar to the franchisor's registered trademark as a trade name in the company name. You must not use the same or similar words as the franchisor's registered trademark, trade name or store name. Marks with the same or similar decoration are used on the same or similar goods or services.
Chapter 4 Information Disclosure
Article 17 The franchisor and the franchisee shall Relevant information should be disclosed in a timely manner before the operating contract and during the franchising process.
Article 18 The franchisor shall provide the applicant with true information in writing 20 days before the date of formal signing of the franchise contract.Provide true and accurate basic information about the franchise and the text of the franchise contract.
Article 19 The basic information disclosed by the franchisor shall include the following:
(1 ) The franchisor’s name, domicile, registered capital, business scope, years of franchising and other major matters, as well as the content of the financial report audited by an accounting firm and basic information such as tax payment;
(2) The number of franchisees, distribution locations, operating conditions, franchise outlet investment budget, etc., and the proportion of franchisees who have terminated the franchise contract to the total number of franchisees;
(3) Registration, licensing and litigation of trademarks; information on trade names, business models and other business resources;
(4) Type, amount, collection method and deposit return method of franchise fees;
(5) All situations involving litigation in the past five years;
(6) Various goods supplies or services that can be provided to the franchisee, as well as additional conditions and restrictions;
(7) Proof of ability to provide training and guidance to the franchisee and the actual situation of providing training or guidance;
(8) Legal representative and The basic information of other main persons in charge and whether they have received criminal punishment, whether they have ever been personally responsible for the bankruptcy of the company, etc.;
(9) The franchisor should be the franchisee Other information required to be disclosed.
If the franchisee suffers economic losses due to insufficient information disclosure or provision of false information, the franchisor shall bear liability for compensation.
Article 20 The franchisee shall truthfully provide information about its own business capabilities as required by the franchisor, including subject qualification certificates, credit certificates, property rights certificates, etc. During the franchising process, the true operating conditions and other contractually agreed information shall be provided in a timely manner as required by the franchisor.
Article 21 During the franchise period and after the termination of the franchise contract, the franchisee and its employees shall not disclose, use or allow it without the consent of the franchisor. others use what they havethe franchisor’s trade secrets.
Article 22 Persons and applicants who have not authenticated the franchise contract with the franchisor but have learned the franchisor’s business secrets through the franchisor’s information disclosure shall Undertake confidentiality obligations. The franchisor's trade secrets may not be disclosed, revealed to others or transferred without the franchisor's consent.
Chapter 5 Advertising
Article 23 The franchisor is publicizing, promoting and selling When franchising, advertising content must be accurate, truthful, and legal, and must not contain any deceptive, omitted important facts, or statements that may be misleading.
Article 24: The franchisor and the franchisee shall directly or indirectly contain records, figures or other relevant records, figures or other related information of the franchisor’s operating income or earnings in advertising materials. The information should be true, and the area and time involved should be clear.
Article 25 The franchisor and the franchisee shall not imitate other people's trademarks, advertising images, terms, or other identifications in any manner that may mislead, deceive, or cause confusion. mark.
Article 26: During franchise promotion activities, the franchisor shall not artificially exaggerate the benefits brought by the franchise or intentionally conceal the objective risks that may arise from the franchise. Situations that affect the interests of others.
Chapter 6 Supervision and Management
Article 27 Competent commercial departments at all levels shall strengthen their supervision Manage and coordinate franchise activities within the administrative region and guide the work of local industry associations (chambers of commerce).
Commercial authorities at all levels should establish credit files for franchisors and franchisees and promptly publish the list of illegal enterprises.
Article 28 Franchise industry associations (chambers of commerce) shall formulate industry norms in accordance with these Measures, carry out industry self-discipline, provide relevant services to franchise parties, and promote industry develop.
Article 29 The franchisor shall, in January of each year, report the status of the franchise contract signed in the previous year to the competent commercial department of its location and the location of the franchisee. Filing with the competent commercial department. The local commercial department shall report the filing status to the higher-level commercial department.
Article 30 If patent licensing is involved in franchise activities, it shallA patent licensing contract shall be signed in accordance with the relevant provisions of the "Patent Law of the People's Republic of China" and its implementing rules, and the filing matters shall be handled in accordance with the "Regulations on the Registration and Management of Patent Implementation License Contracts".
Article 31 Before carrying out franchising activities, the franchisor shall handle a trademark license contract in accordance with the provisions of the "Trademark Law of the People's Republic of China" and its implementation regulations Filing matters.
Chapter 7 Special Provisions for Foreign-Invested Enterprises
Article 32 Foreign-invested enterprises shall not Engage in prohibited businesses in the "Guidance Catalog of Industries for Foreign Investment" in the form of franchising.
Article 33 If a foreign-invested enterprise engages in commercial activities in the form of franchising, it shall apply to the original approval department for the addition of "engaging in commercial activities in the form of franchising". Business scope, and submit the following materials:
(1) Application letter and board resolution; (2) Enterprise business license and foreign-invested enterprise approval certificate (copy); (3) Contract and articles of association modification agreement (foreign-invested enterprises only submit articles of association modification); (4) Relevant documents and materials proving compliance with the provisions of Article 7 of these Measures; (5) Basic information reflecting the provisions of Article 19 of these Measures; (6) Franchise contract sample; (7) Franchise operation manual.
The approval department shall make a written decision of approval or disapproval within 30 days from the date of receipt of all the above application materials.
After the applicant is approved, he should go through the enterprise registration change procedures with the industrial and commercial administration authorities within one month after receiving the "Foreign-invested Enterprise Approval Certificate" renewed by the approval department. .
Article 34 If a foreign-invested enterprise is approved to engage in commercial activities in the form of a franchise, it shall submit the franchise contract signed in the previous year in January of each year. The situation shall be reported to the original approval department and the competent commercial department where the franchisee is located for filing.
Article 35 When foreign investors establish foreign-invested enterprises that specialize in commercial activities through franchising, in addition to complying with these Measures, they must also comply with the provisions of the Foreign Investment Regulations Relevant laws, regulations and rules.
Article 36 Foreign-invested enterprises that have engaged in commercial activities in the form of franchise operations before the implementation of these Measures shall file the status of their business operations with the original approval department. Those who continue to engage in commercial activities in the form of franchising shall comply with this chapterComplete relevant procedures according to prescribed procedures.
Article 37 Hong Kong, Macao and Taiwan-invested enterprises engaging in commercial activities in the form of franchising in the mainland shall be governed by the provisions of this chapter.
Chapter 8 Legal Responsibilities
Article 38 Violation of Article 7 and Article 7 of these Measures Article 8 stipulates that the competent commerce department shall order corrections and may impose a fine of not more than 30,000 yuan; if the circumstances are serious, the business license shall be revoked by the industrial and commercial administration authorities.
Article 39: Anyone who fails to disclose information in accordance with the provisions of these Measures shall be ordered to make corrections by the competent commerce department and shall be fined not more than 30,000 yuan; if the circumstances are serious, Request the industrial and commercial administration authority to revoke the business license.
Article 40 If the franchisor conducts advertising in violation of the provisions of these Measures, it shall comply with the provisions of the Advertising Law of the People's Republic of China and other relevant laws, administrative regulations and rules. deal with.
Chapter 9 Supplementary Provisions
Article 41 The Ministry of Commerce is responsible for the interpretation of these Measures.
Article 42 These Measures shall come into effect on February 1, 2005. At the same time, the "Commercial Franchise Management Measures (Trial)" issued by the former Ministry of Domestic Trade shall Abolition.
