TYPOLOGY OF DISTRIBUTION AGREEMENTS PRODUCER AGENT RESELLER Agency
TYPOLOGY OF DISTRIBUTION AGREEMENTS PRODUCER AGENT RESELLER Agency agreemen t (Wholesale r/retailer) DISTRIBUTOR Exclusive purchasing Exclusive supplying FRANCHISEE Exclusive transfer of business method Exclusive Selective Exclusive. Franchising Master supply distribution franchising n CONSUMER © D. Ferrier 1
FRANCHISING DEFINITION FRANCHISOR HOW - PROVIDES COMMERCIAL AND TECHNICAL ASSISTANCE EFFECT REASON ? ) - TRANSFERS INTELLECTUAL PROPERTY RIGHTS RELATING TO TRADE MARK AND KNOWFOR DISTRIBUTION POSITIVE NEGATIVE COMMERCIAL FREEDOM INCREASE COMPETITION (RULE OF - RESTRICTION OF FRANCHISEE’S - EVICTION OF OTHER DISTRIBUTORS BRAND - RESTRICTION OF INTRA BRAND INTER COMPETITION © D. Ferrier 2
FRANCHISING Assessment of appreciable restriction of competition Undertakings Agreement Turnover (40 M €) Obligations and practices Market share (5% / 15% / 30%) Appreciab le restriction Context (eg : cumulative effect of parallel networks) © D. Ferrier 3
FRANCHISING ECONOMIC APPROACH (BER 2790 -99) MARKET POSITION NO PRESOMPTION OF ILLEGALITY SELF EXAMINATION (INDIVIDUAL EXAMINATION) [>50 %] [CUMULATIVE EFFECT: POSSIBLE DISAPPLICATION OF THE BER] 30 % « SAFE HARBOUR » 15 % « DE MINIMIS » [<5 %] [NO SIGNIFICANT CONTRIBUTION TO THE CUMULATIVE EFFECT] © D. Ferrier 4
FRANCHISING REGULATION HARD CORE RESTRICTIONS - ABSOLUTE TERRITORIAL EXCLUSIVITY - RESALE PRICE MAINTENANCE - RESTRICTION OF CROSS SUPPLY BETWEEN FRANCHISEES (? ) EXCLUDED RESTRICTIONS - NON COMPETE OBLIGATION FOR PERIOD EXCEEDING FIVE YEARS (? ) - OBLIGATION NOT TO RESELL AFTER TERMINATION GOODS OR SERVICES EXCEEDING : ▪ PREMISES, ▪ GOODS OR SERVICES CONTRACT ▪ PERIOD OF ONE YEAR AND NOT NECESSARY TO PROTECT KNOW HOW THE EXEMPTION OBLIGATIONS REQUIRED TO : - PROTECT IPR - MAINTAIN IDENTITY AND UNIFORMITY OF NETWORK © D. Ferrier 5
FRANCHISING IPR RELATED OBLIGATIONS EXEMPTED ARE COVERED BY THE BER OBLIGATION ON THE FRANCHISEE : § NOT TO USE KNOW-HOW LICENSED BY THE FRANCHISOR FOR PURPOSES OTHER THAN THE EXPLOITATION OF THE FRANCHISE, SO: Ø NOT TO ENGAGE IN ANY SIMILAR BUSINESS Ø NOT TO ACQUIRE FINANCIAL INTERESTS IN THE CAPITAL OF A COMPETING UNDERTAKING § NOT TO DISCLOSE TO THIRD PARTIES THE KNOW-HOW PROVIDED BY THE FRANCHISOR, SO : Ø NOT TO ASSIGN THE RIGHTS AND OBLIGATIONS UNDER THE FRANCHISE AGREEMENT WITHOUT THE FRANCHISOR’S CONSENT § TO COMMUNICATE TO THE FRANCHISOR ANY EXPERIENCE GAINED IN EXPLOITING THE FRANCHISE, SO : Ø TO GRANT HIM AND OTHER FRANCHISEES A NON-EXCLUSIVE LICENCE FOR THE KNOW-HOW RESULTING FROM THAT EXPERIENCE § TO INFORM THE FRANCHISOR OF INFRINGEMENTS OF LICENSED IPR, AND TO ASSIST THE FRANCHISOR IN ANY LEGAL AGAINST INFRINGERS © D. ACTIONS Ferrier 6
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