Recommendation 1182
(1992)
- Author(s):
- Parliamentary Assembly
- Origin
- Text
adopted by the Standing Committee, acting on behalf of
the Assembly, on 11 March 1992. See Doc. 6560, report of the Committee on Legal Affairs and Human
Rights, Rapporteur: Mr Stig Gustafsson; and Doc. 6578, opinion of the Committee on Economic Affairs and Development,
Rapporteur: Mr Rowe.
- Thesaurus
1. Franchising – by which is meant
the right to sell, against payment, goods or services under a certain name
or designation supplied by someone else – is becoming increasingly
common in Council of Europe member states, and is already spreading
rapidly in Central and Eastern Europe and in the developing world.
2. Although such an agreement will often benefit both the franchisor
(the brand name's owner) and the franchisee (the person or company
using the brand name), sometimes it may also be unfair to the latter
by submitting him or her to excessive financial and other obligations
vis-à-vis the franchisor, or by not providing for sufficient legal
and social protection.
3. While legislation is already extensive in countries where
the phenomenon is of long standing, such as in the United States,
in many Council of Europe member countries – and in particular in
the reforming countries of Central and Eastern Europe – it is either
non-existent or at an embryonic stage.
4. Among the issues that need to be settled to ensure fair and
equitable franchising agreements are, for instance, whether the
franchisee should be considered as an employee (with the resulting
labour legislation safeguards) or as self-employed or something
in between the two; to what extent ordinary contract laws should extend
also to franchising agreements, for instance as regards clauses
restricting sources of supply, the freedom to sell (including possible
consequences for consumers), or the cancellation of contract; and
the right of franchisees to negotiate with the franchisor, independently
or jointly.
5. The International Institute for the Unification of Private
Law (UNIDROIT) in Rome has been studying the franchising contract
since 1985. Its work may lead to the adoption of a guide to franchise
agreements but does not rule out the possibility of preparing a
convention or uniform law.
6. The Assembly, considering the above, recommends that the Committee
of Ministers study the legal, social and economic aspects of franchising
in Europe in co-operation with the International Institute for the Unification
of Private Law (UNIDROIT) and that it thereby pay particular attention
to the special situation prevailing in Central and Eastern Europe.
7. It also invites the governments of member states to draw up,
and harmonise at European level, legislation on franchising, in
the interest of all parties concerned, as well as that of the general
public.
8. Finally, in the meantime, the Assembly recommends that the
governments of member states work in favour of the volontary adoption
of appropriate codes of conduct by professional associations, at
national and international level.
