Menu
Blog Banner Image

The Franchise Memorandum

China's MOFCOM Amends Franchise Measures
Posted in International

On February 1, 2012, amendments to China’s Commercial Franchise Registration Administrative Measures will become effective, clarifying the 2007 Measures. Among the clarifications in the 2011 Measures are:

  1. Foreign franchisors must register with the Chinese Ministry of Commerce (MOFCOM) in Beijing, not one of the provincial Commerce Ministries.
  2. Amendments to registrations must be filed when Chinese company registration information for the franchisor changes, when a change in the status of the franchisor’s intellectual property rights occurs, and when a change in the number, geographic distribution, territorial rights, gross sales, and profitability of franchised outlets occurs. The revised Measures do not articulate a materiality standard.

The two-plus-one rule, requiring franchisors to have at least two company-owned outlets in operation for at least one year before beginning franchising, has not been changed.

According to our colleagues at the Jun He law firm in Beijing, more substantive revisions to the Franchise Regulations are being prepared.

Email LinkedIn Twitter Facebook

The information contained in this post is provided to alert you to legal developments and should not be considered legal advice. It is not intended to and does not create an attorney-client relationship. Specific questions about how this information affects your particular situation should be addressed to one of the individuals listed. No representations or warranties are made with respect to this information, including, without limitation, as to its completeness, timeliness, or accuracy, and Lathrop GPM shall not be liable for any decision made in connection with the information. The choice of a lawyer is an important decision and should not be based solely on advertisements.

About this Publication

The Franchise Memorandum is a collection of postings on summaries of recent legal developments of interest to franchisors brought to you by Lathrop GPM LLP. 

To subscribe to monthly emails for The Franchise Memorandum, please click here

Topics

Archives

2022

2021

2020

2019

2018

2017

2016

2015

2014

2013

2012

2011

2010

2009

2008

Blog Authors