In cooperation with Cerca, Cecile Peskine revisits, in an accessible way, the fundamentals of franchise law through videos.
04 – How important is the contract term? Can it be changed?
The law does not specify how long a franchise contract must be. However, there is a maximum term that cannot be exceeded. Under French law, this maximum term is 10 years. I cannot draw up a contract with an exclusivity clause that exceeds ten years. However, the duration can take into account lown duration, i.e. 7 years. The duration may also depend on the duration of the commercial lease. In France, the duration of a commercial lease is of 3, 6 or 9 years. Generally, franchise contracts are concluded for a term of around 5 to 10 years. So it really depends on the concept and the franchisee’s ability to recoup their investment over the term in question.
The real advice to give here is that the term must be long enough for them to recoup their investment. It must not be too short, and another piece of advice is that it must not be too long, because 15 years with someone you don’t get on very well with can be a bit long.