You created a business, invented a service. You then developed a franchise network or more generally a distribution network. You are now ready to export your brand.
There are many export models in your distribution network. While one may be the dominant model of your international expansion, it is rarely the only modus operandi.
Strategy for setting up your brand abroad
Gouache Avocats assists you in determining the most appropriate investment scheme: liaison office to study the market, creation of a branch, a subsidiary, a joint venture, use of contractual techniques (commercial agency, exclusive distribution agreements, Master License, Master Franchise), determination of the roles of the parties and financial flows.
These choices partly respond to opportunities and constraints related to regulations.
For example, there is no need to stipulate a brand royalty if exchange control rules or the practice of the local central bank prohibit the payment of royalties abroad. For example, a joint venture may be necessary if foreign investment law requires the control of the local subsidiary by a national.
We invite you to discover here all the articles relating to the legal strategy of setting up in the context of an international expansion.
Gouache Avocats analyses the legal environment of the country applicable to your distribution activities, based on the documentation collected relating to about 50 foreign countries, on specifically designed questionnaires from our correspondents, on the assistance of correspondents specialising in distribution law, and gives you an appropriate recommendation resulting from an overall analysis, including tax aspects.
Taking into account tax aspects is decisive: does the contract create a permanent establishment for the French brand that will oblige it to tax its income locally? If so, is the brand protected from double taxation? How to optimize the cash flow of the brand see the profitability of the contract by playing on differences in withholding tax rates according to the qualification of financial flows (service fee, management fee, royalty, interest, etc.).
Several of our lawyers have lived abroad and have either studied or practiced there (England, Germany, Greece, Algeria, Ivory Coast, etc.). Several of them are Anglo-Saxon LLM graduates. The firm has worked on a large number of international files and has developed methodologies and intimate knowledge of this type of file.
Our method for exporting your brand internationally
Wondering how to set up your brand abroad? Gouache Avocat helps you export your brand:
- We present the possible modes of exporting the brand: creation of a liaison office to study the market, a branch, a subsidiary, a joint venture, or contractual means (agency, exclusive distribution agreements, Master License, Master Franchise);
- We help you choose the right brand export mode according to the characteristics of the market, your objectives, constraints and opportunities in this market;
- We analyze the legal environment (foreign exchange regulations, foreign investment, police laws applicable despite the designation of the law applicable to the contract), fiscal and customs to allow to adapt if necessary the financial clauses of the contract (entry fee, royalties, pricing of products);
- We organize upstream the protection of your brand in the Territory concerned;
- We draft the distribution contract by integrating all international aspects: applicable police laws in the country concerned, clause determining the applicable law, clause conferring jurisdiction or arbitration clause, after carrying out a tax, customs and foreign exchange regulation study to structure the contract in the best of your interests and guarantee the brand the best net return;
- We assist you in litigation with your foreign distributors; Gouache Avocats has developed significant experience in arbitral proceedings.
Gouache Avocats has correspondents and contacts tested in about 50 countries around the world to have access to local regulations and validate its implications on the contract.
We have particular and original experience of the countries of the Maghreb and sub-Saharan Africa (own documentary resources, network of legal, tax correspondents, accounting experts, dense, numerous references, knowledge of local social and economic contexts).
To export your brand, contact Gouache Avocats. To draft, negotiate or conclude a Master Franchise, Gouache Avocats is at your disposal.
The Master Franchise and the Master License
Master Franchise or Master License agreements allow the holder of a trademark operated on its national territory to export its concept by entrusting its development on a specific territory to a Master Franchisee.
The Master Franchisee is a sub-franchisor. It benefits from territorial exclusivity in a geographical area defined by a master franchise agreement. This geographical area is important and the mission of the master franchisee is to select and franchise the activity in this area, under the terms of a contractual development plan (number, characteristics and schedule of openings). The duration of the contract must be sufficient to allow the Master Franchisee to develop the brand and amortize its investments. It is often set at 10 years. The master-franchisee is then the co-contractor of the franchisees in its exclusive territory.
The master franchise makes it possible to set up a brand in markets unknown to the network and in which the implementation of the concept may require its adaptation, which a local investor is often best able to do, under the strict control of the brand. It is a solution wherever the branch or direct franchise development of the network would generate too great risks or could not be carried out quickly.
The construction of a Master Franchise contract takes up most of the provisions of a classic franchise contract. A large entrance fee is generally provided for the acquisition of the Master’s degree and part of the fees collected are frequently paid back to the brand.
The master franchisee is the only contact of the franchisee who has no connection with the main franchisor. The franchisee therefore has no recourse against the main franchisor. The assignment and termination clauses must be particularly protective of the main franchisor, who must ensure that it can recover the network developed at the end of the contract.
This system has been very successful and has allowed many French brands to establish themselves abroad and to grow rapidly. In some geographical areas, such as the near and middle east, there are investors operating several master franchises and having strong investment and management capacity.
The differences between the master franchise and the master license are identical to those that may exist between franchise and license. Gouache Avocats is at your disposal for any other information relating to the Master Franchise.
Gouache Avocats has correspondents and contacts tested in about 50 countries around the world to have access to local regulations and validate its implications on the contract.
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