Franchising refers to the technique of taking over and using another company’s successful business model in return for payment of a fee. The franchise package granted to the franchisee includes, in particular, industrial or intellectual property rights to trade marks, trade names, shop signs, utility models, know‑how, designs, copyrights or patents, with the possibility of use for the purpose of reselling goods or services to end consumers.
The franchisor is the company which, in return for direct or indirect financial remuneration, enables the franchisee to operate the right to its franchise system. The franchisee is the company or person that receives from the franchisor the right to operate the franchise package developed by the latter with the aim of marketing products or services and to operate under the brand, patent or trade and service mark of the franchisor. “Franchise package” or “package deal” (franchising package) is the bundle of intellectual and industrial property rights, including trade marks or trade names or shop trade marks (e.g. signboards), utility models, designs, patents and the necessary know‑how, which are granted by the franchisor to the franchisee with the aim of marketing certain types of goods or services.
For the franchisor, franchising is an alternative to building branches for the supply of goods or services. With franchising, the franchisor can avoid the costs and liabilities associated with developing such an investment if it were to develop it itself with its own resources. On the other hand, the franchisor is dependent on the franchisee because the latter operates his own business and is responsible for it. The franchisor therefore cannot control the day‑to‑day operations of the franchisee’s business. The franchisor’s success is therefore dependent on the success of the franchisee.
In Greece, there is no specific special law for franchising; instead, the franchise agreement is subject to the respective applicable rules, such as Law 4072/2012 regarding national trade marks, Law 1733/1983 regarding patents, Law 3959/2011 regarding antitrust law, the Civil Code, etc.