LEGAL NATURE OF THE FRANCHISE CONTRACT

Abstract

The development of industrial property rights, in business practice and the soft law developed the franchise like commercial activity. Economical prosperity on franchise like commercial activity reflected of the legal framework on some national systems. This fact imposes the need for determination of the concept of franchising, the rights and obligations for each of contract participants. The franchise in Repubilc of North Macedonia is not regulated by law, this mean that Republic of North Macedonia don’t have lex specialis for franchisе. In addition to the stated specifics, the purpose of determining the legal nature of this institute is to determine the rights and obligations of the contracting parties, liability for damage, ways of terminating the contract, etc. Franchising is a more profitable model than the model of starting your own business from the lowest level. Of course, we base this perception and view on the previously conducted analysis in the literature and comparative business practice. Namely, it is indisputable that the beginnings of every business business represent a vision for success in modern society, on the other hand we must not ignore the impact of franchising, license, know-how, as the most modern business institutes. Franchising is a special kind of international licensing strategy when a company / trader buys the legal rights to use the name, brand, trademark or methods of operation of a foreign company. Franchising is applied in the service activities, when the seller of the franchise - the franchisor, assigns the right to use the industrial property rights to the buyer of the franchise. At the heart of franchising is the transfer of the right to use specific industrial property rights: trademark, industrial design, patent, know how, etc. On the basis of the franchise agreement, the franchisor gives the franchisor the right to perform the work in a certain way, which in practice is proven as a brand of doing business, and the latter in return is obliged to pay a certain percentage of the realized sales. This as compensation for the use of the trademark, emblem, process or production system (franchisor knowledge and experience). The question of the legal nature of the franchise agreement is an extremely complex one. This agreement contains elements of other named and unnamed agreements of autonomous commercial law, as follows: contract of sale, agreement of commercial representation, distribution agreement, license agreement for industrial property rights, know-now agreement. Hence, we can emphasize that the franchise agreement is a combination and composition of all those elements that lose their autonomy and uniqueness. In addition to the stated specifics, the purpose of determining the legal nature of this institute is to determine the rights and obligations of the contracting parties, liability for damage, ways of terminating the contract, etc.