Franchising refers to the technique of assuming and using the successful business model of another company against payment of a fee. The franchise package which is granted to the franchisee includes, in particular, the industrial or intellectual property rights to trademarks, trade names, shop signs, utility models, Know-how, registered designs, copyrights, or patents with the possibility of use for purposes of resale of goods, or services to end consumers.
The franchisor is the company which enables the franchisee to operate in its franchise system against direct, or indirect, financial compensation.
The franchisee is the company, or person, which receives the right from the franchisor, develops the franchise package from the latter with the goal of marketing products or services and operating the brand, or patent, or goods and services brand of the franchisor.
Franchise package, or package deal (Franchising Package), is the bundle of intellectual and industrial property rights, including brands, or trade names, or trademarks of businesses (e.g. billboards), usage patterns, designs, patents, and the necessary Know-how, which is granted by the franchisor to the franchisee, with the goal of the marketing of specific types of goods, or services.
Franchising represents an alternative to the set up of branches for the delivery of goods, or services, for the franchisee. With franchising the franchisor can avoid the costs and liabilities associated that it would incur with such an investment if it were to develop these with its own resources. On the other hand the franchisor is dependent upon the franchisee in that the franchisee operates its own company and is responsible for it. For this reason the franchisor cannot control the daily operations of the franchisee’s company. The success of the franchisor is therefore dependent upon the success of the franchisee.
In Greece no specific special law exists for franchising, instead the franchise agreement is subject to the respective current applicable rules like, for example, Law 4072/2012 with regard to national brands, G. 1733/1983 with regard to patents, G. 3959/2011 with regard to cartel law, of the Civil Code, etc.