The Dutch Franchise Act

What does the Act mean for the franchise sector?

The Act sets out clear requirements for franchise agreements and the relationship between the parties. These rules are largely mandatory, meaning deviation is generally not permitted.

For existing agreements, a transitional period applied to specific elements, such as goodwill, non-compete clauses and rights of consent. New agreements must comply fully from the outset. The core principles are clear: transparency, balance and stronger protection for the franchisee.

The pre-contractual phase

As a franchisor, you must provide the franchisee with complete and accurate information in good time. The Act specifies what information must be provided.

This information must be shared at least four weeks before entering into the agreement. During this standstill period, the terms may not be amended. Providing an operational forecast is not mandatory, but clarity in advance is essential.

The franchise agreement

The Act also sets requirements for the content of the agreement. Key topics include:

• Goodwill: how it is determined and how it is valued
• Non-compete: limited to a maximum of one year after termination and restricted to the operating area
• Amendments (right of consent): certain changes require prior consent from some or all franchisees

This requires careful consideration when drafting and updating agreements.

Obligations during the partnership

During the term of the agreement, the franchisor must remain transparent about matters such as fees, including marketing and IT contributions. The aim is to provide better insight and enable proper consultation on how these funds are used.

The franchisee must also be informed in good time of relevant developments within the franchise system.

Foreign franchisees

The Dutch Franchise Act applies mandatorily to franchisees established in the Netherlands. Where a franchisee is established abroad, deviation from the Act is permitted, even if Dutch law applies.

What can we help you with?

Do you have questions about the Dutch Franchise Act, or would you like your agreements and documentation reviewed or updated? We help you quickly understand what is required and what this means in practice for your organisation.