Franchise Law in the Netherlands and Germany: Codification Versus Flexibility

Since the Franchise Act took effect on January 1, 2021, the Netherlands has had a separate legal framework for franchise agreements set forth in Title 7.16 of the Civil Code (“BW”). As a result, the Netherlands has one of the most comprehensive legal frameworks for franchising in Europe, which goes beyond a mere pre-contractual duty to provide information.

This article discusses the key features of Dutch franchise law. It covers, in turn, the pre-contractual phase, the main protective mechanisms for the franchisee—including the right of consent, the goodwill compensation, and the post-contractual non-competition clause—and the termination of the franchise agreement. These topics are codified in the Netherlands and are compared with the German approach to franchising. The core of the comparison is that, with the Franchise Act, the Netherlands has opted for statutory protection and predictability, while Germany approaches franchising primarily through contractual freedom, general standards, and case law.

This article was previously published in the Journal Franchise& Recht Informatiebron No. 25.