Franchising in Russia

Development through franchising is logical and obvious step. There are a lot of sort of business moving up through franchise. To get more markets better with local’s help.

Each state has own legislation and rules which regulates intellectual property rights. There are common international rules working all over the world but there are some special acts exist in each country. Russia isn’t an exception.

Generally, there are no statutory bans or legal restrictions against foreign companies offering or selling franchises in Russia. Thus, foreign business entities are free to franchise directly or indirectly to Russian business entities. There is no requirement to set up a local company as a pre-condition to undertaking franchising activities in Russia.

Step 1. Intellectual right registration.

There is nothing to do without registered rights. If a company has any certificate of another country or international certificate it is necessary to get Russian one.

According Russian law it is allow signing an agreement without registration if there are no registered rights are going to loan. For example a company can franchise its name or brand book without trademark using transfer.

Step 2. Strategy elaboration

If all IR have gotten next step – find a way to open first franchisee. Russia is the biggest area and it is important to know every local market rules. There are own economic interest in the Far East and other in Caucasus, Moscow differs from rest of the state and has own structure and economic rules.

It is mostly simple to put on schedule your order and wait for franchisees. But all of them want to know why your proposal is the best, have you learned all aspects of the market, can you provide the best services to franchisee. For this reason it is important to make good proposal.

Step 3. Legal advice

For doing your business best it’s important to prepare your legal documents – agreements with franchisees and others.

According to Article 1027(1) of the Civil Code, under a franchise agreement, the rights holder grants the user, for consideration and for a definite or indefinite period, a right to use a set of IP rights, including trademarks and other IP rights, to operate its business – in particular, trade names and secrets of production (know-how).

The key element of every franchise agreement is a protected (ie, registered) trademark. Without registration the contract may not be fully save.

Our company will provide support to you if your brand need to enter in Russian market. Contact us.