Franchise Deal Checklist: What Every Buyer & Seller Must Know

In India, your franchise agreement isn't paperwork. It's the entire legal regime your network runs on. There's no standalone franchise law in India. A franchise relationship is stitched together from the Contract Act, the Trademarks Act, the Competition Act, FEMA and tax law. The practical consequence is unforgiving: every protection you have is the protection you drafted. Yet most franchisors expand on a template pulled off the internet — and the post-mortem, when a network fails, almost always lands on the same clauses: → Unregistered trademark. You're literally selling the right to use a mark you may not even own yet. → Vague territory rights. Undefined exclusivity turns your own franchisees against each other. → Oral ROI promises. With no written disclosure, they become misrepresentation claims. → Weak termination & exit. No de-branding, no data return, no clean off-boarding. → Over-broad non-compete. Unreasonable restraints get struck down under §27 of the Contract Act. The pattern is striking: territory, exit and IP disputes account for the bulk of franchise litigation — the exact clauses founders treat as boilerplate. Eight checks before your next franchisee signs: ✓ Trademark filed in all relevant classes ✓ Written disclosure document issued ✓ Territory defined on a map, with carve-outs ✓ Royalty, fees & mandatory purchases itemised ✓ Renewal triggers & notice period specified ✓ Exit playbook documented ✓ Non-compete scoped to survive §27 ✓ Arbitration seat & jurisdiction named A clause closed now is a dispute avoided later. Draft it like it will be litigated — because one day, it might be. Informational only; not legal advice or solicitation. #Franchising #CorporateLaw #StartupIndia #IntellectualProperty #FranchiseLaw #LegalAdvisory