Source: Vincent Pompougnac - Franchise Magazine
In a press release dated February 9, the Minister for the Economy clarified the spirit and scope of the contested amendment to the law that bears his name, dismissing the arguments of both franchises and cooperatives.
"The National Assembly has adopted a measure regulating contracts between affiliated stores and chains," said Economy Minister Emmanuel Macron in a statement on February 9. "These contracts will now be limited to nine years, a period that will allow chains to recoup their investments, provided that the chain exceeds a turnover threshold set by decree."
It should be noted that the amendment in question, numbered 1681, was strongly contested by both the Federation of Cooperative and Associated Trade and the French Franchise Federation. However, as Emmanuel Macron points out in his press release, it is based on an opinion issued in 2010 by the Competition Authority, which considered "that affiliated stores are too often captive to the brand that groups them together. "
And that "multiple clauses inserted into their contracts and statutes hinder their mobility and strongly discourage them from changing brands, particularly the long duration of contracts." Or even non-competition or non-reaffiliation clauses , which would now be "deemed unwritten." Much to the chagrin of , some franchise specialists , even if others say they are in favor of "more freedom."
For Emmanuel Macron, "the measure does not discriminate between different categories of network."
"The freedom of independent retailers to modify their membership terms at reasonable intervals, or even to change brands, will be an important factor in stimulating competition in catchment areas between brands, to the benefit of French consumers, who will enjoy increased purchasing power and a more diverse range of products," the Minister insists . For whom "the measure does not discriminate between different categories of networks."
"Large retail groups operate either as cooperatives or as integrated entities. Most integrated groups also rely on franchising, particularly in the food retail sector, for supermarkets and convenience stores," the Minister explained in support of his argument. In total, independent retailers dependent on large chains [sic], whether cooperatives or franchisees, account for nearly half of retail sales in France."
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