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What safeguards exist for UK franchisees?
Franchising is not governed by any one piece of legislation and there is virtually no regulation of franchising in the UK. However, the UK franchise industry is self regulated via the British Franchise Association. The safeguards that apply to a franchisee will depend on a number of factors, including whether a franchise agreement has been signed and, if it has, the provisions it includes. Greater protection may be available to a franchisee where the franchisor is a bfa member, since the franchise agreement will need to comply with the European Code of Ethics for Franchising. The Code of Ethics requires franchisor members to: 1. Have operated a pilot site before launching the franchise concept (not a company operated site). 2. Be the owner of the relevant trade marks and brand names. 3. Provide initial and continuing training. It also means that the franchisor is subject to obligations relating to recruitment, advertising and franchisee selection, as well as the contents of the franchise agreement. In addition to the self regulation, various UK legislation does, to an extent, affect franchising and provide certain protection to franchisees. This includes the Trading Schemes Act 1996, the Competition Act 1998 and the Enterprise Act.
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