Closing a Franchise in Argentina: How to Remove Your Branding

Before granting a franchise, it is worth addressing an awkward question: how will an outlet stop presenting itself as part of the network once its contract has ended? Planning that exit protects customers, the outgoing franchisee and the wider franchise network. It is not about anticipating a dispute, but about designing an orderly transition that also works when the relationship ends by mutual agreement.

1. Separate the end of the contract from the removal of branding

The end of a contract and the disappearance of franchise branding do not automatically happen at the same time. An illuminated sign, a social media account or branded packaging may remain, leading the public to believe that the outlet is still associated with the brand.

In Argentina, franchise agreements are specifically governed by Articles 1512 to 1524 of the national Civil and Commercial Code. Article 1512 provides for the use of a proven system under the franchisor’s trade name, emblem or trade mark. It also requires the franchisor to own the relevant rights or be entitled to use them and grant their use to the franchisee.

Trade mark protection also falls under Law 22,362 on Trade Marks and Trade Names. When preparing the contract, a legal professional should therefore align the conditions governing use of the brand with the obligations that will apply after the agreement ends.

Do not confuse removing the franchise identity with prohibiting all future business activity. Whether the former franchisee can continue operating another business will depend on the contract and the applicable rules, including those governing any non-compete clause.

2. Create a brand identity inventory from the outset

It is difficult to remove something that was never recorded. Before franchising your business, draw up a list of everything that will associate each outlet with the network. Make it part of the opening process and keep it up to date.

The inventory should distinguish between:

• Physical items: shopfronts, fascia signs, window displays, uniforms, menus, vehicles, packaging and promotional materials.
• Digital channels: social media profiles, map listings, outlet webpages, domain names and listings on sales platforms.
• Business documents: quotations, receipts and other transaction documents, email signatures and forms displaying the franchise identity.
• Internal materials: manuals, graphics files and training resources subject to conditions of use or confidentiality requirements.

For each item, record who owns it, who manages it and what should happen to it when the relationship ends. Not everything needs to be destroyed: some items may be returned, others modified, and others retained for legal reasons without continuing to be used commercially.

Pay particular attention to digital accounts. If you do not know who has access or under what terms a profile was created, removing its association with the brand will be much harder.

3. Agree responsibilities, costs and a workable sequence

A clause that simply says “stop using the brand” is not enough as a practical instruction. The contract must establish clear obligations; an operational procedure can explain how to meet them, without adding restrictions that have not been agreed.

Prepare a sequence that identifies:

1. Who communicates the end of the agreement and coordinates the tasks.
2. When authorisation to use the brand ceases.
3. Who removes or modifies each item and bears the cost.
4. How compliance will be evidenced.
5. How remaining materials will be handled.

Operational deadlines must be consistent with the end of authorisation. If removing a fascia sign requires specialist contractors, plan how to prevent the public from assuming that the outlet still belongs to the network in the meantime.

It is also worth agreeing what will happen to branded stock. Do not assume that it can be sold indefinitely or that there is an automatic buy-back arrangement. Any return, removal or temporary sell-through arrangement requires express terms and legal review. Do not present these options as general legal requirements: they are matters to be resolved on a case-by-case basis.

4. Complete the transition for customers and digital channels

Public communications must be truthful and avoid attributing responsibility incorrectly. Prepare a basic message stating when the outlet will cease to be part of the network and where customers can enquire about outstanding transactions.

Before publishing it, identify paid orders, bookings, warranties and unresolved complaints. Ending the association with the brand does not, in itself, remove existing obligations towards consumers. Determine who will handle each matter according to the transaction and the applicable legal framework, without promising an automatic release from liability.

Finally, document the removal of branding with photographs, records of returned items and checks of digital channels. If accounts are transferred or access is revoked, respect account ownership, platform terms and data protection obligations.

Putting it into practice: before signing your first franchise agreement, create a brand identity inventory and run through how each item would be removed. Any item without an assigned person responsible, an agreed outcome or an allocated cost points to a decision still needed in your contractual and operational planning.