Buying a franchise in Belgium: check the trade mark rights

A recognisable brand can be a major reason for joining a franchise network. But a familiar name, a polished logo and existing outlets do not prove that the business you are contracting with can grant you valid trade mark rights. Before investing, check who owns the trade mark, what protection applies in Belgium and what happens if your right to use it ends. This helps ensure that your signage, website and launch campaign rest on a sound legal footing.

1. Check the trade marks behind the franchise

Ask the franchisor for a list of the trade marks you will use, including registration numbers, the name of the owner and their current status. Make sure both word marks and figurative marks are included: the name and logo may be protected separately and have different owners.

The following registrations are particularly relevant in Belgium:

• Benelux trade marks, registered with the Benelux Office for Intellectual Property (BOIP), provide protection across the Benelux countries.
• EU trade marks, registered with the European Union Intellectual Property Office (EUIPO), apply throughout the European Union, including Belgium.
• International trade mark registrations through the World Intellectual Property Organization (WIPO) may be relevant if their territorial protection covers the Benelux or the European Union.

Check the registers yourself or have a trade mark adviser do so. Do not look only at the brand name: also compare the owner, registration details, any proceedings and the description of the protected goods and services. A trade mark registration for clothing does not automatically cover restaurant services.

An application is not yet a final registration. Nor is a trading name, domain name or entry in Belgium’s Crossroads Bank for Enterprises the same as a registered trade mark. If there is no registration, ask what other rights are being relied on and have an adviser assess how secure that legal basis is.

2. Trace the licensing chain to your contracting partner

The trade mark owner does not have to be the same company as the franchisor. Within an international franchise network, for example, a separate company may own the trade mark while a Belgian master franchisee signs local agreements. This is not necessarily a problem, provided the chain of rights is valid.

Ask for evidence that your contracting partner is entitled both to use the trade mark and to authorise you to use it. A licence for its own use does not automatically include the right to grant sublicences.

Have at least the following points confirmed:

• Which company owns the trade mark, and which company will sign your franchise agreement?
• Does the underlying licence allow sublicences to Belgian franchisees?
• Does it cover your activities, premises and sales channels?
• How long does that licence last, and can it end early?
• What happens to your right to use the trade mark if the agreement between the owner and the franchisor ends?

A verbal assurance that everything is ‘within the same group’ is not enough. Ask for the relevant contractual provisions or specific written confirmation from the trade mark owner. Your solicitor may be able to review confidential information without you receiving the full underlying agreement.

Pay particular attention to the terms of the agreements. A franchise agreement lasting several years offers little certainty if the essential trade mark rights can expire sooner and nobody guarantees their continuation.

3. Define permitted use and allocate the risks

Turn your register checks into clear contractual terms. The agreement should specify which names, logos and other protected elements you may use, and for what purposes: external signage, packaging, social media, local advertising and a dedicated webpage for your outlet.

Also ask who will register and manage domain names and social media accounts. Access through an employee’s personal account can cause practical problems later, even if the trade mark rights themselves are undisputed.

Next, discuss what happens if a third party alleges that use of the trade mark infringes its rights. Who handles the claim? Who pays for legal advice and representation? Must you stop using the trade mark immediately, and who bears the cost of replacement signage, printed materials and digital changes?

Negotiate a clear indemnity and allocation of costs for claims arising from use of the trade mark as permitted under the agreement. Have any exclusions, notification deadlines and control over settlements reviewed. An indemnity offers little help if it excludes significant costs or comes from a company with very limited financial resources.

Also ask whether there are any ongoing trade mark disputes, oppositions or agreements with other trade mark owners that could restrict your intended use.

4. Make targeted use of Belgium’s disclosure requirements

Belgium has no standalone franchise law governing every aspect of the performance of franchise agreements. However, specific pre-contractual rules apply to commercial cooperation agreements: Title 2 of Book X of the Code of Economic Law, Articles X.26 to X.33.

Where these rules apply, you must receive the draft agreement and the pre-contractual disclosure document (known locally as the PID) at least one month before entering into the agreement. The information on the intellectual property rights you will be authorised to use provides an important starting point for your trade mark checks. Compare it with the registers and the schedules to the agreement.

General contract law and the applicable trade mark law are also relevant, among other rules. The European Code of Ethics for Franchising is no substitute for legal requirements or evidence of a valid licence.

Practical conclusion: sign only once three things align: the trade mark registration, your contracting partner’s authority and your own right to use the trade mark. Resolve any uncertainties before committing to irreversible expenditure on branding.