Franchise trade marks: what to check with Brazil’s INPI before buying

Buying a franchise means paying for the right to operate under a recognised brand identity. Before investing in signage, packaging and marketing, however, you need to confirm who can authorise that use and check the trade mark’s status. In the franchise sector, these checks help protect both your individual investment and the continuity of the network’s operations.

1. Understand the legal requirements for the trade mark

Brazil’s current Franchise Law, Law No. 13,966/2019, repealed Law No. 8,955/1994. It requires the franchisor to own, or have applied for, the rights to the trade marks and other intellectual property covered by the franchise arrangement, or to have the owner’s express authorisation.

This means that a franchise can be offered while a trade mark application is still pending. An application, however, is not the same as a granted registration: there is a risk that Brazil’s National Institute of Industrial Property (INPI) will not grant the protection sought.

The Franchise Disclosure Document, known in Brazil as the Circular de Oferta de Franquia (COF), must state the status of the trade mark and other intellectual property rights associated with the franchise. This includes their full description, registration or application numbers, and the relevant classes, where applicable.

Use this information as a starting point, not as the end of your assessment. The COF should allow you to identify exactly which right is being offered. Marketing phrases such as “protected brand” are no substitute for the application or registration details and do not, on their own, establish whether registration has been granted.

2. Check the record and the scope of protection

Ask for the numbers listed in the COF and search INPI’s official trade mark database. Search by application or registration number and compare the results with the documents you have received. Searching by name alone may bring up similar trade marks or fail to identify the graphic version used by the network.

Organise your assessment around a simple checklist:

• Owner or applicant: who is listed as the owner of the registration or the applicant?
• Form of the trade mark: does the record cover the name, a combination of wording and a logo, or another form of mark?
• Goods and services: does the specification match the activities your franchise outlet will carry out?
• Current status: is the application pending, has registration been granted, or are there developments that need clarification?
• Validity and procedural updates: are any maintenance steps, renewals or responses outstanding?

Classes organise goods and services, but the class number alone does not define the full scope of protection. You need to read the specification and consider the activities actually covered by the franchise offer.

Save a dated copy of your search results. If you find an opposition, refusal, ownership dispute or another significant development, seek specialist advice. An issue does not automatically mean the franchise is unviable, but you need to understand it before making commitments.

3. Verify the authority to franchise the brand

The franchisor’s company name will not always match that of the trade mark owner. The mark may belong to another company in the group or to a third party that has granted authorisation. This difference does not, in itself, indicate anything improper.

The crucial point is to establish the legal link between the rights holder and the business offering the franchise. Ask for documents demonstrating that authorisation and clarifying:

• whether it allows the franchisor to grant franchisees the right to use the trade mark;
• which trade marks, activities and territories it covers;
• how long it lasts and under what conditions it can end;
• how operations will be maintained if the authorisation ceases to exist.

Compare these terms with the duration and scope of your franchise agreement. If the authorisation expires sooner, ask for a documented explanation of how the franchisor intends to ensure continued use of the mark.

Keep two separate matters in mind: registering a trade mark and registering a franchise agreement are not the same thing. Registration of the agreement with INPI is optional and may have legal effects in relation to third parties under Article 211 of Law No. 9,279/1996. It does not replace an assessment of the trade mark’s status.

4. Establish who bears the risk of a change

Even after checking the documents, review the agreement to understand what happens if the network has to stop using the trade mark or change its identity because of a problem with its legal protection.

Ask who will pay to replace signage, uniforms, packaging, digital materials and other items. Also check who will handle any legal defence, how franchisees will be informed and what measures are provided for if operations are interrupted.

Do not assume reimbursement will be automatic: ask for clear clauses covering responsibilities, procedures and consequences. If the mark is only at the application stage, also request a plan for what will happen if registration is refused.

Practical takeaway: before buying, gather the trade mark’s identifying details, an up-to-date INPI search, evidence of the franchisor’s authorisation and the contractual provisions for dealing with potential problems. If these documents are inconsistent, resolve the discrepancies with legal support before investing.