Franchising in Colombia: agreeing opening timelines

Between signing a franchise agreement and serving your first customer, you may still need to fit out the premises, obtain permits, install equipment and secure brand approvals. If the contract does not coordinate these steps, months of your franchise term could pass without any sales. In franchising, clearly agreed opening arrangements help distinguish responsibilities and reduce disputes. This guide explains how to turn an estimated opening date into verifiable commitments before buying a franchise in Colombia.

1. Separate signing, preparation and trading

Do not treat signing and opening as the same event. Identify at least three dates: the date the contract is entered into, the start of preparatory work and the opening to the public. Then check which date triggers the franchise term and each financial obligation.

Your right to operate the business may start running down before you can make any sales, if that is what the contract provides. Knowing how many years the agreement lasts is therefore not enough: you need to know when that period starts.

Prepare a table listing each obligation, its start date and the document that will verify it. Include:

• Handover of the premises so that fit-out work can begin.
• Approval of designs and technical specifications.
• Installation and testing of equipment and systems.
• Compliance with the applicable operating requirements.
• The franchisor’s inspection and contractual authorisation to open.

Also distinguish a promotional launch from the actual opening for business. A marketing event should not, on its own, determine whether the agreed conditions for trading have been met.

2. Understand what Colombian law requires

In Colombia, a franchise agreement is an “atypical” contract: it has no specific contractual legislation governing it. As Colombia’s Ministry of Justice explains, it is governed by the parties’ agreement and the general rules applicable to commercial contracts. Civil law provisions and the principles of good faith in negotiation and performance are also relevant.

This means you should not assume that there is a special statutory deadline for opening a franchise, or that the franchise term will automatically be extended if the opening is delayed. These protections need to be reviewed and expressly agreed, subject to any applicable mandatory rules.

Nor should you confuse a regulatory proposal with a binding requirement. The draft document published by Colombia’s Ministry of Commerce, Industry and Tourism in 2021 envisaged a franchise disclosure circular to be provided twenty working days in advance. That draft does not, in itself, constitute a rule in force, nor does it make that notice period enforceable as a general requirement.

The absence of specific franchise legislation does not remove the general requirements applicable to business premises. Depending on the activity and location, you will need to check land-use rules, health requirements and any other relevant obligations. The franchisor’s approval does not replace compliance with these requirements.

3. Make the timetable an enforceable schedule to the contract

Ask for the timetable to form part of the contract, rather than appearing only in a sales presentation. Each milestone should identify the responsible party, the expected deliverable, the deadline and any dependencies. If a task requires prior approval, specify how long the other party has to respond and how its comments will be recorded.

For example, “approve the design promptly” is vague. A deadline running from receipt of a defined set of documents, with a procedure for requesting corrections, is easier to verify. Do not assume that silence amounts to approval: any such effect needs to be reviewed and expressly agreed.

For the final inspection, ask for objective criteria and a list of outstanding items. Distinguish defects that prevent opening from minor adjustments that could be completed afterwards, provided the business can operate legally and safely.

The schedule should also identify who coordinates each administrative process. An agent may be able to submit applications, but cannot guarantee an authority’s decision. Distinguishing responsibility for handling a process from responsibility for its outcome helps avoid promises that cannot be kept.

4. Allocate the consequences of delays

Before signing, consider three scenarios: delays attributable to the franchisee, to the franchisor or to external circumstances. They should not necessarily all have the same consequences.

Negotiate how the problem will be reported, what evidence will be retained and how much time will be allowed to put it right. With legal advice, consider whether dates should be extended, certain charges deferred or the start of the franchise term adjusted. None of these measures should be assumed to apply automatically.

Seek particular clarity on expenses that can build up before any sales are made: staff already hired, storage, technology services and rescheduled technical visits. Define which costs each party will bear and when prior authorisation is required before incurring additional expenses.

Finally, agree a deadline for reassessing an opening that is not progressing, and a written procedure for changing the timetable. Keep meeting minutes, emails and delivery records: they will help establish the causes of any delay.

Practical conclusion: before buying, insist on a contractual timetable that links dates, responsibilities, charges and consequences. The crucial question is not just when you will open, but what will happen if you cannot open on time.