Software for franchising in Colombia: licensing and business continuity

A business may run smoothly with its point-of-sale, inventory and booking systems, but that does not mean it can make those tools available to a franchisee. Before offering a franchise in Colombia, check who is allowed to use each program, how much it costs per outlet and what happens if it fails. Addressing these questions avoids promising an operation that depends on software permissions you have yet to secure.

1. Check which software you can make available to franchisees

Draw up an inventory of the tools essential for selling, taking payments, scheduling services and managing stock. Include applications you subscribe to directly, software developed in-house and services managed on your behalf by a supplier. Identifying the software brand is not enough: you need to review its contract and terms of use.

For each tool, answer the following questions:

• Who holds the account or licence?
• Is use by independent businesses permitted, or is it restricted to the holder’s employees?
• Does the agreement cover multiple outlets, devices or users?
• Can you give the franchisee access, or must they contract directly with the supplier?
• What permission does the supplier require for integrations with other applications?

A subscription held by the original business does not amount to permission to share it with franchisees. If permission is unclear, obtain written confirmation from the supplier before including the tool in your franchise offering.

For bespoke software, also review the rights you acquired. Paying for its development does not automatically mean you can reproduce it, modify it or authorise third parties to use it on any terms you choose.

2. Distinguish legal obligations from commercial decisions

In Colombia, franchising is treated as an atypical contract: it has no dedicated statutory framework. Nor is there a mandatory pre-contractual disclosure document prescribed by a specific franchise law. Valid agreements between the parties apply, alongside the general provisions of the Commercial Code and, where relevant, the Civil Code, including duties of good faith.

Software also has its own legal protection framework. Computer programs are protected by copyright under Andean Decision 351 of 1993 and Colombian legislation, including Law 23 of 1982, as amended. A franchise agreement therefore does not replace the permission required from the software rights holder.

If the tools process personal data, compliance with Law 1581 of 2012 and its implementing regulations must also be assessed. A software licence does not, on its own, address the obligations relating to that information.

It is advisable to review three documents together: the supplier agreement, the franchise agreement and the technology schedule. None should promise rights or service levels that the others do not allow. This consistency helps maintain trust across the franchise network.

3. Define the cost of each service and who is responsible for it

Prepare a technology schedule identifying the mandatory tools, their minimum functionality and who contracts for them. Separate upfront and recurring charges: configuration, compatible equipment, data migration, subscriptions, additional users, maintenance and integrations.

Make clear whether these items are included in any franchise fee or billed separately. Where the supplier charges the franchisee directly, explain which terms are controlled by that third party and avoid presenting its prices as fixed indefinitely.

Allocate support responsibilities too. For example, head office may provide guidance on cashing-up procedures, while the supplier handles an application outage. These are different responsibilities.

The schedule should set out:

• The channel for reporting faults and its support hours.
• Who receives the report and when they escalate it to the supplier.
• Which updates are required and who pays for them.
• How changes to tools or technical requirements will be communicated.

Distinguish between the time allowed to respond to a request and the time allowed to resolve it. Do not guarantee immediate fixes unless you have that commitment from the supplier.

4. Test business continuity before offering the system

Simulate an internet outage, software unavailability and a user losing access. Check which tasks can continue and which must be suspended. Any fallback procedure must comply with applicable tax, security and data protection obligations; it should not be improvised during an outage.

Also check how information is recovered and transactions are reconciled when service resumes. If there is an export function, test it: having a file does not guarantee that it can be used in another tool.

Finally, agree how access will be withdrawn and the relevant information handed over when the relationship ends, while complying with retention obligations.

Practical takeaway: before franchising, secure the necessary permissions to use the software, prepare a cost breakdown and establish a tested business continuity procedure. If any of these is missing, address that dependency before promising a technology setup that is ready to replicate.