Franchising in Greece: keeping sales promises in check

When you turn an existing business into a franchise network, the first presentation to a prospective franchisee creates expectations before the contract even appears. An off-the-cuff assurance from the founder or an external adviser can influence a major investment decision. In franchising, trust requires consistency: what is said in meetings must reflect the facts and specific commitments. That is why promises need to be managed, not just documents carefully drafted.

What good faith means before signing

Greece has no dedicated law providing a comprehensive framework for franchising, nor a specific statutory pre-contractual disclosure regime for it. There is also no specific requirement for franchisors or franchisees to join a franchise register. Ordinary corporate and other legal obligations are a separate matter.

The absence of a dedicated framework does not mean businesses are free to mislead. Articles 197–198 of the Greek Civil Code govern conduct during negotiations: they require good faith and fair dealing and, subject to certain conditions, provide for liability for loss culpably caused at this stage, even if no contract is ultimately concluded. The general rules of the Civil Code apply to the contractual relationship. Competition rules also apply, including Law 3959/2011 and, where applicable, Article 101 of the Treaty on the Functioning of the European Union (TFEU).

The European Code of Ethics for Franchising calls for full and accurate written disclosure a reasonable time before signing. It is a self-regulatory framework, not a Greek law of general application. Whether it is binding needs to be assessed by reference to factors including association membership and contractual commitments. Do not therefore present an internal disclosure deadline as a mandatory statutory one.

Record what the team is authorised to promise

Before delegating franchisee recruitment, create an internal register of approved claims. This does not replace the disclosure pack or the contract: it guides everyone speaking on behalf of the business, from the founder to an external franchise development consultant.

For each frequently asked question, record:

• The approved answer: exactly what may be said to the prospective franchisee.
• The supporting evidence: the facts or available capabilities that support the answer.
• The conditions: what delivery depends on.
• The person responsible for approval: who decides on exceptions or additional commitments.

For example, ‘we will be there for you every day’ does not describe a specific service. By contrast, a clear explanation of the agreed communication channels, availability and process for submitting requests reduces the scope for misunderstanding. If something has not been decided, the correct answer is that it remains subject to confirmation — not that ‘it will definitely happen’.

Apply the same checks to presentations, franchise recruitment adverts and message templates. Withdraw old versions and assign responsibility for updates. A forgotten presentation can remain in circulation long after commercial policies have changed.

Distinguish intentions from commitments

Developing a network involves plans that have yet to be put into practice. You may be considering new software, an expanded support team or a future supply partnership. These should not be presented as features already available within the franchise system.

Use three clear categories in discussions: ‘available today’, ‘available if agreed in writing’ and ‘under consideration’. For each future initiative, explain what has actually been decided and what remains uncertain. Do not base a prospective franchisee’s decision on a promise the business is not yet in a position to make.

Take particular care with individual exceptions. If a prospective franchisee requests an additional service or a different commercial term, the person speaking to them should not verbally approve anything beyond their authority. Record the request, assess its operational and legal implications, and give a clear response. When an exception is approved, include it in the final contractual documents with a lawyer’s assistance.

Follow up every discussion with confirmation and corrections

After a substantive meeting, send a brief written summary covering the topics discussed, the answers given and any points still requiring clarification. Ask the prospective franchisee to flag anything they understood differently. The summary need not read like formal minutes; its purpose is to prevent ambiguity from building up.

If an inaccurate statement comes to light, correct it explicitly and promptly. Simply sending a new presentation without explanation is not enough. Explain what has changed and give the prospective franchisee an opportunity to reconsider their decision before committing or incurring related costs.

Before signing, compare the material promises made with the final contract. A general clause stating that the contract constitutes the entire agreement is not a reliable remedy for earlier misleading information.

Practical takeaway: define who may promise what, supported by which evidence and with whose approval. Network development starts on a firmer footing when every material promise can be verified and honoured.