Franchising in Greece: preparing your first disclosure pack

A successful business is not automatically ready to welcome its first franchisee. Before asking for a signature or a deposit, you need to explain clearly what rights you are granting, how much it will cost and what evidence supports your proposition. A pre-contractual disclosure pack turns this duty of transparency into a structured process and lays sound foundations for the franchise network you are building.

1. Distinguish legal obligations from good practice

Greece has no specific law comprehensively regulating franchising, no generally mandatory format for pre-contractual disclosure and no dedicated state register of franchisors. A business’s registration with the General Commercial Registry (GEMI) does not certify its franchise system.

This does not mean that accuracy and good faith in disclosure are optional. Articles 197 and 198 of the Greek Civil Code govern conduct during negotiations and liability for harm caused through fault. Depending on the circumstances, misleading statements or material omissions may have legal consequences. The general provisions of the Civil Code also apply to the agreement, while restrictions on competition are subject to Law 3959/2011 and EU competition law.

The European Code of Ethics for Franchising is a self-regulatory framework, not Greek law. Similarly, the published membership criteria of the Greek Franchise Association require a disclosure pack with specified contents, but these are not universal state-imposed conditions for operating a franchise.

Practical rule: ask a solicitor or local lawyer to distinguish your business’s legal obligations from commitments arising through association membership or the agreement itself. Do not present an internal disclosure deadline as a statutory waiting period.

2. Describe what exists, not what you plan to build

The pack should reflect the actual state of the business on its issue date. If you have only one company-owned outlet and no franchisees, say so plainly. Experience of running your own outlet is useful, but it is not the same as proven experience of supporting independent operators.

Organise the introductory presentation into four parts:

• Business identity: company name, legal form, registered office, GEMI details and the people responsible for providing support.
• Operational track record: which outlets have operated, for how long and which operating procedures have actually been tested.
• Rights granted: the trade mark, know-how and tools the franchisee will be entitled to use.
• Support: what initial training, pre-opening preparation and ongoing guidance include, with clear limits and details of any additional charges.

For the trade mark, check its owner, registration status, the goods or services covered and the right to license its use. Greek trade marks are governed by Law 4679/2020, while European Union trade marks are governed by Regulation (EU) 2017/1001. A company name or domain name is no substitute for trade mark registration.

3. Make the financial information verifiable

The financial picture is the most sensitive part of the pack. Clearly distinguish historical data for the existing business from estimates for a new outlet. For each table, state the reporting period, data sources, assumptions and whether amounts include VAT.

Set out the initial franchise fee, premises fit-out, equipment, opening stock, security deposits and working capital separately. Explain which costs depend on the premises or location and which are excluded from the estimate.

For ongoing fees, a percentage alone is not enough. You need to define the calculation basis: for example, how VAT, returns and sales through third-party platforms are treated. Also list marketing contributions, software costs, mandatory purchases and potential refurbishment requirements.

If you use results from a pilot outlet, explain factors that may make them unrepresentative: company-owned premises, the founder’s labour not being fully costed, a different rent or special supplier terms. Do not present a payback period as a guarantee. Instead, use scenarios with explicit assumptions that the prospective franchisee’s adviser can independently assess.

4. Link the pack to the signing process

The disclosure pack, sales presentation and draft agreement must be consistent. Pay particular attention to the term, renewal, operating territory, exclusivity, supply arrangements, transfer and termination. A verbal promise of exclusivity must not be contradicted by the written terms.

Establish an internal procedure for providing the pack before any binding agreement is signed or money is paid. Allow a reasonable period for review and encourage independent legal and financial advice. If you request a reservation payment, explain in writing its purpose, how it will be credited against subsequent payments and the conditions for a refund.

Keep a version number, date, acknowledgement of receipt and a record of written clarifications. If a material detail changes, provide updated disclosure before proceeding. A signed acknowledgement proves receipt, not the accuracy of the contents or any waiver of legal rights.

Practical takeaway: before seeking your first franchisee, prepare a pack that can withstand independent scrutiny. Anything you cannot yet substantiate should be presented as an outstanding matter or an estimate, not as a certainty.