Franchising in Greece: pricing without unlawful restrictions

When turning an existing business into a franchise network, a shared price list may seem an obvious choice. In your own outlets, you set the prices; in outlets run by independent franchisees, however, the same approach may breach competition law. A healthy franchise network needs a clear distinction between a shared brand identity and control over final selling prices. That distinction must be reflected in the franchise agreement, promotions and your team’s day-to-day instructions.

1. Understand the legal boundaries before drawing up price lists

Greece has no dedicated law providing a comprehensive framework for franchising, nor a specific statutory regime requiring pre-contractual disclosure for franchises. The general provisions of the Greek Civil Code apply, including those on pre-contractual good faith, alongside commercial law and competition rules. The absence of a dedicated law does not give franchisors free rein to determine every commercial decision their franchisees make.

For pricing, the key provisions are Article 1 of Greek Law 3959/2011 and, where trade between EU Member States may be affected, Article 101 of the Treaty on the Functioning of the European Union. Regulation (EU) 2022/720 provides a block exemption for certain vertical agreements, subject to conditions. It is not a blanket permission to impose prices.

Setting a fixed or minimum resale price is a hardcore restriction and excludes the agreement concerned from the block exemption. By contrast, recommended or maximum prices may be permitted, provided they do not become fixed or minimum prices through pressure or incentives, and the other conditions are met. Seek specialist legal advice on your actual practices, not just the wording of your agreement.

2. Distinguish recommendations from indirect enforcement

Calling a price ‘indicative’ is not enough if your conduct suggests that compliance is compulsory. A franchisee must genuinely be able to depart from the recommended price without suffering adverse consequences as a result.

Before opening your first franchised outlet, check whether you plan to use, or already use, any of the following:

• Warnings, suspension of supplies or threats to terminate the relationship because a franchisee sells at a lower price.
• Discounts on supplies or other benefits conditional on charging a particular retail price.
• A maximum permitted discount that effectively creates a minimum price.
• A minimum advertised price, even if you maintain that a lower price may be charged at the till.
• Software that locks prices and prevents franchisees from changing them.

Assess the effect, not the label attached to the measure. Protecting the brand’s image does not, on its own, justify restricting pricing independence. You can set standards for presentation, service and quality without requiring everyone to maintain the same profit margins.

3. Organise promotions that also work locally

A centrally run campaign needs planning before posters are printed or advertising space is bought. Decide which outlets will participate, how their participation will be recorded and who will bear the cost. Do not announce a single price across the network as a given without first examining its legality and how it will work in practice.

For example, a food business might create shared promotional material for a meal and recommend a selling price. Franchisees need clear information about ingredient costs, the promotion’s duration and the terms of any funding. Funding must not be used as a disguised mechanism for imposing a fixed or minimum price.

A maximum promotional price is not automatically the same as a prohibited fixed price, but its terms need to be reviewed and franchisees must genuinely be able to charge less. Do not assume that every short-term joint promotion is exempt from competition rules. Any potential exemptions require specific assessment and supporting evidence.

You should also check consumer-facing communications against Greek Law 2251/1994: participating outlets, exclusions, availability and duration must be clearly stated. Where price reductions on goods are announced, also examine the applicable rules on the prior price used as a reference.

4. Turn the policy into everyday procedures

Draw up a short internal pricing policy, separate from technical operating instructions. Set out who approves campaigns, who reviews contractual terms and how problematic instructions are corrected before they reach franchisees.

Pay particular attention to three areas:

1. Systems: confirm that tills allow the necessary local price changes and that central updates do not automatically override them.
2. Training: explain to franchisee support managers that they must not demand price ‘alignment’ or put pressure on franchisees following complaints from other outlets.
3. Communication: do not use group discussions to coordinate future prices or discounts between independent franchisees.

Periodically review agreements, messages, commercial incentives and software settings together. A properly drafted clause does not remedy contradictory day-to-day practices.

Practical takeaway: before expanding your business, test whether a franchisee can genuinely change a recommended price without obstacles or retaliation. If not, redesign your policy with legal support.