Hong Kong Franchise Copyright Guide: Clarify Ownership and Usage Fees for Local Marketing Materials Before Signing

When you join a franchise network in Hong Kong, the brand will usually supply marketing materials. However, local campaigns may still require you to hire a photographer, designer or production company. “I paid for it” does not mean “I own the copyright”, and brand approval to publish does not mean that all necessary permissions are in place. Before buying a franchise, include ownership of locally commissioned work, permitted uses and ongoing fees in your due diligence rather than leaving these issues until after opening.

1. Distinguish franchise rights from copyright in creative work

The right to use a brand’s trade marks is separate from copyright in photographs, illustrations, videos, copy and menu designs. A franchise agreement allowing you to use the brand name does not necessarily let you copy images from the franchisor’s website, adapt overseas adverts or download work created for other franchisees.

Hong Kong has no legislation specifically governing franchising, nor a generally applicable system of pre-sale franchise disclosure, franchise registration or statutory cooling-off periods. Franchise arrangements are primarily governed by common law contract principles and applicable general legislation. Marketing materials are particularly relevant to the Copyright Ordinance (Cap. 528), while misleading promotions may fall under the Trade Descriptions Ordinance (Cap. 362). The Competition Ordinance (Cap. 619) also applies: the absence of franchise-specific legislation does not mean the sector is unregulated.

Copyright in Hong Kong generally exists without registration. Commissioning work does not mean the person paying automatically acquires all copyright; the parties’ agreement, the purpose of the commission and the law may all affect the rights involved. If you want copyright to be assigned to you, ask a lawyer to check the requirements for writing and signatures. Do not rely solely on a quotation describing production as “all-inclusive”.

2. Ask the brand for a list of materials and licences

Before signing, ask the brand to list the creative work included in the franchise fee and identify who has authority to approve its use. Break down “marketing support” into items you can verify:

• Channels: Does permission cover in-store print materials, food delivery platforms, social media and paid advertising?
• Territory and duration: Can the materials be used in Hong Kong, and will any licences expire before the franchise agreement ends?
• Permission to modify: Can you translate or crop the materials, add prices or turn them into short videos?
• Third-party restrictions: Are fonts, music, stock photographs and performers’ likenesses subject to separate conditions of use?
• Deliverables: Will you receive only finished files, or also editable files and the relevant licensing records?

Ask to see the applicable licence terms or evidence sufficient to confirm their scope, rather than accepting “head office has always used them this way”. The brand may itself only be a licensee and may not have the right to sublicense the work to Hong Kong franchisees.

If key materials have not yet been cleared for use in Hong Kong, the contract should specify who will obtain the necessary permissions, who will pay and what alternatives will be provided if permission cannot be secured.

3. Agree both contracts before commissioning work at your own expense

Local production usually involves both a franchise agreement and a creative services contract. The two documents must align. If the franchise agreement requires you to transfer rights in the work to the brand, but the photographer grants you only limited usage rights, you may be taking on an obligation you cannot fulfil.

For example, a franchisee might pay for a set of product photographs that head office then wants every outlet to use. Before signing, choose and document an arrangement: the franchisee could own the copyright and license the work to the brand, or the creator could assign copyright to the brand while the franchisee receives sufficient usage rights. There is no single correct arrangement; the key is to ensure that the rights match the fees paid.

In particular, ask whether the brand can supply the work to other franchisees free of charge, whether you can reprint it during the contract term, who can modify it and whether the creator can include it in a portfolio. Acquiring copyright does not mean you can disregard the creator’s moral rights. Any relevant consents or arrangements should be checked separately.

Your budget should cover more than the initial production fee. Ask suppliers to itemise charges for revisions, translation, music, fonts, extensions to the usage period and delivery of source files. If changes required for brand approval fall outside the quotation, agree in advance who will pay.

4. Set out approval, infringement and exit procedures clearly

Brand approval primarily checks whether the presentation and content meet the brand’s requirements; it does not replace checks on third-party rights. The contract should distinguish between materials supplied by the brand, work commissioned by the franchisee and material added by suppliers, identifying who must verify permissions and retain evidence for each category.

Seek clear terms on the documents needed for approval, the response procedure and requirements for revisions. Do not assume that silence from the brand means approval. Any arrangement treating silence as consent needs an explicit agreement and a lawyer’s assessment of whether it is appropriate.

If an infringement complaint arrives, there should be a designated contact to notify, a procedure for suspending use and replacing materials, and clear responsibility for handling claims, reprinting and takedown costs. Franchisees should not automatically bear all liability for materials supplied or mandated by the brand. Indemnity provisions should reflect the source of the materials and each party’s fault.

The agreement should also specify which content must be taken down when the franchise ends, which files may be retained for accounting purposes or as evidence in a dispute, and how existing printed materials will be handled. Owning copyright in a photograph does not mean you can continue promoting your business with photographs bearing the brand’s trade marks after leaving the franchise.

Practical takeaway: Before paying for production, prepare a checklist covering “work, rights holder, permitted channels, duration, modification rights and fees”, then match each item against the franchise agreement and supplier contract. Until the rights are clear, do not treat the materials as ready-to-use assets for your launch.