Buying a Franchise in Lebanon: Is a Hands-On Management Requirement Right for You?

You might choose a successful brand and fund the fit-out of your outlet, only to discover that the contract requires you to manage it yourself—even though your plan was to keep your job and hire a manager. In franchising, owning the business does not necessarily mean you are free to delegate its operation. Before buying a franchise in Lebanon, check whether your intended role fits the hands-on management requirements: who must be present, who has decision-making authority, and when can you replace the person responsible for the outlet?

1. Choose Your Management Model Before Choosing the Brand

Start by describing your expected working week, rather than focusing on the brand you have in mind. Will you be there every day? Do you run another business? Will you spend part of your time living outside Lebanon? Do you have enough experience to oversee a manager without handling every detail yourself? Your answers will help determine which brands suit you, even before you compare initial franchise fees.

Distinguish between three possible arrangements: an owner who manages the outlet directly, an owner who oversees a full-time manager, and an investor who delegates day-to-day management to a team. These are practical descriptions, not standard legal categories, and they must match the contract. The phrase ‘investment opportunity’ in a sales presentation does not establish that the investor need not be present.

Ask the franchisor to answer the following questions in writing:

• Is hands-on management an ongoing requirement, or does it apply only during the start-up period?
• Does the obligation fall on the investor personally, or on a manager appointed by the company?
• Are there specified attendance hours or restrictions on pursuing other business activities?
• Can the outlet be managed while you live outside Lebanon, and on what terms?

If the brand's model requires a full-time owner-manager and you cannot fulfil that role, this is a fundamental mismatch—not a detail to leave until after signing.

2. Understand the Legal Basis of Your Personal Obligations

Lebanon has no comprehensive law specifically governing franchise agreements, nor a dedicated statutory disclosure regime that automatically entitles you to a standard document explaining management obligations. Depending on the nature and legal classification of the relationship, it is governed by the general rules of the Code of Obligations and Contracts and the Commercial Code, alongside other legislation relevant to the activity.

Nor should you assume that Legislative Decree No. 34 of 1967 on commercial representation applies to every franchise. Determining the legal classification requires an examination of the substance of the relationship, not merely the contract's title. Do not base your decision on the belief that protections for commercial representatives will later resolve a dispute over your obligation to be personally present.

The Lebanese Franchise Association's Code of Ethics includes a commitment to written disclosure of material information by members within its scope. However, it is not a general law giving all buyers the same rights, and it is no substitute for clearly written management terms.

In practice, ask your lawyer to identify exactly who is obliged to attend or supervise the outlet. If the franchisee is a company, does the contract also impose a separate obligation on one of its shareholders? Does wording elsewhere turn that shareholder's signature as a director into a personal undertaking? Clarify these distinct capacities before signing.

3. Scrutinise the Franchisor's Approval Process for a Replacement Manager

The contract may allow you to appoint a manager, but make this conditional on the franchisor's approval. Do not settle for permission in principle; examine how the process works. The right to propose a manager is not the same as the right to have them run the outlet if the approval request can remain pending indefinitely.

Negotiate objective approval criteria, such as management experience and the ability to oversee operations, along with a list of required documents and a deadline for responding. Also request written reasons for any refusal and the opportunity to put forward another candidate. Do not assume that the franchisor's silence amounts to consent unless the agreement clearly says so.

Agree arrangements for temporary cover in the event of leave, resignation or routine absence. Specify who takes responsibility, how the franchisor must be notified and how long the temporary arrangement may last. The aim is to prevent a change of manager from disrupting the outlet or causing an avoidable breach of contract.

Pay attention to any ‘key person’ clause, too: it may make continuation of the franchise dependent on a named person remaining in management. Ask what happens if their role within the company changes, and whether they can be replaced through an agreed procedure. Keep the appointment decision, the manager's contract and the franchisor's approval together in one file to avoid conflicting lines of authority.

4. Assess the Cost of Your Role and the Limits of Decision-Making Authority

Even if you do not draw a salary, your time is not a free resource. Prepare an operating budget that includes the cost of a qualified manager and cover for their absence, then compare it with a model in which you manage the business yourself. The purpose is not to forecast profits, but to establish whether the project's affordability depends on ongoing personal work that you have not factored in.

Speak, with their consent, to franchisees who manage their own outlets and others who rely on managers. Ask how much time they spend at the outlet, which decisions their managers cannot make, and what their experience has been of obtaining approval for a replacement. Use their answers to test the operational reality, not as a substitute for the contract's wording.

Finally, draw up a schedule of responsibilities and authority showing who approves expenditure, monitors the accounts, handles customer complaints and liaises with the franchisor. Distinguish between the franchisor's oversight of brand standards and your responsibility for running a legally and financially independent business. If its approval is required for day-to-day decisions, define the scope of that requirement and the process for seeking approval.

The practical takeaway: Do not buy a franchise until you know whether you are buying a business you must manage yourself or one whose management you can delegate. Put in writing who is responsible, the conditions for appointing a replacement and the limits of their authority, and calculate the cost of the management arrangements you will actually need.