Buying a franchise: your right to information in Portugal

Joining a franchise network takes more than a convincing sales presentation. Before signing, a prospective franchisee needs to understand the obligations they are taking on and be able to prove what they have been told. In Portugal, there is no single statutory form that fulfils this purpose. You therefore need to organise the information and distinguish between rights established by law and protections that must be negotiated.

1. Understand the rules on pre-contractual information

Portugal has no franchise-specific legislation and does not require a standardised pre-contractual disclosure document or a minimum disclosure period specifically for franchise agreements. Nor is there a dedicated register of franchisors that certifies the quality of the opportunity on offer.

This does not mean there is no protection. Article 227 of the Portuguese Civil Code requires good faith during negotiations and the formation of a contract. Omitting relevant facts or presenting them misleadingly may give rise to pre-contractual liability, depending on the circumstances, fault and proven loss. Good faith also governs the performance of obligations under Article 762(2).

Where an agreement contains pre-drafted terms that the prospective franchisee had no opportunity to influence, Decree-Law No. 446/85 of 25 October, as amended, on standard contract terms is also relevant. Articles 5 and 6 establish duties to communicate and provide information: terms must be communicated in full, sufficiently in advance, and any aspects requiring clarification must be explained.

The European Code of Ethics for Franchising can serve as a self-regulatory reference for those who subscribe to it, but it does not replace the law. Ask whether the franchisor expressly commits to complying with it and how that commitment is reflected in the documents provided.

2. Request a clearly identified set of documents

Do not simply collect files. The aim is to obtain a coherent version of the proposal that makes clear who is promising what, on which conditions and subject to which limits.

Request the following in writing:

• The complete draft agreement, including schedules, tables and any documents it refers to.
• Details of the contracting entity and those authorised to represent it.
• A description of each party’s obligations, distinguishing firm commitments from optional services or those subject to availability.
• The basis for significant commercial claims, such as the concept’s track record or the existence of company-owned outlets.
• Any conditions still to be met, including internal approvals or authorisations needed for the proposal to proceed.

If a document cannot be provided for confidentiality reasons, ask for a specific explanation and an alternative: controlled access, a version with sensitive information redacted, or disclosure after signing a confidentiality agreement. That agreement should itself be reviewed before you sign it.

The law does not grant unlimited access to all of a network’s internal documents. However, restricted access should not prevent you from understanding essential obligations. If you cannot establish the scope of a commitment, do not regard it as clarified.

3. Turn promises into verifiable explanations

Create a simple table with four columns: statement received, supporting document, outstanding question and franchisor’s response. Also record the date and the person who provided each explanation.

Suppose the sales presentation refers to ‘dedicated support’, but the draft agreement only provides for assistance subject to availability. The useful question is not ‘Will I receive support?’ It is: ‘Will I have an assigned contact, which communication channels will be available, and what specific commitment will be included in the agreement?’

After a meeting, send a factual summary and ask for confirmation or corrections. Silence should not automatically be interpreted as acceptance. Keep messages, presentations and document versions in dated folders.

If a promise is decisive to your decision, ask for it to be incorporated into the agreement or a signed schedule. Pay particular attention to clauses stating that the agreement supersedes all previous communications. These do not necessarily remove liability for pre-contractual conduct, but they make it all the more important to resolve discrepancies before signing.

4. Carry out a final review focused on your rights

Compare the final version with the draft you reviewed. A seemingly minor change may limit a commitment or introduce an acknowledgement that does not reflect the facts.

Do not sign statements confirming receipt of documents that were never made available to you. If new clauses appear, ask for time to review them: what counts as sufficient advance notice depends on the length and complexity of the content, not on a universal franchise-specific deadline.

The rules on standard contract terms provide for certain clauses to be excluded where the legal duties to communicate or explain them have not been properly met. This requires a case-specific assessment; it does not mean the entire agreement is automatically invalid. Similarly, misleading information may provide grounds for compensation or other remedies, but it does not create an automatic right to cancel.

Practical takeaway: before signing, give your lawyer the final draft, the schedules and your record of the responses received. Proceed only once the promises that matter to your decision have been clarified and documented.