Registering a Commercial Concession: A Guide for Franchisors in Russia

Signing an agreement does not complete the legal formalities for a franchise. An established business owner developing a franchise network in Russia must arrange state registration of the rights granted to the partner. If no one takes responsibility for this stage, fitting out the premises and training staff may be completed before there is a proper legal basis for using the brand. Here is how to build registration into preparations for the first franchised outlet, then repeat the process without unnecessary risk.

1. Distinguish between signing the agreement and registering the grant of rights

In Russia, commercial concession arrangements are governed by Chapter 54 of the Civil Code of the Russian Federation. Under Article 1027, the rights holder grants the user, in return for payment, the right to use a package of exclusive rights in their business activities, including the right to use a trade mark or service mark. Commercial organisations and individual entrepreneurs may be parties to such an agreement.

Article 1028 of the Civil Code is central to registration. It establishes two separate requirements:

• the agreement must be in writing; failure to comply with this requirement makes it void;
• the grant of the right to use the package of exclusive rights must be registered with Rospatent, Russia’s intellectual property authority; without registration, the grant is deemed not to have taken effect.

It is therefore inaccurate to say that ‘the agreement is automatically invalid without registration’. The law distinguishes between the validity of a written agreement and whether the rights have actually been granted. This distinction matters in disputes over payments, the performance of obligations and use of the brand name or mark.

In business correspondence, ‘registering the concession’ is acceptable shorthand. In an internal launch plan, however, it is better to use the precise term: state registration of the grant of the right to use. Registering the trade mark itself is a separate procedure and does not replace this step.

2. Assign responsibility before signing

Under Article 1031 of the Civil Code, the rights holder is responsible for ensuring state registration unless the agreement provides otherwise. Even if this duty is assigned to the partner, the franchisor still needs to monitor the outcome: it determines whether the outlet can lawfully launch under the shared brand.

Specify the following in the agreement and project plan:

• who prepares and submits the documents;
• who pays the official fees;
• the deadline for submitting the application after signing;
• who receives notifications from Rospatent and responds to its requests;
• how the parties will correct errors and supply missing information;
• which document will confirm that registration is complete.

Do not confuse the contractual deadline for submitting the application with the authority’s processing time. The parties can directly control the former; the latter depends, among other things, on whether the documents are complete and whether further correspondence is needed. Do not promise the partner a guaranteed completion date without allowing for these factors.

It is useful to appoint a single coordinator, even if an external lawyer prepares the documents. The coordinator should maintain a registration record covering the signing date, agreement version, submission date, application reference, requests, responses and outcome. For a growing franchise network, this prevents different employees from assuming the task is complete when the application has merely been submitted.

3. Prepare a consistent set of documents

Start by checking that the information is consistent, rather than simply filling in the application form. The parties’ names, registration details, trade mark particulars and terms governing the grant of rights must match across the agreement and registration documents.

State registration requires an application and the supporting documents prescribed by the procedure. The grant of rights may be evidenced, for example, by the agreement, a notarised extract from it or a notice signed by the parties confirming the transaction involving the exclusive rights. The supporting documents required depend on the submission method and the form of evidence chosen; any representative’s authority must also be properly documented.

Before submission, carry out a separate check:

1. The named rights holder is entitled to grant the relevant rights.
2. The list of intellectual property clearly identifies the rights the partner will receive.
3. The term, territory and any restrictions are set out without contradictions.
4. All required signatures and authorisations are in place.
5. Fees have been calculated under the current rules and payment details are correct.

Do not rely on an old fee amount or a saved application template without checking that it is still current. Confirm Rospatent’s requirements before every submission. If the agreement contains commercially sensitive information, discuss with a lawyer which permitted form of supporting document to use: do not automatically submit every internal annex.

4. Link registration to the opening schedule

Separate preparations for the outlet from the start of use of the rights being granted. Finding premises, purchasing unbranded equipment and carrying out organisational work do not, in themselves, replace registration. Installing signage, advertising under the trade mark and making sales under the brand require particular attention to the legal basis for doing so.

Include a checkpoint in the launch schedule: before the public opening, the coordinator must check confirmation of state registration, not merely a receipt for the application, and verify that the registered terms match what the parties agreed. Submitting documents alone does not mean that the grant of rights has taken effect.

Agree in advance what will happen if registration is delayed or refused: postponing the opening, addressing objections, allocating additional costs and dealing with the consequences if registration cannot be completed. Payment arrangements should also account for these scenarios; a promise to ‘register it later’ does not resolve what happens to money already paid.

After registration, keep the final documents in a single partner file. If the relationship changes or ends, check whether corresponding registration steps are required. A change of party, a change in the scope of the rights granted or the termination of their use should not be recorded solely in correspondence between managers.

Practical takeaway: make registration of the grant of rights a mandatory condition for the outlet’s readiness to open. A designated person in charge, a checked set of documents and a confirmed outcome protect both parties better than simply ticking the ‘agreement signed’ box.