Buying a franchise: check your right to use the trade mark

When you buy a franchise, part of what you pay for is the opportunity to trade under a recognised name. But a logo in a presentation does not prove that the provider can authorise you to use it in Slovenia. Before joining a franchise network, check the connection between the registered trade mark, its owner and the agreement you will sign. This reduces the risk of having to change your trading name, signage or packaging after opening.

1. Identify exactly which trade marks you are paying to use

Ask the franchisor for a list of the trade marks you will use. This should include the word mark, any logo, registration numbers, owners and the territories covered by protection. If the business concept uses several names, the franchisor should clearly identify which are included in your agreement.

A company name, a domain name and a registered trade mark are not the same thing. Registration in a business register does not, in itself, confirm that a company has exclusive rights to a particular sign for your goods or services. Owning a domain name is no substitute for checking the trade mark either.

Compare the details with official records. National trade marks are handled by the Slovenian Intellectual Property Office, while European Union trade marks are handled by the European Union Intellectual Property Office (EUIPO). For an international registration, check the World Intellectual Property Organization (WIPO) records and the actual scope of protection.

An EU trade mark generally provides protection in Slovenia too. Registration in another individual country does not, by itself, provide protection in Slovenia. For an international registration, check whether it covers Slovenia or the European Union and what the status of that protection is.

2. Check the status, scope and chain of authorisation

Do not simply check whether the name appears in the search results. What matters is what the record actually confirms:

• Status: is it an application or an already registered trade mark?
• Owner: is the owner the party you are contracting with, or someone else?
• Goods and services: does the list cover the intended use at your outlet?
• Validity: is the registration valid, and when will it need to be renewed?
• Proceedings: are any oppositions, applications for revocation or other circumstances recorded that require further assessment?

The class number alone is not enough; the specific list of goods and services matters too. If you will also sell products bearing the trade mark alongside your services, ask a specialist to check that use as well.

If the franchisor is not the owner, ask for evidence that it has the right to grant further licences. This is particularly important where you are dealing with a master franchisee developing a franchise network in a particular territory. Its right to use the trade mark does not necessarily mean it can authorise you to use it too.

Ask to see the relevant provisions of the underlying licence or other appropriate evidence. You need to check the territory, duration, permitted scope of use and right to grant sublicences. Commercially sensitive sections may be redacted, but not information needed to verify that authority.

3. Set out the right to use the trade mark precisely in the agreement

Slovenia has no specific franchising act, compulsory franchise register or dedicated statutory franchise disclosure document. A franchise agreement is an innominate contract — one not specifically defined as a contract type in legislation — governed by the general rules of the Slovenian Obligations Code (OZ). Rights in national trade marks are governed by the Industrial Property Act (ZIL-1), while Regulation (EU) 2017/1001 on the European Union trade mark is relevant to EU trade marks.

As there is no dedicated franchise procedure that verifies the provider's rights on your behalf, the agreement should clearly specify:

• which trade marks you may use and for which activities;
• whether permission covers premises signage, your website, social media, advertising and packaging;
• who approves local adaptations to graphics and within what timeframe;
• who is responsible for renewing registrations and notifying you of changes to their status;
• how long the permission lasts and how it relates to the franchise relationship.

Propose an express contractual assurance from the franchisor that it holds the rights needed for the agreed use. This is a matter for negotiation, not an automatic statutory guarantee specifically protecting franchise buyers. A lawyer should also check that the franchise agreement is consistent with any underlying licence.

4. Agree in advance how third-party claims will be handled

Imagine that, after opening, you receive a demand from another company to stop using the name. Who do you notify? Who obtains legal advice, handles the defence and pays for urgent changes to signage?

The agreement should set out the notification procedure, cooperation in defending claims and allocation of costs. Distinguish between situations where you use the trade mark as instructed and those where you introduce an unapproved sign or use it in an unauthorised way. A blanket clause making the franchisee responsible for all third-party claims warrants particularly careful review.

Also agree what happens if the agreed use of the trade mark is no longer possible: the terms for using a replacement trade mark, rebranding costs, how packaging already purchased will be dealt with and any right to terminate the agreement. Do not assume that you will automatically be entitled to reimbursement of all your expenditure.

Practical takeaway: before signing, cross-check three pieces of evidence: the official trade mark record, evidence of the franchisor's authority and clear contractual permission for your intended use. If they do not match, resolve the discrepancy before ordering signage and packaging.