Buying a franchise in Sweden: get the right information well before signing

When you buy a franchise, you join a network, but the decision and the business risk are yours. That means you need more than a presentation and an agreement to sign. Swedish law requires the franchisor to provide clear written information well before the agreement is concluded. This guide sets out a practical approach to checking that information and ensuring your review does not become a last-minute formality.

What the disclosure obligation means

Sweden has no comprehensive law governing the entire franchise relationship. However, the Act (2006:484) on Franchisors’ Duty to Disclose Information specifically governs disclosure before a franchise agreement is concluded. The franchisor must provide written information about what the agreement entails, and any other matters needed in the circumstances, well before the agreement is entered into. The information must be clear and understandable.

This obligation is mandatory. The franchisor cannot contract out of it by asking you to agree to waive your right to information. Equally, the law does not guarantee that the commercial terms are favourable or that the business will be profitable.

The Swedish Contracts Act and the Act on Contract Terms between Businesses are among the laws relevant to the contractual relationship itself. The Swedish Competition Act may also affect the terms of the arrangement. You should therefore distinguish between two questions: have you received the information you are entitled to, and is the agreement one you should accept?

Check that all the mandatory information is included

Ask for a consolidated, dated information pack with clear references to the relevant sections of the agreement. The law does not require the material to follow a particular commercial template. What matters is its content, clarity and timely delivery.

The information must cover at least:

• A description of the franchise business you will operate.
• Details of other franchisees in the same system and the scale of their operations.
• Payments to the franchisor and other financial terms governing the business.
• The intellectual property rights you will have access to.
• Goods or services you must buy or hire.
• Non-compete restrictions during or after the agreement’s term.
• The agreement’s duration, the conditions for amendment, renewal and termination, and the financial consequences of termination.
• How contractual disputes will be resolved and who will be responsible for the costs.

This is a minimum requirement, not necessarily the full extent of the information you need. If a particular aspect of the arrangement affects your decision, ask a specific question about it. Mark each item as answered, incomplete or missing. A reference to a document you have not been given access to should remain an outstanding review point.

Turn “well in advance” into a workable timetable

The law does not specify a fixed number of days that must always pass between disclosure and signing. Do not assume that Sweden has a general two-week disclosure period. Instead, allow meaningful time to read the material, ask follow-up questions and seek help from an independent adviser.

Suggest a process in which you first receive the information pack, then submit your questions, and finally review the answers before agreeing a signing date. This is a practical approach, not a statutory timetable.

If important information or substantially revised terms arrive late, ask to postpone signing. You need to be able to assess the terms that will actually apply, not just an earlier version. Receiving a detailed presentation early on does not mean that obligations introduced later have already been reviewed.

Be particularly wary of claims that a place must be reserved immediately. Ask what a reservation means legally and financially before agreeing to it. Do not let time pressure replace proper scrutiny.

Record what you have received and what remains outstanding

Create a simple review log with four columns: information item, document and version, date received, and outstanding question. Keep the material in a way that shows what information you had at each stage. Online material can change, so ask for a dated copy of the information on which your decision will be based.

Confirm verbal explanations by requesting written answers. For example: “My understanding is that this obligation also applies during the start-up period. Please confirm and indicate where this is stated.”

Also distinguish between acknowledging receipt of documents and accepting their contents. Do not sign a declaration stating that you have received and understood everything if key questions remain unanswered. Ask for any gaps to be recorded accurately.

Act before gaps in disclosure become your problem

If the information pack is incomplete, send a clear list of what is missing and request the additional information before signing. If the answers remain unclear, a lawyer with franchise expertise should assess both compliance with the disclosure obligation and the risks of proceeding.

Do not assume that inadequate disclosure automatically invalidates a signed agreement or entitles you to leave the arrangement without cost. Those questions require a separate legal assessment. Above all, the disclosure obligation is intended to help you make an informed decision before you commit.

Practical takeaway: Request the information early, check every mandatory item and record any gaps. Set a signing date only once you have had an opportunity to understand and assess the answers.