How to Prepare a Trade Mark Licence Before Offering Franchises

Allowing another entrepreneur to use a successful business’s name involves more than letting them copy its signage. The franchisor must establish which rights it holds in each trade mark and the limits within which it can authorise others to use them. Protecting a franchise network’s shared reputation starts with a trade mark licensing framework that can be incorporated into the agreement and monitored in day-to-day operations.

1. Document trade mark ownership

The first step is to draw up an inventory of all the signs used by the business. The business name, word mark, logo and any sub-brands used for different services should each be assessed separately. Owning a company name, domain name or social media account is not the same as holding a trade mark registration for that sign.

Keep the following information for each trade mark in a single due diligence file:

• The name or company name of the registered rights holder.
• The application number and, where applicable, registration number.
• The current status of the application or registration.
• The goods and services covered by the protection.
• The renewal date and the person responsible for managing the file.
• Existing licences, disputes and restrictions on use.

Particularly in family businesses, the trade mark may belong to the founder, while the company signing the franchise agreement is a separate legal entity. In that situation, the company’s use of the trade mark does not mean it can authorise others to use it. A clear chain of authorisation between the rights holder and the company must also be established.

If the franchisor does not own the trade mark, check whether the licence on which it relies includes the authority to grant usage rights to third parties. The term and scope of the head licence must align with the usage rights promised to the franchisee. Do not make firm commitments to prospective franchisees about trade mark use until this check is complete.

2. Compare registration coverage with actual business activities

Simply having a registration certificate is not enough. You need to assess whether the protection covers the goods and services the franchise business will offer. Class numbers under the Nice Classification provide guidance, but the substantive review should focus on the list of goods and services recorded in the register.

For example, if a café plans to sell packaged products under its service mark, do not assume that the existing protection also covers those products. Similarly, the relationship between a registered word mark and a subsequently redesigned logo needs separate consideration. Updating the visual identity may also require a review of the trade mark portfolio.

Before filing a new application, commission a search for similar signs and earlier rights. Filing an application does not mean that registration has been secured. Make this distinction clear in the documents provided to prospective franchisees, and do not conceal pending oppositions or disputes that could affect the right to use the mark.

The output of this stage should be a short table showing the permitted uses for each sign. This ensures that the sales team’s promises, the agreement drafted by the legal team and the branding used at each outlet all reflect the same scope.

3. Establish the correct legal framework in Türkiye

Türkiye has no dedicated franchise law governing every aspect of the franchising relationship. Nor is there a requirement to register franchise agreements in a dedicated public register or a mandatory franchise disclosure document with standardised content. However, general legal provisions and pre-contractual duties of good faith still apply.

The key legislation includes the Turkish Code of Obligations No. 6098 for contractual relationships, the Turkish Commercial Code No. 6102 for commercial matters and the Industrial Property Law No. 6769 for trade mark rights. Provisions that restrict competition must also be assessed under Law No. 4054 on the Protection of Competition. The former franchise block exemption regulation No. 1998/7 is no longer in force; where the relevant conditions are met, the Communiqué on Block Exemption for Vertical Agreements No. 2002/2 should be considered.

Article 24 of the Industrial Property Law governs trade mark licensing. The licence should clearly state whether it is exclusive. It is safer to set out the scope of use expressly rather than rely on the statutory default rules.

A trade mark licence must be in writing. However, it would be incorrect to say that every trade mark licence requires notarisation to be valid. Recording the licence in the register maintained by TÜRKPATENT, the Turkish Patent and Trademark Office, is also separate from entering into the agreement: rights arising from legal transactions that have not been recorded cannot be asserted against third parties acting in good faith. Plan recordal according to the particular licensing structure, without presenting it as compulsory registration of the franchise agreement itself.

4. Turn the licence into a practical usage plan

The trade mark licence may form part of the franchise agreement or be set out in a separate document consistent with it. What matters is that the documents do not contradict one another. Do not define the licence’s scope merely by saying that the franchisee ‘may use the trade mark’.

Clarify at least the following:

• Signs: The word marks, logos and approved versions that may be used.
• Scope: The permitted goods and services, business premises and geographical area.
• Channels: Use on signage, packaging, websites, social media and in advertising.
• Limits of authority: Whether assignment or sublicensing is permitted.
• Quality control: How compliance with the required standards for products and services offered under the trade mark will be monitored.
• Term: When usage rights begin and end, and how they relate to the head licence.

Do not confuse permission to use the trade mark in a geographical area with a commitment not to open another franchise outlet there. These are different rights and should be explained separately.

Finally, prepare a concise implementation pack containing logo files, examples of permitted use and details of who approves usage. Specify whom to notify if counterfeiting or unauthorised use is identified, how evidence should be preserved and who will coordinate legal action. Do not leave the renewal timetable to one person’s memory either.

Practical takeaway: Before signing the first franchise agreement, verify ownership, registration coverage and the authority to grant usage rights in a single file. Then align that file with the agreement’s licensing provisions: do not turn uncertain trade mark rights into a firm investment promise.