Protecting Your Trade Mark Before Franchising in the UAE

Your business may thrive at its first location, but granting others the right to use its name raises different questions: who actually owns the trade mark? What uses are permitted? And what happens when the relationship ends? Building a cohesive franchise network starts with clear rights, not just a familiar logo. This guide helps you prepare your trade mark for licensing in the UAE before signing your first franchise agreement.

1. Distinguish between a trade name and trade mark ownership

Reserving a trade name and obtaining a business licence are no substitute for registering a trade mark. A trade name identifies the business for licensing purposes, whereas trade mark registration protects the sign that distinguishes your goods or services, within the scope of protection provided by law. Similarly, owning a domain name or social media accounts does not, on its own, establish ownership of the trade mark.

Start by listing the assets the franchisee will use: the Arabic and English names, the logo, distinctive product names and any sub-brands. Then check who holds the rights to each asset. The trade mark may be registered in the founder’s personal name, while the company granting the franchise is a separate entity. In that case, document the chain of ownership or the right to license the mark before making any commitments to a prospective partner.

Prepare a file containing:

• Registration certificates, pending applications and their status.
• The owner’s details and any previous assignments or licences.
• Logo design contracts and evidence of the associated rights.
• Renewal dates and any known objections or disputes.

Do not assume that paying a designer’s fees automatically transfers all rights in their work. Review the written agreement and address any gaps before bringing in new partners.

2. Match protection to the business you intend to franchise

Trade marks in the UAE are governed by Federal Decree-Law No. 36 of 2021 on Trade Marks and its implementing regulations. This is the legislation to consult for trade mark registration, licensing and protection, rather than relying on the old trade mark law issued in 1992.

Commission a professional search for similar earlier trade marks, rather than checking only for exact matches. Consider sound, meaning and appearance, particularly where the Arabic name differs from its rendering in another language. Then make sure the registered classes of goods and services cover the activities you actually plan to franchise.

For example, if your business is a café and you plan to sell packaged products bearing the trade mark, protection for café services alone may not cover all those products. The aim is to review the appropriate coverage, not to register unrelated classes at random.

Set a go/no-go checkpoint before marketing the franchise: is ownership clear? Are there any significant obstacles to using the mark? If registration is pending, explain its status accurately to the prospective franchisee; do not present an application as a final certificate of protection. Agree with your adviser which risks are acceptable and the conditions for proceeding or postponing.

3. Turn the right to use the mark into specific contractual terms

The UAE has no standalone federal law dedicated to franchising, nor a franchise-specific federal disclosure regime comparable to those in some other countries. The relationship is governed by general contract and civil transaction rules, the Commercial Transactions Law issued under Federal Decree-Law No. 50 of 2022, and trade mark, competition and licensing legislation, as applicable.

Federal Law No. 3 of 2022 Regulating Commercial Agencies may also apply if the relationship meets its requirements and is registered as a commercial agency. Not every franchise is automatically a registered agency, and registering the trade mark does not remove the need to assess this issue. Seek independent legal advice on how agency registration could affect the relationship and its termination.

In the franchise agreement or a trade mark licence schedule, specify:

• The marks covered and their registration numbers or application status.
• The permitted location, territory, activities and sales channels.
• The duration of use and how it relates to the term of the franchise agreement.
• The limits of any exclusivity and a prohibition on sublicensing without consent.
• The process for approving advertising materials and monitoring the quality of trade mark use.

Meet the legal requirements for putting the trade mark licence in writing and having it authenticated, and check the procedures for recording it with the relevant authority where necessary. Do not treat a general phrase such as ‘the name may be used’ as a substitute for a clear licence.

4. Control digital use and responses to infringement

Before the first franchised outlet opens, decide who will create local accounts, who will have administrative access and how they will be handed over when the agreement ends. Distinguish account ownership from an employee’s day-to-day access, and prohibit the registration of similar domain names or the creation of new accounts without written approval.

Create a streamlined approval process for designs and promotions, with a designated person responsible and an agreed response time. Slow approvals encourage franchisees to make their own decisions, while a lack of oversight risks fragmenting the brand’s identity.

If suspected imitation is discovered, require evidence and dates to be preserved and the franchisor to be notified. Specify who will assess the infringement, who will contact legal counsel and who will bear the costs. Avoid giving franchisees authority to issue legal threats or accept settlements on the trade mark owner’s behalf without authorisation.

5. Plan for debranding before the relationship begins

The agreement should explain what happens to signage, packaging, uniforms and digital accounts when the right to use the mark ends. Set deadlines and responsibilities, establish how removal will be verified, and specify how remaining stock will be handled without assuming it may be sold under the trade mark after the licence expires.

Distinguish debranding from the settlement of other obligations, and review whether the proposed measures are legally enforceable, particularly where the relationship is registered as a commercial agency. A contractual clause does not justify taking unilateral action that breaches the law.

Practical takeaway: Before accepting your first franchise partner, complete your trade mark ownership file, review the scope of protection, and put an agreed trade mark use schedule and exit plan in place. These steps protect the business and give your franchise network a clearer foundation for trust and growth.