A quick guide to Danish franchise legislation

Legislation varies and can be complex. Thus, when it comes to franchising it is important to know the applicable legislation of the country in question. NJORD has contributed with a quick guide to the dos and don’ts of Danish franchise legislation in the latest edition of the International Franchise Handbook.

In comparison, there is no legal definition of a franchise in Danish law; nor is it regulated by any specific code. A franchise agreement is initially regulated by the contract, which the parties have agreed on, and no restrictions are imposed specifically on foreign franchisors in Denmark according to Danish law, which makes it ideal to establish a local franchise.

Nevertheless, general Danish contract law, accompanied by national and European legislation governing relevant areas such as trademarks, patents, competition, etc., complements the franchise agreement, and a franchise agreement is often subject to intense negotiation and regulation of the terms, including for instance means of dispute resolution and remedies in the event of breach of contract.

Thus, there are a few areas of legislation to consider before establishing a franchise in Denmark:

  • Corporate law – business entity
  • Consumer protection law – franchisee or customer?
  • Competition law
  • Labour law aspects
  • Sales agent law
  • Tax – how are foreign businesses and individuals taxed in the specific country?
  • IPR – trademarks, copyright, patents, etc.
  • Pre-sale disclosure/pre-contractual information
  • Legal restrictions affecting franchise agreements
  • Franchise fees
  • Confidentiality clauses
  • Termination and transfer of franchise agreements
  • Dispute resolution and applicable law

NJORD renders advice on both national and international franchising systems on an ongoing basis. Several NJORD lawyers have been involved in large and small franchising projects and other legislation processes, and we have specific knowledge of all aspects within franchising.

Thus, we have gathered our recommendations for each of the above areas of legislation giving you the overview required to consider the legislative opportunities and limitations before venturing into the Danish market: What to consider when establishing a Danish franchise.

The International Franchise Handbook is a collective guide covering local franchise legislation of 31 jurisdictions. More than 30 law firms and numerous lawyers have contributed with their knowledge to the guide, which is the second edition of its kind. The information has been gathered and published by DWF Germany.
Download the International Franchise Handbook here (pdf).

Would you like to know more?

If you have any questions regarding franchising in Denmark and the Nordic countries or the International Franchise Handbook in general, you are welcome to contact Attorney Niels Gade-Jacobsen on ngj@njordlaw.com or by telephone (+45) 77 40 11 96.

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