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Insight

The obligation to register in the Spanish Franchisor Registry has been suspended

18/04/2018

Locations

Spain

The prospective Franchisor who intends to grant a Franchise in Spain must register in the Spanish Franchisor Registry within three months from the date when it starts carrying out the franchising activity (obligation provided by article 62 of Spanish Act 7/1996 of 15 January on Regulation of Retail Trading and Royal Decree 201/2010 of 26 February 2010 on commercial activities of franchising and Registry of Franchisors). 

This obligation does no apply to franchisors who intends to grant other kind of agreements such as Master Franchise or Area Development Services agreements.

Nevertheless, in practice, the Franchisor Registry has shown a bad performance since its foundation in 1998. That is why even if the data of franchisors are no up to date, there have not been any administrative sanctions while operating for 20 years.

In addition to the bad performance, some material technical problems have also emerged in its new website. Therefore, the Spanish Authorities have decided to suspend the obligation to register in the Spanish Franchisor Registry.

The Secretary State for External Trade web has published the following warning:

“Due to technical and operational problems of the Franchisor Registry, the General Sub directorate of Internal Trade has decided to suspend its activity and therefore, all obligations to register in the Spanish Franchisor Registry”.

Obviously, as far as the register has been suspended, not any liability will arise if franchisors do not register in the meanwhile, provided that they do inscribe as soon as the suspension is lifted.

The Spanish Franchise Association (of which I’m honored to be the legal adviser and Chairman of the Committee of Experts) is working together with the Minister of Economy, Industry and Competition to sort out the Franchisor´s Registry System.

We strongly recommend to all foreign franchisors who are willing to grant franchise agreements in Spain to keep in touch with a local lawyer or at least with the Register of Franchisor itself to be notified when the obligation starts again.

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