New Korean Franchise Act Amendment
by Brendon Carr
This week I will be out of the office to attend the 2007 annual conference of the International Bar Association being held in Singapore. I am speaking on two panels: the Employment Law Committee and the Franchising & Distribution Law Committee. My paper for the Franchising Committee is available as a FREE download to anyone who wants it. Click here to download (Adobe Acrobat PDF, 291Kb).
We’ve also got a high-quality English translation of the new Franchise Act amendments, prepared by Hwang Mok Park attorneys Ms. In-Kyu Hwang, Mr. Si-Mok Kim, and Ms. Sun-Hee Kim. These excellent associates are doing first-rate work and I am very proud to be able to work with people of their caliber. To get the English translation, though, please e-mail me (see the contact link in the right-hand column of this page, below my picture).
The changes to the Franchise Act are not insubstantial. In brief, the amendment requires franchisors (i) to register their disclosure statements with the KFTC; (ii) to deliver a written disclosure statement to all prospective franchisees in all cases, not just the cases where disclosure is requested; (iii) to observe a “cooling off” period after disclosure is given to the prospective franchisee; (iv) to escrow franchise fees at the commencement of the relationship and to establish some means to protect the franchisee’s right to refund in certain cases; (v) to refrain from direct competition with the franchisee; and (vi) to be much more meticulous in respect of the renewal, non-renewal, and termination of the franchise relationship.
The amended provisions of the Franchise Act will be effective from February 4, 2008.
One of the reasons I enjoy franchise work is that each new franchised business, especially restaurants, brings Korea closer to the world that I find familiar. While this place will always be its own little universe, being able to pop on over to a Wendy’s (oh, how I wish Wendy’s would come back to Korea!) is a little taste of home. It’s good to be able to personally benefit from one’s own legal work, and to have the opportunity to help others. For example, if I could help franchise Tim Horton’s in Korea it might relieve some of the homesickness that compels Canadian English teachers to go to such lengths to smuggle weed to themselves in Korea.
Want to know more (about the franchise law—I can’t help you with the dope smuggling)? Better yet, want to hire attorneys from my offices to assist with your franchise-related legal issues? Click here to download (Adobe Acrobat PDF, 291Kb) the FREE paper and get familiar with the changes in the Franchise Act.
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Korea Law Blog is brought to you by Brendon Carr, an American lawyer working as a foreign legal consultant for more than 10 years in Seoul. (Brendon is not admitted as an attorney in Korea. But you knew that.) -
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