Tiếng Việt
中文 (中国)
Franchising is a common business method in free-market economies, particularly in countries such as the United States, Australia, and the European Union. In Vietnam, franchise activities from abroad officially began in 2007 and have since experienced significant development.
Franchising is a process where one party (the franchisor) permits and requires another party (the franchisee) to conduct business activities such as buying and selling goods, using brand names, business experience, advertising, etc., of the franchisor. The franchisor often has the responsibility to support and supervise the franchisee in business operations.
These business activities are usually carried out under the franchisor’s name and associated with their brand. In Vietnam, franchising is commonly applied in industries such as restaurants, fashion, and education.
The development of franchise activities in Vietnam started when Vietnam joined the World Trade Organization (WTO), establishing a legal environment for businesses that is complete and compatible with international standards.
By mid-May 2015, about 135 foreign brands from 21 countries had registered franchising in Vietnam, mainly focusing on restaurant, fashion, and education sectors. However, some business sectors such as real estate, auditing and accounting services, entertainment, cinemas, and karaoke venues have not seen significant development in franchise activities in Vietnam.
Franchising from Vietnam to abroad began in 2007, and the number of enterprises registering franchise abroad has increased. However, since December 2011, enterprises franchising abroad no longer need to register but only need to report to the Department of Industry and Trade. However, the control and collection of this information have not been specifically managed, and there is no accurate data on franchise activities abroad.
To further develop franchise activities in Vietnam, providing a clear and comprehensive legal framework is crucial. Although there have been many legal regulations related to franchising, there are still certain limitations such as not covering all forms of franchising, insufficient protection for franchisees in the case of domestic franchising, and lacking regulations on penalties for infringements related to franchising.
Therefore, to foster stronger and more effective franchise development, further efforts are necessary to improve the legal system related to franchising.
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ASL LAW is the top tier Franchise law firm in Vietnam. If you need any advice, please contact us for further information or collaboration.
