A right granted by a franchisor to a franchisee to run a franchise business on his/her own account under the trademark or under the brand name of the franchisor or the person licensed to use the same; this shall include transferring technical expertise and specifying the manner of operation. Such right may be granted for a financial or non-financial consideration, excluding the amounts the franchisee pays to the franchisor in return for goods or services

The franchisor is a natural or legal person who grants the franchise under a franchise agreement, allowing another natural or legal person called the franchisee to use their name or trademark.

Regulating the relationship between the franchisor and the franchisee, providing them with protection, ensuring the disclosure of rights and duties related to franchise opportunities, and raising the quality of goods and services.

The Law applies to any franchise agreement executed within the Kingdom.

According to Article 4 of the Franchise Law, commercial agency agreements and their contracts are not considered commercial franchising agreements.

No, it is only permissible after practicing a franchise business for at least one year by two persons or in two different sales outlets.

A document that includes the disclosure of key rights, obligations, and significant risks related to franchise opportunities.

Yes, but the franchisee must first obtain the consent of the franchisor, which shall not be withheld unless specifically allowed by Law, or if it is not stated in writing.

It shall expire under the Bankruptcy Law, or either party’s death, incapacity, or health condition. The agreement may include a provision to be transferred by inheritance. It may also expire for any legitimate reasons specified in the Law.

Yes.

Yes, three years from the termination date of the franchise agreement.

Yes, and these provisions are mentioned in Article Eleven of the Franchise Law, and Article Eight of the Franchise Law’s Implementing Regulations.

Yes, and if any of the information or elements contained in the Disclosure Document does not apply to the franchise or franchisor, it shall be marked as “Not Applicable".

1- The application fee for registering the franchise agreement and the Disclosure Document is (five hundred) Saudi Riyals.
2- The application fee for registering the franchise agreement amendment is (one hundred) Saudi Riyals.

It is limited to compensation for material breach by the franchisor of its obligations.