Abstract
Due to gobalization, world trade has increased tremendously. Franchising having surged as one of the many business models has the potential to improve the economy of the community. Basically, franchising refers to a method of goods and services distribution to consumers. The party who owns the method is referred to as the franchisor, while the party given the right to use a method the franchisee. This article examines the legal issues that arise in granting license rights from foreign franchisors to franchisees, and how the laws in Indonesia provide protection for the rights and obligations of the parties. The research employed the normative juridical method or library research. Normative legal research examines the law as a positive norm as it is written in the book. In accordance with Article 1320 and 1338 of the Indonesian Civil Code, arrangements of franchising agreement in Indonesia are based on the agreement between the parties. To provide legal protection for recipients foreign franchise in Indonesia, the government has enacted the Government Regulation No. 42/2007 on Franchise and Trade Minister Regulation No. 53/2007 on the Implementation of Franchising. In principle, the settlement of the problems that occur in international franchising agreement would be resolved by consultation or negotiation. If consensus is not reached, the parties can take the dispute to international arbitration. In general, the dispute over the franchise business concept is mostly resolved through the general justice institution.
Highlights
The concept of a franchise business is in demand by business people because it is almost the same as opening a business branch
It is important to conduct a study to find out how legal protection for franchisees and forms of settlement if there is a dispute from the agreement between the foreign franchisor and the franchisee in Indonesia
According to Article 2 of the Government Regulation No 42/2007 on Franchising, there are several criteria that must be met in a franchise agreement, including: Having a business characteristics; proven to have provided benefits; have a standard for services and goods and/or services offered made in writing; easy to teach and apply; continuous support; and registered intellectual property rights
Summary
The concept of a franchise business is in demand by business people because it is almost the same as opening a business branch. The committee on Small Business, United States Congress defines franchise as franchising is a contractual method for marketing and distributing goods and services (franchisors) through a dedicated or restructured network of distributors (franchisees).. In order to fulfilling the legal needs of business people, the government issues several provisions that regulate franchise agreements. In relation to franchising involving foreign parties, the franchisor and franchisee usually take procedures commonly used in contract law.. It is important to conduct a study to find out how legal protection for franchisees and forms of settlement if there is a dispute from the agreement between the foreign franchisor and the franchisee in Indonesia. The results of this study are expected to provide input for improving franchise regulations, as well as the application and supervision
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