Some Legal İssues Of Franchising In Kazakhstan

A franchise is a legal and commercial relationships between the owner of the brand (the Franchisor) and someone who seeks to use that identification in a business (the Franchisee). A franchise could be used as a strategy of expanding a business and distributing goods and services through a licensing relationship.

In other words, francising is a continuing relationship in which a franchisor provides a licensed privilege to the franchisee to do business and offers assistance in organizing, training, merchandising, marketing and managing in return for a monetary consideration. The franchisee uses these items in order to establish and conduct business.

In Kazakhstan, franchising legal relations are regulated, firstly, by Chapter 45 of the Civil Code of the Republic of Kazakhstan, wherein the franchise agreement is also called the Comprehensive Entrepreneurial License Agreement. The provisions of the Civil Code of the Republic of Kazakhstan on the license agreement are also applicable to the agreement of an comprehensive entrepreneurial license, as to the type of the license agreement. Moreover, the country has a special Law of the Republic of Kazakhstan dated June 24, 2002 "On the comprehensive entrepreneurial license (franchising)". Depending on the subject of the agreement, its legal regulation may be subjected to other regulatory acts, in particular, the Laws of the Republic of Kazakhstan "On Trademarks", "On Copyright", "Patent Law".

It should be noted that according to international private law and by agreement of the parties, you can select the law of which country the agreement will be governed, unless otherwise provided by Kazakhstan legislation. The civil legislation of Kazakhstan gives tangible freedom in relation to contractual relations with foreign participation, so according to Art. 1112 of the Civil Code of the Republic of Kazakhstan, it is possible to elect the applicable law, both for the agreement as a whole and for its parts; it is also possible to determine the regulated law, both at the time of the conclusion of the agreement, and in further, and you can also change the law applicable to the contract at any time by agreement of the parties. In cases of working with foreign Franchisors or Franchisees, it is necessary to study the agreement carefully, as well as to analyze possible risks in election the law applicable to the contract.

According to Kazakhstan law, a franchise agreement is a binding, bilateral, compensated...

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