2016/2244(INI) | [ParlTrack]

Draft opinion
Paragraph 1

1. Recalls that franchising is an effective and efficient way for people to set up their own business and thus create their own employment: advice, (training), engineering and know-how, visibility, communication, ~~installation, products~~products, services, technical and commercial assistance, etc. is provided by the franchiser; in the long term the franchisee will ~~often create additional~~be able to create new jobs;

Amendment 10 #

Draft opinion
Paragraph 4 – introductory part

4. ~~Calls on~~Urges the Commission and the Member States to implement measures to improve protection of franchisees and their employees while ensuring that the business concerned remains viable:

Amendment 11 #

Draft opinion
Paragraph 4 – indent 1

- the franchiser should set up the franchisee (furniture, interior and exterior decoration, advertising, packaging, etc.) on reasonable terms and at market prices;

Amendment 12 #

Draft opinion
Paragraph 4 – indent 2

- unless they give a commitment to take back unsold stock, franchisers should no longer be able to impose ~~the type and~~a volume of stocks ~~in a way that risks strangling the franchisee financially~~that is greater than the franchisees wish or likely to cause liquidity problems; the type and volume of stocks must be such as to guarantee adequate availability thereof;

Amendment 13 #

Draft opinion
Paragraph 4 – indent 3

- the franchiser must guarantee and ensure brand and product exclusivity for the franchisee within a viable catchment area;

Amendment 14 #

Draft opinion
Paragraph 4 – indent 3 a (new)

- the franchiser must provide the franchisee with technical and commercial assistance in step with the development of the latter’s business activities; - the franchiser must be permanently attentive to the provision of vocational training for the franchisee’s staff; - the franchiser must track and foster the development of the franchisee’s business activities, since the franchiser depends for its income on the franchisees being financially successful;

Amendment 15 #

Draft opinion
Paragraph 4 – indent 4

- modification of the contractual conditions by the franchiser without proper consultation with the franchisee must be prohibited, as well as any modification with retroactive effect;

Amendment 16 #

Draft opinion
Paragraph 4 – indent 5

- it must be possible to terminate the franchise contract, in a coordinated and manageable way, within a reasonable period, especially where the franchiser falsified the market research;

Amendment 17 #

Draft opinion
Paragraph 4 – indent 6

- ~~national rules should be harmonised across all Member States;~~deleted

Amendment 18 #

Draft opinion
Paragraph 4 – indent 6

- ~~national rules should be harmonised across all Member States~~the possible harmonization of national rules across all Member States and the impact thereof should be considered;

Amendment 19 #

Draft opinion
Paragraph 4 – indent 7

- the (weak) representation of franchisees in representative organisations should be aided and enhanced against the (powerful) representation of franchisers; representation of each of the parties must be properly balanced.

Amendment 2 #

Draft opinion
Paragraph 1

1. Recalls that franchising is an effective way for people to set up their own business and thus create their own employment: if they are affiliated with a well-known business model and able to take immediate advantage of its commercial reputation; advice (training), visibility, communication, installation, products, etc. provided by the franchiser; in the long term the franchisee will often create additional jobs;

Amendment 20 #

Draft opinion
Paragraph 4 – indent 7

- the (weak) representation of franchisees in representative organisations should be aided and enhanced immediately against the (powerful) representation of franchisers.

Amendment 21 #

Draft opinion
Paragraph 4 a (new)

4a. Stresses the need to ensure that, in particular, international concerns operating on the franchise principle pay appropriate taxes at national level in order to ensure fair competition for small and medium-sized businesses and independent retailers;

Amendment 22 #

Draft opinion
Paragraph 4 a (new)

4a. Calls on the Commission to improve the legislative framework governing franchising;

Amendment 3 #

Draft opinion
Paragraph 1 a (new)

1a. Points out that being a franchiser means conducting and expanding viable business activities which have proved themselves efficient and effective in the long term;

Amendment 4 #

Draft opinion
Paragraph 1 a (new)

1a. Stresses the importance of franchise-based and independent retailers for vibrant inner cities in Europe;

Amendment 5 #

Draft opinion
Paragraph 1 b (new)

1b. Recalls that groups of independent retailers are not the same as franchises;

Amendment 6 #

Draft opinion
Paragraph 2

2. ~~Recall~~Notes that 100% of the investment, however, comes from the franchisee; purchasing or leasing the premises, furnishings, interior and exterior decorations and stock, all of which is imposed by the franchiser, who is often also the seller of those items, and at a high price;

Amendment 7 #

Draft opinion
Paragraph 2

2. Recalls that 100% of the investment, however, comes from the franchisee; purchasing or leasing the premises, furnishings, interior and exterior decorations and stock, and, in addition, frequently providing insurance and legal cover, all of which is imposed by the franchiser, who is often also the seller of those items, and at a high price;

Amendment 8 #

Draft opinion
Paragraph 3 a (new)

3a. Believes that the existing EU policy framework with regard to franchising should be examined to ensure it is fit for purpose in line with the better regulation principles;

Amendment 9 #

Andreas SCHWAB, Ildikó GÁLL-PELCZ

Draft opinion
Paragraph 4 – introductory part

4. Calls on the ~~Commission and the~~ Member States to implement measures to improve protection of franchisees and their employees while ensuring that the business concerned remains viable:

source: 595.459

2017/02/08 ECON 178 amendments...

Amendment 1 #

Draft opinion
Paragraph 1

1. ~~Considers that the lack of homogeneity in its application across the Member States undermined the effectiveness~~Regrets that, to date, there has been scarcely any information about the application of Commission Regulation No 330/2010 in the area of franchising;

Amendment 1 #

Marc TARABELLA, Lucy ANDERSON, Sergio GUTIÉRREZ PRIETO, Marlene MIZZI, Nicola DANTI, Maria GRAPINI, Pina PICIERNO, Liisa JAAKONSAARI

Motion for a resolution
Recital A

A. whereas there is no common European definition of franchising~~, but it normally involves~~ and franchising agreements differ from one business to another, while franchising normally includes specific basic common elements, namely a partnership between natural or legal persons that are legally and financially independent of each other, whereby one party (the franchisor) grants to the other party (the franchisee) the right to operate his franchising formula to sell goods and/or services, ~~and~~ shares know- how, and the provision of commercial and technical assistance on the part of franchisor to the franchisee for the duration of the agreement; the intention of both the franchisor and the franchisee being to generate business revenue;

Amendment 10 #

Marc TARABELLA, Sergio GUTIÉRREZ PRIETO, Marlene MIZZI, Maria GRAPINI, Pina PICIERNO, Liisa JAAKONSAARI

Draft opinion
Paragraph 4

4. ~~Is concerned at the fac~~Points out that some Member States ~~have introduced~~already have legislation on franchising ~~that prevents homogeneity of the market; believes that an approach based on EU competition law enforcement and~~, which ultimately results in further fragmentation of the market; believes that better implementation of the regulation at national level wcould help improve distribution and ~~increase~~ market access for businesses from other Member States~~’ businesse~~; points out, at the same time, that legislation covering franchising as a business model varies among Member States, which can also discourage franchisees from entering into cross- border franchise networks;

Amendment 10 #

Marc TARABELLA, Sergio GUTIÉRREZ PRIETO, Marlene MIZZI, Nicola DANTI, Maria GRAPINI, Pina PICIERNO, Liisa JAAKONSAARI

Motion for a resolution
Recital C

C. whereas franchising has the full potential of being a business model that can help in completing the single market in the retail sector as it can be a convenient means to establish business through a shared investment of franchisor and franchisee, but is currently under- performing in the EU, representing only 1.89 % of GDP, as opposed to 5.95 % in the USA and 10.83 % in Australia, 83.5 % of franchising’s turnover being concentrated in only seven Member States;

Amendment 100 #

Motion for a resolution
Paragraph 11

11. Points, in particular, to the need for specific principles to ensure the balanced contractual rights and obligations of the parties, such as clear, correct and comprehensive pre-contractual information, including information on the franchise formula’s performance, both general and targeted towards the franchisee’s envisaged location, and clear limits concerning the confidentiality requirements, to be available in writing at least 15 working days prior to the signing of the agreement, and the introduction of a five-day cooling- off period after execution of the agreement; the obligation for the franchisor to ensure that the duration of the contract allows the franchisee to cover his investment; continued commercial and technical assistance from the franchisor to the franchisee for the duration of the agreement; and fair indemnities at the end of the contract;

Amendment 101 #

Jiří POSPÍŠIL, Richard SULÍK, Andreas SCHWAB

Motion for a resolution
Paragraph 11

11. Points~~, in particular,~~ to the need for correct and comprehensive pre- contractual information, including information on the franchise formula’s performance, both general and targeted towards the franchisee’s envisaged location, to be available in writing at least 15 working days prior to the signing of the agreement, and the introduction of a five- day cooling-off period after execution to be available in writing prior to the signing of the agreement;

Amendment 102 #

Jasenko SELIMOVIC

Motion for a resolution
Paragraph 11

11. PRegrets that the franchising market lacks transparency; points, in particular, to the need for correct and comprehensive pre-contractual information, including information on the franchise formula’s performance, both general and targeted towards the franchisee’s envisaged location, to be available in writing at least 15 working days prior to the signing of the agreement, and the introduction of a five-day cooling- off period after execution of the agreement;

Amendment 103 #

Motion for a resolution
Paragraph 11

11. Points, in particular, to the need for correct and comprehensive pre-contractual information, including information on the franchise formula’s performance, both general and targeted towards the franchisee’s envisaged location, to be available in writing a~~t least 15 working days prior to~~ nd withe s~~igning of the agreement, and the introduction of a five-day cooling- off period after execution~~ufficient notice prior to the signing of the agreement;

Amendment 104 #

Motion for a resolution
Paragraph 12

12. Emphasises the need for specialised initial training and appropriate guidance by the franchisor for franchisees during the term of the agreement to the extent necessary;

Amendment 105 #

Motion for a resolution
Paragraph 12

12. Emphasises the need for specialised initial training and appropriate guidance and information by the franchisor for franchisees during the term of the agreement;

Amendment 106 #

Jiří POSPÍŠIL

Motion for a resolution
Paragraph 12

12. Emphasises the need for specialised initial training where necessary and appropriate guidance by the franchisor for franchisees during the term of the agreement;

Amendment 107 #

Motion for a resolution
Paragraph 12

12. ~~Emphas~~Recognises there is usually a need for specialised initial training and appropriate guidance by the franchisor for franchisees during the term of the agreement;

Amendment 108 #

Edward CZESAK

Motion for a resolution
Paragraph 13

13. Recalls the obligation of franchisees to devote their best endeavours to the growth of the franchise business and to the maintenance of the common identity and reputation of the franchise network, and to this effect to collaborate loyally with all partners in the network and to respect the industrial and intellectual property rights involved in the franchise formula, as well as competition rules;

Amendment 109 #

Jean-Marie CAVADA

Motion for a resolution
Paragraph 13 a (new)

13 a. Calls on the Commission to clarify liability conflicts between the franchisee and the franchisor as regards infringements of industrial and intellectual property rights;

Amendment 11 #

Draft opinion
Paragraph 4

4. Is concerned ~~at the fact~~ that some Member States ~~have introduced~~' legislation on franchising ~~tha~~is not compatible with the regulation because it prevents homogeneity of the market; believes that an approach based on EU competition law enforcement and better implementation of the regulation at national level would improve distribution and increase market access for other Member States’ businesses;

Amendment 11 #

Motion for a resolution
Recital C

C. whereas franchising has the potential of being a business model that can help in completing the single market in the retail sector, but is currently under- performing in the EU, representing only 1.89 % of GDP, as opposed to 5.95 % in the USA and 10.83 % in Australia, 83.5 % of franchising’s turnover being concentrated in only seven Member States, which is why it is important to encourage a wider spreading of this business model throughout the EU;

Amendment 110 #

Jean-Marie CAVADA

Motion for a resolution
Paragraph 13 b (new)

13 b. Calls on the Commission to consider proposing an EU directive tackling unfair trading practices in the franchise sector with cross-border implications;

Amendment 111 #

Motion for a resolution
Paragraph 14

14. Adds, however, that sometimes franchisors require franchisees to purchase products and services that are not related to the franchise formula; such a requirement should not be seen as part of the obligation of franchisees relating to the maintenance and common identity and reputation of the franchise network, but can easily constitute an unfair trading practice;deleted

Amendment 112 #

Motion for a resolution
Paragraph 14

Amendment 113 #

Motion for a resolution
Paragraph 14

Amendment 114 #

Motion for a resolution
Paragraph 14

14. ~~Add~~Notes, however, that some~~times~~ franchisors are said to be requireing franchisees to purchase products and services that are not related to the franchise formula; such a requirement should not be seen as part of the obligation of franchisees relating to the maintenance and common identity and reputation of the franchise network, but c~~an easily~~ould constitute an unfair trading practice;

Amendment 115 #

Motion for a resolution
Paragraph 15

15. Emphasises that non-competition clauses should be clearly formulated, reasonable and proportionate and should not apply for a longer duration than what is strictly necessary, considering, in particular, the potential need for franchisees to change their franchise formula, if their neighbourhood and therefore the demand for products or services changes;

Amendment 116 #

Motion for a resolution
Paragraph 15

15. Emphasises that non-competition clauses ~~should be~~are generally clearly formulated, reasonable and proportionate and ~~should not~~ apply for a ~~longer~~ duration tha~~n wha~~t is strictly necessary~~, considering, in particular, the potential need for franchisees to change their franchise formula, if their neighbourhood and therefore the demand for products or services changes~~;

Amendment 117 #

Marlene MIZZI, Marc TARABELLA, Maria GRAPINI

Motion for a resolution
Paragraph 15

15. Emphasises that non-competition clauses should be clearly formulated~~, reasonable and proportionate~~ and should not apply for a longer duration than what is strictly necessary~~, considering, in particular, the potential need for franchisees to change their franchise formula, if their neighbourhood and therefore the demand for products or services changes~~;

Amendment 118 #

Motion for a resolution
Paragraph 15 a (new)

15 a. Notes with concern that parallel importation of franchised products seriously undermines and jeopardizes territorial exclusivity agreements and pollute and contradict the franchising model to the detriment of the franchisees, and holds the franchisors responsible if such importation into the territory is within their capability to control and prevent;

Amendment 119 #

Motion for a resolution
Paragraph 16

16. Notes with concern the disputes arising about internet sales, as they are vital in the digital market, whereas traditional franchise agreements do not take into account the effect internet sales may have on exclusivity clauses, thus making it possible that in the area for which the franchisee has the right of exclusivity, customers may buy their products from the franchisor, even if they pick up the goods in the franchisee’s shop;deleted

Amendment 12 #

Draft opinion
Paragraph 4

4. Is concerned at the fact that some Member States have introduced legislation on franchising that prevents homogeneity of the market; believes that an approach based on EU competition law enforcement and better implementation of the regulation at national level would improve distribution ~~and~~, increase market access for other Member States’ businesses; and provide potentially a better deal for end consumers.

Amendment 12 #

Motion for a resolution
Recital C

C. whereas franchising has the potential of being a business model that can help in completing the single market in the retail sector, but is disappointed that it is currently under- performing in the EU, representing only 1.89 % of GDP, as opposed to 5.95 % in the USA and 10.83 % in Australia, 83.5 % of franchising’s turnover being concentrated in only seven Member States;

Amendment 120 #

Motion for a resolution
Paragraph 16

Amendment 121 #

Marc TARABELLA, Marlene MIZZI, Lucy ANDERSON, Maria GRAPINI, Pina PICIERNO, Liisa JAAKONSAARI

Motion for a resolution
Paragraph 16

16. Notes with concern the disputes arising about internet sales, as they are vital in the digital market, whereas the power of the franchisor and the franchisee is often very unbalanced, and traditional franchise agreements do not take into account the effect internet sales may have on exclusivity clauses, thus making it possible that in the area for which the franchisee has the right of exclusivity, customers may buy their products from the franchisor, even if they pick up the goods in the franchisee’s shop; recalls that efforts should be made to prevent internet sellers from developing unfair competitive advantages vis-a-vis franchisees;

Amendment 122 #

Motion for a resolution
Paragraph 16

16. Notes ~~with concern the disput~~the issues arising abroutnd internet sales, ~~as they are vital in the digital market,~~ whereas traditional franchise agreements often do not take into account the effect internet sales may have on exclusivity clauses, ~~thus~~ making it possible that in ~~the~~an area for which the franchisee has the right of exclusivity, customers may buy their products from the franchisor, even if they pick up the goods in the franchisee’s shop;

Amendment 123 #

Motion for a resolution
Paragraph 16

16. Notes with concern the disputes arising about ~~inter~~onlinet sales, as the~~y are vital in the digital market, whereas~~se constitute an increasingly important part of the franchise business model, but are not covered in traditional franchise agreements, which do not take into account the effect internet sales may have on ~~exclusivity clauses, thus making it possible that in the area for which the franchisee has the right of exclusivity, customers may buy their products from the franchisor, even if they pick up the good~~the provisions set out in them; calls, therefore, for the inclusion of provisions relating to online sales in ~~the~~ franchise~~e’s shop~~ agreements;

Amendment 124 #

Marc TARABELLA, Marlene MIZZI, Nicola DANTI, Maria GRAPINI, Pina PICIERNO, Liisa JAAKONSAARI

Motion for a resolution
Paragraph 16 a (new)

16 a. Expresses its concerns about the use of consumer data collected via the franchisee; asks the Commission to take into consideration the digital components of the business model in its further actions;

Amendment 125 #

Jasenko SELIMOVIC

Motion for a resolution
Paragraph 17

17. Requests the Commission to draft guidelines reflecting best practices on the functioning of franchising in the retail sector and the latest technological and market developments, such as internet sales; invites the Commission in this respect to make an analysis of the existing self-regulatory instruments as well as of legislative practices of Member States in the field of franchising in the retail sector and to submit its findings to Parliament, including recommendations for further action, focusing on the need for effective enforcement as well as on how to further develop the franchising market in the EU;

Amendment 126 #

Marc TARABELLA, Lucy ANDERSON, Nicola DANTI, Maria GRAPINI, Pina PICIERNO, Liisa JAAKONSAARI

Motion for a resolution
Paragraph 17

17. ~~Request~~Urges the Commission to draft guidelines reflecting best practices on the functioning of franchising in the retail sector; invites the Commission in this respect to, open a public consultation in order to obtain unbiased information as to the real situation in franchising, then to make an analysis of the existing self- regulatory instruments as well as of legislative practices of Member States in the field of franchising in the retail sector and to submit its findings to Parliament, including recommendations for further action, focusing on the need for effective enforcement;

Amendment 127 #

Dennis de JONG

Motion for a resolution
Paragraph 17

17. Requests the Commission to draft guidelines reflecting best practices on the functioning of franchising in the retail sector and to submit these to Parliament by January 2018 at the latest; invites the Commission in this respect to make an analysis of the existing self-regulatory instruments as well as of legislative practices of Member States in the field of franchising in the retail sector and to submit its findings to Parliament, including recommendations for further action, focusing on the need for effective enforcement;

Amendment 128 #

Dita CHARANZOVÁ

Motion for a resolution
Paragraph 17

17. Requests the Commission to draft non-legislative guidelines reflecting best practices on the functioning of franchising in the retail sector within the Member States and to further support similar programmes, such as the Supply Chain Initiative (SCI), in relation to franchising; invites the Commission in this respect to make an analysis of the existing self- regulatory instruments as well as of legislative practices of Member States in the field of franchising in the retail sector and to submit its findings to Parliament~~, including recommendations for further action, focusing on the need for effective enforcement~~;

Amendment 129 #

Motion for a resolution
Paragraph 17

17. Requests the Commission to draft guidelines reflecting best practices on the functioning of franchising in the retail sector; invites the Commission in this respect to make an analysis of the existing self-regulatory instruments as well as of legislative practices of Member States in the field of franchising in the retail sector and to submit its findings to Parliament~~, including recommendations for further action, focusing on the need for effective enforcement~~;

Amendment 13 #

Draft opinion
Paragraph 5

5. Believes that the Commission should also analyse the unintended impact of competition law, and that competition law measures should be evaluated not only in the light of market integration aims, but also as building blocks of private-law relations;deleted

Amendment 13 #

Marc TARABELLA, Lucy ANDERSON, Sergio GUTIÉRREZ PRIETO, Nicola DANTI, Maria GRAPINI, Pina PICIERNO, Liisa JAAKONSAARI

Motion for a resolution
Recital D

D. whereas franchising has a significant cross-border dimension and is of importance for the functioning of the internal market, but existing legislation covering franchising as a business model varies widely between Member States, and franchisees may refrain from entering into cross-border franchise networks, because they are not familiar with other legal systems and may not be protected against unfair trading practices; whereas in turn this can have an impact on the entire EU economy, as well as on final consumers by limiting their choice;

Amendment 130 #

Motion for a resolution
Paragraph 17

17. Requests the Commission to draft guidelines reflecting best practices on the functioning of franchising in the retail sector; invites the Commission in this respect to make an analysis of the existing self-regulatory instruments as well as of legislative practices of Member States in the field of franchising in the retail sector and to submit its findings to Parliament, including recommendations for further action, focusing on the need for effective enforcement and for further legislative measures, if appropriate;

Amendment 131 #

Jiří POSPÍŠIL

Motion for a resolution
Paragraph 17

17. Requests the Commission to draft guidelines on the cross-border aspects of franchising reflecting best practices on the functioning of franchising in the retail sector; invites the Commission in this respect to make an analysis of the existing self-regulatory instruments as well as of legislative practices of Member States in the field of franchising in the retail sector and to submit its findings to Parliament, including recommendations for further action, focusing on the need for effective enforcement;

Amendment 132 #

Motion for a resolution
Paragraph 17

17. Requests the Commission to draft guidelines reflecting best practices on the functioning of franchising in the retail sector; invites the Commission in this respect to make an analysis of the existing self-regulatory instruments as well as of legislative practices of Member States in the field of franchising in the retail sector and to submit its findings to Parliament, including recommendations for further action, focusing on the need for effective ~~enforcement~~and harmonised enforcement in the 28 Member States;

Amendment 14 #

Draft opinion
Paragraph 5 a (new)

5a. Points out the comprehensiveness of competition rules that apply when the there is a risk to or a breach of the public interest with regard to ensuring that conditions suit the functioning of the economic market, rather than the situation of the individual entrepreneur;

Amendment 14 #

Jasenko SELIMOVIC

Motion for a resolution
Recital D

D. whereas existing legislation covering franchising as a business model varies widely between Member States, and franchisees may refrain from entering into cross-border franchise networks, because they are not familiar with other legal systems and may not be protected against unfair trading practices; regrets in that regard the underdevelopment of franchising that negatively affects growth, job creation, increase in the tax base, SME and entrepreneurship development as well as the acquisition of new capabilities and skills;

Amendment 15 #

Draft opinion
Paragraph 6

6. Points out that the Commission should start public consultations with a view to correcting the model on which the future block exemption regulation is based and to establishing the concept of a franchising contract to be used in any future EU legislation, as well as for possible action in the area of private law;deleted

Amendment 15 #

Motion for a resolution
Recital D

D. whereas existing legislation covering franchising as a business model ~~varies widely~~understandably varies between Member States, and franchisees may refrain from entering into cross-border franchise networks~~, because they are not familiar with other legal systems and may not be protected against unfair trading practices~~;

Amendment 16 #

Draft opinion
Paragraph 6

6. Points out that the Commission should start public consultations ~~with a view to correcting~~and, in that context, check whether it is necessary to adapt the model on which the future block exemption regulation is based ~~and~~, in order to establish~~ing~~ the concept of a franchising contract to be used in any future EU legislation, as well as for possible action in the area of private law;

Amendment 16 #

Motion for a resolution
Recital D

Amendment 17 #

Draft opinion
Paragraph 6

6. Points out that the Commission should ~~start public consultations with a view to correcting~~asses and inform the Parliament on the suitability of the model on which the future block exemption regulation is based and to establishing the concept of a franchising contract to be used in any future EU legislation, as well as for possible action in the area of private law;

Amendment 17 #

Motion for a resolution
Recital D

D. whereas existing legislation covering franchising as a business model varies widely between Member States, and franchisees may refrain from entering into cross-border franchise networks, because they are not familiar with other legal systems and may not be protected against unfair trading practicethe implementation of existing EU-level regulations, and the way in which national laws are applied to franchising as a business model varies widely between Member States, and the consequent lack of homogenous rules creates technical barriers which may discourage both franchisors and franchisees from expanding their activities across borders;

Amendment 18 #

Marc TARABELLA, Lucy ANDERSON, Maria GRAPINI, Liisa JAAKONSAARI

Draft opinion
Paragraph 7

7. Calls on the Commission to also ensure the recovery of any illegal state aid ~~by means of tax advantages~~ in the area of franchises and to show firmness in the conduct and result of ongoing inquiries, such as the McDonald’s case; stresses, moreover, that the EU needs to have more stringent legislation on tax rulings, providing also for an effective system and a debt recovery procedure in favour of EU budget own resources; calls on the Commission to rectify any infringement in the area of franchising with the view to ensuring fair competition across the single market;

Amendment 18 #

Motion for a resolution
Recital D a (new)

D a. Whereas the self-regulatory environment in the EU is weak due to poor enforcement by national franchisee associations of the European Code of Ethics and the low representativeness of those associations;

Amendment 19 #

Draft opinion
Paragraph 7

7. Calls on the Commission to ~~also ensure the recovery of any illegal state aid by means of tax advantages~~consider the functioning of franchising in the are~~a of franchises~~tail sector, and, to show firmness in the conduct and result of ongoing inquiries, such as the McDonald’s case; stresses, moreover, that the EU needs to have more stringent legislation on tax rulings, providing also for an effective system and a debt recovery procedure in favour of EU budget own resources; calls on the Commission to rectify any infringementgether with the Member States, to encourage franchisees to form associations; stresses, furthermore, that the Commission should look into infringements of contractual terms and unfair trading practices in the area of franchising with the view to ensuring fair competition across the single market;

Amendment 19 #

Motion for a resolution
Recital D a (new)

D a. whereas franchising combines the advantages of increasing the distribution of goods and establishing a uniform network;

Amendment 2 #

Andreas SCHWAB, Jiří POSPÍŠIL

Draft opinion
Paragraph 1

1. ~~Considers that the lack of homogeneity in its application across the Member States undermined the effectiveness of Commission Regulation No 330/2010~~Emphasises that Commission Regulation (EU) No 330/2010 has not been uniformly applied in the Member States;

Amendment 2 #

Motion for a resolution
Recital A

A. whereas there is no common European definition of franchising, b~~ut it normally involve~~ecause of the differences between franchising agreements, but one key feature of such agreements is a partnership between natural or legal persons that are legally and financially independent of each other, whereby one party (the franchisor) grants to the other party (the franchisee) the right to operate his franchising formula to sell goods and/or services, and shares know- how, the intention of both the franchisor and the franchisee being to generate business revenue;

Amendment 20 #

Draft opinion
Paragraph 7

7. Calls on the Commission to also ensure the recovery of any illegal state aid by means of tax advantages in the area of franchises and to show firmness in the conduct ~~and result~~ of ongoing inquiries, such as the McDonald’s case; stresses, moreover, that the EU needs to have more stringent legislation on tax rulings, providing also for an effective system and a debt recovery procedure in favour of EU budget own resources; calls on the Commission to rectify any infringement in the area of franchising with the view to ensuring fair competition across the single market;

Amendment 20 #

Motion for a resolution
Recital D b (new)

D b. whereas franchising has been a successful business formula allowing for the rapid acquisition of new markets with limited investment and an increased chance of success for both franchisees and franchisors;

Amendment 21 #

Draft opinion
Paragraph 7

7. Calls on the Commission to also ensure the recovery of any illegal state aid by means of tax advantages in the area of franchises and to show firmness in the conduct and result of ongoing inquiries, such as the McDonald’s and Starbuck's case; stresses, moreover, that the EU needs to have more stringent legislation on tax rulings, providing also for an effective system and a debt recovery procedure in favour of EU budget own resources; calls on the Commission to rectify any infringement in the area of franchising with the view to ensuring fair competition across the single market;

Amendment 21 #

Marc TARABELLA, Marlene MIZZI, Maria GRAPINI, Pina PICIERNO, Liisa JAAKONSAARI

Motion for a resolution
Recital E

E. whereas there are differences between ‘hard’ and ‘soft’ franchising, depending on the conditions of the franchising agreement; and, moreover, alternative business models such as ‘groups of independent retailers’ have special characteristics and should only be affected by rules governing franchising, insofar as they meet the definition of franchising;

Amendment 22 #

Draft opinion
Paragraph 8

8. Considers that the ~~self-regulatory environment in the EU results in an inability to influence nearly 80 % of franchise chains in the EU, as they are not~~effectiveness of the EU supply chain initiative needs to be assessed as membership of the national franchise associations is a pre-requisite for the participation in this initiative;

Amendment 22 #

Andreas SCHWAB, Ildikó GÁLL-PELCZ

Motion for a resolution
Recital F

F. whereas there is a lack of information on the functioning of franchising in the retail sector, since relevant information is not written down or can often only be found in the side letters accompanying a franchise agreement, which are confidential, therefore not public, and at EU-level there is no mechanism for collecting information on potentially unfair contract terms or unfair implementation of contracts;deleted

Amendment 23 #

Draft opinion
Paragraph 9

9. Calls on the Commission to check whether it is necessary to revisew the regulation ~~before 2018 and to (1)~~and, in that connection, to verify (1) the impact of the horizontal approach on the functioning of franchising; (2) ~~test~~ whether the model of franchising adopted in the regulation reflects the market reality, and correct it if necessary; (3) assess the negative effects and proportionality of the permitted vertical restraints, taking into account also their impact on the functioning of franchising by establishing market standards, for example a revision of the definition of know-how and a reconsideration of the context of territorial exclusivity clauses and permitted options; (4) collect market information in terms of new trends, market development regarding network organisation and technological advances; (5) considering that the subject is not covered at the national level, further assess the; (3) to what extent permitted vertical restraints are proportionate and have negative effects; (4) and what new challenges franchisors and franchisees have to face in the context of e- commerce~~; (6) adapt the regulation in order to achieve a general improvement and align it with digitalisation of the economy~~ and digitisation in general;

Amendment 23 #

Motion for a resolution
Recital F

Amendment 24 #

Draft opinion
Paragraph 9

9. Calls on the Commission to ~~review the regulation before 2018 and to~~carry out a study and to inform Parliament as regards (1) verifying the impact of the horizontal approach on the functioning of franchising; (2) testing whether the model of franchising adopted in the regulation reflects the market reality~~, and correct it if necessary~~; (3) assessing the negative effects and proportionality of the permitted vertical restraints, taking into account also their impact on the functioning of franchising by establishing market standards, for example a revision of the definition of know-how and a reconsideration of the context of territorial exclusivity clauses and permitted options; (4) collecting market information in terms of new trends, market development regarding network organisation and technological advances; (5) ~~considering that the subject is not covered at the national level,~~ further assessing the new challenges franchisors and franchisees have to face in the context of e-commerce; ~~(6) adapt the regulation in order to achieve a general improvement and align it with digitalisation of the economy;~~

Amendment 24 #

Motion for a resolution
Recital F

F. whereas there is a lack of information on the functioning of franchising ~~in the retail~~across sectors, since relevant information is not written down or can often only be found in the side letters accompanying a franchise agreement, which are confidential, therefore not public, and at EU-level there is no mechanism for collecting information on potentially unfair contract terms or unfair implementation of contracts;

Amendment 25 #

Draft opinion
Paragraph 10

10. Stresses ~~that~~ the European Parliament ~~should be actively involved when regulations and directives on franchising are adapted~~'s desire to be involved in all work on franchising in the retail sector;

Amendment 25 #

Motion for a resolution
Recital G

G. whereas, in the context of the realisation of the digital single market specific attention should be paid to the tensions which have arisen between franchisors and franchisees with respect to e-commerce and the sharing of consumer data, since currently franchise agreements do not contain provisions on these subjects and thus lead to unnecessary uncertainty and conflicts; whereas e-commerce is expanding and is being used more and more by consumers and should therefore be better included into franchise agreements;

Amendment 26 #

Marc TARABELLA, Sergio GUTIÉRREZ PRIETO, Maria GRAPINI, Pina PICIERNO, Liisa JAAKONSAARI

Draft opinion
Paragraph 10

10. Notes that national rules vary greatly from one Member State to another; Stresses that the European Parliament should be actively involved when regulations and directives on franchising are adapted in order to get a more consistent regulatory framework;

Amendment 26 #

Motion for a resolution
Recital G

G. whereas, in the context of the realisation of the digital single market specific attention should be paid to the tensions which have arisen between franchisors and franchisees with respect to e-commerce and the sharing of consumer data, since currently franchise agreements do not contain provisions on these subjects and thus lead to unnecessary uncertainty and conflicts, and digitalisation of the economy is largely ignored by Regulation 330/2010 and its accompanying directives;

Amendment 27 #

Draft opinion
Paragraph 11

~~11. Believes that a reporting or complaint model should be set up by the Commission to simplify the information- gathering process as regards the market situation;~~deleted

Amendment 27 #

Motion for a resolution
Recital G

G. whereas, in the context of the realisation of the digital single market, specific attention should be paid to the texpansion~~s which have arisen between franchisors and franchisees with respect to~~ of franchises into the domain of e-commerce, and the ~~sharing of consumer data, since currently~~increasing relevance of consumer data for the success of franchising business models, particularly as franchise agreements do not currently contain provisions on these subjects ~~and thus lead to~~, leaving scope for unnecessary uncertainty and conflicts;

Amendment 28 #

Draft opinion
Paragraph 11

11. Believes that a ~~reporting or complaint~~ model should be set up by the Member States for reporting, for making complaints and for submitting other relevant information they receive via a contact point or in any othe ~~Commission~~r way, with a view to simplifying the information- gathering process as regards the market situation; calls on the Commission to draw up, on the basis of that information, a non-exhaustive schedule of unfair contractual terms and practices;

Amendment 28 #

Motion for a resolution
Recital G

G. whereas~~, in the context of the realisation of the digital single market~~ specific attention should be paid to the tensions which have arisen between franchisors and franchisees with respect to e-commerce and the sharing of consumer data, since currently franchise agreements do not contain provisions on these subjects and thus lead to unnecessary uncertainty and conflicts;

Amendment 29 #

Draft opinion
Paragraph 12

12. ~~Calls~~Acknowledges that, on a national level, legislation has been enacted to protect franchisees, but the focus is on the pre-contractual stage, to impose disclosure obligations on the franchisor; calls therefore on the Commission to revise the rules on the enforcement of the regulation by Member States, while its application should be proportionally adjusted to fulfil its aim;

Amendment 29 #

Edward CZESAK

Motion for a resolution
Recital G

G. whereas, in the context of the realisation of the digital single market specific attention should be paid to ~~the~~any tensions ~~which have~~ arisening between franchisors and franchisees with respect to e-commerce and the sharing of consumer data, since currently franchise agreements do not contain provisions on these subjects ~~and thus~~, which can lead to unnecessary uncertainty and conflicts;

Amendment 3 #

Draft opinion
Paragraph 1

1. Considers that the lack of homogeneity in its application across the Member States undermined the effectiveness of Commission Regulation No 330/2010; notes that, because of the different legal cultural traditions in the Member States, uniform application across the EU is impossible;

Amendment 3 #

Edward CZESAK

Motion for a resolution
Recital A

A. whereas there is no common European definition of franchising, but ~~it normally involves a partnership between natural or legal persons that are legally and financially independent of each other, whereby one party (the franchisor) grants to the other party (the~~whereas it is generally acknowledged that franchising is an economic arrangement for the distribution of goods and services under which a franchisee) is given the right to ~~operate his franchising formula to sell~~sell, for its own benefit, specific goods and~~/or~~ services, a~~nd shares know-how, the intention of both the franchisor and the franchisee being to generate business rev~~s part of the franchisor's marketing process, using the franchisor's name and trade marks and drawing on its technical and organisational experienuce;

Amendment 30 #

Marlene MIZZI, Marc TARABELLA, Maria GRAPINI

Draft opinion
Paragraph 12

12. Calls on the Commission to ~~revise the rules on th~~combat government failure to ensure enforcement of the regulation by Member States~~, while its application should be proportionally adjusted to fulfil its aim~~ by revising the rules and removing those that prevent the aim of the regulation from being achieved;

Amendment 30 #

Motion for a resolution
Recital G a (new)

G a. Whereas the franchisor has to prove serious breach of contract or ethics by the franchisee in order to unilaterally decide not to renew the contract or to award the franchise to another person or company in the same territory, in particular if the franchisee has been successfully operating the franchise for the duration of the agreement, during which time considerable investment in growing the brand and enhancing its goodwill has taken place;

Amendment 31 #

Draft opinion
Paragraph 12 a (new)

12 a. Regrets that it does not help to correct this situation that national systems have not provided for enforcement mechanisms which are efficient in assuring continuation of the franchise relationship;

Amendment 31 #

Marc TARABELLA, Lucy ANDERSON, Sergio GUTIÉRREZ PRIETO, Marlene MIZZI, Nicola DANTI, Olga SEHNALOVÁ, Maria GRAPINI, Pina PICIERNO, Liisa JAAKONSAARI

Motion for a resolution
Recital G a (new)

G a. Whereas, the Commission has defined unfair trading practices as "practices that deviate grossly from good commercial conduct, are contrary to good faith and fair dealing and are unilaterally imposed by one trading partner on another"1a; _________________ 1a"Tackling unfair trading practices in the business-to-business food supply chain", COM(2014)472.

Amendment 32 #

Draft opinion
Paragraph 13

13. Calls on the Commission to ~~ensure equal~~work towards an appropriate and independent representation of the interested parties to franchising contracts in the European supply chain initiative, and to take action to strengthen the self-organisation of franchisees at the EU and national level, in order to ~~grant~~allow franchisees ~~equal access to~~to better participate in the public debate on franchising and establish a level playing field;

Amendment 32 #

Marc TARABELLA, Sergio GUTIÉRREZ PRIETO, Marlene MIZZI, Nicola DANTI, Olga SEHNALOVÁ, Maria GRAPINI, Pina PICIERNO, Liisa JAAKONSAARI

Motion for a resolution
Recital G b (new)

G b. Whereas the "fear factor" comes into play in commercial relationships, with the weaker party being unable to make effective use of their rights and unwilling to lodge a complaint about unfair trading practices imposed by the stronger party, for fear of compromising their commercial relationships;

Amendment 33 #

Draft opinion
Paragraph 13 a (new)

13 a. Stresses that regulation should maintain and increase market confidence in franchising as a way of doing business as it encourages entrepreneurism not only in SMEs that become franchisors, but also in individuals who become franchisees;

Amendment 33 #

Marc TARABELLA, Sergio GUTIÉRREZ PRIETO, Marlene MIZZI, Nicola DANTI, Olga SEHNALOVÁ, Maria GRAPINI, Pina PICIERNO, Liisa JAAKONSAARI

Motion for a resolution
Paragraph 1

1. Considers that for the completion of the single market in the retail sector, franchising can play an important role, provided that effective protection of both franchisors and franchisees against unfair trading practices is offered throughout the EU; however, this is not currently the case, as different measures exist between Member States, leading to a high degree of divergence and diversification between Member States in terms of the level, nature and form of legal protection;

Amendment 34 #

Draft opinion
Paragraph 14

~~14. Calls on the Commission to introduce guidelines on franchising contracts, in order to better shape the normative environment of franchising contracts;~~deleted

Amendment 34 #

Motion for a resolution
Paragraph 1

1. Considers that for the completion of the single market in the retail sector, franchising can play an important role~~, provided~~ given its current under-utilisation in the EU in comparison to other developed economies; considers that effective protection of both franchisors and franchisees against unfair trading practices ~~is offered~~ throughout the EU will encourage further growth in franchising;

Amendment 35 #

Miguel URBÁN CRESPO

Draft opinion
Paragraph 14 a (new)

14a. Calls on the Commission to work towards a standard regulation establishing the rights of franchisors and franchisees in terms that prevent the imposition of unfair conditions by brand managers passing on their know-how to a network of franchisees, with more transparent formats, and prevent the establishment of secret ad hoc conditions unconnected to technical processes for producing the service in question.

Amendment 35 #

Motion for a resolution
Paragraph 1

1. Considers that for the completion of the single market in the retail sector, franchising can play an important role~~, provided that effective protection of both franchisors and franchisees against unfair trading practices is offered throughout the EU~~;

Amendment 36 #

Miguel URBÁN CRESPO

Draft opinion
Paragraph 14 b (new)

14b. Calls on the Commission to establish minimum criteria regulating maximum rates of commission for sale, profit and exclusive provision of equipment and setting out the subsidiary responsibilities of the comapny managing the brand, as head of the network. Those responsibilities shall include establishing and ensuring complaince with labour standards and standards for decent and high-quality service, which the franchisor is ultimately responsible for enforcing.

Amendment 36 #

Motion for a resolution
Paragraph 1

1. Considers that f~~or the completion of the single market~~ranchising in the retail sector~~, franchising~~ can play an important role, provided that effective protection of both franchisors and franchisees against unfair trading practices is offered ~~throughout the EU~~;

Amendment 37 #

Draft opinion
Paragraph 15

Amendment 37 #

Motion for a resolution
Paragraph 1

1. Considers that franchising can play an important role for the completion of the single market ~~in the retail sector, franchising can play an important role, provided that effective protection of both franchisors and franchisees against unfair trading practices is offered throughout the EU~~, provided that homogenous standards are put in place, clarifying the rights and obligations of each party to a franchise contract, and removing technical barriers to cross- border trade;

Amendment 38 #

Draft opinion
Paragraph 15

15. Stresses that collecting information on bankruptcies would require cross-border cooperation with national bodies and a comprehensive analysis of the existing differences among the national markets and that, accordingly, that should not be proceeded with; stresses that market players are better placed to exchange information, of whatever nature, if they are not hampered in the process by red tape;

Amendment 38 #

Motion for a resolution
Paragraph 1 a (new)

1 a. Recalls that both franchisor as well as franchisee are two entrepreneurs voluntarily involved in business activity, which is understood to be systematic activity independently carried on for the purpose of making a profit by an entrepreneur in his own name, and at his own responsibility; recalls, further, that the essential idea of franchising is a unified system of co-operation; customers of the franchise system rely upon the unity of the system and of the products and services supplied and sold by the members of the system;

Amendment 39 #

Draft opinion
Paragraph 16

16. Calls on the Commission to correct market failures ~~through legislative action, either~~ by tackling unfair trading practices ~~or by better regulating retail law, contract law or/and competition law~~;

Amendment 39 #

Marc TARABELLA, Sergio GUTIÉRREZ PRIETO, Marlene MIZZI, Nicola DANTI, Olga SEHNALOVÁ, Maria GRAPINI, Pina PICIERNO, Liisa JAAKONSAARI

Motion for a resolution
Paragraph 1 a (new)

1 a. Envisages that in view of the strong-border component in franchising, a uniform approach to correct unfair trading practices at EU level is advisable;

Amendment 4 #

Draft opinion
Paragraph 1

1. Considers that the lack of homogeneity in its application across the Member States undermined the effectiveness of Commission Regulation No 330/2010; highlights the growth of e- commerce and its impact on the franchise business model as a significant challenge for the sector.

Amendment 4 #

Motion for a resolution
Recital B

B. whereas ~~in its resolution of 11 December 2013, Parliament welcomed~~ franchising as a business model, which supports new business and small-business ownership~~, but noted the existence of unfair contract terms in certain cases and called for transparent and fair contracts; moreover, it drew the attention of the Commission~~ and boosts growth and Mem~~ber States, in particular, to problems faced by franchisees wishing to sell their business or change their business formula, whilst remaining acti~~ployment at national level ins the same sector and requested that the Commission examine the ban on price-fixing mechanisms in franchise systems and the effects of long- term competition clauses, purchase options and the prohibition of multi- franchising, and to reconsider in this respect the current exemption from competition rules for contracting parties having a market share of less than 30 %o be welcomed; whereas the franchisor and franchisee engage in a relationship of mutual trust in the strict interests of both parties;

Amendment 40 #

Miguel URBÁN CRESPO

Draft opinion
Paragraph 16

16. Calls on the Commission to ~~correct market failures through legislative action, either by tackling unfair trading practices or by better regulating retail law, contract law or/and competition law;~~draw up EU rules obliging brand managers to establish a national and international register of companies linked to their brand. For the purposes of tax assessment and preventing tax evasion, it is essential that undertakings within the network provide a joint annual report of their annual accounts, setting out in its main chapter transfer prices, together with proof of compliance with the relevant tax obligations in the various countries in which they operate, detailing their various activities and the volume of business for each activity (turnover, number of employees, facilities, points of sale) in each tax jurisdiction.

Amendment 40 #

Motion for a resolution
Paragraph 1 a (new)

1 a. Recalls that franchising is a contractual relationship between two legally independent businesses;

Amendment 41 #

Draft opinion
Paragraph 16

16. ~~Calls on the Commission to correct market failures through legislative action, either by tackling unfair trading practices or~~Points out that the existing fragmented and low level of cooperation within different national enforcement bodies is not sufficient to address cross- border challenges regarding unfair trading practices; calls on the Commission to correct market failures through action by better regulating retail law, contract law or/and competition law;

Amendment 41 #

Motion for a resolution
Paragraph 1 b (new)

1 b. Underlines that parties to a franchising contract are vulnerable towards each other, with the franchisor facing the risk of losing the secrecy of its formula and the franchisee that of giving up part of its independence as regards its business decisions;

Amendment 42 #

Draft opinion
Paragraph 16

16. Calls on the Commission to ~~correct market failures through legislative action, either b~~propose an EU approach aimed at effectively tackling unfair trading practices or by better regulating retail law, contract law or/and competition law;

Amendment 42 #

Motion for a resolution
Paragraph 2

2. ~~Emphasi~~Stresses that the franchise~~es are often the weaker contracting party, as~~ formula is developed by the franchisor and franchisees directly benefit from it; stresses, further, that the fbran~~chise formula has normally been developed by the franchisor and franchisees tend to b~~d's chances of commercial success depend on a detailed contractual commitment and a high level of trust between the parties; takes the view that franchisees are highly dependent on the finranc~~ially weaker and less well-infor~~hisor's expertise, and that, at the samed t~~han~~ime, the franchisor ~~and therefore heavily dependent on the expertise of the franchisor~~has to be able to count on the franchisee's commercial effectiveness and economic stability and has no interest in creating businesses with an uncertain future;

Amendment 43 #

Draft opinion
Paragraph 16 a (new)

16 a. Stresses that UTPs in franchising can only be determined after specific analysis has been carried out in which also the view of franchisees has been taken into account, believes that the next step should be to organise a multi- stakeholder debate to discuss unfair practices in franchise supply chains and possible solutions and this can be reached by organizing an Expert Platform, as has been the case with food supply chains, or by opening a public consultation;

Amendment 43 #

Motion for a resolution
Paragraph 2

2. Emphasises that ~~franchisees are often the weaker contracting party, as~~ the franchise formula has normally been developed by the franchisor, and that franchisees ten~~d to be financially weaker and less well-informed than the franchisor and therefore heavily dependent on the expertise of the franchisor~~ter into a contractual relationship with the franchisor on a voluntary basis;

Amendment 44 #

Draft opinion
Paragraph 17

~~17. Calls on the Commission to provide a non-exhaustive list of contractual terms and practices allowed and prohibited in order to facilitate the self-assessment process of any future regulation.~~deleted

Amendment 44 #

Motion for a resolution
Paragraph 2

2. Emphasises that franchisees are often the weaker contracting party, especially when they are representatives of SMEs, as the franchise formula has normally been developed by the franchisor and franchisees tend to be financially weaker and less well-informed than the franchisor and therefore heavily dependent on the expertise of the franchisor;

Amendment 45 #

Draft opinion
Paragraph 17

Amendment 45 #

Motion for a resolution
Paragraph 2

2. ~~Emphasis~~Notes that franchisees are often the weaker contracting party, as the franchise formula has normally been developed by the franchisor and franchisees tend to be financially weaker and can be less well- informed than the franchisor and therefore heavily dependent on the expertise of the franchisor;

Amendment 46 #

Draft opinion
Paragraph 17 a (new)

17a. Calls on the Commission to abide by the principle of contractual freedom.

Amendment 46 #

Motion for a resolution
Paragraph 2

2. Emphasises that franchisees are often the weaker contracting party, as the franchise formula has normally been developed by the franchisor and franchisees tend to be financially weaker and consequently less well-informed than the franchisor and therefore heavily dependent on the expertise of the franchisor;

Amendment 47 #

Motion for a resolution
Paragraph 2

2. Emphasises that franchisees are often the weaker contracting party, as the franchise formula has normally been developed by the franchisor and franchisees tend to be financially weaker and less well-informed than the franchisor and therefore ~~heavily~~ dependent on the expertise of the franchisor;

Amendment 48 #

Marc TARABELLA, Lucy ANDERSON, Sergio GUTIÉRREZ PRIETO, Marlene MIZZI, Maria GRAPINI, Liisa JAAKONSAARI

Motion for a resolution
Paragraph 2 a (new)

2 a. Stresses the fact that franchise systems are heavily dependent upon the functioning co-operation of franchisor and franchisees; in many cases, even a single franchisee may damage the whole franchising system beyond repair;

Amendment 49 #

Motion for a resolution
Paragraph 3

3. States that franchisors have organised themselves both at national and European level for the representation of their interests, whereas often due to a lack of resources, franchisees often lack such representative organisations ~~and a~~defending their collective interests, continuing to operate mostly on an individual basis and are therefore under- represented;

Amendment 5 #

Draft opinion
Paragraph 2

2. Considers that the regulation’s clauses on vertical restraints do not allow balanced representation of the two parties to the franchising and are not in line with recent market developments, in particular the exempted post-contractualDraws attention to Parliament's resolution of 11 December 2013, which emphasised the problems encountered by franchisees wishing to sell their business or change their business formula, whilst remaining active in the same sector; calls on the Commission to look into situations such as the ban on price-fixing mechanisms in franchise systems and the effects of long-term competition clauses ~~and~~, purchas~~ing conditions~~e options and the ban on multi- franchising;

Amendment 5 #

Motion for a resolution
Recital B

B. whereas in its resolution of 11 December 2013, Parliament welcomed franchising as a business model which supports new business and small-business ownership, but noted the existence of unfair contract terms in certain cases and called for transparent and fair contracts; moreover, it drew the attention of the Commission and Member States, in particular, to problems faced by franchisees wishing to sell their business or change their business formula, whilst remaining active in the same sector and requested that the Commission examine the ban on price-fixing mechanisms in franchise systems and the effects of long- term competition clauses, purchase options and the prohibition of multi-franchising~~, and to reconsider in this respect the current exemption from competition rules for contracting parties having a market share of less than 30 %~~;

Amendment 50 #

Motion for a resolution
Paragraph 3

3. States that franchisors have organised themselves both at national and European level for the representation of their interests, whereas often due to a lack of resources, franchisees often lack such representative organisations and are under- represented, vulnerable and at higher risk when it comes to fair trade being respected;

Amendment 51 #

Motion for a resolution
Paragraph 3

3. States that franchisors have organised themselves both at national and European level for the representation of their interests, whereas often due to a lack of resources, franchisees often lack such representative organisations and are under- represented as well as under-protected at national and European levels;

Amendment 52 #

Jiří POSPÍŠIL

Motion for a resolution
Paragraph 3

3. States that franchisors have organised themselves both at national and European level for the representation of their interests, whereas ~~often due to a lack of resources, franchisees often lack such representative organisations and are~~franchisees are often under-represented;

Amendment 53 #

Motion for a resolution
Paragraph 3

3. States that franchisors and franchisees have organised themselves both at national and European level for the representation of their interests, ~~whereas often due to a lack of resources, franchisees often lack such representativ~~and that their membership in those organiszations ~~and are under-represented~~shall remain optional;

Amendment 54 #

Kaja KALLAS

Motion for a resolution
Paragraph 3

3. States that franchisors have organised themselves both at national and European level for the representation of their interests, whereas ~~often due to a lack of resources,~~ franchisees often lack such representative organisations and are under- represented;

Amendment 55 #

Marc TARABELLA, Lucy ANDERSON, Sergio GUTIÉRREZ PRIETO, Marlene MIZZI, Maria GRAPINI, Liisa JAAKONSAARI

Motion for a resolution
Paragraph 3

3. ~~Sta~~Notes that franchisors have organised themselves both at national and European level for the representation of their interests, whereas often due to a lack of resources, franchisees often lack such representative organisations and are under- represented;

Amendment 56 #

Motion for a resolution
Paragraph 4

4. Calls on the Commission and Member States to promote the creation of associations representing franchisees, and to make sure that their voices are heard, whenever policies or legislation are prepared that may affect them, in order to ensure more equal representation of the parties;

Amendment 57 #

Motion for a resolution
Paragraph 4

4. Calls on the Commission and Member States to promote and foster the creation of associations representing franchisees, and to make sure that their voices are heard, whenever policies or legislation are prepared that may affect them;

Amendment 58 #

Jiří POSPÍŠIL, Andreas SCHWAB, Richard SULÍK

Motion for a resolution
Paragraph 4

4. Calls on the Commission and Member States to promote and strengthen the creation of associations representing franchisees, and to make sure that their voices are heard, whenever policies or legislation are prepared that may affect them;

Amendment 59 #

Motion for a resolution
Paragraph 4

4. Calls on the Commission and Member States to ~~promote the creation of associations representing~~encourage dialogue between franchisors, franchisees, and ~~to make sure that their voices are heard,~~decision-makers whenever policies or legislation are prepared that may affect them;

Amendment 6 #

Andreas SCHWAB, Ildikó GÁLL-PELCZ

Draft opinion
Paragraph 2

2. Considers that the ~~regulation’s clauses on vertical restraints do not allow balanced representation of the two parties to the franchising and are not~~Commission should check whether the effectiveness of that regulation is not being undermined as a result of inconsistent application in the Member States and whether it is in line with recent market developments, in particular the exempted post-contractual clauses and purchasing conditions;

Amendment 6 #

Marc TARABELLA, Maria GRAPINI, Liisa JAAKONSAARI

Motion for a resolution
Recital B

B. whereas in its resolution of 11 December 2013, Parliament welcomed franchising as a business model which supports new business and small-business ownership, but noted the existence of unfair contract terms in certain cases and called for transparent and fair contracts; moreover, it drew the attention of the Commission and Member States, in particular, to problems faced by franchisees wishing to sell their business or change their business formula, whilst remaining active in the same sector and requested that the Commission examine the ban on price-fixing mechanisms in franchise systems and the effects of long- term competition clauses, purchase options and the prohibition of multi-franchising, and to reconsider in this respect the current exemption from competition rules for contracting parties having a market share of less than 30 %; however this request remained unanswered;

Amendment 60 #

Motion for a resolution
Paragraph 4

4. Calls on the Commission and Member States to ~~promot~~encourage the creation of associations representing franchisees, and to make sure that their voices are heard, whenever policies or legislation are prepared that may affect them;

Amendment 61 #

Motion for a resolution
Paragraph 5

5. Emphasises that there is a persistent lack of information on the functioning of franchising in the retail sector and calls on the Commission to open a contact point for information on problems encountered by franchisees, whilst guaranteeing the confidentiality of the information thus acquired;deleted

Amendment 62 #

Motion for a resolution
Paragraph 5

Amendment 63 #

Jiří POSPÍŠIL, Andreas SCHWAB

Motion for a resolution
Paragraph 5

Amendment 64 #

Motion for a resolution
Paragraph 5

5. Emphasises that there is a persistent lack of information on the functioning of franchising in the retail sector and calls on ~~the Commission to open a~~Member States to assign, in cooperation with the Commission, contact points for information on problems encountered by franchisees, whilst guaranteeing the confidentiality of the information thus acquired;

Amendment 65 #

Kaja KALLAS

Motion for a resolution
Paragraph 5

5. Emphasises that there is a persistent lack of information on the functioning of franchising in the ~~retail sector~~EU and calls on the Commission to ~~open a~~improve the collection of information such as by opening confidential contact points for information on problems encountered by franchis~~ees, whilst guaranteeing the confidentiality of the information thus acquired~~ors and franchisees or by launching public consultations;

Amendment 66 #

Motion for a resolution
Paragraph 5

5. Emphasises that there is a ~~persistent lack of~~number of national and international franchise associations that have the necessary information on the functioning of franchising in the retail sector ~~and calls on the Commission to open a contact point f~~; however, this information has not been collected in a coor dinated form~~ati~~ on oan ~~problems encountered by franchisees, whilst guaranteeing the confidentiality of the information thus acquired~~EU-wide scale, and so far, there has been no need to do so;

Amendment 67 #

Marc TARABELLA, Marlene MIZZI, Maria GRAPINI, Liisa JAAKONSAARI

Motion for a resolution
Paragraph 5

5. Emphasises that there is a persistent lack of information on the functioning of franchising in the retail sector and calls on the Commission to open a contact point for information on problems encountered by franchisors and franchisees, whilst guaranteeing the confidentiality of the information thus acquired;

Amendment 68 #

Motion for a resolution
Paragraph 5 a (new)

5 a. Encourages the setting-up of national and European franchising associations recognized as legally- acknowledged sources of best practice in franchising, ensuring a balance of membership between franchisors and franchisees;

Amendment 69 #

Motion for a resolution
Paragraph 6

6. Calls on the Commission to actively examine the functioning of franchising in the retail sector, and, in particular, the existence of unfair contract terms or other unfair trading practices, and to request Eurostat to devote special attention to this model when collecting statistical information on the sectorstresses that unfair contract terms or other unfair trading practices exist within the single market;

Amendment 7 #

Jiří POSPÍŠIL, Richard SULÍK

Draft opinion
Paragraph 3

3. Considers that the implementation of the regulation through a mechanism of assessment ~~at European level should be improved, and stresses that the unsatisfactory follow-up action by the Commission prevents cross-border retail activity and fails~~should be improved; calls on the Commission and the Member States to be more active in this area under the European Competition Network in order to create a level playing field within the single market;

Amendment 7 #

Motion for a resolution
Recital B

B. whereas in its resolution of 11 December 2013, Parliament welcomed franchising as a business model which supports new business and small-business ownership, but noted the existence of unfair contract terms in certain cases and called for transparent and fair contract terms; moreover, it drew the attention of the Commission and Member States, in particular, to problems faced by franchisees wishing to sell their business or change their business formula, whilst remaining active in the same sector and requested that the Commission examine the ban on price-fixing mechanisms in franchise systems and the effects of long- term competition clauses, purchase options and the prohibition of multi-franchising, and to reconsider in this respect the current exemption from competition rules for contracting parties having a market share of less than 30 %;

Amendment 70 #

Motion for a resolution
Paragraph 6

6. Calls on the Commission to actively examine the functioning of franchising in the retail sector, and, in particular, the existence of unfair contract terms or other unfair trading practices, and to request Eurostat to devote special attention to this model when collecting statistical information on the sector, without any additional administrative or other burdens for entrepreneurs;

Amendment 71 #

Motion for a resolution
Paragraph 6

6. Calls on the Commission to ~~actively~~ examine the functioning of franchising in the retail sector, and, in particular, the existence of unfair contract terms or other unfair trading practices, and to request Eurostat to devote special attention to this model when collecting statistical information on the sector;

Amendment 72 #

Marlene MIZZI, Marc TARABELLA, Maria GRAPINI

Motion for a resolution
Paragraph 6

6. Calls on the Commission to actively examine the functioning of franchising in the retail sector, ~~and, in particular,~~including the existence of unfair contract terms or other unfair trading practices, and to request Eurostat to ~~devote special~~pay attention to this model when collecting statistical information on the sector;

Amendment 73 #

Motion for a resolution
Paragraph 6 a (new)

6 a. Expresses its concern that, given the weaker status of franchisees, unfair trading practices can also consist in franchisors unilaterally deciding not to renew a long-standing franchise agreement, causing serious financial damage to the investment of the franchisee in the franchise property, fittings, advertising and goodwill, thereby jeopardizing employment, especially if the intention and reason for non-renewal is for the franchisor to award the franchise to another person or company in the same territory, even though the franchisee has consistently and fully abided by the agreement;

Amendment 74 #

Motion for a resolution
Paragraph 7

7. Takes note of the European Code of Ethics for Franchising, developed by the European Franchise Federation, but also notes that the Code has been unilaterally drawn up by franchisors and has met with fundamental criticism from franchisees pointing, inter alia, to the fact that the code preceding the 2016 revision of the Code was worded more strongly in respect of the commitments of the franchisor;.

Amendment 75 #

Jiří POSPÍŠIL, Andreas SCHWAB

Motion for a resolution
Paragraph 7

Amendment 76 #

Motion for a resolution
Paragraph 7

Amendment 77 #

Motion for a resolution
Paragraph 7

7. ~~Takes note of~~Welcomes, in principle, the European Code of Ethics for Franchising, developed by the European Franchise Federation~~, but also notes that the Code has been unilaterally drawn up by franchisors and~~ as a potentially efficient tool for promoting best practices in the franchise sector on a self-regulatory basis; notes, further, that the Code primarily represents the interests of franchisors, but also notes that the Code has met with fundamental criticism from franchisees pointing, inter alia, to the fact that the code ~~preceding the 2016 revision of the Code~~ was worded more strongly in respect of the commitments of the franchisor prior to its revision in 2016;

Amendment 78 #

Motion for a resolution
Paragraph 7

Amendment 79 #

Motion for a resolution
Paragraph 7

Amendment 8 #

Draft opinion
Paragraph 3

3. Considers that the implementation of the regulation through a mechanism of assessment ~~at European level~~within the European network of competition authorities should be improved, and stresses that the unsatisfactory follow-up ~~action~~within that network by the Commission prevents cross-border retail activity and fails to create a level playing field within the single market;

Amendment 8 #

Motion for a resolution
Recital B a (new)

Ba. Whereas the unfavourable economic conditions in the eurozone and the emergence of unfair competition within the single market itself are generating chronic market instability which acts as a disincentive to investment and the establishment of long-term cooperation between parties;

Amendment 80 #

Motion for a resolution
Paragraph 7 a (new)

7 a. Regrets, however, that the Code only covers a small minority of franchises operating in the EU, as the majority of franchises belong neither to the EFF nor the national associations that have adopted it, and several Member States do not have national franchise associations;

Amendment 81 #

Motion for a resolution
Paragraph 8

8. Expresses its concern with the lack of an independent enforcement mechanism accompanying the European Code of Ethics and recalls that in some Member States this lack of independent enforcement prompted the introduction ofRecalls that in some Member States legislation preventing and addressing unfair trading practices in franchising has been introduced;

Amendment 82 #

Motion for a resolution
Paragraph 8

8. ~~Expresses its concern with~~Welcomes the lack of an additional independent enforcement mechanism accompanying the European Code of Ethics and recalls that ~~in som~~the Member States ~~this lack of independent enforcement prompted the introduc~~do not need European legislative texts to establish their own adapted, made-to- measure and proportion ofate legislation to effectively prevent~~ing~~ and address~~ing~~ unfair trading practices in franchising;

Amendment 83 #

Olga SEHNALOVÁ, Marc TARABELLA

Motion for a resolution
Paragraph 8

8. ~~Expresses its~~Notes there are concern ~~with~~s about the lack of an independent enforcement mechanism accompanying the European Code of Ethics and ~~recall~~notes that in some Member States this lack of independent enforcement prompted the introduction of legislation preventing and addressing unfair trading practices in franchising;

Amendment 84 #

Motion for a resolution
Paragraph 8 a (new)

8 a. Recalls that Parliament has repeatedly asked the Commission to set up an EU legislative framework banning unfair trading practices in the food supply chain; urges the Commission to submit such a proposal without delay;

Amendment 85 #

Motion for a resolution
Paragraph 8 a (new)

8 a. Recalls that the Code of Ethics is a set of rules accepted by franchisors in addition to legally-required rules; the Code of Ethics should always remain as added value for anyone willing to abide by these rules;

Amendment 86 #

Motion for a resolution
Paragraph 8 a (new)

8 a. Regrets the lack of homogeneity of the approach to franchise-specific laws between EU Member States, which can substantially hinder cross-border franchising;

Amendment 87 #

Motion for a resolution
Paragraph 9

9. States that franchise agreements should fully respect the principles of ~~balanced~~a contractual business partnership, under which the franchisor and franchisee must be ~~reasonable and fair towards each other~~have within the law and resolve complaints, grievances and disputes primarily through frank, reasonable and direct communication, and in accordance with their written contract;

Amendment 88 #

Motion for a resolution
Paragraph 9

9. States that franchise agreements should fully respect the principles of balanced partnership, under which the franchisor and franchisee must be reasonable and fair towards each other and resolve complaints, grievances and disputes through frank, transparent, reasonable and direct communication;

Amendment 89 #

Motion for a resolution
Paragraph 9

9. States that franchise agreements ~~should~~must fully respect the principles of balanced partnership, under which the franchisor and franchisee must be reasonable and fair towards each other and resolve complaints, grievances and disputes through frank, reasonable and direct communication;

Amendment 9 #

Draft opinion
Paragraph 3

3. Considers that the Commission should check to what extent implementation of the regulation could be improved through a mechanism of assessment at European level ~~should be improved, and~~; stresses that the unsatisfactory follow-up action by the Commission prevents cross-border retail activity and fails to create a level playing field within the single market;

Amendment 9 #

Motion for a resolution
Recital C

C. whereas franchising has the potential of being a business model that can help in completing the single market in the retail sector, but is currently under- performing in the EU, representing only 1.89 % of GDP, as opposed to 5.95 % in the USA and 10.83 % in Australia, 83.5 % of franchising’s turnover being concentrated in only seven Member Statesis a business model which contributes to growth in the retail sector in the Member States, but has not yet reached its full potential;

Amendment 90 #