Franchise System

• The Saudi Franchise System

  was issued by Royal Decree No. (M/22) dated 9/2/1441 AH, corresponding to 8/10/2019 AD, with the aim of regulating the practice of franchise business. This system includes the rules and regulations that govern the contractual relationship between the franchisor and the franchisee.
  
  The Saudi Franchise System defines a franchise as follows: A person called the franchisor grants the right to another person called the franchisee to operate the franchise business on their behalf, using the franchisor's trademark or trade name. This includes providing technical expertise and know-how to the franchisee and specifying the operational methods for the franchise business.
  
  This is done in exchange for financial or non-financial consideration, excluding the amounts paid by the franchisee to the franchisor for goods or services, based on a franchise agreement in which the franchisee is responsible for operating and managing the project within specific terms and conditions defined in the agreement.
  
  The obligations and rights of the franchisor and the franchisee in Saudi franchise agreements vary according to the contractual agreement between the parties. The Saudi Franchise System grants both parties full freedom to organize the contractual relationship within the framework of the system's provisions, clearly and precisely, to eliminate ambiguity.
  
  The Saudi Franchise System recommends the official registration of the granted trademark to protect the intellectual property rights of the franchisor.
  
  For detailed information, you can download the Saudi Franchise System file or click here to view it.