UNDERSTANDING THE LEGAL FRAMEWORK FOR FRANCHISING IN INDIA

AUTHOR – ROHANASRI.K* & MARUTHAVIJAYAN**

* STUDENT AT SCHOOL OF EXCELLENCE  IN LAW, TAMILNADU DR.AMBEDKAR LAW UNIVERSITY.

** ASSISTANT PROFESSOR AT SCHOOL OF EXCELLENCE IN LAW, TAMILNADU DR.AMBEDKAR LAW UNIVERSITY

BEST CITATION – ROHANASRI.K* & MARUTHAVIJAYAN, UNDERSTANDING THE LEGAL FRAMEWORK FOR FRANCHISING IN INDIA, INDIAN JOURNAL OF LEGAL REVIEW (IJLR), 5 (7) OF 2025, PG. 66-70, APIS – 3920 – 0001 & ISSN – 2583-2344

Abstract :

Franchising in India functions within a broad legal framework, as there is no specific law dedicated solely to franchising. Franchise agreements are primarily governed by the Indian Contract Act, 1872, which requires clear terms on the rights and responsibilities of both parties. Intellectual property rights are safeguarded through the Trade Marks Act, 1999 and the Copyright Act, 1957. The Competition Act, 2002 ensures that franchise agreements do not restrict competition, while the Consumer Protection Act, 2019 holds businesses accountable for service standards. Franchise fees and royalties are subject to GST, and foreign franchisors must comply with FEMA regulations regarding royalty payments. In the absence of a dedicated franchising law, judicial rulings and industry practices influence franchise operations. Given the sector’s rapid growth, there is a need for more specific regulations to ensure sustainable and compliant franchise models.

Key words ; Franchising, FEMA, Rapid growth, GST, Ensure sustainable