Franchise agreements

A number of the regulations governing agreements in the new Civil and Commercial Code refer to IP-related matters. This is especially true for franchise agreements.

Section 1512 of the Civil and Commercial Code provides that under the terms of a franchise agreement, the franchisor must:

  • be the exclusive rights holder of its trademarks, patents, commercial names and copyrights; or
  • have the right to confer the right of use and transmission of these IP rights to the franchisee.

The object of a franchise agreement is the authorisation of the franchisee to use a proven system for the commercialisation of goods or services. The licence for the relevant industrial or intellectual property rights is thus directly associated with the essential aim of a franchise agreement, which is the cloning or copying of the franchisor's company, including identification of the franchisee's company with the franchisor's corporate image.

In addition to the immaterial or intangible goods (or even material goods) that constitute the object of the franchise agreement, the provision of a body of technical knowledge and continued technical and commercial assistance – as established by Section 1512 – makes it possible to commercialise goods or services by using the franchisor's proven system.

Leasing agreements

Leasing agreements also contain IP-related regulations. Section 1227 of the new Civil and Commercial Code defines a 'leasing agreement' as one in which the lessor agrees to:

  • transfer to the lessee the possession of a certain item of property for the use and enjoyment thereof against the payment of a royalty; and
  • confer on the lessee the right to purchase the property.

Regarding intellectual property, Section 1228 establishes that the object of the agreement may be:

  • personal property or real estate;
  • trademarks, patents or industrial models; or
  • software.

The property may be owned by the lessor or that which the lessor has the right to transfer under lease.

Section 1234 states that in order to be enforceable against third parties, a leasing agreement must be filed with the corresponding registry, depending on the nature of its object.

Where the object of the lease is a trademark, patent or industrial model, the registration will be held by the National Institute of Industrial Property; in the case of software, the registration will be held by the National Pledge Registry.

For further information on this topic please contact Daniel R Zuccherino at Obligado & Cia by telephone (+54 11 4114 1100) or email (dzuccherino@obligado.com.ar). The Obligado & Cia website can be accessed at www.obligado.com.

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