Franchisee Protection under China’s Franchising Regulations: A Comparative Study

Xinbo Huang1, Zuryati Mohamed Yusoff2 & Mohd Zakhiri Bin Md Nor3

https://doi.org/10.62271/pjc.16.3.649.662

Abstract
Franchising has played a pivotal role in driving China’s economic growth in recent years. With the prominent problem of franchise asymmetry, the protection of franchisees has emerged as a significant concern. This paper conducts a comparative study of franchisee protection practices under franchising regulation in China and certain jurisdictions such as the United States, Australia, and Malaysia. This paper aims to analyze three aspects of franchisee protection,
including information disclosure, registration, liability, and relief for violations. To this end, the researchers adopted library data collection methods. Franchisingrelated laws, regulations, rules, and cases are the primary data sources, while journals, books, industry reports, and network resources are the secondary data sources. The results of this study show that although China’s franchisee protection is generally in line with international practice, there is still room for further improvement. The authors proposed recommendations such as strictly implementing registration requirements, introducing a disclosure exemption system, specifying the exact duration of the cooling-off period, and diversifying dispute resolution. The contribution of this paper is to learn from the advanced experience of foreign franchisee protection and improve the current franchisee protection system in China.

Keywords: Franchising regulations, franchisee protection, China, disclosure, registration.