New rules for franchisors and franchisees in the supermarket sector.

Since 1 January 2025, new rules have prohibited unfair terms in franchise agreements in the supermarket sector, aimed at ensuring a fairer balance. This includes the entry into force of the Royal Decree of 20 June 2024, which completes the list of unfair terms applicable to commercial partnership agreements in the food sector.

In other words, franchisors and franchisees (and other similar forms of cooperation) will be subject to a list of clauses that may not be included in their contracts.

The purpose of this Royal Decree is to ensure a fairer balance between the rights of franchisors (often large chains) and franchisees (usually small independents). Indeed, legislators have found that negotiations are mainly paper-only and independent entrepreneurs are often forced to accept the franchisor’s terms.

Scope

As indicated, the new unfair terms only apply to commercial partnership agreements that mainly concern food retailing in non-specialised shops (NACE code 47.11), or (neighbourhood) supermarkets.

These clauses are in addition to the already existing list of unfair terms contained in Articles VI.91/4 and VI.91/5 of the Economic Code.

Unfair terms in all cases (“black clauses”)

The four “black” clauses below (which are prohibited in all circumstances) are added to the above list:

• (i) franchisor’s obligation to supply

Any clause depriving the franchisee of damages or excluding or restricting the franchisee’s right to be supplied by a third party if the franchisor fails to fulfil its obligation to supply is prohibited.

• (ii) negotiation during the notice period

A clause prohibiting the franchisee from preparing for or negotiating with third parties with a view to developing a new business during the notice period or the period covered by the non-compete clause is prohibited.

The franchisee must nevertheless respect the trade secret in connection with the terminated commercial partnership agreement.

• (iii) promotion costs

A clause requiring the franchisee to bear more than half of the costs of promotions imposed by the franchisor is prohibited.

• (iv) competent court

It is prohibited to submit a dispute between the franchisor and the franchisee to the exclusive jurisdiction of the court whose registered office is that of the franchisor and/or to a court located in a language area other than the registered office of the franchisee.

Clauses presumed to be unfair (“grey clauses”)

Three so-called “grey” clauses (presumably unfair unless proven otherwise) have been added to the list in the Economic Law Code:

• Unbalanced valuation

A clause setting a fixed value for the franchisee’s goodwill or shares that results in a price that is clearly unreasonable given the normal valuation of goodwill or shares in a company is presumed to be unfair.

• Loss-making activities

A clause requiring the franchisee to operate a business that has been structurally loss-making for at least 12 months, without providing for a notice period of up to 4 months for the franchisee, without additional compensation, is presumed to be unfair.

• Express cancellation clause

A provision allowing the franchisor to terminate the commercial partnership agreement by applying an express termination clause is presumed to be unfair.

An express cancellation clause allows a party to automatically and automatically terminate the contract (without going to court) if the other party fails to fulfil a contractual obligation.

Impact

If the commercial partnership contract contains any of these clauses, it will be void and unenforceable. However, to the extent possible, the rest of the contract will remain valid between the parties.

Entry into force

The Royal Decree will take effect in two stages:

• on January 1^st  2025 for commercial partnership contracts entered into, amended or renewed after that date; and
• on May  1^st 2025 for existing commercial partnership agreements (not amended or extended after¹ January 2025).

For more information, please contact Arnaud Vanitterbeek(arnaud.vanitterbeek@laurius.be ), Senior Partner, and Lancelot Clément de Cléty(lcdc@laurius.be ), Senior Associate.