Question: Our company is located in Ho Chi Minh City and operates in the food service industry. We have also registered our trademark. Currently, we aim to expand to other provinces and cities in the country by franchising to other parties. Could you please advise on any conditions required for our catering service and if there is any registration necessary?
Answer:
1. As a condition for franchising, the franchisor (your company) is only allowed to grant commercial rights when the business system intended to be used for franchising has been in operation for at least 1 year (Article 5 of Decree 35/2006/ND-CP amended by Article 8 of Decree 08/2018/ND-CP).
2. According to the information provided, if the Company only intends to franchise within domestic provinces and cities, it is not required to register for franchising but must comply with the reporting regime to the Department of Industry and Trade (Clause 2, Article 3 of Decree 120/2011/ND-CP) and periodically report to the Department of Industry and Trade no later than January 15 every year, according to the form in Part B, Appendix III of Circular 09/2006/TT-BTM.
Thus, if your company wants to franchise domestically, the franchisor must have been in business for 1 year or more, and the company is not required to register for franchising but only needs to implement a notification regime and report to the Department of Industry and Trade.
PARTNER CONTRACT
On March 22, 2023, I signed a Collaborator Contract to work for a company, but is this Contract a type of labor contract? Are there any legal risks in entering into a collaborator contract?
Answer:
Because you have not provided specific content and terms of the Contract, we cannot determine whether it is a Labor Contract or not, so please refer to the content below:
1. To determine whether a Collaborator Contract is a type of Labor Contract or not, it is necessary to rely on the specific content agreed upon by the parties in this Contract. Pursuant to Clause 1, Article 13 of the 2019 Labor Code, it stipulates: “In case the two parties agree by a different name but with content expressing paid employment, wages, and management, administration, and supervision of one party is considered a labor contract.”
Thus, determining whether a Contract is a Labor Contract is not based on the name but must rely on the following contents of the Contract: (i) salary, wages, and (ii) management and conditions of implementation and supervision of one party in the contractual relationship. If the contract has all the above contents, it will be determined as a Labor Contract and governed by the provisions of labor law; otherwise, it will be governed by the provisions on Service Contracts according to the provisions of the the Civil Code.
2. In fact, there have been many cases where Enterprises deliberately signed Contracts with different names with employees to avoid the responsibility to participate in social insurance and other constraints of labor law.
