A franchisor who requires a franchisee to make any payment for the purpose of the promotion of a franchise shall establish a Promotion Fund (“Fund”).
franchisor
“franchisor” means a person who grants a franchise to a franchisee and includes a master franchisee with regard to his relationship with a subfranchisee, unless stated otherwise in this Act;
The Fund shall be managed under a separate bank account and shall only be used for the promotion of the product under the franchise.
franchise
“franchise” means a contract or an agreement, either expressed or implied, whether oral or written, between two or more persons by which— Franchise 9 (a) the franchisor grants to the franchisee the right to operate a business according to the franchise system as determined by the franchisor during a term to be determined by the franchisor; (b) the franchisor grants to the franchisee the right to use a mark, or a trade secret, or any confidential information or intellectual property, owned by the franchisor or relating to the franchisor, and includes a situation where the franchisor, who is the registered user of, or is licensed by another person to use, any intellectual property, grants such right that he possesses to permit the franchisee to use the intellectual property; (c) the franchisor possesses the right to administer continuous control during the franchise term over the franchisee’s business operations in accordance with the franchise system; and (d). (e) in return for the grant of rights, the franchisee may be required to pay a fee or other form of consideration. (f).
If a franchisee is required to make any payment under section 23, the franchisor shall submit a financial statement of the
franchisee
“franchisee” means a person to whom a franchise is granted and includes, unless stated otherwise in this Act— (a) a master franchisee with regard to his relationship with a franchisor; and (b) a subfranchisee with regard to his relationship with a master franchisee;
Fund, which has been endorsed by a registered public accountant, to the Registrar within thirty days after the conclusion of the last financial term.
Registrar
“Registrar”, “Deputy Registrar” and “Assistant Registrar” mean respectively the Registrar of Franchises, a Deputy Registrar of Franchises and an Assistant Registrar of Franchises appointed under section 5;
The financial statement in subsection (3) shall be submitted to the Registrar together with the annual report under section 16.
A person who fails to comply with this section commits an offence.
person
“person” includes a natural person, corporation, partnership, association, firm, joint venture or trust;
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