DTI Requirements and Laws for Business Franchising in the Philippines

In case you didn’t know it yet, there are new laws governing the business franchising in the Philippines today and it is being implemented by none other than the authorities by the government of the Philippines – DTI or the Department of Trade and Industry. I have listed below the different steps to follow for franchise owner who are offering investment opportunities to their franchisors leaving open their business for franchising. Read them below.

DTI just launched their new system before any business owner could open their franchise to any franchisor. The agency of the government for trade and industry is already requiring all franchisors to provide their franchisee applicants with Franchise Disclosure Information.

DTI Requirements for Franchise for the FDI Documentation

1. Business address, email address, internet home page / website, fax numbers and other Contact details.

2. Copy of the DTI or SEC Registration Cover page

3. Parent companies and affiliates, if any, and their respective description of their qualifications and background, ownership of interest and references.

4. Name of the Board Directors and officers with a brief description of their qualifications and background, ownership of interest and references and background of Franchise Manager.

5. The contact number and business location of existing Franchisees

6. Executed promotional / marketing materials

7. Description of the business concept, which includes brand image, brand personality, unique selling proposition, target market, mission and mission

8. Basic Information on training, commercial and / or technical assistance

9. Certificate that the Franchisor is a member in good standing of any Franchisor Association and that the Franchisor has no pending administrative, civil or criminal case (e.g. FIFA Certificate)

10. Declaration of the initial fee, amount that will be collected and services covering these fees

11. Training that will be provided, number of persons, how long and training modules

12. Numbers of years Company has operated and number of years it has franchised and number of years it has franchised with corresponding numbers of company owned branches and franchised branches

13. Copy of Memorandum of Agreement and Franchise Agreement

14. Full disclosure of the financial requirements of the franchise business and expected P&L

15. A provision that requires the franchise applicant to seek adequate legal and financial counsel before signing the Franchise Agreement

16. Mechanism for dispute resolution

17. Copy of the Trademark or Trademark application