It is difficult to say which business sector has the most dangerous franchises. In Russia, about 20 percent of franchise offers can be classified as such. It is quite easy for them to get lost among proven brands. And simply paraphrasing the name of a popular brand in order to evoke positive associations in a businessman is not difficult.
Pseudo franchise
Anyone can find franchises of unknown origin on the Internet. The price of such franchises also varies significantly - from 1 to 500 dollars. A more in-depth search for information may show that such franchises do not exist at all, and the various "trademarks" under which they are designated have never been registered with Rospatent.
Beauty salon franchise
A pseudo-franchise is a linkedin database project that exists only on paper. It does not exist in real life. Usually, such franchises are presented beautifully, attract potential buyers, and arouse their interest. The main goal of an unscrupulous franchisor is to sell a "franchise" by promising mountains of gold.
After receiving a lump sum payment from a businessman, he may even provide documentation for examination. Then the pseudo-franchisor simply disappears with the "partner's" money. Of course, he does not provide any business either.
Quite often, a pseudo-franchise is a copy of a well-known trademark, and therefore a one-day company can actually be registered according to all the rules.
If a similarity with a well-known brand is detected, the franchisee can rely on paragraph 3 of Article 1484 of the Civil Code, which states that no one can use a designation similar to an existing brand. The similarity can be both phonetic and visual, and semantic similarity of trademarks also occurs.
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In Russia, a businessman who buys a similar franchise is not protected by law in any way. He may suffer damage due to the illegal use of someone else's trademark or receive counterfeit goods under the guise of the original; fraud associated with non-return of funds is not excluded.
It should be remembered that the unlawful use of a trademark is a crime specified in Article 180 of the Criminal Code, for which all participants in the criminal act are liable.
Pseudo-franchises without a trademark
Pseudo-franchises are never registered with Rospatent and are not secured by an agreement. If all necessary procedures are not carried out, the agreement is considered invalid on the basis of paragraph 2 of Article 1028 of the Civil Code.
Beauty salon franchise
When the franchisee has questions, the pseudo-franchisor comes up with various excuses. For example, he may state that concluding a concession agreement is inappropriate, or try to convince the franchisee that an application for trademark registration has already been filed and a certificate should be issued in a few days.
However, he demands that the funds be transferred right now. It is possible that the trademark registration has already been denied, but the pseudo-franchisors are in no hurry to inform the franchisee about this.
But even if an application for trademark registration has actually been filed, this is not a reason to conclude an agreement. The franchisor does not yet have the right to the trademark. In other words, the filed application does not mean anything and does not guarantee the registration of the trademark.
"Raw" franchising
Undoubtedly, every businessman wants to earn money by selling a franchise. This applies not only to well-known companies, but also to new ones. Having just started a business, many entrepreneurs are sure that their earning scheme is reliable. That is why they strive to earn money by selling a franchise.
This scheme may be considered less dangerous, but even here franchisees should be careful.
A "raw" beauty salon franchise (in our case) implies the implementation of a poorly prepared project. The ambitions of an inexperienced franchiser may be to the detriment of his partner. In such situations, it is difficult to talk about any support and long-term cooperation, since new enterprises do not always manage to maintain their positions.
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