Franchise, Retail, and E-commerce Lawyers

Our lawyers in franchise, retail, and e-commerce law in Montreal can provide you with advice and answer your questions concerning the legal framework of your industry. As a manager of such a business, we can advise you on the negotiation and preparation of franchise or commercial contracts as well as prevent and resolve conflict situations you may face.

---

Franchising:

---

We actively collaborate with lawyers versed in franchising and the establishment of franchise networks.

Whether you are a franchisee of one or multiple branches, we encourage you to consider what contributes to your success. Are there elements that could be negotiated to simplify operations with the franchisor? Are there cost-saving actions that could be advanced? What are the strengths and weaknesses of the organization? What are the new legal obligations legislated by the province or country? We find such questions worthwhile as a periodic update of your processes and information is relevant to properly operate your franchise.

A franchise network must be built on a solid foundation. One such cornerstone is that your business concept is financially proven and can be easily replicated using the same « recipe » and « know-how. »

Moreover, to establish a franchise network, it is crucial to design a corporate structure and a master contract between the franchisor and franchisee. The franchise agreement will be of paramount importance as it will outline the support the franchisor must provide to the franchisee and the financial royalties that will be significant for the growth of the network.

Beyond the contract, case law dictates that the franchisor has various implicit obligations to its franchisees, such as an obligation to provide technical and commercial assistance.

Furthermore, in franchising as in business, it is better to « under-promise and over-deliver. » It is important to surround yourself not only with franchise lawyers but also with certified professional accountants (CPAs) and other professionals who will help you prepare realistic and achievable financial projections to provide accurate information to those interested in investing and starting a franchise.

Our franchise and retail law lawyers can advise you on these matters, whether you are the owner of one or multiple franchises or a franchisor.

---

Online Commerce:

---

The majority of online sales correspond to a distance contract covered by the Consumer Protection Act. This type of contract must be in writing, containing the name and address of the merchant as well as the date of the transaction. Mandatory information must also be presented to the consumer before concluding the contract. This includes your company's details, a detailed description of the goods and services sold, the price of each item, and the payment terms. Delivery dates, cancellation policies, and any other restrictions or applicable conditions must also be stated.

A step prior to accepting the contract should allow the consumer to correct any errors, if necessary, and to accept or refuse the offer.

Following the conclusion of the contract, a contract must be provided to the consumer within 15 days of the conclusion. If the consumer does not receive the goods within 30 days of the date specified in the contract, they may cancel the sale. Our lawyers familiar with e-commerce law can assist you in drafting such contracts.

---

Legal and Conventional Warranties:

---

A legal warranty is provided under the Consumer Protection Act. Depending on the products, the coverage of the warranty will vary in terms of duration. For example, a mobile device typically has a legal warranty of one year, while a larger appliance, like a washing machine, covers a longer period to ensure a reasonable lifespan free of hidden defects.

Additional warranties may be offered to the consumer. It is crucial that the consumer is informed of the legal warranty before being presented with the additional warranty. An additional warranty can be offered online.

---

Consumer Protection Act:

---

Discussing retail without addressing the Consumer Protection Act is impossible. This Act provides various types of protection to favor consumers who generally have less bargaining power. A consumer, according to Article 2 of the Act, is an individual who is not a merchant acquiring goods for the purposes of operating their business.

Non-compliance with this law can lead to the cancellation of sales, complaints filed with the Office de la protection du consommateur, and even class-action lawsuits. To prevent such litigation and lower the risk of class-action lawsuits, it is advisable for merchants to have sales contracts reviewed that are subject to consumer law. Specific rules apply to gym memberships, distance purchases, credit contracts, offered warranties, vehicle repair and sales, and services provided remotely.

When it comes to contract review, it is better to be proactive than reactive to complaints since this could save you a lot. The review includes advice to protect your business's interests as well.

---

Laws and Regulations Applicable to Retail:

---

The new Regulation Prohibiting Single-Use Plastics was published on June 22, 2022. It indicates that the manufacture, import, export, and sale of single-use plastics from six non-essential categories will be banned by the end of 2025. This includes shopping bags, utensils, food containers made from problematic plastics or containing them, beverage packaging rings, stir sticks, and straws. The ban on manufacturing and importing for sale in Canada takes place from December 20, 2022, for shopping bags, utensils, straws, food containers, and stir sticks. As for the bans on sales and manufacturing for the purpose of export, this will go from 2023 to 2025 depending on the products. The laws and dates of implementation can be cumbersome, and our franchise and retail lawyers will be happy to advise you on implementing these new obligations.

Finally, we cannot discuss franchises without mentioning the Competition Act. This law sets out general objectives to preserve and promote healthy competition in Canada. Thus, it may be argued that a franchise banner could not require franchisees to sell all products at a set price as this would constitute an offense under the Competition Act. However, the franchisor could, to circumvent these limits, include a suggested price in the contract and allow the franchisee to sell at a price lower than the suggested price. This is why it is important to be aware of your rights in franchise contract negotiations.

Regardless of your situation, it is important to consult a lawyer seasoned in franchise and retail law to obtain help and legal advice specific to your industry and support through all the steps of your business projects.