1. Reason for revision
The draft is intended to improve the efficiency of enforcement of the act through exemption from the obligatory operation of directly managed stores delegated in accordance with the amended Franchise Business Act by protecting the rights/interests of franchisees with strengthened information supply in relation to online sales by franchisers and by transferring some rights for the imposition of fine for negligence to some si/do governors.
2. Main content
A. Embodiment of delegated matters under the amended Franchise Business Act (Article 5.5 of draft and [Appendix Table 1] of draft)
1) The amended Franchise Business Act (to be enforced on November 19, 2021) prescribes the liability of franchisers to state matters on the operation periods and sales of directly managed stores in information disclosure sheets. Therefore, the matters to be stated in information disclosure sheets are embodied.
2) In addition, the amended Franchise Business Act prescribes that, if franchisers have no experience in the operation of directly managed stores (at least one store and at least for one year), registration of information disclosure sheets may be refused. Where, if it is accepted that the operation of a directly managed store is not needed because the business type was verified, exemption is accepted. Therefore, exceptional cases such as acquisition of permission/license, etc. through other acts and subordinate statutes and domestic/foreign experience in the same business for one (1) year or longer are embodied.
3) As the amended act accepts the operation period by an executive as the operation period of the directly managed store, if such executive is still the executive of the franchiser as of the date of applying the registration of the information disclosure sheet, the operation period by the executive is included in the operation period of directly managed stores.
B. Expanded information supply in relation to online sales by the franchiser ([Appendix Table 1] of draft)
Online sales by a franchiser have a direct competition relationship with franchisees, but required information on online sales is not supplied to franchisees.
2) In domestic sales by the franchiser, the ratio between online and offline sales and the ratio between exclusive products of franchisees and exclusive online products are added in the matters to be stated in information disclosure sheets.
C. Delegation of some rights for the imposition of fine for negligence to si/do governors
1) Rapid and efficient enforcement of acts is required by assigning the right for the imposition of fine for negligence against actions whose illegality may be determined with a simple identification of facts only.
2) The current act assigns the right for the imposition of fine for negligence against such actions (five kinds) to four si/do governors (metropolitan governments) who perform information disclosure sheet registration work.
D. Clarification of matters to be stated in the information disclosure sheet ([Appendix Table 1] of draft)
1) The current Enforcement Decree prescribes the liability to state the fact of actions taken by the Fair Trade Commission in the information disclosure sheet and four si/do governors and their right to withdraw registration of the information disclosure sheet, but the corresponding fact is not stated in the information disclosure sheet.
2) Therefore, the fact of disposition of registration withdrawal by si/do governments is added to the matters to be stated in the information disclosure sheet.
