|
The Lumber City Franchise, as well as several other FASA members,
have a franchisee base who are each individually registered as separate legal entities
trading as Lumber City etc. In essence, this has severe ramifications going forward.
We would appreciate comment and direction from FASA, assisting in the way forward
in this matter.
Kind regards
Brent Hellawell
|
|
Hi Vera,
I have also not been able to pick up the article on the website.
What they may be thinking of is section 79 of the CPA which, you may recall, I dealt
with in the presentation I gave in February. The relevant extract from the presentation
is quoted below: -
“The Act requires that any person carrying on business must do
so: -
In the case of a natural person, under his full name as recorded in an identity
document;
In the case of a company or close corporation, as registered in terms
of "a public regulation"; or
Under a "business name" registered with the Registrar
of Companies in terms of the Act.
In many franchises the franchisee, whether it
is a natural person, a company or a close corporation, will not be known to the
public under his or its registered name, but will be known as, for example, "Mr.
Pizza Sandton". The Act requires that all franchisees will have to register these
names with the Registrar of Companies”.
In a nutshell, the Act does not prohibit
a franchisor from allowing its franchisees to trade under the name of the franchise,
as long as the business name registered by each franchisee is distinguishable, e.g.
in Lumber City’s case, they should not register as simply “Lumber City”, but as,
for example, “Lumber City Cape Town”, Lumber City Sandton”, etc. Some amendments
to franchise agreements will probably be necessary in most franchises.
Regards,
Ian Jacobsberg Director Eversheds
Tel. (27 11) 286 6900
Fax. 086 678 1151
Direct. (27 11) 523-6091
Email: IanJacobsberg@eversheds.co.za
|