"Measures for the Administration of Commercial Franchise Registration"

 Recently, the Ministry of Commerce published the "Administrative Measures for the Filing of Business Franchising" on its website, which will be implemented from February 1, 2012.
　　Attachment: Administrative Measures for the Filing of Business Franchising
　　Article 1 To strengthen the management of business franchising activities and regulate the franchising market order, these measures are formulated in accordance with the relevant provisions of the "Regulations on the Administration of Business Franchising" (hereinafter referred to as the "Regulations").
　　Article 2 These measures apply to business franchising activities conducted within the territory of the People's Republic of China (hereinafter referred to as "within China").
　　Article 3 The Ministry of Commerce and the commerce authorities of the people's governments of provinces, autonomous regions, and municipalities directly under the Central Government are the filing authorities for business franchising. For business franchising activities conducted within a province, autonomous region, or municipality, filing shall be made to the commerce authority of the people's government of the province, autonomous region, or municipality where the franchisor is located; for franchising activities conducted across provinces, autonomous regions, or municipalities, filing shall be made to the Ministry of Commerce.
　　Business franchising implements nationwide networked filing. Franchisors who meet the provisions of the "Regulations" shall file through the Business Franchising Information Management System established by the Ministry of Commerce in accordance with these measures.
　　Article 4 The Ministry of Commerce may, according to relevant regulations, entrust the commerce authorities of the people's governments of provinces, autonomous regions, and municipalities to complete the filing work for business franchising activities conducted across provinces, autonomous regions, and municipalities. The entrusted commerce authorities shall complete the filing work themselves and shall not entrust any other organizations or individuals to file on their behalf.
　　If the entrusted commerce authorities of the people's governments of provinces, autonomous regions, and municipalities fail to perform their filing duties according to law, the Ministry of Commerce may directly accept the franchisor's filing application.
　　Article 5 Any unit or individual has the right to report violations of these measures to the commerce authorities, and the commerce authorities shall handle them according to law.
　　Article 6 Franchisors applying for filing shall submit the following materials to the filing authority:
　　(1) Basic information on business franchising.
　　(2) Distribution of all franchisees' stores within China.
　　(3) Franchisor's market plan.
　　(4) Business license of the corporate legal person or other proof of main qualification.
　　(5) Registration certificates of trademarks, patents, and other business resources related to franchising activities.
　　(6) Proof documents that meet the provisions of Article 7, Paragraph 2 of the "Regulations."
　　Franchisors who have been engaged in franchising activities before May 1, 2007, are not subject to the provisions of the preceding paragraph when submitting application materials for business franchising filing.
　　(7) The first franchising contract signed with franchisees within China.
　　(8) Sample franchising contract.
　　(9) Table of contents of the franchising operation manual (must indicate the page number of each chapter and the total number of pages of the manual; for manuals provided on the franchising system's internal network, an estimated number of printed pages must be provided).
　　(10) For products and services that require approval according to national laws and regulations before franchising can be conducted, the approval documents from relevant competent authorities must be submitted.
　　Foreign-invested enterprises shall submit the "Foreign-Invested Enterprise Approval Certificate," and the business scope in the certificate shall include the item "engaging in commercial activities through franchising."
　　(11) Franchisor's commitment signed and sealed by the legal representative.
　　(12) Other materials that the filing authority deems necessary to be submitted.
　　Documents formed outside the People's Republic of China must be notarized by the notary authority of the country where they are located (with a Chinese translation attached) and authenticated by the Chinese embassy or consulate in that country, or go through the certification procedures stipulated in relevant treaties between China and that country. Documents formed in Hong Kong, Macau, and Taiwan shall go through relevant certification procedures.
　　Article 7 The franchisor shall apply for filing with the filing authority within 15 days from the date of signing the first franchising contract with franchisees within China.
　　Article 8 If the franchisor's following filing information changes, an application for change shall be submitted to the filing authority within 30 days from the date of change:
　　(1) Franchisor's business registration information.
　　(2) Business resource information.
　　(3) Distribution of all franchisees' stores within China.
　　Article 9 The franchisor shall report to the filing authority the status of franchising contracts signed, revoked, terminated, or renewed in the previous year before March 31 each year.
　　Article 10 The franchisor shall carefully fill in all filing information and ensure that the content is true, accurate, and complete.
　　Article 11 The filing authority shall file within 10 days from the date of receiving documents and materials submitted by the franchisor that comply with the provisions of Article 6 of these measures, and announce it in the Business Franchising Information Management System.
　　If the documents and materials submitted by the franchisor are incomplete, the filing authority may require the franchisor to supplement the documents and materials within 7 days. The filing authority shall file within 10 days from the date the franchisor's materials are complete.
　　Article 12 The filing authority may revoke the filing and announce it in the Business Franchising Information Management System if the franchisor who has completed filing has any of the following behaviors:
　　(1) The franchisor cancels business registration or has its business license revoked by the competent registration authority due to illegal operation.
　　(2) The filing authority receives a judicial recommendation from judicial authorities to revoke the filing due to the franchisor's illegal operation.
　　(3) The franchisor conceals relevant information or provides false information causing significant impact.
　　(4) The franchisor applies for revocation of filing and is approved by the filing authority.
　　(5) Other circumstances requiring revocation of filing.
　　Article 13 The commerce authorities of the people's governments of provinces, autonomous regions, and municipalities shall feedback the filing and revocation status to the Ministry of Commerce within 10 days.
　　Article 14 The filing authority shall completely and accurately record and preserve the franchisor's filing information materials and keep business secrets of the franchisor according to law.
　　The commerce authority of the people's government at the franchisor's location (province, autonomous region, municipality, or city with districts) may issue a filing certificate to franchisors who have completed filing.
　　Article 15 The public may inquire about the following information through the Business Franchising Information Management System:
　　(1) The franchisor's company name and the registered trademarks, corporate logos, patents, proprietary technologies, and other business resources used in the franchise business.
　　(2) The franchisor's filing date.
　　(3) The franchisor's legal business address and contact information, and the name of the legal representative.
　　(4) The distribution of all franchisee stores within China.
　　Article 16: If the franchisor fails to file according to the "Regulations" and these Measures, the municipal or higher-level commerce authority shall order a deadline for filing and impose a fine of not less than 10,000 yuan but not more than 50,000 yuan; if the filing is still not made after the deadline, a fine of not less than 50,000 yuan but not more than 100,000 yuan shall be imposed and announced publicly.
　　Article 17: If the franchisor violates the provisions of Article 9 of these Measures, the municipal or higher-level commerce authority shall order correction and may impose a fine of up to 10,000 yuan; if the circumstances are serious, a fine of not less than 10,000 yuan but not more than 50,000 yuan shall be imposed and announced publicly.
　　Article 18: Foreign franchisors engaging in franchise activities within China shall comply with these Measures. Franchisors from the Hong Kong, Macau Special Administrative Regions, and Taiwan region shall refer to these Measures.
　　Article 19: Relevant associations and organizations shall strengthen industry self-discipline and guide franchisors to file legally in accordance with these Measures.
　　Article 20: These Measures shall be interpreted by the Ministry of Commerce.
　　Article 21: These Measures shall come into effect on February 1, 2012. The "Administrative Measures for the Filing of Commercial Franchising" (Ministry of Commerce Order No. 15 of 2007) effective from May 1, 2007, shall be repealed simultaneously.