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Rights to Transfer a Franchise

Generally, most franchisors reserve their own right to transfer a franchise in New York. This includes the right to transfer the franchise agreement, as well as the ownership interests. This right is reserved in case of an acquisition by another company, and generally specifies that such a transaction may take place only if the successor is "reasonably qualified" to perform the franchisor's obligations.

On the other hand, franchisees may not transfer a franchise without the franchisor's consent. This restriction generally applies to the transfer of a franchise and franchise agreement, an ownership interest in the franchise, the business facility and its assets, and leases or subleases. This includes voluntary and involuntary transfers, lifetime transfers, and transfers upon death and disability.

However, if the franchisor consents to the transfer of a franchise, then such a transaction is possible once all obligations are met. These obligations may include that a written notice of the transfer be provided to the franchisor, and that the transferor remains liable for the terms of the franchise agreement.

You can learn more about selling or transferring a franchise by visiting our article library.  

Contacting a New York Franchise Lawyer

If you are an entrepreneur who is interested in franchising your business there is a lot you need to know, including the significance of evaluating your trademark and how to approach the preparation of your FDD. For a limited time, get New York franchise lawyer Charles N. Internicola, Esq's franchise law report to determine whether or not your business is right for franchising. Contact us today at 1-800-976-4904 for more information about Mr. Internicola's franchise law services in New York and how he assists entrepreneurs franchise their business nationwide.