Franchise contracts play a crucial role in the Belgian distribution sector, where many independent entrepreneurs operate through a franchise formula. The legislature introduced a series of legislative changes and royal decrees in 2024 that have significant implications for both franchisors and franchisees. Below, we explain the four most important changes and analyze their impact on the sector.
1. The law of Feb. 9, 2024: Reform of the Precontractual Information Document (PID).
One of the most sweeping changes concerns the requirements for the pre-contractual information document (PID), which potential franchisees must receive at least one month before signing the franchise contract.
The changes, introduced by the law of Feb. 9, 2024 containing various provisions on economy , were introduced primarily to improve transparency and reduce the abundance of information that previously led to confusion. The law now specifies a mandatory list of essential contractual provisions, including:
- The duration and terms of renewal or termination of the contract;
- The franchisee's financial obligations, such as start-up and recurring expenses;
- Pricing structure and restrictions on pricing;
- Minimum sales requirements and purchase obligations;
- The rights and restrictions surrounding intellectual property, including the use of brands and customer records.
This reform forces franchisors to review their PIDs and word contracts more clearly to reduce the risk of disputes.
These new rules took effect on Sept. 1, 2024, and apply to PIDs regarding new franchise contracts entered into after Sept. 1, 2024, and to amendments and renewals of current franchise contracts that occurred after Sept. 1, 2024.
2. The law of May 3, 2024: Establishment of a new Advisory Commission on Commercial Distribution Agreements
The Arbitration Committee, which advises on pre-contractual information requirements, has been replaced by the Advisory committee on commercial distribution agreements. This new committee, established by the law of May 3, 2024 containing various provisions on economy, has broader jurisdiction and handles not only franchise contracts, but also commercial agency and concession agreements.
An important change is that all legislative amendments to the Economic Law Code (Book X) and relevant royal decrees are now required to be submitted to this committee. This will give the industry a greater say in future regulations, which should lead to more balanced and thoughtful legislation.
This new provision took effect on June 1, 2024.
3. The Royal Decree of June 20, 2024: New rules around abusive clauses in franchise contracts in the supermarket sector
Franchisees are often in an economically dependent position vis-à-vis their franchisors. To prevent abuse, the government banned specific contract clauses or labeled them as suspect in franchise contracts in the "supermarket sector" . This was done through the Royal Decree of June 20, 2024, supplementing the lists of abusive clauses in commercial cooperation agreements on retail sales in non-specialized stores where food and beverages predominate.
Unlawful clauses that henceforth in any case, null and void are (and are therefore prohibited - blacklisted), include:
- Prohibition on franchisees' damages for defective deliveries by the franchisor;
- Restriction of the right to make preparations for a new activity during the notice period;
- Disproportionate distribution of promotional costs, such as when the franchisee has to pay more than 50%;
- In case of disputes, declare only courts of jurisdiction in the region where the franchisor is located and/or in a language area other than that of the franchisee.
In addition, there are clauses that probably unlawful are (unless proven otherwise - gray list), such as option and pre-emption clauses with unbalanced valuations, the obligation to continue a loss-making business and unreasonable termination clauses.
Franchisors in the supermarket industry will have to revise their contracts to comply with these new rules.
These new rules took effect on Dec. 1, 2024, and apply to franchise contracts entered into, modified or renewed after Dec. 1, 2024.
4. The Royal Decree of Aug. 19, 2024: Mandatory financial transparency and forward planning
The Royal Decree of August 19, 2024, supplementing and clarifying the list of information enumerated in Article X.28, § 1, 1° and 2°, of the Code of Economic Law and establishing a model of an estimated operating account, introduces several additional mandatory disclosures in the Precontractual Information Document (PID), including:
- The franchisor's expansion plans in the franchisee's region;
- Information on pending permit applications for competing sites;
- Regular investment commitments, such as periodic store renovations;
- A standard operating account model.
This last point is particularly important: franchisors must now provide a sample operating account so that potential franchisees can make a realistic assessment of their future financial situation.
These new provisions took effect on March 1, 2025, and apply to new franchise contracts entered into after March 1, 2025, and to the amendments and renewals of current franchise contracts that occurred after March 1, 2025.
Conclusion
Recent reforms show that the Belgian legislature wants to regulate franchise contracts more strictly in order to better protect franchisees' rights. Transparency, financial predictability and contractual balance are central to this.
Franchisors in Belgium must be aware of their new obligations and carefully adapt their contracts and PIDs to avoid legal risks. Franchisees, on the other hand, now have stronger protection mechanisms, allowing them to invest in a franchise formula with greater certainty.
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