- The term "franchise business" refers to a continuous business relationship in which a franchisor allows its franchisees to use its own trademarks, service marks, trade names, signs, or any other business marks (hereinafter referred to as “business marks") in selling goods (including raw materials and auxiliary materials) or services in compliance with certain quality standards or business methods, and provides support, training, and control of its franchisees with regards to their management and business activities, etc., and in which franchisees pay franchise fees to their franchisor in return for the use of business marks and the support and training provided for their management and business activities, etc. (Subparagraph 1 of Article 2 of the Fair Transactions in Franchise Business Act).
※ How to settle disputes with the franchisor
▪ Disputes can be settled through the Franchise Business Transaction Dispute Settlement Council established under the Korea Fair Trade Mediation Agency, which is an affiliated agency of the Fair Trade Commission (☎ 1588-1490). The Council allows an application for mediation to be made in respect of all grounds, such as the cancellation of unfair franchise agreements, the return of franchise fees, and the violation of business areas. If the franchisee and franchisor agree to the proposal of mediation, the dispute is concluded as an agreement is deemed to be established between both parties. An application for mediation may be made free of charge, and the time period for settlement may differ depending on the importance and details of the case.
▪ You may also report a dispute to the Fair Trade Commission (http://www.ftc.go.kr). After each regional office receives a case, an investigator in charge will be assigned to conduct investigation on any violations of related statutes such as the Fair Transactions in Franchise Business Act and to handle the case.
Independent start-up and support for persons who intend to start up a micro enterprise
- Independent start-up is a concept that is in contrast with the start-up of a franchisee, and it refers to the type of start-up in which the person who wishes to start up a makeup shop is required to handle on his/her own the various start-up preparation processes such as market research, making of decision on the interior concept, promotion, etc.
Support for persons who intend to start up a micro enterprise
- The Chairperson of the Small Enterprise and Market Service may conduct projects regarding any of the following matters, in order to support the start-up of micro enterprises (Article 8 of the Protection of and Support for Micro Enterprises and Subparagraph 1 of Article 12(3) of the Enforcement Decree of the Act on the Protection of and Support for Micro Enterprises).
1. Discovery of persons desiring to start a micro enterprise, who have exceptional ideas, etc.
2. Consultation, advice, and education on the procedures, etc. for the start-up of micro enterprises
3. Provision of information necessary for a start-up, such as information on financing, human resources, market, and location of place of business
4. Other matters necessary for supporting the start-up of micro enterprises.