What constitutes a 'Competitive Business' for Belocal franchisees, specifically regarding offering or selling digital marketing and advertising services?
Belocal Franchise · 2025 FDDAnswer from 2025 FDD Document
. The term "Competitive Business" includes the following divisible and severable business lines or services (each a "Competitive Service") which the Franchisee's Franchised Business provided (a) for covenants applicable during the Term, during the Term and (b) for covenants applicable post-term, at any time within the twelve-month period prior to the termination, expiration, or transfer of this Agreement:
- (i) selling digital and/or print advertising to businesses for publication in or related to digital or print publications that compete with any N2 publication(s), including BELOCAL publications;
- (ii) publishing and/or facilitating the publishing of digital or print publications that compete with any N2 publication(s), including BELOCAL publications;
Source: Item 22 — CONTRACTS (FDD page 71)
What This Means (2025 FDD)
According to Belocal's 2025 Franchise Disclosure Document, a 'Competitive Business' includes specific business lines or services that would be considered competitive to Belocal. This definition is important both during the term of the franchise agreement and for a 12-month period after termination, expiration, or transfer of the agreement.
Specifically, a 'Competitive Business' includes offering or selling digital marketing and advertising services that are offered or sold by Belocal or its affiliates, or that were offered and sold by the franchisee themselves. This means that during the franchise term and for one year afterward, a franchisee is restricted from engaging in a business that provides digital marketing and advertising services that directly compete with those provided by Belocal.
This restriction is in place to protect Belocal's goodwill and legitimate business interests. The franchisee agrees that these covenants are reasonable in terms of time, geographical area, and scope of activity, and that they do not impose a greater restraint than necessary to protect Belocal. This non-compete clause ensures that franchisees do not directly leverage the knowledge and resources gained from Belocal to start a competing business shortly after leaving the franchise system.