What constitutes a 'Competitive Business' for Belocal franchisees, specifically regarding organizing events for advertisers?
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 activities that could be considered competitive to Belocal. This definition is relevant both during the term of the franchise agreement and for a 12-month period after termination, expiration, or transfer of the agreement. For Belocal franchisees, understanding what constitutes a 'Competitive Business' is crucial to avoid violating the franchise agreement, especially concerning post-term activities.
Specifically, organizing, sponsoring, or hosting events for advertisers in the Publication, or for members of Communities or Industry Groups within the Territory and within ten miles of the Territory, is considered a 'Competitive Business' if the purpose of these events is to sell or market digital or print publications, or advertising within those publications, that compete with N2 publications, including Belocal publications. This means a franchisee cannot engage in event-based marketing for competing publications within their territory or a ten-mile radius of it.
This restriction aims to protect Belocal's market share and the integrity of its advertising and publication model. A prospective franchisee should carefully consider this restriction, especially if they have existing relationships or experience in organizing similar events for other publications or advertising services. It is important to note that the definition of 'Competitive Business' also extends to selling digital or print advertising for competing publications, publishing competing publications, and developing relationships to market competing publications.