Does the Belocal franchise agreement consider selling digital or print advertising for publications that compete with N2 publications as a 'Competitive Service'?
Belocal Franchise · 2025 FDDAnswer from 2025 FDD Document
- (2) Competitive Business.
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;
Source: Item 22 — CONTRACTS (FDD page 71)
What This Means (2025 FDD)
According to Belocal's 2025 Franchise Disclosure Document, the franchise agreement explicitly defines selling digital or print advertising for publications that compete with N2 publications, including Belocal publications, as a 'Competitive Service.' This definition is crucial because it directly impacts what a franchisee can and cannot do both during the term of the franchise agreement and for a specified period after the agreement terminates, expires, or is transferred.
Specifically, the agreement outlines that 'Competitive Business' includes several 'Competitive Service' lines. Among these is '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.' This means that during the franchise term, and for up to twelve months after termination, expiration, or transfer, a franchisee is restricted from engaging in these competitive activities.
The restrictions are designed to protect Belocal's market position and goodwill. The franchise agreement also states that these covenants contain reasonable limitations regarding time, geographical area, and scope of activity. This suggests that Belocal has attempted to balance protecting its business interests with ensuring the restrictions on franchisees are fair and not overly broad. Franchisees should carefully consider these restrictions and how they might impact their business plans, especially if they have prior experience or relationships in the advertising or publishing industries.