Is selling digital advertising that competes with Belocal publications considered a 'Competitive Service'?
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;
Source: Item 22 — CONTRACTS (FDD page 71)
What This Means (2025 FDD)
According to Belocal's 2025 Franchise Disclosure Document, selling digital advertising that competes with Belocal publications is considered a 'Competitive Service.' Specifically, the FDD defines a 'Competitive Business' as including several business lines or services, each considered a 'Competitive Service.'
One of these 'Competitive Services' 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 term of the franchise agreement, and for a period after termination, expiration, or transfer of the agreement (specifically, within the twelve-month period prior), a franchisee is restricted from engaging in such competitive activities.
This restriction is in place to protect Belocal's goodwill and business interests. The franchisee acknowledges that these covenants contain reasonable limitations regarding time, geographical area, and scope of activity. This non-compete clause is a standard practice in franchising to prevent franchisees from directly competing with the franchised business, both during the agreement and for a limited time afterward.