Under what conditions can Budget suspend a licensee's network access permanently?
Budget Franchise · 2025 FDDAnswer from 2025 FDD Document
- (c) If Licensee fails to install, maintain, implement and observe the Controls as mandated by ABCR in written procedures, Licensee will be in material breach of the Rental System Agreement, the License Agreement and responsible for any resulting damage or expense incurred by ABCR and the System.
Licensee will be responsible for the expense required to correct any non-conformity of Licensee's Equipment or communication systems employed by Licensee with the System, including non-PCI compliance.
As a result of any such material breach, Licensee will be suspended from network access until the failure is remedied to ABCR'S satisfaction.
If any such failure happens more than twice within any one-year period, ABCR may also, at its discretion, suspend permanently Licensee's connection to the System via the Internet, and require Licensee to follow dedicated connection procedures at Licensee's expense as provided in the Rental System Agreement.
Source: Item 23 — RECEIPTS (FDD pages 80–426)
What This Means (2025 FDD)
According to Budget's 2025 Franchise Disclosure Document, Budget can permanently suspend a licensee's connection to the system via the Internet under specific conditions related to failures in maintaining required controls. If a Budget licensee fails to install, maintain, implement, and observe the controls mandated by Budget in written procedures, it constitutes a material breach of the Rental System Agreement and the License Agreement. This failure also makes the licensee responsible for any resulting damage or expense incurred by Budget and the System.
As a result of this material breach, Budget will initially suspend the licensee's network access until the failure is corrected to Budget's satisfaction. However, if this type of failure occurs more than twice within a one-year period, Budget has the discretion to permanently suspend the licensee's connection to the System via the Internet. In this case, the licensee would be required to follow dedicated connection procedures at their own expense, as outlined in the Rental System Agreement.
This policy highlights the importance of adhering to Budget's mandated controls and security procedures. Franchisees must ensure they consistently maintain and implement these controls to avoid potential disruptions to their network access and the possibility of incurring additional expenses for dedicated connection procedures. The repeated failure to comply with these requirements can lead to a permanent loss of internet connectivity to Budget's system, which could significantly impact the franchisee's ability to operate efficiently.