After the termination or expiration of a Burger King franchise agreement, for how long is the franchisee prohibited from owning or operating a hamburger business within two miles of the former Burger King restaurant?
Burger_King Franchise · 2025 FDDAnswer from 2025 FDD Document
Franchisee covenants and agrees that during the Term of this Agreement Franchisee will not own, operate or have any interest in any hamburger business except other franchised BURGER KING Restaurants. Franchisee further covenants and agrees that for a period of one (1) year after any sale, assignment, transfer, termination or expiration of this Agreement, Franchisee will not own, operate or have any interest in any hamburger business, except other franchised BURGER KING Restaurants, either at or within two (2) miles of the Premises. The restrictive covenant shall remain an individual obligation of each individual Franchisee under this Agreement, and shall not be effected in any way by the transfer or assignment of this Agreement to a Corporation or LLC in accordance with Sections 15.D of this Agreement.
Source: Item 23 — RECEIPTS (FDD pages 127–995)
What This Means (2025 FDD)
According to Burger King's 2025 Franchise Disclosure Document, a franchisee is restricted from engaging in any hamburger business, with the exception of other franchised Burger King restaurants, for one year following the sale, assignment, transfer, termination, or expiration of their franchise agreement. This restriction applies to owning, operating, or having any interest in a hamburger business either at or within two miles of the Burger King restaurant's premises.
This restrictive covenant is an individual obligation of each franchisee and is not affected by the transfer or assignment of the agreement to a corporation or LLC. This means that even if the franchise agreement is transferred to a business entity, the individual franchisee remains bound by the terms of the covenant.
This non-compete clause ensures that former Burger King franchisees do not directly compete with the Burger King system shortly after leaving the franchise. This protects Burger King's market share and customer base in the immediate vicinity of the former franchise location. Prospective franchisees should consider this restriction carefully, as it could limit their business opportunities for a year after leaving the Burger King system.