After termination or expiration of a Burger King franchise, what is the geographic limit of the non-competition covenant?
Burger_King Franchise · 2025 FDDAnswer from 2025 FDD Document
| PROVISION | SECTION IN FRANCHISE AGREEMENT | SUMMARY |
|---|---|---|
| a. Length of the franchise term | Sec. 1 | Term is 20 years for freestanding Restaurant; may be less for non-traditional locations, where property control is for a shorter period, or as agreed by you and us1 |
| b. Renewal or extension of the term | Sec. 1, 17 | No right of renewal. Option to obtain a successor Franchise Agreement up to 20 years if in compliance with Franchise Agreement and with all other agreements with us, if property control is obtained, and if Franchisee meets our then current successor requirements. No successor Franchise Agreement option if you are in the Big-Box Program or operate a Delivery Restaurant. |
| c. Requirements for you to renew or extend | Sec. 17 | Submit and obtain our approval of Successor Franchise Application and General Release, sign the current Franchise Agreement which may have materially different terms than those in your Franchise Agreement and pay successor franchise fee, sign any other agreements including Successor Addendum (Exhibits H1 - H3), comply with building upgrades, inspections. |
| d. Termination by you | Not Applicable | You may terminate the Franchise Agreement under any grounds permitted by applicable state law. |
| e. Termination by us | Not Applicable | |
| without cause | ||
| Crown Your Career Franchise Agreement Addendum – Sec. 3 | Your Operating Partner or Managing Owner may not engage in any other business activities until the later of the 5th anniversary of the commencement date of the first Franchise Agreement signed or the repayment in full of the loan under the Crown Your Career Promissory Note. | |
| r. Non-competition covenants after the franchise is terminated or expires2 | Sec. 12 Sec. 19 | You cannot use the BURGER KING System, our marks, or other trade secrets except in connection with the operation of a BURGER KING® Restaurant. For 1 year after termination at or within 2 miles of your restaurant, you may not own, operate or have any interest in any other hamburger business. |
Source: Item 17 — RENEWAL, TERMINATION, TRANSFER AND DISPUTE RESOLUTION (FDD pages 81–94)
What This Means (2025 FDD)
According to Burger King's 2025 Franchise Disclosure Document, if the franchise is terminated or expires, the franchisee is subject to a non-competition covenant. This covenant restricts the franchisee from engaging in any other hamburger business within a specific geographic area.
Specifically, the franchisee cannot own, operate, or have any interest in any other hamburger business for one year after termination. This restriction applies within a 2-mile radius of the former Burger King restaurant location. This means that after the franchise agreement ends, the franchisee must refrain from involvement in a competing hamburger business within that immediate vicinity for the specified duration.
This non-compete agreement is designed to protect Burger King's market share and brand recognition in the area. It prevents a former franchisee from leveraging their experience and knowledge gained while operating a Burger King restaurant to directly compete with the brand shortly after their franchise agreement concludes. Franchisees should consider this restriction carefully, as it could impact their future business opportunities in the food service industry.