What is the nature of the relationship between Christies International Real Estate and the Advertising Fund?
Christies_International_Real_Estate Franchise · 2025 FDDAnswer from 2025 FDD Document
- **7.1.
Advertising Fund.** We reserve the right to require that you to pay a monthly advertising fee ("Advertising Fund Fee") for deposit into a system marketing fund (the "Advertising Fund").
As of the Effective Date, we have not established an Advertising Fund, and we do not collect the Advertising Fund Fee.
We may implement, begin collecting, and increase the Advertising Fund Fee at any time upon written notice to you; however, the Advertising Fund Fee will not exceed three percent (3%) of Gross Revenue.
If we begin collecting the Advertising Fund Fee, you will pay the Advertising Fund Fee in the same manner and at the same time as the Royalty Fee.
If we begin collecting the Advertising Fund Fee, we will place all Advertising Fund Fees we receive in the Advertising Fund and we will manage such Advertising Fund.
Any CHRISTIE'S INTERNATIONAL REAL ESTATE businesses operated by us or our affiliates will not be required to contribute to the Advertising Fund.
The Advertising Fund will pay expenses in connection with the general promotion of the Marks and the System, which may include, but are not limited to, the development and operation of a call center; market research; customer retention; incentive programs; sales development programs; media planning; media buying fees; creating and producing advertising materials; outside advertising agency fees for creating advertising programs; public relation activities; outside public relations agency fees; technology investments; digital marketing; and reimbursing us the costs of administering the Advertising Fund.
Additionally, we may use up to ten percent (10%) of the Advertising Fund to solicit new franchisees.
The Advertising Fund is not a trust or escrow account, and we have no fiduciary obligations regarding the Advertising Fund.
We cannot ensure that any individual franchisees will benefit directly or on a pro rata basis from the future placement of any such advertising in its local market.
We may spend in any fiscal year an amount greater or less than the aggregate contributions to the Advertising Fund in that year.
We will determine the methods of advertising, media employed, and scope, contents, terms and conditions of advertising, marketing, promotional and public relations campaigns, and programs.
Upon written request, we will provide you an annual unaudited statement of the receipts and disbursements of the Advertising Fund for the most recent calendar year.
Any end-of-year surpluses or shortages in the Advertising Fund in a given year will carry over to the next year.
- **7.2.
Local Advertising and Promotions**.
All advertising and promotions must conform with the Operations Manual, including the Brand Guidelines.
We may require you to use our advertising templates or materials in accord with our Operations Manual, including our Brand Guidelines, or as we otherwise approve in writing.
If you use or develop your own marketing materials for your Business, we, in our sole discretion, have the right to require you to remove any marketing materials or advertising that do not comply with the Operations Manual, Brand Guidelines or any laws.
Source: Item 23 — RECEIPT (FDD pages 54–177)
What This Means (2025 FDD)
According to the 2025 Christies International Real Estate FDD, Christies International Real Estate reserves the right to require franchisees to pay a monthly advertising fee, up to a maximum of three percent of gross revenue, for deposit into an advertising fund. As of the FDD's effective date, an advertising fund has not been established, and the company is not collecting an advertising fund fee. However, Christies International Real Estate may implement, begin collecting, and increase the advertising fund fee at any time with written notice to the franchisee. Any Christies International Real Estate businesses operated by Christies International Real Estate or its affiliates are not required to contribute to the Advertising Fund.
If Christies International Real Estate begins collecting the advertising fund fee, it will place all fees received into the Advertising Fund and manage the fund. The Advertising Fund will pay for expenses connected to the general promotion of the Marks and the System, including the development and operation of a call center, market research, customer retention, incentive programs, sales development programs, media planning and buying, creating and producing advertising materials, outside advertising agency and public relations agency fees, technology investments, and digital marketing. Christies International Real Estate may also use up to 10% of the Advertising Fund to solicit new franchisees.
The FDD states that the Advertising Fund is not a trust or escrow account, and Christies International Real Estate has no fiduciary obligations regarding the Advertising Fund. Christies International Real Estate cannot ensure that individual franchisees will benefit directly or on a pro rata basis from advertising in their local market. Christies International Real Estate will determine the methods of advertising, media employed, and scope, contents, terms, and conditions of advertising, marketing, promotional, and public relations campaigns and programs. Upon written request, Christies International Real Estate will provide an annual unaudited statement of the receipts and disbursements of the Advertising Fund for the most recent calendar year, and any end-of-year surpluses or shortages in the Advertising Fund will carry over to the next year.
All advertising and promotions, including local advertising and promotions, must conform with the Operations Manual, including the Brand Guidelines. Christies International Real Estate may require franchisees to use their advertising templates or materials. If a franchisee uses or develops their own marketing materials, Christies International Real Estate has the right to require the franchisee to remove any marketing materials or advertising that do not comply with the Operations Manual, Brand Guidelines, or any laws.