What actions are Engel & Volkers franchisees prohibited from taking with confidential information?
Engel_Volkers Franchise · 2025 FDDAnswer from 2025 FDD Document
Franchisee hereby agrees to treat all business and operational information received by Franchisee, either directly or indirectly, from Franchisor and with respect to the ENGEL & VÖLKERS System, including that contained in the Integrated Product Suite to be provided pursuant to Section 7, and from the knowhow conveyed to Franchisee in the System Documentation (hereinafter called the "Confidential Information"), in strict confidence and not to divulge it to any third party. Franchisee agrees that, use of Confidential Information in connection with any generative, artificial intelligence tool or program is considered disclosure of such Confidential Information to a third party and constitutes a breach of this Section. However, Franchisee is permitted to use any information (a) which is, at the time of the disclosure to Franchisee, available to the general public; (b) which becomes available at a later date to the general public through no fault of Franchisee; or (c) which Franchisee can demonstrate was in its possession, through valid means, before receipt. Access to this Confidential Information by Franchisee's staff members and independent Sales Advisors must be restricted to the necessary minimum (need-to-know) and may only be used for purposes of performing under this Agreement. During the Term or afterwards, Franchisee agrees not use any
Confidential Information, directly or indirectly, in any other business or in any other manner or obtain any benefit therefrom or disclose to any person any Confidential Information, unless such disclosure is specifically approved in writing by Franchisor before the use or disclosure. Franchisee further agrees to impose the foregoing confidentiality undertaking on its shareholders, partners, members, officers, directors, managers, staff members and Sales Advisors, by having such persons execute Franchisor's form of Confidentiality Agreement and Covenant Not to Compete.
Source: Item 22 — CONTRACTS (FDD page 88)
What This Means (2025 FDD)
According to Engel & Volkers' 2025 Franchise Disclosure Document, franchisees must maintain the confidentiality of all business and operational information received from Engel & Volkers. Franchisees are prohibited from divulging confidential information to any third party. A critical restriction is that franchisees cannot use confidential information in connection with any generative, artificial intelligence tool or program, as this is considered a disclosure to a third party and a breach of the agreement. Franchisees can use information that was already publicly available at the time of disclosure, becomes publicly available later through no fault of their own, or that they possessed before receiving it from Engel & Volkers.
Access to confidential information by the franchisee's staff and sales advisors must be limited to a 'need-to-know' basis and used only for performing under the Franchise Agreement. Franchisees must ensure their personnel understand their obligation to maintain confidentiality. During and after the term of the agreement, franchisees cannot use confidential information in any other business or manner, nor can they disclose it to anyone unless Engel & Volkers provides written approval beforehand.
To ensure compliance, Engel & Volkers requires franchisees to impose these confidentiality obligations on their shareholders, partners, members, officers, directors, managers, staff, and sales advisors. This is done by having these individuals execute Engel & Volkers' standard Confidentiality Agreement and Covenant Not to Compete. This multifaceted approach underscores the importance Engel & Volkers places on protecting its proprietary information and maintaining a competitive edge.