Who bears the expense of complying with governmental or quasi-governmental requirements for an Engel & Volkers franchise?
Engel_Volkers Franchise · 2025 FDDAnswer from 2025 FDD Document
26.11.3 Franchisee undertakes to operate its franchised Business in strict compliance with all applicable laws, rules and regulations of all governmental authorities; comply with all applicable wage, hour and other laws and regulations; prepare and file all necessary tax returns; pay all taxes imposed on Franchisee related to the Residential Real Estate Brokerage; obtain and keep in good standing all necessary licenses, permits and other required forms of governmental approval required for Franchisee to offer and sell the services and products which now or in the future are part of the ENGEL & VÖLKERS System; pay or cause to be paid prior to delinquency all taxes, fines, fees and/or assessments arising out of or in connection with the operation of its franchised Business; and, otherwise be responsible for compliance, at Franchisee's sole expense, with all governmental or quasigovernmental requirements, restrictions, duties and responsibilities.
26.11.4 Franchisee shall notify Franchisor in writing within five (5) days of the commencement of any action, suit, or proceeding, and of the issuance of any order, writ, injunction, award, or decree of any court, agency, or other governmental instrumentality, which may adversely affect the operation or financial condition of Franchisee.
26.11.5 Franchisee and its Principals understand the requirements of, and will abide by, all United States government economic sanctions requirements throughout the Term.
Source: Item 22 — CONTRACTS (FDD page 88)
What This Means (2025 FDD)
According to Engel & Volkers' 2025 Franchise Disclosure Document, the franchisee is solely responsible for all expenses related to complying with governmental or quasi-governmental requirements, restrictions, duties, and responsibilities. This includes adhering to all applicable laws, rules, and regulations from governmental authorities at the franchisee's own expense.
This means that an Engel & Volkers franchisee must cover all costs associated with running their business in accordance with local, state, and federal laws. These costs can include license and permit fees, taxes, and any assessments related to the operation of the franchised business. The franchisee is expected to obtain and maintain all necessary licenses, permits, and other required forms of governmental approval needed to offer and sell Engel & Volkers' services and products.
Furthermore, the franchisee is obligated to notify Engel & Volkers in writing within five days of any legal actions, suits, proceedings, orders, or decrees from any court, agency, or governmental body that could negatively impact the operation or financial condition of the franchise. This ensures that Engel & Volkers is kept informed of any potential legal or regulatory issues that could affect the franchise.
In addition, the franchisee and its principals must comply with all United States government economic sanctions requirements throughout the term of the franchise agreement. They must also ensure that neither the franchisee nor any related parties are listed on the U.S. Treasury's Office of Foreign Assets Control (OFAC) list or subject to trade restrictions under United States law. This highlights the franchisee's responsibility to adhere to all legal and regulatory requirements at their own expense.