What brand standards must the proposed Engel & Volkers assignee follow?
Engel_Volkers Franchise · 2025 FDDAnswer from 2025 FDD Document
If Franchisor does not elect to exercise its right of first refusal (as provided in Section 22.5 below), then Franchisor will not unreasonably withhold consent to Franchisee's sale, transfer or assignment of any interest in Franchisee (if Franchisee is a business entity), the
franchise conveyed by this Agreement and Franchisee's right to use the ENGEL & VÖLKERS System, or any interest in any of these, to a third party. Franchisee agrees that it will not be unreasonable for Franchisor to impose, among other requirements, the following conditions to granting consent to Franchisee's proposed sale, assignment or transfer of any of the foregoing:
- 22.3.1 That the proposed assignee (meaning individual or business entity which, after the proposed assignment, will be the franchisee under this Agreement or under any successor/renewal agreement) applies to Franchisor for acceptance as a franchisee and demonstrates to Franchisor's satisfaction that the proposed assignee (and, if it is a business entity, each and every Principal owner and guarantor of the proposed assignee) possesses the skills, qualifications, financial condition, background and history, reputation, economic resources, education, managerial and business experience, moral character, credit rating and ability to assume the duties and obligations under this Agreement or any successor agreement.
Franchisee must pay the costs of any investigation required to be conducted by Franchisor.
Source: Item 22 — CONTRACTS (FDD page 88)
What This Means (2025 FDD)
According to Engel & Volkers' 2025 Franchise Disclosure Document, a proposed assignee—the individual or entity taking over the franchise—must meet several brand standards to be approved by Engel & Volkers. The assignee must apply for acceptance as a franchisee and demonstrate that they possess the necessary skills, qualifications, financial condition, background, history, reputation, economic resources, education, managerial and business experience, moral character, credit rating, and ability to fulfill the obligations outlined in the Franchise Agreement. Engel & Volkers requires this to ensure that anyone taking over a franchise can maintain the brand's standards and reputation.
Engel & Volkers also requires the franchisee to cover the costs of any investigation the franchisor deems necessary to conduct. This investigation likely involves verifying the information provided by the proposed assignee and assessing their suitability as a franchisee. This requirement ensures that Engel & Volkers can thoroughly vet potential assignees without incurring additional expenses.
These conditions are typical in franchise agreements, as franchisors need to protect their brand and ensure that all franchisees meet certain standards. By imposing these requirements, Engel & Volkers aims to maintain consistency and quality across its franchise network, which ultimately benefits both the franchisor and the franchisees.