What is the consequence if an Engel & Volkers franchisee engages in a business or advertising practice that injures the Franchisor's business?
Engel_Volkers Franchise · 2025 FDDAnswer from 2025 FDD Document
Franchisee agrees to refrain from any business or advertising practice which might injure Franchisor's business or the goodwill associated with the ENGEL & VÖLKERS System or Trademarks.
Franchisor shall be entitled to set requirements and restrictions on advertising, promotion and other activities that it determines, in its sole discretion, negatively impacts the business
of one or more other franchisees or that is specifically targeted or directed towards the protected areas of one or more other franchisees. Such requirements and restrictions are intended to balance the ability of franchisees to freely compete in the marketplace and the right of a franchisee to operate within its protected area without undue interference from other franchisees, and Franchisor shall have full discretion in its determination of such balance. Franchisee agrees to comply with all such requirements and restrictions.
Source: Item 22 — CONTRACTS (FDD page 88)
What This Means (2025 FDD)
According to Engel & Volkers' 2025 Franchise Disclosure Document, a franchisee must refrain from any business or advertising practice that might harm Engel & Volkers' business or the goodwill associated with the Engel & Volkers system or trademarks. If a franchisee violates this agreement, Engel & Volkers is entitled to set requirements and restrictions on advertising, promotion, and other activities that it determines, in its sole discretion, negatively impacts the business of one or more other franchisees or that is specifically targeted or directed towards the protected areas of one or more other franchisees. Franchisees must comply with all such requirements and restrictions.
Additionally, the franchisee is obligated to defend, reimburse, and hold harmless Engel & Volkers and its affiliates against all claims, losses, liabilities, and costs incurred due to actions or omissions committed by the franchisee or its affiliates, employees, contractors, or sales advisors in connection with the operation of the Engel & Volkers Residential Real Estate Brokerage. This includes any claims arising from the franchisee's unauthorized use of trademarks or violation of applicable laws.
Furthermore, engaging in any act or practice that subjects the franchisee and/or Engel & Volkers to widespread publicity, ridicule, or derision can result in a default of the agreement. A breach of advertising standards, including corporate or brand identity, that is not cured within three days following written notice from Engel & Volkers, can also lead to default. Except as specifically provided elsewhere in the Agreement, Franchisee will have thirty (30) calendar days following Franchisor's delivery of written notice to Franchisee to cure any default under this Agreement and provide Franchisor with evidence that Franchisee has done so. If the franchisee fails to cure the default within the specified time, the agreement will terminate immediately upon expiration of the thirty (30) day period, unless Engel & Volkers agrees otherwise in writing.