Who is responsible for obtaining government approvals and licenses to commence operations of the Engel & Volkers Residential Real Estate Brokerage?
Engel_Volkers Franchise · 2025 FDDAnswer from 2025 FDD Document
of the Residential Real Estate Brokerage. As between the parties hereto, it will be Franchisee's responsibility to promptly investigate the need for, seek and obtain all government and quasi-governmental approvals, consents and licenses required to commence operations of the Residential Real Estate Brokerage. Franchisor makes no representation or warranty that Franchisee will be able to do so.
- 26.11.2 Without limiting the generality of the requirements of this Section, Franchisee agrees to strictly comply with all applicable laws, rules or regulations of any
nation, state, or other political/governmental subdivision governing the franchised Business.
- 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.
Source: Item 22 — CONTRACTS (FDD page 88)
What This Means (2025 FDD)
According to Engel & Volkers' 2025 Franchise Disclosure Document, the franchisee is responsible for obtaining all necessary licenses, permits, and governmental approvals required to operate their Engel & Volkers Residential Real Estate Brokerage. This includes ensuring that all licenses and permits remain in good standing. The franchisee must also comply with all applicable laws, rules, and regulations from all governmental authorities, including wage and hour laws.
This means that prospective Engel & Volkers franchisees must handle all aspects of regulatory compliance related to their business. This includes understanding and adhering to local, state, and federal laws, as well as securing and maintaining all required licenses and permits. Failing to comply with these requirements or keep licenses current could lead to penalties, legal issues, or even termination of the franchise agreement.
Furthermore, the franchisee is obligated to inform Engel & Volkers in writing within five days of any legal actions, suits, proceedings, or governmental orders that could negatively impact the operation or financial condition of the franchise. This ensures that Engel & Volkers is kept informed of any potential issues that could affect the brand or the franchisee's ability to operate the business. Franchisees must also provide Engel & Volkers with a current copy of their real estate broker license annually, no later than January 31st.
This level of responsibility is typical in franchising, where franchisees are generally considered independent business owners responsible for their own compliance. However, prospective franchisees should carefully review all legal and regulatory requirements in their area and consult with legal and business advisors to ensure they fully understand their obligations before signing the franchise agreement.