What is the role of System Documentation in the operation of an Engel & Volkers franchised business by a proposed assignee?
Engel_Volkers Franchise · 2025 FDDAnswer from 2025 FDD Document
11. System Documentation
- 11.1 Compliance with System Documentation: Franchisor has summarized and documented details of the ENGEL & VÖLKERS System and its application in the System Documentation. In order to preserve the good reputation of the ENGEL & VÖLKERS System and ensure maintenance of uniform standards, Franchisee hereby agrees to operate its Residential Real Estate Brokerage in accordance with the mandatory instructions contained in the System Documentation, as it may be amended or modified from time to time. Notwithstanding the foregoing, nothing in the System Documentation shall give Franchisor the right to use technology or tools that the Franchisee is required to use pursuant to the System Documentation to direct or assert control over Franchisee's staff members' or Sales Advisors working conditions, except to the extent the control relates to Franchisor's legitimate interest in protecting the quality of the ENGEL & VÖLKERS System (brand) or the products or services offered at the Residential Real Estate Brokerage.
- 11.2 Validity of System Documentation: Franchisor will provide Franchisee with access to the System Documentation. The System Documentation may be available through a secure Internet link from time to time. Franchisor may communicate to Franchisee mandatory and suggested standards, methods, procedures and specifications applicable to the ENGEL & VÖLKERS System and information relative to other obligations of Franchisee under this Agreement and to the operation of the ENGEL & VÖLKERS System. Such communications may be made through the System Documentation or written or electronic media. Franchisee shall follow the instructions contained in the most recent versions of the System Documentation. In case of any doubt, the master version of the System Documentation kept at the Franchisor's head office shall take precedence, control and
prevail. The System Documentation may be modified by Franchisor in its sole business judgment at any time.
11.3 Confidentiality, Copyright, etc.: Franchisee hereby agrees to treat the System Documentation as strictly confidential and not to allow any unauthorized persons to read or use them or to have access to them. The System Documentation and the copyright on them remain the sole and exclusive property of Franchisor. Franchisee may only use the System Documentation during the Term and may only use them for purposes of operating its business in compliance with the ENGEL & VÖLKERS System. The System Documentation at all times shall remain the exclusive property of Franchisor, and Franchisee shall return all copies of the System Documentation, in whatever format, which Franchisee may have made or obtained to Franchisor promptly upon request by Franchisor and, in any event, upon termination or expiration of this Agreement for any reason whatsoever. Franchisee shall not at any time copy, duplicate, record or otherwise reproduce or transcribe any of the System Documentation or any of the forms supplied by Franchisor hereunder without Franchisor's prior written consent. If the System Documentation is supplied electronically, Franchisee may print one copy for its personal use in the operation of the Residential Real Estate Brokerage.
Source: Item 22 — CONTRACTS (FDD page 88)
What This Means (2025 FDD)
According to Engel & Volkers' 2025 Franchise Disclosure Document, the System Documentation contains the details of the Engel & Volkers System and its application. To maintain the brand's reputation and uniform standards, a franchisee must operate their residential real estate brokerage according to the mandatory instructions within this documentation, which may be updated. However, the System Documentation does not allow Engel & Volkers to control the working conditions of the franchisee's staff or Sales Advisors, except to protect the quality of the Engel & Volkers brand or the products/services offered.
Engel & Volkers will provide access to the System Documentation, potentially through a secure internet link. They may also communicate mandatory and suggested standards, methods, procedures, and specifications through the System Documentation or other written/electronic media. Franchisees must follow the most recent version of the System Documentation, with the master version at Engel & Volkers' head office taking precedence in case of doubt. Engel & Volkers can modify the System Documentation at any time based on their business judgment.
The franchisee must treat the System Documentation as strictly confidential, preventing unauthorized access or use. The System Documentation and its copyright remain the exclusive property of Engel & Volkers. Franchisees can only use the System Documentation during the term of the agreement and for operating their business in compliance with the Engel & Volkers System. Upon request or termination of the agreement, all copies of the System Documentation must be returned to Engel & Volkers. Franchisees cannot copy, duplicate, or reproduce the System Documentation without prior written consent, although one printed copy is allowed for personal use in operating the brokerage if the documentation is supplied electronically.
In the context of a proposed assignee, the FDD states that the proposed assignee must apply to Engel & Volkers for acceptance as a franchisee and demonstrate that they possess the skills, qualifications, financial condition, background, history, reputation, economic resources, education, managerial and business experience, moral character, credit rating and ability to assume the duties and obligations under the Franchise Agreement. This would include the ability to comply with the System Documentation.