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Alex J.
Alex J., Solicitor
Category: Law
Satisfied Customers: 3653
Experience:  Solicitors 2 years plus PQE
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Hello, I recently set up a UK company with the intention

Resolved Question:

Hello,

I recently set up a UK company with the intention of retailing Caribbean goods and would like to have the business opportunity adopted and implemented by individuals in markets without Franchising. This seeing as The businesses currently online.

Is there a way to expand/grow the business with people interested in opening opening a stall at a market for example, selling our products without being classified as a Fracnchise, what criteria would have to be missing for this strategy not to be considered Franchising.

We would like the operators to sell our products exclusively, and perhaps have the stalls set up in keeping with the brand and pay a one time set up fee / monthly advertising fee
Submitted: 3 years ago.
Category: Law
Expert:  Alex J. replied 3 years ago.
Hi,

Thank you for your question and welcome.

My name is XXXXX XXXXX I will assist you.

I am a company and commercial law expert.

This does not need to be a Franchise you can set up a distribution network whereby you appoint your distributors to certain territories and give them the price details, and how they must market the goods. This wont be a Franchise as you wont have a some guaranteed income it will be purely on the ability of your distributors to sell. Also the distributors will be responsible for any local laws of retail.

Alternatively you could appoint commercial sales agents to sell the goods for your to distributors for example supermarket chains. The down side of this is you will have to pay them on commission and you will be subject to the Commercial Agents Regulations 1993.

I look forward to hearing from you.

Kind regards

AJ
Customer: replied 3 years ago.

Thanks Aj I'm not sure I understand ,


 


How I would the appointment of distributors to certain territories work, would this mean hiring them as employees or rather would they be independent individuals / Sole trader consultants and if so how would this differ from them being agents out side of them being responsible for the retail laws.


 


Also with regards XXXXX XXXXX distribution recommendation would they be able to set up under The Barbados Shop brand if so how would they do this as if they are sole proprietor distributors then they won't be able to trade under the same name The Barbados Shop in various territories.


 


Also would it be illegal to charge someone interested in being a distributors a one time registration/ set up fee or would this be looking more like a franchise again?


 

Expert:  Alex J. replied 3 years ago.
Hi

Thank you.

Distributors can work as separate legal entities. You would not necessarily have to have the distributors as employees.

They could use your branding subject to your conditions of sale which you could standardise across all the territories.

It would not be illegal to charge a distributor a registration. It would not make it a franchise.

Kind regards

AJ
Customer: replied 3 years ago.

Thank you for your reply,

 

By separate legal entity would this mean that the Distributor would need to be a limited company, in order for the branding name for example, setting up at physical locations for sale to be used repetitively.

 

 

Or if the distributors simply register as a sole trader with their own names in the UK, would they then be able to use the brand name while trading without breaking the law.

 

The reason I'm being repetitive is because i read on one of the government sites that sole traders would have to use a unique name when registering and not one that is in use already.

 

Further since the company would be appointing directors, the company would be left with the brand logo / name trade marks. Would it then need to set up or adjusted as a holding company to reflect this in the UK.

 

Would it make sense if the brand name and logo will be used in other countries for the company to be set up outside of the UK holding this intellectual property. Or would the company still need to be a UK company holding these trade marks for them to be prohibited from being misused in the UK by un authorised persons or businesses

 

 

Expert:  Alex J. replied 3 years ago.
Hi

Thank you.

I have limited Internet access at the moment.

I will review this and respond by tomorrow evening at the latest.

Kind regards

AJ
Customer: replied 3 years ago.

ok thank you , will look forward to your response

Expert:  Alex J. replied 3 years ago.
Hi,

Thank you.

1. The distributor would not need to be a limited company per say, but it is likely any distributor would insist upon this;

2. The would be able to use the brand anime under licence from you, but as long as they made it clear they were a distributor for your company.

3. They could use the brand name for marketing purpose, but they could not claim to be trading as part of your company. That is the distinction, unless they did actually have the power to bind your company which they wont as they will only be distributors;

4. There is no legal distinction between a holding company and non holding company. A holding company is one that just holds an asset and does not trade;

5. This does not really matter it is only what is most advantageous for you in terms of tax and ease of trading. There is something called the Madrid Protocol that allows you to make multiple trade mark registrations in various countries.

Kind regards

AJ
Customer: replied 3 years ago.

Thank you AJ, I just want to make absolute clear about distribution at physical locations.


 


 


So if they set up at a markets and the stalls sign read "The AtoZ shop" would that be considered being claimed to be trading as part of the company.


 


or would that sign need to read "AtoZ shop" distributors.


 


Also, would you happen to know a reasonable fee( affordable) Attorney that would be able to assist in drawing up such a contract for us?


 


 


 

Expert:  Alex J. replied 3 years ago.
Hi,

Thank you.

They should trade under there own name with a sign saying, "An authorized distributor of AtoZ Limited".

Kind regards

AJ
Alex J. and 2 other Law Specialists are ready to help you
Customer: replied 3 years ago.

What if the brand logo isn't registerable , owing to it describing geographically where the goods are originating is there any other form of protection than can be sought for the purpose of it being used under license?

Expert:  Alex J. replied 3 years ago.
Hi,

Thank you.

Even if it is not registerable, it is still your good will and branding which is an asset and can be licensed.

Kind regards

AJ
Customer: replied 3 years ago.

Thank you Aj,


 


Regards


Miasha

Expert:  Alex J. replied 3 years ago.
Hi,

No problem.

I wish you the best of luck. Please do not hesitate to contact me with any follow up points.

Any feedback is gratefully received.

Kind regards

AJ