Hak Menjalankan Perniagaan Dan Kawalan Dalam Perniagaan Francais Di Malaysia

Abstract

Franchise business involves the granting of rights by the franchisor to the franchisee to duplicate the entire franchise system with payment of certain fees. Since the franchisee is duplicating the franchisor’s business system, the franchisor must grant the franchisee the right to operate business including the use of intellectual property. The franchisor also has the right to control the business to maintain quality and uniformity of the product or service. Nevertheless, how far have these two rights been implemented? The objective of this article is to discuss the right to operate and control in the franchise business in Malaysia including related discussions from the Islamic perspective. This qualitaive study employed the legal research approach supported by interviews using primary and secondary data. Primary data was obtained through legal documents such as acts, cases and interviews, while secondary data was obtained from books and journals from the Sultanah Bahiyah Library, Universiti Utara Malaysia. Both primary and secondary data were analyzed using analytical and critical methods while primary data from interviews were analyzed using thematic methods. This study could be a source of reference for policymakers, government agencies, the Malaysian Franchise Association, franchisors, franchisees, legal practitioners, and academia. Analysis of legal documents showed that these two rights have been expressly stated in the Franchise Act 1998 and represent key components of the definition of franchise under section 4. Findings from interviews with all informants comprising franchisors indicated their compliance with the requirements regarding granting business rights and use of intellectual property, including elements of control over the business of franchisees. Thus, they ındirectly complied with requirements of the Franchise Act 1998. In conclusion, the right to operate business and control must be included in a franchise agreement to safeguard both contracting parties.