Franchise in LAOS

Bud & Prairie are profusely expert and experienced to advise and assist you with franchising related matters.

Franchising in Laos is a developing area, with increasing interest as the country’s economy grows and foreign investment increases. The framework for franchising is guided by general commercial laws and regulations, but specific franchise regulations are not yet fully developed. For your information, Bud & Prairie provides below an overview of the key aspects of franchising in Laos:

1. Legal Framework

1.1 General Commercial Laws

  • Law on Business Organizations (2005): Governs business operations, including aspects related to franchising.
  • Law on Investment (2014): Regulates foreign and domestic investment, including franchise businesses.

1.2 Franchise Agreements

  • Contract Law: Franchise agreements in Laos are subject to general contract law principles, which require that contracts be legally binding, clear, and enforceable.

2. Franchise Agreement

2.1 Key Components

  • Franchise Disclosure Document (FDD): While Laos does not have specific franchise disclosure laws, a comprehensive FDD is crucial for transparency and to ensure that both parties understand their rights and obligations. This document typically includes:
    • Franchisee’s rights and obligations.
    • Franchise fee structure.
    • Duration of the franchise agreement.
    • Intellectual property rights and usage.
    • Training and support provided by the franchisor.
    • Termination and renewal conditions.
  • Franchise Agreement: The agreement should detail:
    • Terms of the franchise relationship.
    • Responsibilities of both parties.
    • Intellectual property rights and restrictions.
    • Performance standards and quality control.
    • Dispute resolution mechanisms.

2.2 Legal Considerations

  • Compliance: Ensure that the franchise agreement complies with Lao laws, including business registration, taxation, and employment regulations.
  • Registration: While there is no specific franchise registration requirement, businesses must comply with general business registration and licensing requirements.

3. Franchise Registration and Licensing

3.1 Business Registration

  • Business License: Both franchisors and franchisees must obtain the necessary business licenses from the Ministry of Industry and Commerce (MOIC) or relevant local authorities.
  • Tax Registration: Businesses must register for tax purposes and comply with Lao tax regulations.

3.2 Foreign Investment

  • Foreign Investment Approval: Foreign franchisors wishing to establish a presence in Laos must obtain approval from the Lao government’s foreign investment authorities, including the Lao Foreign Investment Promotion Agency (FIPA).

4. Intellectual Property

4.1 Trademark Registration

  • Trademark Protection: Franchisors should register their trademarks with the Department of Intellectual Property (DIP) under the Ministry of Science and Technology (MOST) to protect their brand in Laos.

4.2 Enforcement

  • Trademark Enforcement: Ensure that trademark rights are enforced to prevent unauthorized use or infringement. This may involve administrative and judicial measures, as well as customs enforcement.

5. Operational Considerations

5.1 Training and Support

  • Training Programs: Provide comprehensive training to franchisees to ensure they meet the franchisor’s operational standards and quality control measures.
  • Ongoing Support: Offer ongoing support and resources to franchisees to help them operate successfully.

5.2 Quality Control

  • Standards: Implement and enforce quality control measures to maintain consistency and uphold the franchise’s brand reputation.

6. Dispute Resolution

6.1 Mechanisms

  • Negotiation and Mediation: Initially, disputes should be addressed through negotiation and mediation between the franchisor and franchisee.
  • Arbitration and Litigation: If disputes cannot be resolved amicably, arbitration or litigation may be pursued. The franchise agreement should specify the preferred method of dispute resolution and the applicable jurisdiction.

7. Challenges and Opportunities

7.1 Challenges

  • Regulatory Environment: The regulatory environment for franchising is still developing, which can create uncertainties for franchisors and franchisees.
  • Market Knowledge: Limited local knowledge and understanding of franchising can pose challenges for foreign franchisors entering the Lao market.

7.2 Opportunities

  • Economic Growth: Laos’s growing economy and increasing consumer spending present opportunities for franchise expansion.
  • Market Potential: There is potential for franchising in various sectors, including food and beverage, retail, and services.

8. Best Practices for Franchising in Laos

8.1 Due Diligence

  • Market Research: Conduct thorough market research to understand local conditions, consumer preferences, and competitive dynamics.
  • Legal Advice: Seek legal advice from local experts to ensure compliance with Lao laws and regulations and to navigate the regulatory environment effectively.

8.2 Local Partnerships

  • Local Expertise: Partner with local business experts or consultants who have a deep understanding of the Lao market and regulatory landscape.

8.3 Compliance and Adaptation

  • Adaptation: Adapt franchise models to fit local market conditions and regulatory requirements while maintaining core brand values and operational standards.

Franchising in Laos offers opportunities for growth and expansion, supported by the country’s developing economy and increasing foreign investment. While specific franchise regulations are still evolving, understanding the legal framework, preparing comprehensive franchise agreements, and navigating regulatory requirements are key to successful franchising in Laos. By conducting due diligence, seeking local expertise, and adapting to market conditions, franchisors and franchisees can effectively establish and manage franchise operations in Laos.

 

For further information, please do not hesitate to contact us at [email protected].

Patent Search

1. Patentability Search
Patentability search is also known as a novelty search, which helps identify whether or not an idea is novel and involves an inventive step (nonobvious). The most complete searches include all types of prior art to give an inventor or organization a comprehensive look at the technology landscape. A patentability search should be completed during the ideation phase, as well as prior to disclosure.
A patentability search is conducted by examining published patents that relate to your own invention to figure out whether your idea has already been patented. You can also see similar inventions, allowing you to improve and refine your own invention without infringing on someone else’s patent. And you can do all this before you have spent many hours and thousands of dollars on an idea that you can’t patent.
2. Freedom to Operate Search
A freedom to operate search (often abbreviated as FTO) determines how similar your product is to existing patents, and therefore how likely you are to infringe on a patent by making and marketing your invention. You may also see this type of search called a patent infringement search or right-to-use search.
Completing an FTO search early in the innovation cycle helps R&D teams design around existing patents. Later on, the results of the search can identify whether you may need to license other patents to bring your product to market.
3. State of the Art Search
Completing a state of the art search (also known as a product clearance or patent landscape search) allows you to examine the literature related to a specific industry, rather than around a certain technology, which may be applicable across industries. Using a state of the art search helps businesses find competitors and existing products within their field. These insights allow researchers, engineers, and leaders to make strategic decisions at any point within the innovation cycle.
4. Invalidity Search
To assess the strength of a specific patent, companies will use an invalidity search. This is also called a validity search. The results of this search determine whether or not the patent holder can claim infringement. They can also be used to decide licensing fees or value. If an invalidity search finds evidence in the form of existing, yet undiscovered, prior art, the patent should not have been granted and is unenforceable. This type of patent search is completed after a patent is granted.
5. Evidence of Use Search
Some organizations actively seek out products that infringe on their patent rights. This type of search is called an evidence of use search. To find these products, an organization or inventor will review similar patents and look for evidence the patent is utilized in a way that infringes on the searcher’s rights. Evidence of use searches happen after a patent is granted and as it matures.
6. Search Database
There are several databases in which patent searching may be done. Many databases such as USPTO, Google Patents, Free Patents Online, esp@cenet etc. are freely available, while other databases such as ThomsonInnovation, Orbit, Patbase etc. are available on the basis of a subscription. Each of these databases varies in terms of at least one of the following: Data Coverage, Search Engine, Interface.
• Google Patent Search Database. The Google search engine has revolutionized how people use the Internet. …;
• Patentscope. Patentscope is a free database put out by the World Intellectual Property Organization (WIPO)…;
• The USPTO Database…;
• Espace European Database…
The following are some of the largest and most popular patent office databases.
• Canadian Patents Database (CIPO)…;
• DEPATISnet (DPMA)…;
• Espacenet (EPO)…;
• JP-PlatPat (JPO)…;
• PatentScope (WIPO)…;
• U.S. Patent Assignment Database (USPTO)…;
• U.S. Patent Center (USPTO)…;
• U.S. Patent Databases (USPTO).
However, an inventor or applicant can also conduct their own patent search. The inventor or applicant has the advantage of often being more familiar with the art to which the invention relates, including having an understanding of the common knowledge held by persons skilled in the art and the relevant terminology.

Patent drafting is a part of how to patent an idea and is the process of writing the patent description and claims. It is at the core of every patent application. When the patent is issued or allowed, the draft serves as the specification part of the document. The patent applicants have to be more aware that depending on how well the complete specification is drafted and how precisely and correctly the claims describe the invention or the imaginary ‘boundary” is set, the easier it will be to defend it against third parties.
Normally, a patent specification covers the following parts:
• Field of Invention: It generally discloses a field to which the invention generally relates.
• Background: It discloses existing devices or methods related to the field of invention, broadly known as prior art. Background generally discloses prior art and limitations or disadvantages associated with the prior art.
• Summary of Invention: It (i) discloses the objectives of the invention, (ii) generally lists distinguishing features and advantages of the invention for which protection is being sought, (iii) summarizes the main features of the invention to be claimed, and (iv) also includes a broader explanation of the invention and briefly mentions the solution provided by the invention.
• Brief Description of Drawings (if any): If the invention includes any drawings, then this section includes a description of the drawing briefly such that a reader can get an overview of what could be disclosed by the drawing. The drawings are to be prepared in separate sheets as per different guidelines of different jurisdictions. The drawing sheets are filed with the patent specification.
• Detailed Description of Invention: It explains the different features of the invention in detail. Detailed description should be written such that a skilled person in the art can understand the invention solely after referring to this description. All claimed features and their interconnections, if any, need to be explained. In other words, all the claimed features need to be well supported in the detailed description.
• Claim(s): Claims are the most important part of a patent draft. Claims decide the scope of the protection which would be awarded to the inventor when the patent is granted. Claims are broadly divided into two categories, independent claim, and dependent claim. Every patent draft or patent application must contain at least one independent claim. Claims tend to change in course of the examination (narrower in most cases than the originally filed claims.
• Abstract: It is a technical summary of the invention. Generally, the Abstract should disclose the invention sufficiently to enable a person to perform a search for anticipation. The publication of a patent application includes publication of the abstract and representative drawing, if any.
• Drawings: Not all specifications have drawings. Such drawings, if any, would be prepared and submitted to the Patent Office in separate sheets. Different jurisdictions have different rules for allowable drawing sheets.

The significance of patent drafting and its impact on the patent protection should be conveyed to the SMEs, start-ups and inventors along with the information on importance of the patent protection in general. They should be informed that in case of any opposition or challenging the validity of their patent by a third party, a poorly drafted patent will be easily invalidated.

A patent is a right granted to an individual or enterprise by the government which excludes others from making, using, selling, or importing the patented product or process without prior approval. Patent filing or patent registration is the first step an inventor takes to protect his/her invention from being misused.
Under Vietnam legislation, there exists three kinds of patents, i.e. Invention Patent, Utility Solution Patent and Design Patent. Patents may be granted to anyone who invents or discovers any new and useful process, machine, article of manufacture, or compositions of matters, or any new useful improvement thereof. Patent filing is essential for establishing definitive, enforceable IP rights for your inventions, covering all relevant jurisdictions. A patent registers your invention and lets you take legal action against anyone who makes, uses, sells or imports your invention without your permission.
You should be aware of the examination process conducted by the Intellectual Property Office of Vietnam (IP Vietnam). This process begins with the filing of a patent application with IP Vietnam and completed by granting a patent (if the invention meets the protection criteria) or rejection/refusal (if the invention does not the protection criteria).
We can help you with such a patent prosecution by drafting a patent specification or translating such specification into local language, filing, and negotiating with IP Vietnam’s examiners regarding the patentability of the invention in order to obtain patent protection and rights for an invention.

An opposition proceeding is an administrative process available under the patent law of many jurisdictions which allows third parties to formally challenge the validity of a pending patent application (pre-grant opposition), of a granted patent (post-grant opposition).
Once the patent application is published, an opposition may be filed within a certain time period prescribed under the applicable law. The opponent shall state the grounds for opposition and submit any evidence. If no opposition is filed during that period, the substantive examination will be carried out.
In the meantime, an applicant for a patent, any of whose claims has been twice rejected, may appeal from the decision of examiners to IP Vietnam, having once paid the fee for such appeal.

LET'S GET STARTED

Please fill in and submit the form for our assistance.

    Key Contact