The Commission for the Supervision of Business Competition launched Thursday a guideline on franchise practices as stipulated in the law on monopoly.
Implementation of article 50 of Law No. 5/1999 on monopoly, which regulates the exception of franchise agreement from the law, is further explained in the guideline officiated in March.
“It basically says the exception can not be applied unconditionally,” Director of Communication for the commission, A. Junaidi, said on Thursday.
The guideline includes the regulation on resale price maintenance. An agreement on resale price is usually made between franchiser and franchisee. However, in the guideline, the commission says that the franchisee has the freedom to set the resale price on products or services purchased from the franchiser.
However, franchisers are allowed to make a recommendation on the resale price.
The requirement to buy materials, products and/or services from the franchiser is also stipulated in the guideline. The commission says franchisers can not prohibit the franchisees from buying materials, products and/or services from other parties as long as they have the required quality. (adh)