Franchisees sometimes seek for information regarding potential back margins and remunerations granted by suppliers or services providers to franchisor non-disclosed to franchisees.
To the extent French procedural code ignores discovery proceedings, a way to get such information is opened by French procedural code (Article 145). One files an application for the court appointment of a bailiff and/or expert who will gather information, including accessing to IT systems, emails, saved documents, WhatsApp or text messages, owing to key words, of another party (before any claim on the merits and subject to a “legitimate reason”). The disclosure of the extracted evidence is subject to review by the judge.
Franchisees sometimes bring such action in order to have a detailed information of the back margins and services remuneration eventually received by the franchisor.
Paris Appeals Court (Sect. 1, Ch.2 , May 7, 2026, No. 25/20079) illustrates this issue. A legitimate reason is required: “a credible and plausible fact, not merely hypothetical, that has a useful connection to a potential future dispute whose subject matter and legal basis are sufficiently defined and whose resolution may depend on the requested investigative measure, provided that this measure does not unlawfully infringe upon the rights of others. It must be relevant and useful” (Art. 145 French Civil Procedure Code). When the agreements between the parties excluded any mandate from franchisees to franchisor to negotiate pricing on their behalf, the court turns down petition for a judicial expertise. The court emphasized the absence of “a legal obligation to inform the buyer, before the sale, of the final purchase price of the product, which, moreover, would be impossible in this case given the very nature of the payments made by the franchisor, which can only be calculated once the attached condition has been met” (number of products, purchase threshold or volume, sales volume level).
This is consistent with established reasoning. The Paris Appeals Court (Sect. 1 – Ch. 8, January 28, 2022) rejected franchisee’s claim for an expert appraisal of the franchisor’s sale prices contractually deemed taking into account immediate discounts and rebates, known discounts and rebates whose payment is deferred, and conditional discounts and rebates when the condition agreed upon between the franchisor and a supplier was met during the year, and finally, the remuneration for commercial services performed by the franchisee. In the absence of any evidence of non-compliance by the franchisor with its obligations when setting prices, there was no “legal basis for a lawsuit”. Taking a pragmatic approach, the Court also dismissed the claim, as “disproportionate to the volume of information to be processed, namely tens of thousands of products sold over a period” of several years.
Even in the case of a mandate to negotiate, in Advice No. 15-14, French Commission for the Evaluation of Commercial Practices upheld “the applicability of trade secrets to prohibit a franchisee from consulting documents relating to commercial negotiations conducted on its behalf by its franchisor with suppliers, and regarding the appropriation by a supplier of year-end rebates that should normally accrue exclusively to distributors.”
Therefore, there is no lack of transparency, but rather the application of contract law. The content of the franchise agreement is of the essence here and shall not contain powers to negotiate on behalf of the franchisees.
Link to the ruling: Paris Appeals Court (Sect. 1, Ch.2 , May 7, 2026, No. 25/20079)
Frédéric Fournier, IDI Country Expert for agency in France
