Advice on franchise agreements and on disputes with the franchisor.
We act for franchisors and for franchisees alike.
Come to us before you sign, and before you give notice to terminate,
and there are more routes still open to you.
Even at the stage of “nothing has blown up yet”, please feel free to consult us.
What you can do, and what is urgent, changes with the stage.
We read the agreement, and the document the franchisor hands you, together with you. This is the stage for checking how the royalty is worked out, how long the term runs, and on what terms you may leave early. Before you sign is when the terms are easiest to move.
This is the stage of doubts over the suppliers the franchisor requires you to use, limits on discounting, or extra costs passed to you. We hold the agreement up against how things actually run, and set out the points you can raise with the franchisor.
Here the questions are early termination, the penalty, and the non-compete after you leave (the promise not to run the same kind of business). Working from the clauses and the history, we look at how much of it you actually have to pay.
If you cannot tell which one you are in, we will hear you out at the initial consultation first, then advise.
For each of the situations we are asked about most, here is the law behind it and how it is approached.
A franchise that lets its members use a trademark or trade name and takes a franchise fee or a deposit from them is what the law calls a “specified chain business”. A franchisor of that kind must, before the agreement is entered into, hand over and explain a document setting out certain matters (Article 11 of the Act on the Promotion of Small and Medium-sized Retail Business). The franchise fee and deposit, the terms on which goods are sold, the management guidance, the trademark you are licensed to use, and the term together with the conditions for renewal and termination are all covered. Some lines of business fall outside that Act. Even then, a franchisor is expected to disclose enough information — that comes from the Japan Fair Trade Commission’s “Guidelines Concerning the Franchise System under the Antimonopoly Act” (the Franchise Guidelines).
While you are being encouraged to join, a franchisor may put forward sales projections resting on little. Conduct that misleads you into thinking the deal is far better than it is may amount to “deceptive customer inducement” (Article 19 of the Antimonopoly Act, and Item 8 of the Unfair Trade Practices [General Designation]). That is the approach set out in the Japan Fair Trade Commission’s Franchise Guidelines. Depending on what was said and on the material handed over, a claim for damages against the franchisor may be worth considering (Articles 709 and 415 of the Civil Code). Where it comes out turns on what you were told, and how, at the time you were being signed up. Please keep the material and the emails from then.
A penalty written into the agreement is presumed to be an amount of damages fixed in advance (Article 420(3) of the Civil Code). Where the figure is strikingly high, however, to the point that the franchisee cannot in practice leave at all, it may be void as contrary to public policy (Article 90 of the Civil Code). Where a franchisor uses its stronger position in the dealings to impose an unjustified disadvantage, that can also raise a question under the Antimonopoly Act, as an abuse of a superior bargaining position (Articles 2(9)(v) and 19 of the Antimonopoly Act). Whether a figure is defensible turns on the facts of the case. If you have been billed, talk to us before you pay.
A promise not to carry on the same kind of business once the agreement ends is called a non-compete obligation. In franchising, such a clause is often there to protect the franchisor’s know-how. At the same time, it restricts the freedom of the former member to trade. Where the period, the area, or the range of work shut off is drawn too widely, its validity can be disputed. We look at the wording of the clause alongside what know-how you were in fact given.
On the franchisor’s side, unpaid royalties from a franchisee are the usual issue. We act from a formal demand by content-certified mail through to a demand for payment, litigation and compulsory execution (see our debt collection page for details). On the franchisee’s side, the question is whether the franchise fee already paid can be reclaimed, on grounds such as a breach of the franchisor’s duty to explain. Either way, the starting point is the agreement and the record of where the money went.
We also draft template franchise agreements, put the statutory disclosure document in order, and help build the arrangements for overseeing how franchisees operate. An agreement is not made safe simply by tightening every clause. We draw the line with you: one that keeps clear of Antimonopoly Act problems while still protecting your brand.
For your business more broadly — contracts, employment, advertising claims and the like — see our corporate law page.
We cannot promise an outcome. We explain the likely course and the routes open to you in concrete terms, and then decide the approach together with you.
Our managing attorney spent about three years in the legal department of the Japanese arm of a foreign automotive company. Having sat on the inside reading contracts, we aim at advice that fits how a business actually runs. About the attorney
Whether you are about to join, already trading as a franchisee, or running the franchise itself, we are glad to advise. Our clients range from small and medium-sized companies and foreign-owned businesses to start-ups and sole traders. See our industry experience
We keep legal jargon to a minimum and set out the risks from several angles. We advise in English as well as Japanese.
Call us or use the contact form. We will arrange a time for the consultation.
At our office, or online or by phone. Please bring the franchise agreement, the document the franchisor handed you, and any emails between you.
Having read the agreement, we explain the routes open to you, how each is likely to go, and what it costs.
Once you are satisfied with the terms, we enter into the engagement.
We open the negotiation with the franchisor, or with the franchisee. Where it does not come together, we take it to mediation or litigation after discussing it with you.
We explain the fees before you instruct us. The figures shown include tax.
* A review of the agreement, and negotiation with the franchisor, are taken on at the hourly rate or under an advisory retainer above. Based on the (former) Japan Federation of Bar Associations fee guidelines.
* Where a matter turns into a dispute or litigation, we give you an estimate in advance. Recovery of unpaid royalties and the like is taken on at the debt collection fees: a retainer fee from 11% of the claimed amount (minimum JPY 110,000), and a success fee of 22% of the amount recovered.
* Actual expenses are charged separately. We accept credit cards (VISA / MasterCard) and instalment payments.
See Attorney’s Fees for details.
| Office | Eight Force Law Office |
|---|---|
| Managing attorney | Kento Araki (Dai-Ichi Tokyo Bar Association) |
| Address | 3F BIZ SMART Yoyogi, 1-25-5 Yoyogi, Shibuya-ku, Tokyo 151-0053 |
| Phone | 03-6809-0683 |
| Hours | Weekdays 9:00-18:00 (closed weekends & holidays) |
| Area covered | Nationwide (phone and online consultations) |
| Access | 3 min from Yoyogi Sta. (JR Yamanote / Sobu Line) / 4 min from Minami-Shinjuku Sta. (Odakyu Line) |
* The statutory references on this page are as at September 2026.
Please do not carry it alone — talk to us first.
We are here by phone and by email.