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Heads up, MSMEs! – A new guide for MSME franchise agreements

On 12 May 2022, Executive Order (E.O.) No. 169, s. 2022 was signed into effectivity, requiring all franchise agreements between franchisors and Micro, Small and Medium Enterprise (MSME) franchisees to be in writing, duly notarized, and to contain a number of minimum provisions, such as, among others, those relating to full disclosure of pre-signing, initial or recurring fees; a cooling-off period, where the MSME can opt to terminate the agreement; and an alternative dispute resolution mechanism which shall include a stipulation that the parties may seek voluntary mediation under Republic Act No. 9285 or the “Alternative Dispute Resolution Act of 2004”.

Under E.O. No. 169, franchisors, with MSMEs as franchisees, are required to register the franchise agreement with the Department of Trade and Industry (DTI), who is also tasked to create an MSME Registry of Franchise Agreements for this purpose. E.O. No. 169 also provides that compliance with the listed minimum terms and conditions may entitle franchisors to incentives from the National Government.

What does this mean for existing franchise agreements?

The guidelines shall apply not only to franchise agreements yet to be entered into but also to existing franchise agreements between a franchisor and an MSME franchisee upon renewal of their respective agreements.

What about the IP Code provisions covering franchise agreements?

Since franchise agreements come within the description of technology transfer arrangements (TTAs), which are regulated under the IP Code, franchise agreements involving MSME franchisees will also need to be consistent with the provisions of the IP Code on mandatory and prohibited clauses. Otherwise, the agreement will be unenforceable. In other words, franchise agreements involving MSME franchisees will need to comply with both the IP Code provisions governing TTAs and E.O. No. 169.

With the continuous proliferation of MSMEs amid a global pandemic, this executive measure regulating franchise agreements will not only protect MSME franchisees, but it will also empower franchisors in view of the incentivization scheme to be formulated and helmed by the National Government.

For more details, E.O. No. 169, s. 2022 may be accessed at

For additional discussion on TTAs, please refer to

Katherine Imperial promoted to partner

BCCSLAW is delighted to announce the promotion of Katherine R. Imperial to partner with effect on January 1, 2022.

Katherine obtained her law degree from the Ateneo de Manila University School of Law. She joined the firm as a senior associate to focus on domestic and international trademark registration, licensing and enforcement. She expanded her practice to cover data privacy, online media and fintech, advising various industry leaders in air transportation, e-commerce, streaming, networking, and finance.

Leo Singson joins BCCSLAW

We are pleased to announce that Leonardo Singson has joined our firm as Of Counsel for Special Corporate Transactions, Regulatory Compliance, and Immigration. Mr. Singson was formerly a Partner in the Corporate and Special Projects Department of Villaraza and Angangco. He obtained his law degree from the University of the Philippines.

COVID-19 corporate report submission guidelines

The Securities and Exchange Commission has issued a summary of guidelines on the filing of reports and other documents during the enhanced community quarantine that has been imposed over Luzon and other regions in the Philippines due to the COVID-19 pandemic. A copy of the issuance can be downloaded here: SEC COVID guidelines

Cancelled Events

Due to concerns relating to COVID-19, some conferences that we intended to attend, including the ICANN Community Forum in Cancun, the ASEAN IPA meeting in Jakarta, and the INTA annual meeting in Singapore, have been cancelled or postponed. Please visit our events calendar for updates on our attendance during upcoming conferences.

INTA Committee Membership

We are pleased to announce that the partners of our firm have been appointed to various committees of the International Trademark Association (INTA). Their committee memberships are as follows:

Andre Betita– Famous and Well-Known Marks

John Cabilao– Right of Publicity

Pericles Casuela– Data Protection

Joseph Sarmiento– Designs

Their appointments are effective beginning January 1, 2020, and will conclude on December 31, 2021.