Franchise Agreement in Austria: Template, Key Clauses and Local Law (2026)

What an Austrian franchise agreement is A franchise agreement lets a franchisee run a business under the franchisor's brand, system and know-how, in return for fees, while following the franchisor's standards. Franchising is common in Austrian retail, food and services, but it has no statute of its own, so the contract and general law do the work. ## The law that governs it Austria has no dedicated franchise law. A franchise is an atypical contract governed by the general Civil Code (Allgemeines Buergerliches Gesetzbuch, ABGB), the Business Code (Unternehmensgesetzbuch, UGB) and freedom of contract, with good faith duties in negotiation and performance. Two points stand out. First, EU and national competition law applies, especially the Vertical Block Exemption Regulation (EU) 2022/720, which controls restrictions on pricing, territory and customers. Second, the end-of-contract compensation claim is contested. The question is whether the compensation claim for commercial agents under section 24 of the Commercial Agents Act (Handelsvertretergesetz) applies by analogy to franchisees. The Austrian Supreme Court (Oberster Gerichtshof, OGH), in a 2025 decision (4 Ob 8/25t), again refused the analogy for a franchisee, holding that franchisees and independent authorised dealers are not comparable to commercial agents. Chamber guidance (WKO) suggests the analogy can still succeed where the franchisee is integrated into the principal's sales organisation and must hand over its customer base, so the position turns on the facts and remains unsettled. ## Key clauses to include ### Grant and territory

Define the franchise, the territory and whether it is exclusive. ### Term and renewal Set the term, renewal conditions and end-of-term arrangements. ### Brand and intellectual property licence Licence the trademarks, trade name and system, and control quality and use. ### Know-how and operations manual Transfer know-how and bind the franchisee to the manual and brand standards. ### Fees Set the initial fee, ongoing royalties and marketing fund contributions. ### Pre-contract disclosure Good faith supports clear, accurate pre-contract information to reduce later disputes. ### Training and support Describe initial and ongoing training and support. ### Supply and sourcing Set sourcing rules within competition law limits. ### Restrictions and competition compliance Draft non-compete, territory and pricing terms to fit the Vertical Block Exemption; avoid fixing resale prices. ### Termination and post-term obligations Cover grounds for termination, de-branding, return of materials and the debated compensation question. ### Confidentiality and governing law Protect know-how and choose Austrian law and forum. ## Common mistakes - Assuming a franchise statute exists; it does not.

• Fixing the franchisee's resale prices, which breaches competition law.
• Overlooking the live debate on compensation by analogy to section 24 HVertrG.
• Thin pre-contract disclosure, which invites good faith claims. ## Draft and manage it in one workspace A franchise network means many similar contracts, each with renewal dates, brand standards and fee terms to track. Adira is an AI legal workspace where you can draft from a structured template, see each clause flagged favourable or unfavourable to your side, edit clauses in plain language across a set of agreements and keep renewal and compliance dates in one place. Depth for non-India jurisdictions such as Austria is on the roadmap, so confirm local coverage first. You can see the approach at Adira. This article is general information, not legal advice. Confirm the current law, case law and competition rules with a qualified Austrian lawyer before you sign.