Do you know that Franchise in Malaysia are governed by the Franchise Act 1998 (Amendment 2012)? This act applies to the sale and operation of any franchises throughout Malaysia.
The sale an operation of a franchise is deemed to be in Malaysia where:
- Is made in Malaysia and accepted within or outside Malaysia
- Is made outside Malaysia and accepted within Malaysia
- The franchised business is or will be operating in Malaysia
Under the Franchise Act 1998 (Amendment 2012), there are four (4) categories of registration as follows:
| 1. Section 6 – Franchisor | A person who grants a franchise to a franchisee and includes a master franchisee and his relationship with a sub-franchisee |
| 2. Section 6A – Master Franchisee | A person who has been granted the rights by a franchisor to sub franchise to another person, at his own expense, the franchise of the franchisor |
| 3. Section 6B – Franchisee of Foreign Franchisor | A person who has been granted the rights by a foreign franchisor but does not sub franchise to another person |
| 4. Section 14 – Franchise Broker | A person doing business as an agent or representative of a franchisor to sell a franchise to any person for a certain consideration but does not include any director, officer or employee of the franchisor or franchisee |
By virtue of Section 6 of the Franchise Act 1998, a franchisor or master franchisee is required to make an application to register his franchise with the Registrar of Franchises, Ministry Of Domestic Trade and Consumer Affairs (KPDNHEP), by submitting an application to the Registrar, together with the required documents and information.
Source: Official Portal Ministry of Domestic Trade, Co-operative and Consumerism
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