We quote from a comprehensive publication entitled “Franchising: USA vs. Europe” based on a lecture given by Dr. Thomas Komarek in Dublin, Ireland, in May 2026.
Franchising is generally understood to mean a partnership between two parties based on the transfer of rights. Franchising is primarily used to tap into new markets as a means of expanding sales. The origins of franchising are thought to date back to the late 19th century in America. Today, franchising represents a modern approach to distribution. The key differences between franchising in Europe and the USA lie in strict legal regulation, the maturity of the market and cultural homogeneity. Whilst the USA is the historical birthplace of modern franchising, with uniform, strict disclosure requirements, Europe presents itself as a highly fragmented market with varying national laws and voluntary industry codes. In the USA, commercial franchising is extremely widespread and accounts for around 3% of the country’s gross domestic product. The principle is as follows: a franchisor provides an independent entrepreneur – the franchisee – with a ready-made, tried-and-tested business conce...