SUMMARY LEGAL INVENTORY OF FRANCHISING IN NIGERIA (2) Now, it equally needs to be appreciated that some laws having to do with the subst...

Summary Legal Inventory of Franchising in Nigeria (2)


Now, it equally needs to be appreciated that some laws having to do with the substantive laws of the major concern of the franchisee/ors would likewise be applicable. For instance, if an entrepreneur seeks to transact under the franchise of an international company majoring in electricity generation, transmission and distribution, no doubt they would have to consider relevant provisions from the Electric Power Sector Reform Act to determine their positions in a manner which is adverse to their legal interests and contractual commitments. So in essence, the laws governing the substantive issue must be acknowledged and duly researched. Ditto, though two different jurisdictions would be involved it would be the jurisdiction of the franchisee in situ.

 Moreover, regarding the function, the NOTAP Act provides in clear terms for the regulation of franchise in the country. Indeed, the centerpiece of the functions of the Office was well adumbrated in S.4(d) of the NOTAP Act Cap 273 LFN 1990:

The registration of all contracts or agreements having effect in Nigeria on the date of the coming into force of this Act, and of all contracts and agreements hereafter entered into, for the transfer of foreign technology to Nigerian parties; and without prejudice to the generality of the foregoing, every such contract or agreement shall be so registrable if its purpose of intent is, in the opinion of the National Office, wholly or partially for or in connection with any of the following purposes,

Such purposes are pointedly enunciated in the subsections to relate to the use of trade-marks; the right to use patented inventions; the supply of technical expertise in the form of the preparation of plans, diagrams, operating manuals or any other form of technical assistance of any description whatsoever; the supply of basic or detailed engineering; the supply of machinery and plant, and; the provision of operating staff or managerial assistance and the training of personnel.

Again, it should be noted that no agency is established to regulate franchising in the country, the National Office of Technology Acquisition and Promotion (NOTAP) is playing the front row duty of registering certain technology transfer agreements(so is it dubbed). Other agencies that may become important only become so to the extent that the subject matter of the franchise determines and as a matter of incidence. Thereby, it would be realized as in the illustration given before now if a franchise has electric power as its subject matter then it means the Nigerian Electricity Regulatory Commission would have a proper standing. So also in matters of telecommunications the Nigerian Communications Commission would be relevant, the same also goes for food and pharmaceutical needs the National Agency for Food and Drugs Administration Control would in every way be involved. So while no agency is stricto sensu established it need must be appreciated that other agencies become indispensable for compliance and other related objectives in the event of registration of the franchise. These other agencies may also include the Nigerian Copyrights Commission, The Registrar of Trademarks, Patents and Industrial Design, Federal Ministry of Commerce, the Nigerian Investment Promotion Council and a host of others.
As has been pinpointed earlier on, the NOTAP Act simply regulates the legal as well as proper conduct of franchise agreements in the Federation. Its provisions serve as an effective guide to a workable transfer and management of technology arrangement between relevant parties.
While the foregoing Act has provided in the average manner it can for franchise regulations in the country, there are palpable lacunae in Nigeria’s supposed legal machinery for franchising. Anti-competitive tendencies, restriction of prices, market dominance and other ignoble practices of franchising appear to have let out a can of worms for the effective legal as well as regulatory framework for the franchise industry. This unbecoming incidence has posed a lot of questions from several quarters, to wit, whether enacting a franchise specific legislation would suffice or would rather be a ‘dis-enabler’ on the long run. The enactment of a competition law is in the pipeline in Nigeria. It is hoped the law would provide valid, workable responses to the challenges and inhibitions to the problem of competition in the franchising country. As an aside, legal issues are not the only issues challenging franchise system in Nigeria. Indeed and apart from legal uncertainties it must be emphasized that many international franchises also take care of the problems of the proper management of their franchises. This is barraged by the worsening economic conditions.

For more about the legal requirements of the operations of NOTAP one may consult this link -


Nigeria’s Unemployment Rate Rises from 14.2% to 18.8%, Dec 23, 2017 Vanguard Newspapers.
Nigerian International Franchising Association Newsletter December 2013, Dr. Uche Eweluka Ofodile, Franchising Law in Nigeria.
National Office For Technology Acquisition and Promotion Act CAP. N62 L.F.N. 2004.