Protected territory
A geographic area defined in the franchise contract within which the franchisor commits not to open any company-owned outlet or competing franchisee for the duration of the contract. It may extend beyond the strict exclusivity zone and sometimes covers digital channels.
In practice
Territorial protection in the e-commerce era raises complex contractual questions: if the franchisor develops a national online sales channel, do franchisees lose revenue from within their protected territory? Modern contracts must define how online orders originating from a franchisee’s territory are attributed to that operator. Several French court cases since 2018 have involved franchisees disputing precisely this issue with their franchisors.