Franchise agreement in Brazil: Template, Key Clauses and Local Law (2026)

What a Brazilian franchise agreement is, and the law that governs it A franchise agreement in Brazil lets a franchisee run a business under the franchisor's brand, system and know-how in return for fees. It is governed by the Franchise Law (Lei de Franquias, Lei 13.966/2019), which replaced the old 1994 law (Lei 8.955/1994). The centrepiece of the regime is the Franchise Offering Circular (Circular de Oferta de Franquia, COF), a disclosure document the franchisor must hand over before the deal is done. The law does not dictate the commercial terms of the franchise. It focuses on transparency: give the franchisee a full, accurate picture in good time, and make clear this is not an employment relationship. If the disclosure rules are broken, the franchisee can seek to annul the agreement and recover what it paid, so compliance is not optional. This article is general guidance, not legal advice. Have a Brazilian lawyer review a franchise agreement before you sign. ## What local law requires in 2026 - The COF must be given at least 10 days before. The franchisor must deliver the Franchise Offering Circular to the candidate at least 10 days before signing the franchise agreement or any pre-contract, and before paying any fee to the franchisor or parties it designates. A deal signed inside that window is at risk.

• What the COF must contain (Art. 2). Among other items, a full description of the franchise, the franchisor's history and financial statements, pending lawsuits relevant to the franchise, the full list of franchisees and former franchisees, the fees and other payments, the territory and exclusivity, the IP involved, rules on transfer and succession, penalties and indemnities, and the terms for the contract term and renewal.
• Portuguese and clear. The COF must be written in Portuguese, objectively and in accessible language.
• Consequences of a defective COF (Art. 4). If the franchisor fails to deliver the COF, or delivers one that is late or false or incomplete, the franchisee may seek to annul the agreement and recover amounts paid, adjusted, plus damages.
• Not an employment relationship (Art. 1). The law confirms a franchise does not create an employment bond between franchisor and franchisee or its employees. Structure the relationship so this holds in practice.
• Public bids. For public tenders and prequalification there is a carve-out, with the COF disclosed at the start of the selection process. ## Brazilian franchise agreement template Copy the block below and fill the bracketed fields. Deliver a complete COF at least 10 days before signing and keep dated proof. ``` FRANCHISE AGREEMENT (CONTRATO DE FRANQUIA) This agreement is made on [DATE], at least 10 days after delivery of the Franchise Offering Circular (COF) dated [DATE]. BETWEEN: [FRANCHISOR NAME], [CNPJ], [address] ("Franchisor") AND [FRANCHISEE NAME], [CNPJ], [address] ("Franchisee") 1. GRANT AND TERRITORY The Franchisor grants the Franchisee the right to operate a [brand] franchise at [location] / in [territory], [exclusive / non-exclusive]. 2. TERM AND RENEWAL Term: [N] years from [DATE]. Renewal: [conditions]. 3. FEES Initial franchise fee: [amount]. Royalty: [percentage of turnover]. Advertising fund: [amount]. Other payments: [list]. Payment: [schedule]. 4. SYSTEM, KNOW-HOW AND IP The Franchisor licenses the brand, the operations manual and the know-how. Trade marks remain the Franchisor's and the trademark licence is recorded at the INPI where needed. 5. TRAINING AND SUPPORT The Franchisor provides [initial training and ongoing support]; the Franchisee keeps standards and passes inspections. 6. OBLIGATIONS OF THE FRANCHISEE Operate to brand standards, use approved supplies, keep records, report turnover, maintain insurance. 7. NO EMPLOYMENT This agreement does not create any employment bond between the Franchisor and the Franchisee or its employees (Art. 1, Lei 13.966/2019). 8. TRANSFER AND SUCCESSION Rules on transfer of the franchise and succession: [terms]. 9. PENALTIES AND TERMINATION Grounds, notice, penalties and indemnities; end-of-term treatment of IP use, signage and stock. 10. GOVERNING LAW AND DISPUTES Brazilian law applies. Disputes go to [arbitration / the courts of (city/state)]. Signed: Franchisor ____________ Franchisee ____________ Name / date Name / date

- **Fees (clause 3).** List every payment: initial fee, royalty base, advertising fund and any supply mark-up. These must match what the COF disclosed.
- **No employment (clause 7).** The law confirms a franchise is not employment, but the relationship must also work that way in practice, so avoid treating franchisee staff as your own.
- **Transfer and succession (clause 8).** The 2019 law expanded the content on transfer and succession, so address what happens if the franchisee sells, dies or restructures. ## Red flags to avoid - Signing or taking any payment inside the 10-day window after the COF, which risks annulment of the agreement.
- A COF that is incomplete, out of date or inconsistent with the signed agreement on fees, territory or term.
- A COF not written in clear Portuguese.
- Treating the franchise as if it could create or avoid an employment bond without matching the reality.
- Not recording the trademark licence at the INPI where third-party effect is needed.
- Vague transfer and succession terms, now an express part of the required disclosure. ## Where a contract workspace helps A template gives you a workable Brazilian franchise agreement. The ongoing work is everything around it: preparing a complete COF, delivering it at least 10 days before signing and keeping dated proof, keeping the COF and the agreement aligned on fees, territory and term, tracking renewal and notice windows across a growing network, and keeping restraint and transfer terms sound. Drafting from a franchise template, checking that the COF and agreement line up and that the 10-day rule is met, reviewing fees and transfer terms, and tracking renewal dates across many units can sit in one AI workspace tuned to how your company franchises. [Adira](https://adiralaw.com) is built around that shape: it drafts from a template, models the contract as linked clauses so a change in one place can be traced through the rest, lets you edit in plain language, and keeps renewal and notice dates on one timeline. Adira is India-first today, and deeper Brazil-specific coverage, including the COF rules, is on its roadmap rather than a settled claim, so use it for drafting and review and keep a Brazilian franchise lawyer for the local-law call. The template and checklist above are enough to start a fair agreement on their own. Last verified October 2026.