Key practical points:
• The franchisor must own a mature model (the 'two stores for over one year' rule).
• The franchise business must be filed with the commerce authority within the set period.
• Pre-contract disclosure is mandatory: information on the franchisor, fees and rights before signing.
• The franchisee is granted a short 'cooling-off' period to withdraw shortly after signing.
• Trademarks and trade secrets must be protected within the contract.
🏢 Company setup
Regulations on the Administration of Commercial Franchises · Yalla China
商业特许经营管理条例 / Regulations on the Administration of Commercial Franchises
Enacted: 2007-02-06 ✅ Effective: 2007-05-01
📝 Overview
Regulations governing commercial franchising in China: a franchisor grants a franchisee the right to use its trademark and business model for a fee. They require pre-contract disclosure and government registration.
This is general information only, not legal advice. For your specific case, consult a licensed lawyer.
📜 The law text / key provisions
💬 Practical reading
💬 This is a general reading/opinion for orientation — not the official legal text nor legal advice.
If you plan to take a franchise in China, demand all required disclosures from the franchisor before signing and confirm it is properly registered. You have a short cooling-off period to withdraw, so read the contract carefully. General orientation, not legal advice.
📎 Official source
gov.cn
🕒 Updated: 16 March 2026