Foreign Franchise Brands Crossing the Canadian Divide


Aug 23, 2018


As popular fast-food brand Chick-Fil-A makes its way north, it has to do so with a full understanding of Canada's legal system, laws and specific culture. 

When the fast food titan announced it was going to expand its brand into Canada a couple of weeks ago via franchising starting with Toronto, it was immediately the subject of much discussion. Chick-Fil-A is one of the most rapidly-growing quick service restaurant brands in the United States. This company is so popular that even some previous US cabinet members were reportedly unable to get the rights to open one of its franchises. 

This expansion, however, can serve as an informative event for any foreign company looking to expand into Canada, whether it's a franchise or not. While another brand's expansion into Canada may not generate the same amount of attention or headlines, the issues any foreign brand would face coming into Canada are very similar. 

The trademark, for example, is where the issues can start to arise. One of the most important steps for a growing brand to take is to make sure all intellectual property is or can be legally protected. Many businesses have prepared for entry into a foreign market only to discover that their trademark was not going to be available in that new market. 

When a foreign brand cannot protect its trademark in a market it wants to enter, it makes for very tough and expensive decisions. If a company can't get or use its trademark in Canada, does it expand there anyway, taking on the legal risks associated with trademark infringement? Alternatively, does the foreign brand introduce a separate name for use in Canada or even drop the expansion entirely?


Considering the Market 

Any brand that is considering Canadian expansion needs to plan well in advance and contact Canadian trademark legal counsel for advice on their trademark status and how to protect it, if possible. In addition, research needs to be carried out into the market so that the brand understands Canadian tastes and is ready to accommodate them. 

Last but certainly not least, a company that is ready to enter Canada should work with legal counsel who understands their business type, the applicable laws in Canada, and the laws of the provinces in which the brand wants to operate. Not only does a foreign brand need to know the laws regarding business creation and operation, but also those regarding taxes and employment. 

Expanding into a new country is an exciting move for many businesses, and the entry of a US brand into Canada seems logical given the cultural and economic similarities between the two countries. International expansion, however, is not as easy as opening a new location. Understanding Canadian laws and Canadian tastes is a crucial component of any foreign brand's successful growth here. 

To learn more about US and Canadian brands expanding into Canada, visit today.