MEXICO Trends and Developments Contributed by: Gustavo A. Alcocer, Luis Astorga, Isabella Montero Torres and Fernanda Martínez Zolezzi, OLIVARES
A franchise agreement should therefore distinguish between physical exclusivity and digital rights. Depending on the business model, the parties may wish to establish rules concerning: • online sales to customers located within a fran - chisee’s territory; • sales through the franchisor’s centralised website or application; • sales through third-party marketplaces; • delivery areas and overlapping delivery zones; • attribution of online revenue and royalties; • national or regional advertising campaigns; • the franchisor’s ability to operate company-owned online channels; and • the appointment of additional franchisees or company-owned locations. Clear rules can prevent disputes over whether the franchisor’s national digital strategy undermines the economic value of the franchisee’s territorial rights. Data protection and technology governance Technology is increasingly embedded in franchise operations through point-of-sale systems, custom - er relationship management platforms, loyalty pro - grammes, inventory systems, online ordering and analytics. These systems generate information that may have substantial commercial value. They may also involve personal data belonging to customers, employees and other individuals. The Federal Law for the Protection of Personal Data in Possession of Private Parties regulates the lawful, controlled and informed processing of personal data by private entities and establishes obligations con - cerning the treatment and protection of such infor - mation. For franchise systems, the principal issue is often not whether data protection rules apply, but how respon - sibility is allocated between the franchisor, franchisee and technology providers. The increasing use of centralised customer databases also raises a commercial question concerning the val -
ue of customer relationships. A franchisee may expect to retain access to information generated through its location, while the franchisor may require centralised access to maintain a national loyalty programme or customer-management system. These rights should be addressed at the contractual level. A new federal private-sector data protection law was published in March 2025 and was last amended in November 2025. It continues to require privacy notic - es and consent where applicable, and specifically requires controllers to maintain administrative, tech - nical and physical safeguards and to notify individu - als immediately of security incidents that significantly affect their economic or moral rights. Franchise agree - ments and operating manuals should therefore allo - cate responsibility for cybersecurity standards, ven - dor oversight, incident notification and co-operation, access to shared systems, and the return or deletion of data when the relationship ends. Competition law and franchise restrictions Franchising inherently involves restrictions on how franchisees conduct their businesses. A franchisor may require purchases from approved suppliers, impose quality standards, establish territorial arrange - ments, restrict the use of competing brands or co- ordinate certain aspects of marketing and distribution. These restrictions can be commercially justified, but they must be assessed under Mexican competition law. In other words, the implication for franchisors is not that territorial exclusivity, supplier restrictions or pricing provisions are automatically prohibited. Rath - er, the analysis depends on the relevant market, the parties’ market position, the nature and duration of the restriction and its actual or potential effects. Consumer protection and e-commerce Franchise networks are ultimately consumer-facing businesses, and the fact that a consumer contracts with or purchases from a franchisee does not elimi - nate the importance of the broader consumer-protec - tion framework. The Federal Consumer Protection Law ( Ley Federal de Protección al Consumidor , or LFPC) regulates matters including advertising, pricing, promotions,
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