IP in the Italian Fashion Industry

It’s a good idea to register a business in the fashion industry in Italy, the birthplace of designers who have entered the world fashion history. This multicolored market offers an incredible range of companies, from multinational corporations to very tiny family businesses.

How fashion is governed

In the Italian fashion and luxury goods sector, there are no specific laws governing sales agreements: the Civil Code and the Collective Labor Agreement apply.

If you are planning to register a fashion company in Italy, it is wise to check the local legislation applicable to the manufacturing process beforehand.

For example, to protect a brand in the Italian fashion industry, when a manufacturer manufactures products for several brands, the production line and everything that is intended for each brand must be stored separately.

Other features of the relationship between manufacturer and brand in the Italian fashion sector:

• long-term agreements between the brand and contractors can be terminated at any time, but with mandatory prior notification;
• the brand has the right to terminate the contract unilaterally, subject to reimbursement of all costs and lost profits;
• the brand assumes joint responsibility for all payments to the contractor's employees within two years after their dismissal;
• Warranty lasts two years subject to notification of defects.

Sub-deliveries are subject to strict and binding regulations, namely:

• intellectual property rights in the Italian fashion industry cannot be transferred to a brand for unreasonable compensation;
• Suppliers cannot transfer more than half of the work to third parties without prior approval.

The purchase of raw materials for the production of products is governed by special provisions that are designed to guarantee:

• Exclusivity - to prevent competitors from using similar products or technologies;
• Vendor selection and opt-out options - if a brand wants to work with the most competitive vendors on the market, it has the right to select the most suitable option for itself and reject less suitable candidates.

Franchising in Italy

It is a common practice for a brand to enter into a franchise agreement in Italy. Brands benefit from this format primarily because it gains greater control over the distribution network.

If you plan to enter into a franchise agreement in Italy, the written agreement is valid for at least three years. If you need advice on drafting a franchise agreement in Italy, the specialists of our company have solid experience in this area and we are always at your service. You can also order a consultation on the grounds for terminating a franchise agreement in Italy.