Environmental and Sustainability Clauses in Turkish Franchise Agreements

on July 21, 2026

Introduction

Environmental sustainability is no longer limited to voluntary corporate social responsibility programmes.

Franchise networks increasingly use environmental requirements to regulate packaging, waste, water, energy, product sourcing, store design, transportation and consumer communications.

A restaurant franchisor may require franchisees to reduce single-use packaging, separate food waste, purchase certified raw materials and record energy consumption. A hotel franchise may introduce water-efficiency standards, linen-reuse programmes and renewable energy targets. A retail franchise may require recyclable packaging, low-energy lighting, sustainable store materials and supplier traceability.

These requirements may produce substantial commercial benefits.

A network-wide sustainability policy can:

Reduce energy and waste costs;
Improve regulatory compliance;
Strengthen brand reputation;
Respond to investor and lender expectations;
Produce consistent environmental data;
Prepare the network for changing climate legislation;
Reduce supply-chain risk;
Support credible environmental advertising.

The contractual risks are equally important.

A clause requiring a franchisee to become “carbon neutral” or “fully sustainable” may be too vague to enforce. A franchisor may impose expensive environmental upgrades without establishing who will pay. A franchisee may publish unsupported environmental claims that expose the complete brand to greenwashing allegations. A supplier may describe packaging as recyclable even though only part of the packaging can be processed through available systems.

The environmental responsibility of a franchise network is also divided among several legally independent actors.

The franchisor may determine the product, packaging and supplier. The franchisee may operate the premises and generate the waste. The landlord may control the building’s heating, ventilation and waste infrastructure. A manufacturer may be responsible for the product’s environmental characteristics. A logistics provider may control part of the transportation footprint.

The franchise agreement cannot eliminate statutory environmental obligations merely by allocating them internally.

It may, however, determine:

Which party performs the obligation;
Who collects and reports data;
Who bears compliance costs;
Who indemnifies the other party;
What happens when environmental standards change;
How breaches are investigated and remedied.

Türkiye’s environmental framework has also changed materially.

Climate Law No. 7552 was adopted on 2 July 2025 and published on 9 July 2025. It created Türkiye’s first comprehensive climate-law framework, established the legal basis for a national emissions trading system and introduced principles and mechanisms relating to mitigation, adaptation, climate finance, green taxonomy, biodiversity and local climate action. Detailed aspects of the emissions trading system and green classification framework continue to depend on secondary legislation.

Environmental and sustainability clauses should therefore be drafted as measurable commercial obligations rather than broad public-relations language.

This article examines how environmental and sustainability clauses should be structured in Turkish franchise agreements, including legal compliance, waste, packaging, energy, water, carbon emissions, suppliers, environmental advertising, reporting, auditing, costs, breaches and termination.

What Is an Environmental or Sustainability Clause?

An environmental clause is a contractual provision regulating the environmental impact of the franchise business or requiring compliance with specified environmental standards.

A sustainability clause may be broader.

It may cover environmental, social and governance matters, including:

Climate change;
Resource efficiency;
Circular economy;
Waste;
Sustainable sourcing;
Human rights;
Labour conditions;
Animal welfare;
Supply-chain transparency;
Corporate governance.

This article focuses primarily on environmental matters.

A franchise sustainability provision may be located in:

The principal franchise agreement;
Operations manual;
Supplier code of conduct;
Store design manual;
Advertising manual;
Technology and reporting policy;
Lease approval requirements;
Annual sustainability plan.

Material financial and operational obligations should not be hidden entirely in a manual that the franchisor may change without meaningful limits.

The agreement should establish the basic obligation, while technical manuals may contain detailed implementation standards.

Mandatory Compliance and Voluntary Commitments

The agreement should distinguish three categories of obligation.

Statutory Environmental Obligations

These are requirements imposed by legislation or competent authorities.

Examples may include:

Waste separation;
Environmental permits;
Packaging responsibilities;
Disposal through authorised facilities;
Regulatory reporting;
Emission-related obligations;
Product-specific restrictions.

The franchise agreement should require each party to comply with laws applicable to its own activity.

Mandatory Network Standards

These are environmental requirements created by the franchisor even where the law does not require the specific measure.

Examples include:

Elimination of specified single-use materials;
Renewable electricity procurement;
Energy-efficient equipment;
Certified ingredients;
Network-wide waste targets;
Environmental data reporting.

These obligations should be clearly measurable and contractually justified.

Aspirational Goals

These may include long-term ambitions such as:

Net-zero emissions;
Fully circular packaging;
Zero food waste;
Climate-positive operations.

An aspiration should not be drafted as an immediate warranty unless the party intends to guarantee that result.

The agreement should distinguish a binding current obligation from a future target requiring progressive action.

Turkish Environmental Law Framework

The principal general statute is Environmental Law No. 2872.

Its objective is to protect the environment according to sustainable environment and sustainable development principles. The legislation operates together with extensive secondary regulations concerning waste, emissions, water, permits, chemicals, environmental impact and sector-specific activities.

Article 28 contains an important liability rule.

Persons who pollute or damage the environment are responsible for losses arising from the pollution and deterioration without requiring proof of fault. Liability under general legal provisions is also preserved.

This rule has significant consequences for franchise drafting.

A franchisee may face direct public-law or civil responsibility for pollution caused at its premises even where the franchisor approved the relevant process.

The franchisor may face responsibility where the damage results from:

A centrally designed system;
A mandatory product;
Defective equipment;
Instructions issued by the franchisor;
Conduct attributable to the franchisor.

The parties may allocate reimbursement or indemnity internally, but they cannot contract out of obligations owed to public authorities or injured third parties.

Climate Law No. 7552

Climate Law No. 7552 provides an overarching framework for Türkiye’s climate policy.

The Law incorporates principles such as sustainability, transparency, precaution, climate justice, participation and just transition. It establishes the legal basis for the Turkish emissions trading system and includes provisions concerning climate finance, green classification, technology, capacity building, biodiversity and local climate planning.

The adoption of the Climate Law does not mean that every franchise outlet immediately requires an emissions permit or must participate directly in the emissions trading system.

Direct obligations depend on:

The relevant activity;
Emission thresholds;
Covered installations;
Secondary regulations;
Sectoral classifications.

However, franchise systems may be affected indirectly through:

Higher energy and supplier costs;
Carbon-related reporting requests;
Lower-carbon product requirements;
Procurement standards;
Lender requirements;
Supply-chain data requests;
Local climate action plans.

Franchise agreements should be capable of responding to these regulatory developments without giving one party unlimited authority to impose every transition cost on the other.

Carbon and Emissions Clauses

A carbon clause may require measurement, reduction or reporting of greenhouse gas emissions.

The clause should identify the relevant scope.

Possible categories include:

Direct fuel consumption at the outlet;
Purchased electricity;
Refrigerant leakage;
Delivery vehicles;
Purchased products;
Packaging;
Waste treatment;
Employee travel;
Customer delivery.

The contract should avoid stating simply that the franchisee must “reduce its carbon footprint.”

It should specify:

Baseline year;
Organisational boundary;
Emission sources;
Calculation methodology;
Data frequency;
Reduction target;
Verification;
Treatment of new outlets;
Treatment of acquisitions and closures.

A percentage target is meaningless unless the baseline and methodology are defined.

For example, a requirement to reduce emissions by twenty percent should clarify whether the reduction is:

Absolute;
Per outlet;
Per square metre;
Per customer;
Per unit of turnover;
Per product sold.

Net-Zero and Carbon-Neutral Claims

Expressions such as “net zero,” “carbon neutral” and “zero emissions” can have different meanings.

The agreement should not use these expressions interchangeably.

A credible commitment should explain:

Which emissions are included;
Which period applies;
Whether reductions are absolute or intensity based;
Whether offsets are used;
Which offset standard applies;
Who verifies the claim;
How residual emissions are treated.

The Ministry of Trade’s environmental advertising guidance requires the scope of environmental claims to be identified clearly. A broad statement must not give consumers the impression that it covers the entire product or lifecycle where it relates only to one component or production stage. Future environmental targets should be supported by a publicly available and verifiable strategy.

A franchisee should not advertise an outlet as “zero emission” merely because it purchases renewable electricity while using fossil-fuel heating, delivery vehicles or carbon-intensive products.

Sustainability Reporting

Türkiye has introduced Türkiye Sustainability Reporting Standards through the Public Oversight, Accounting and Auditing Standards Authority.

The KGK maintains the applicable standards, reporting scope decisions, assurance standards and related guidance. The thresholds used to determine mandatory reporting scope were updated in January 2026.

Not every franchisee will fall directly within mandatory TSRS reporting scope.

A large franchisor, parent company, listed enterprise, bank-related entity or other in-scope organisation may nevertheless need information from franchisees to prepare its sustainability disclosures.

The franchise agreement should regulate this data flow.

Required information may include:

Electricity;
Fuel;
Water;
Waste;
Refrigerants;
Packaging;
Transportation;
Supplier certifications;
Environmental incidents.

The franchisor should not request unlimited information without defining the purpose and methodology.

The franchisee should understand whether the information will be used for:

Mandatory reporting;
Voluntary sustainability reports;
Environmental advertising;
Financing;
Supplier evaluation;
Performance sanctions.

Accuracy of Environmental Data

Sustainability reporting depends on reliable data.

The agreement should require the party submitting information to:

Use the stated methodology;
Preserve supporting records;
Correct known errors;
Identify estimates;
Disclose material limitations;
Avoid double counting.

Supporting evidence may include:

Utility invoices;
Meter records;
Waste transfer documents;
Supplier declarations;
Purchase quantities;
Transportation records;
Certificates;
Equipment maintenance records.

A franchisee should not be required to warrant the absolute accuracy of information produced by a third-party utility or supplier where it has taken reasonable verification steps.

The franchisor should distinguish deliberate false reporting from minor methodological errors.

Zero Waste Obligations

The Zero Waste Regulation created the national framework for preventing or reducing waste, separating waste according to its characteristics and directing it toward recovery.

The Regulation established implementation schedules for local administrations and various buildings and premises. Its scope has included shopping centres, commercial complexes, accommodation businesses, healthcare facilities, education institutions, transport facilities and other specified sites according to their nature, area or capacity.

A franchise outlet may be subject to zero-waste requirements:

Directly because of its own activity or size;
Through the shopping centre or building management;
Through a municipal collection system;
Through sector-specific waste rules.

The franchise agreement should allocate responsibility for:

Waste bins;
Labelling;
Employee training;
Temporary storage;
Collection contracts;
Reporting;
Landlord coordination;
Inspection records.

A franchisor may impose higher network standards than the statutory minimum.

However, it should identify whether the standard is mandatory law or an additional contractual policy.

Waste Hierarchy

An environmental clause should follow a clear hierarchy.

The preferred order may include:

Preventing waste;
Reducing unavoidable waste;
Reusing products or materials;
Recycling;
Other recovery;
Lawful disposal as the final option.

Simply increasing recycling does not address unnecessary waste generation.

For example, replacing one disposable material with another recyclable disposable material may produce less benefit than creating a reusable system.

The franchise sustainability policy should therefore examine:

Product design;
Portion planning;
Inventory forecasting;
Packaging selection;
Refill systems;
Returnable transport packaging;
Donation of suitable surplus products;
Recycling.

Packaging Obligations

The Packaging Waste Control Regulation is especially relevant to food, beverage, retail and e-commerce franchise systems.

The framework applies zero-waste principles to packaging, prioritises material recycling and regulates duties of packaging manufacturers, persons placing packaged products on the market and sales points.

It also addresses extended producer responsibility, labelling, recovery contribution payments and deposit-return structures.

The franchise agreement should identify which entity is treated as:

Manufacturer;
Importer;
Person placing the packaged product on the market;
Seller;
Sales point;
Brand owner.

The answer may differ according to the product.

For example:

The franchisor may design the packaging;
An affiliate may import it;
A manufacturer may fill it;
The franchisee may sell it;
A master franchisee may place the branded product on the Turkish market.

The agreement should allocate operational and financial duties according to the actual legal structure.

Internal allocation does not change the identity of the legally responsible person toward authorities.

Recycled and Recyclable Packaging

The terms “recycled” and “recyclable” describe different characteristics.

“Recycled content” concerns material already recovered and incorporated into the product or packaging.

“Recyclable” concerns whether the product or packaging can enter an appropriate recycling process after use.

The Ministry of Trade’s environmental claims guidance requires advertisements to clarify whether a recyclability claim relates to the entire product, its packaging or only a particular component.

Claims concerning recycled content should also state the relevant amount or percentage where the complete product is not made from recycled material.

The franchise agreement should prohibit franchisees from adding unapproved recycling symbols or environmental statements to packaging.

The franchisor should verify centrally supplied packaging before requiring franchisees to advertise its environmental characteristics.

Biodegradable and Compostable Claims

A product described as biodegradable or compostable may require particular conditions.

It may break down only:

In an industrial composting facility;
At a specified temperature;
Under controlled humidity;
Within a defined period;
After separation from other components.

The environmental claims guidance requires clear information concerning the conditions, rate and scope of biodegradation and warns against misleading consumers into believing that a product or its packaging will return naturally to the environment under normal conditions where that is not the case.

A franchise sustainability clause should therefore require technical evidence before terms such as the following are used:

Biodegradable;
Compostable;
Plastic-free;
Nature-friendly;
Environmentally harmless.

Food Waste

Food franchises face specific waste-management challenges.

A food waste clause may regulate:

Demand forecasting;
Portion sizes;
Preparation procedures;
Expiry monitoring;
Cold-chain records;
Donation;
Animal by-product restrictions;
Used cooking oil;
Organic waste separation.

The agreement should not create an incentive to sell unsafe or expired food merely to satisfy a waste-reduction target.

Food safety and public health duties must take priority.

Waste performance should be assessed through metrics that do not penalise lawful disposal of unsafe products.

Used Cooking Oil and Hazardous Waste

Some outlets generate waste requiring specialised treatment.

Examples include:

Used cooking oil;
Cleaning chemicals;
Batteries;
Electronic equipment;
Fluorescent lamps;
Refrigerants;
Medical or cosmetic waste.

The agreement should require delivery to authorised collectors or facilities where required.

Records should identify:

Waste category;
Quantity;
Date;
Collector;
Transport;
Receiving facility;
Relevant permit or licence.

A general instruction to “dispose of waste responsibly” is insufficient for regulated waste streams.

Energy Efficiency

Energy clauses may require:

LED lighting;
High-efficiency refrigeration;
Smart meters;
Energy management software;
Equipment maintenance;
Automatic controls;
Minimum performance ratings;
Renewable electricity.

The franchise agreement should determine:

Who purchases equipment;
Who owns it;
Who pays installation costs;
Who receives energy savings;
When replacement is required;
Whether existing equipment is grandfathered;
Whether landlord approval is needed.

An immediate network-wide equipment replacement may create substantial financial pressure.

A phased programme may be more proportionate.

Possible implementation triggers include:

New outlet opening;
Equipment failure;
Major refurbishment;
Lease renewal;
End of useful life.

Renewable Energy Claims

A franchisor or franchisee may state that an outlet uses renewable energy.

The Ministry of Trade’s guidance requires environmental advertising to identify the renewable source, such as solar, wind or another specified source, rather than using an unsupported general claim.

The agreement should state what evidence is required.

Evidence may include:

Direct on-site generation;
Electricity supply contract;
Renewable energy certificate;
Verified contractual instrument;
Metering data.

The parties should also clarify whether the claim concerns:

All electricity;
A percentage of electricity;
One outlet;
Corporate offices;
The whole franchise network;
Only a particular reporting period.

Water Management

Water sustainability is particularly important for:

Restaurants;
Hotels;
Car-wash franchises;
Laundries;
Fitness centres;
Beauty services;
Food production.

Water clauses may require:

Efficient fixtures;
Leak monitoring;
Sub-metering;
Cleaning protocols;
Reuse systems where lawful;
Employee training;
Periodic consumption reports.

The target should account for outlet type and customer volume.

Comparing total water use of a large hotel with a small retail unit does not produce a meaningful performance measure.

More appropriate indicators may include:

Litres per guest;
Litres per transaction;
Litres per kilogram of product;
Consumption per square metre.

Refrigerants and Equipment Maintenance

Refrigeration and air-conditioning systems can create environmental and climate risks through energy consumption and refrigerant leakage.

A clause may require:

Approved refrigerants;
Leak inspections;
Maintenance records;
Qualified service providers;
Recovery during equipment disposal;
Prompt incident reporting.

Responsibility should be coordinated with the lease.

In some premises, the landlord controls the central cooling system. In others, the franchisee owns individual units.

The franchisor should not impose an obligation that the franchisee cannot perform without the landlord’s consent or cooperation.

Sustainable Store Design

New outlet designs may include environmental standards concerning:

Insulation;
Lighting;
Flooring;
Furniture;
Paint;
Ventilation;
Water systems;
Recycled materials;
Construction waste;
Energy monitoring.

The franchisee should receive these requirements before signing the lease and finalising the investment budget.

A requirement introduced after construction may result in duplication and waste rather than sustainability.

The agreement should distinguish:

New-store requirements;
Refurbishment standards;
Recommended improvements;
Mandatory legal upgrades.

Commercial Lease Coordination

Environmental standards may depend on rights controlled by the landlord.

Examples include:

Roof-mounted solar panels;
Exterior charging equipment;
Waste-storage areas;
Ventilation changes;
Smart meters;
Water systems;
Façade modifications.

The franchisee should negotiate these rights in the commercial lease.

The franchise agreement should not treat failure to install a system as franchisee default where the landlord refused permission and the franchisee used reasonable efforts.

The site approval process should examine environmental infrastructure before the lease becomes unconditional.

Sustainable Suppliers

A franchisor may require suppliers to satisfy environmental criteria.

These may concern:

Materials;
Energy;
Water;
Emissions;
Waste;
Deforestation;
Chemicals;
Animal welfare;
Traceability;
Certification.

The supplier code should identify which requirements are:

Legal minimums;
Contractual network standards;
Future targets;
Reporting requests.

The franchisor should verify whether required certifications are available in the relevant market and whether the requirement excludes equivalent standards without justification.

A sustainability label should not become a disguised method of favouring an affiliated supplier.

Franchisee-Proposed Suppliers

A franchisee may identify a local supplier with lower transportation emissions or more sustainable products.

The agreement should provide a procedure for proposing that supplier.

The assessment may include:

Quality;
Product safety;
Environmental certification;
Capacity;
Traceability;
Price;
Confidentiality;
Brand compatibility.

Approval should be based on objective criteria.

A franchisor should not claim to promote local sustainable sourcing while refusing every alternative source without technical review.

Supply-Chain Due Diligence

A franchise network should determine the level of due diligence appropriate to the environmental risk.

Possible measures include:

Supplier questionnaires;
Document review;
Certification verification;
Site audits;
Product testing;
Corrective action plans;
Termination for serious non-compliance.

The agreement should avoid unrealistic absolute warranties concerning every lower-tier supplier.

A more workable obligation may require:

Reasonable due diligence;
Risk-based monitoring;
Prompt reporting of known violations;
Corrective action;
Cooperation with investigation.

The applicable standard should reflect the party’s ability to control the supply chain.

Environmental Certifications

A franchise agreement may refer to certifications relating to:

Energy;
Buildings;
Forestry;
Agriculture;
Fisheries;
Packaging;
Carbon;
Waste.

The agreement should identify:

Certification scheme;
Issuing body;
Scope;
Validity period;
Renewal;
Audit;
Cost;
Consequences of suspension.

The Ministry of Trade’s environmental advertising guidance states that environmental certificates and approvals used in advertisements should be verified through competent public bodies, relevant university departments or accredited research, testing and evaluation institutions.

Advertisements should also provide understandable information or direct consumers to accessible details concerning the certificate’s scope and benefits.

An outlet should not continue displaying an expired or suspended environmental certificate.

Greenwashing Risk

Greenwashing occurs when environmental communications exaggerate, obscure or misrepresent the environmental qualities of a product, service or business.

High-risk expressions include:

Eco-friendly;
Green;
Clean;
Sustainable;
Natural;
Climate positive;
Environmentally harmless;
Zero waste;
Carbon neutral.

These terms may be misleading where they lack:

Defined scope;
Scientific basis;
Verification;
Relevant qualifications;
Current data.

The Ministry of Trade’s environmental advertising guide applies to consumer-facing advertisements and unfair commercial practices containing environmental statements or visuals.

It requires conditions attached to claims to be stated clearly and prohibits presenting compliance with an ordinary legal requirement as though the advertised business were environmentally superior to competitors.

Recent Advertising Board decisions continue to examine claims concerning renewable energy, recyclable packaging, biodegradable materials, recovered waste and sustainable sourcing. This demonstrates that environmental advertising is an active enforcement area rather than a purely theoretical compliance issue.

Responsibility for Environmental Advertising

The franchise agreement should allocate responsibility for:

National campaigns;
Local advertising;
Social media;
Influencers;
Store signs;
Product packaging;
Website statements.

A franchisee should use only approved environmental claims concerning the brand or products.

The franchisor should maintain a central evidence file supporting approved claims.

That file may contain:

Test reports;
Certificates;
Supplier documents;
Carbon calculations;
Energy invoices;
Lifecycle studies;
Audit reports.

Approval by the franchisor does not necessarily eliminate the franchisee’s responsibility as the local advertiser or seller.

The franchisee should report where a centrally approved claim no longer reflects local conditions.

Comparative Environmental Claims

A comparative claim may state that a product uses:

Less plastic;
Less energy;
Less water;
More recycled content;
Lower emissions.

The comparison should identify:

Comparator;
Baseline;
Measurement method;
Period;
Scope;
Percentage calculation.

The environmental advertising guide requires the content of environmental comparisons to be stated clearly.

A statement such as “twenty percent more recycled content” should identify whether the comparison concerns the advertiser’s previous product or competing products.

Environmental Targets and Franchise Performance

A franchisor may link environmental performance to:

Audit scores;
Renewal;
Development rights;
Supplier discounts;
Incentive payments;
Recognition programmes.

The agreement should distinguish between:

Compliance with law;
Minimum brand standards;
Improvement targets;
Voluntary leadership levels.

A franchisee should not lose the complete franchise because it misses one aspirational reduction target.

Serious consequences should generally be reserved for conduct such as:

Illegal waste disposal;
Falsification of environmental records;
Deliberate misuse of certificates;
Repeated failure to remedy material breaches;
Environmental conduct creating serious brand or public-health risk.

Environmental Audits

The franchisor may audit environmental compliance.

The audit may review:

Waste areas;
Utility records;
Packaging;
Supplier documents;
Equipment;
Maintenance;
Environmental claims;
Regulatory notices.

The audit clause should regulate:

Scope;
Notice;
Frequency;
Auditor qualifications;
Confidentiality;
Access to documents;
Corrective action;
Cost.

Environmental audits should not be used to collect unrelated commercially sensitive information.

The franchisor should also distinguish an internal network audit from an official regulatory inspection.

Audit Costs

The parties should agree who pays.

Possible models include:

Franchisor pays routine audits;
Franchisee pays re-audits after a failed inspection;
Franchisee pays where material non-compliance is confirmed;
Costs are shared for new certification programmes;
Supplier pays audits concerning supplier-specific claims.

A clause requiring the franchisee to pay every audit cost regardless of result may discourage legitimate objections and create unpredictable expenditure.

Environmental Data and Confidentiality

Sustainability data may reveal commercially sensitive information.

For example, energy, water and waste data may indicate:

Sales volume;
Production capacity;
Outlet performance;
Supplier relationships;
Cost structure.

The agreement should limit use of the data to defined purposes.

Where network-wide reports are published, outlet-level information may be aggregated or anonymised unless individual disclosure is required or authorised.

The franchisor should also protect franchisees from misleading network claims based on incomplete data.

Competition Law

Environmental cooperation does not receive automatic immunity from competition law.

Sustainability clauses in a bilateral franchise agreement are generally part of a vertical commercial relationship.

However, competition risk may arise where independent franchisees coordinate:

Retail prices;
Customer charges;
Purchasing conditions;
Output;
Suppliers;
Future commercial strategy.

For example, franchisees should not agree that every outlet will charge the same environmental fee or stop buying from a supplier collectively without legal assessment.

Common environmental standards may be legitimate where they are necessary for the franchise system and do not exceed what is proportionate.

The Turkish Competition Authority has been conducting policy work concerning how sustainability initiatives should be evaluated under competition law, while its strategic documents have identified possible development of guidance in this field.

Until more specific guidance is adopted, sustainability cooperation should be assessed under the ordinary rules of Competition Law No. 4054.

Environmental Fees Charged to Customers

A franchise system may introduce charges for:

Disposable bags;
Cups;
delivery packaging;
Reusable-container deposits;
Carbon contributions.

The agreement should clarify whether the charge is:

Legally required;
Set by the franchisor;
Recommended;
Determined independently by the franchisee;
A refundable deposit;
Donated to an environmental project;
Retained as revenue.

Competition-law review is required where independently owned franchisees are expected to apply a fixed customer charge.

Consumer communications should explain the purpose and destination of the payment accurately.

A charge described as an environmental donation should not be retained as ordinary revenue without disclosure.

Cost Allocation

Sustainability clauses can create substantial costs.

Possible expenditure includes:

New equipment;
Packaging changes;
Solar systems;
Environmental consultants;
Software;
Audits;
Certifications;
Supplier price increases;
Waste contracts;
Renovation.

The agreement should establish who pays and when.

Relevant questions include:

Is the upgrade required by law or only by the brand?
Did the franchisor introduce it after signing?
Does it benefit one outlet or the whole network?
Is the equipment owned by the franchisee?
Does the investment remain useful after termination?
Is financing available?
Is there a transition period?

The franchisor may fund or support upgrades through:

Grants;
Supplier discounts;
Advertising fund expenditure;
Low-interest financing;
Extended implementation periods;
Royalty credits.

Unilateral Amendment of Sustainability Standards

Environmental legislation and technology change rapidly.

The franchisor needs some ability to update standards.

However, an unlimited right to introduce any environmental obligation and transfer every cost to the franchisee creates contractual risk.

Articles 20 to 25 of the Turkish Code of Obligations regulate pre-drafted standard terms.

Terms adverse to the counterparty must be disclosed properly, ambiguous provisions are interpreted against the drafter and a clause granting unilateral authority to introduce adverse changes may be treated as unwritten. Standard terms also cannot aggravate the counterparty’s position contrary to good faith.

A balanced amendment clause may distinguish:

Mandatory Legal Changes

Changes necessary to comply with binding law may apply within the legally required period.

Urgent Safety or Environmental Risks

Immediate temporary measures may be introduced where delay would create serious harm.

Ordinary Brand Improvements

Material non-urgent investments should require notice, consultation and a reasonable implementation period.

Major Capital Expenditure

High-cost changes may be introduced at opening, refurbishment, equipment replacement or renewal rather than immediately.

Hardship and Regulatory Change

A sustainability requirement may become unexpectedly expensive because of:

New environmental legislation;
Carbon costs;
Import restrictions;
Certification changes;
Supply shortages;
Exceptional energy prices.

The agreement should contain a change-in-law and hardship process.

That process may include:

Notice;
Cost evidence;
Temporary compliance measures;
Alternative materials;
Revised timetable;
Cost sharing;
Renegotiation.

Article 138 of the Turkish Code of Obligations provides an exceptional adaptation mechanism where an extraordinary and unforeseeable event not attributable to the debtor changes circumstances so severely that performance under the original terms becomes contrary to good faith.

Ordinary commercial inconvenience or foreseeable transition costs will not automatically satisfy that high standard.

Environmental Incidents

An environmental incident may include:

Chemical spill;
Illegal waste disposal;
Refrigerant leakage;
Wastewater discharge;
Fire involving hazardous material;
Contaminated soil;
False environmental reporting;
Loss of required environmental permission.

The franchise agreement should require immediate internal reporting.

The notice should include:

Date and location;
Material involved;
Estimated quantity;
Immediate measures;
Authorities contacted;
Injuries or third-party damage;
Media interest;
Supporting photographs and records.

The internal notice should not replace any statutory notification to authorities.

Corrective Action

The agreement should establish a corrective action process.

The franchisor may require the franchisee to:

Stop the harmful activity;
Contain the incident;
Use qualified contractors;
Notify authorities where required;
Investigate the cause;
Submit a remediation plan;
Implement preventive measures;
Provide completion evidence.

The franchisor should not interfere with urgent action needed to protect health or the environment.

Brand approval should not delay legally required containment or reporting.

Environmental Liability and Indemnity

An indemnity clause may allocate losses arising from:

Regulatory fines;
Clean-up;
Third-party claims;
Product recall;
Advertising sanctions;
Audit expenses;
Business interruption;
Remediation.

The clause should reflect control and fault.

A franchisee may indemnify the franchisor for illegal disposal conducted by local employees contrary to the system.

The franchisor or supplier may indemnify the franchisee where harm arises from:

Mandatory defective equipment;
Incorrect central instructions;
Mislabelled packaging;
Unsupported brand-wide environmental claims;
Centrally selected materials.

The agreement should not state that one party bears all environmental liability regardless of cause, control or mandatory law.

Insurance

Relevant policies may include:

Environmental impairment liability;
General liability;
Product liability;
Property insurance;
Business interruption;
Product recall;
Directors and officers insurance.

The agreement should state:

Required coverage;
Limits;
Deductibles;
Additional insured status;
Evidence of renewal;
Notification procedure.

Ordinary general liability insurance may exclude gradual pollution or certain environmental clean-up costs.

The parties should review policy wording rather than assuming that environmental incidents are covered.

Breach and Remedies

A sustainability breach may justify:

Warning;
Corrective plan;
Training;
Re-audit;
Temporary suspension of a claim or certificate;
Removal of unapproved packaging;
Compensation;
Contractual penalty;
Termination.

The remedy should correspond with the seriousness of the breach.

Minor reporting delays should not be treated like deliberate illegal dumping.

A tiered enforcement structure may classify breaches as:

Administrative;
Material;
Critical;
Repeated.

Immediate suspension may be justified where the conduct creates imminent environmental, health, regulatory or reputational risk.

Termination

Environmental grounds for termination may include:

Repeated unlawful waste disposal;
Falsified certificates;
Deliberate environmental misrepresentation;
Serious contamination;
Refusal to remedy a critical breach;
Loss of a permit essential to operation.

The agreement should address post-termination matters such as:

Continued remediation;
Records;
Regulatory cooperation;
Environmental claims;
Waste disposal;
Equipment;
Insurance notification;
Confidentiality.

Termination does not eliminate responsibility for pollution or false advertising that occurred during the franchise relationship.

Evidence and Record Retention

Environmental disputes often depend on technical evidence.

Relevant records may include:

Utility invoices;
Meter readings;
Waste transfer documents;
Certificates;
Supplier declarations;
Laboratory reports;
Photographs;
Maintenance records;
Advertising approvals;
Audit reports;
Regulatory correspondence.

Records should be preserved for the applicable statutory, contractual and litigation periods.

The franchisee should not discard environmental records immediately after termination where an investigation or claim remains possible.

Dispute Resolution

Environmental franchise disputes may involve:

Upgrade costs;
Supplier compliance;
Green claims;
Reporting accuracy;
Audit findings;
Indemnity;
Termination;
Pollution damage.

Technical matters may be suitable for independent expert determination.

The agreement may provide that an expert determines:

Carbon calculation;
Recycled content;
Energy performance;
Compliance with a technical standard;
Remediation completion.

Legal disputes concerning liability, termination and damages may remain subject to courts or arbitration.

Commercial monetary claims may require pre-litigation mediation where the statutory conditions apply.

Drafting Recommendations for Franchisors

A franchisor should:

Separate legal compliance from voluntary targets;
Define environmental standards precisely;
Establish realistic baselines;
Use recognised measurement methodologies;
Identify responsible entities;
Provide reasonable transition periods;
Allocate major upgrade costs;
Verify supplier claims;
Approve environmental advertising centrally;
Maintain substantiation records;
Audit proportionately;
Coordinate standards with leases;
Protect environmental data;
Avoid unlimited unilateral amendment rights;
Apply proportionate remedies.

The franchisor should not publish a network-wide environmental claim before verifying that it applies consistently across the relevant outlets.

Drafting Recommendations for Franchisees

A franchisee should negotiate:

Clear standards;
Defined implementation dates;
Cost caps or sharing;
Protection against retrospective upgrades;
Alternative supplier procedures;
Access to environmental claim evidence;
Reasonable audit rules;
Cure periods;
Relief for landlord-controlled matters;
Relief for franchisor or supplier failure;
Accurate data methodologies.

Before signing, the franchisee should calculate the complete cost of environmental obligations rather than treating them as minor operational requirements.

Sustainability Clause Checklist

Before signing an environmental or sustainability clause, the parties should confirm that:

Applicable environmental laws are identified.
Climate-law developments are monitored.
Statutory and voluntary duties are separated.
Responsible entities are identified.
Environmental permits are allocated.
Zero-waste duties are assessed.
Waste streams are classified.
Authorised collection is required.
Packaging responsibilities are allocated.
GEKAP and producer responsibilities are reviewed.
Deposit systems are addressed.
Recyclability claims are verified.
Recycled-content percentages are documented.
Biodegradable claims specify conditions.
Food safety takes priority over waste targets.
Energy targets use a baseline.
Water targets reflect outlet type.
Refrigerant duties are allocated.
Store-design requirements are disclosed before investment.
Landlord consent risks are considered.
Supplier standards are objective.
Alternative suppliers may be proposed.
Certifications are verified.
Environmental claims have evidence.
Future targets have a public and verifiable strategy.
Comparative claims identify the comparator.
Reporting methodology is stated.
Estimates and limitations are disclosed.
Audit scope is proportionate.
Confidential data are protected.
Competition-law risks are reviewed.
Customer environmental charges are transparent.
Upgrade costs are allocated.
Unilateral amendments are limited.
Change-in-law procedures are included.
Environmental incidents require immediate notice.
Remediation obligations are defined.
Indemnities reflect control and cause.
Insurance coverage is reviewed.
Remedies are proportionate.

Conclusion

Environmental and sustainability clauses in Turkish franchise agreements are becoming essential components of franchise governance.

Türkiye’s Climate Law No. 7552 has created a new legal framework for mitigation, adaptation, emissions trading, climate finance and green classification.

Environmental Law No. 2872, the Zero Waste Regulation, packaging legislation, consumer advertising rules and sustainability reporting standards create additional obligations relevant to franchise networks.

The franchise agreement should not attempt to summarise the complete environmental legislation in one general compliance sentence.

It should translate the applicable risks into practical obligations concerning:

Waste;
Packaging;
Energy;
Water;
Products;
Suppliers;
Data;
Advertising;
Incidents.

The distinction between legal compliance, network standards and future aspirations is fundamental.

A statutory waste duty may require immediate compliance. A voluntary energy target may require gradual implementation. A net-zero ambition may depend on a long-term transition plan.

The parties should also identify the entity that controls each environmental issue.

The franchisor may control product and packaging design. The franchisee may control local waste handling. The landlord may control the building’s systems. The supplier may control material composition.

Liability and cost allocation should follow this operational reality.

Environmental advertising requires particular care.

Claims such as recyclable, biodegradable, carbon neutral, renewable and sustainable must be clear, specific and supported.

The scope of the claim should identify whether it concerns the product, packaging, production process, electricity or complete business.

Sustainability should not become a justification for unlimited unilateral control.

A franchisor may need to update standards as legislation changes, but material capital expenditure should be introduced through a transparent process with reasonable notice and proportionate cost allocation.

Environmental clauses also require reliable data.

Franchise networks should establish common methodologies, preserve supporting evidence and distinguish actual measurements from estimates.

Where sustainability information is used in corporate reports or consumer advertising, inaccurate franchisee data may create liability beyond the individual outlet.

The strongest environmental franchise clause is therefore not the clause containing the broadest promises.

It is the clause that converts environmental goals into measurable, verified and fairly allocated obligations while preserving the ability of the system to adapt to future legislation.

Frequently Asked Questions

Are sustainability clauses mandatory in Turkish franchise agreements?

There is no rule requiring every franchise agreement to contain a separate sustainability clause. Environmental laws may nevertheless impose mandatory obligations on the parties.

Does the Turkish Climate Law apply to franchise businesses?

The Climate Law provides a broad national framework. Direct obligations depend on the activity, sector, emissions profile and secondary legislation.

Must every franchise outlet participate in the emissions trading system?

No. Participation depends on whether the relevant installation or activity falls within the system’s final regulatory scope.

Can a franchisor impose environmental standards above the legal minimum?

Yes, subject to contract law, good faith, proportionality, competition law and the agreed allocation of costs.

Can sustainability standards be placed in the operations manual?

Technical standards may be included in the manual, but material financial and operational obligations should be established transparently in the agreement.

Can the franchisor change environmental standards unilaterally?

A limited update right may be agreed, but an unlimited right to impose adverse obligations may face standard-term and good-faith objections.

Who is responsible for pollution at the outlet?

Responsibility depends on the conduct and statutory framework. Environmental Law Article 28 imposes liability on persons causing pollution or environmental damage without requiring proof of fault.

Can the franchise agreement transfer all environmental liability to the franchisee?

It may allocate internal responsibility, but it cannot eliminate mandatory duties owed by the franchisor, supplier or another legally responsible person.

What is a zero-waste system?

It is a system designed to prevent or reduce waste, separate unavoidable waste and direct it toward appropriate recovery processes.

Does every franchise outlet need a zero-waste certificate?

The answer depends on the type, size, capacity, location and applicable current rules concerning the outlet or wider building.

Who is responsible for branded packaging?

The legal role may belong to the manufacturer, importer, person placing the packaged product on the market, seller or another entity. The actual supply structure must be reviewed.

What is extended producer responsibility?

It is an approach under which producers or persons placing products on the market bear specified responsibilities for the environmental management of products or packaging.

Is recyclable the same as recycled?

No. Recyclable means capable of being recycled under relevant conditions. Recycled content means recovered material was used in production.

Can a product be described as fully recyclable?

Only where the claim accurately covers the complete product or packaging. Non-recyclable components should be disclosed.

Can packaging be described as biodegradable?

Only where the claim is supported and the relevant conditions, environment, scope and degradation characteristics are stated clearly.

Can an outlet advertise itself as carbon neutral?

Only where the scope, methodology, emissions included, reductions, offsets and verification support the claim.

Can legal compliance be advertised as an environmental advantage?

A business should not present compliance with an obligation applying equally to competitors as though it were a unique environmental benefit.

Can a franchisee create its own green advertising?

Only within the franchise agreement and brand approval rules. The franchisee remains responsible for misleading local advertising.

Who must prove an environmental advertising claim?

The advertiser should maintain reliable evidence supporting objective environmental claims.

Can future environmental targets be advertised?

Yes, but they should be supported by a publicly available, verifiable strategy and should not be presented as already achieved.

Can franchisees share environmental performance data?

Yes, where the sharing has a lawful purpose and appropriate confidentiality, competition and data controls are applied.

Must small franchisees prepare TSRS reports?

Not every small franchisee is directly subject to mandatory TSRS reporting. A franchisor may nevertheless require data for its own reporting obligations.

Can the franchisor require utility invoices?

It may require proportionate information needed for compliance or reporting, subject to confidentiality and contractual terms.

Who pays for energy-efficient equipment?

The agreement should allocate the cost. The appropriate answer depends on whether the upgrade is legally required, brand driven, outlet specific or introduced after signing.

What happens if the landlord refuses an environmental improvement?

The franchisee should document the refusal. The franchise agreement should provide relief where the obligation depends on landlord-controlled property rights.

Can environmental non-compliance justify termination?

Serious, repeated or deliberately concealed breaches may justify termination. Minor or remediable failures should generally be subject to corrective action.

Can a contractual penalty apply?

A valid and proportionate contractual penalty may be agreed, but the underlying environmental obligation must be clear.

Should franchisees obtain environmental insurance?

The need depends on the sector and risk. General liability policies may not cover every pollution or clean-up claim.

Can sustainability cooperation violate competition law?

Yes. Environmental objectives do not automatically permit price fixing, customer allocation, collective boycotts or unlawful supplier coordination.

Can all outlets charge the same environmental fee?

A mandatory customer charge applied by independent franchisees requires consumer, contract and competition-law review.

What should be reported after an environmental incident?

The parties should report the location, material, quantity, immediate measures, authority contacts, damage and supporting evidence according to the agreement and applicable law.

What is the most important drafting rule?

Every environmental commitment should state its scope, responsible party, measurement method, cost, timetable, evidence and consequence of non-compliance.

This article provides general legal information as of July 2026 and does not constitute legal, environmental, climate, advertising, competition, tax, technical or investment advice. Environmental and sustainability clauses should be reviewed according to the franchise sector, outlet structure, products, packaging, suppliers, premises and current Turkish legislation.

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