Retailing, Franchising, and Consumerism Business Intelligence in China

Informatics To Contest Franchisee's Claim

Informatics plans to vigorously defend itself against a lawsuit filed by KS Consultants Pte Ltd and Kim Seng Holdings Pte Ltd in the Singapore High Court for the return of the fees, costs incurred and damages, after the claimants found that the franchises for Informatics Computer School (ICS) and Thames Business School were allegedly unviable to be setup in China's Hainan province.

In a press release, Informatics says, "Informatics' view on the alleged breach or breaches stated by the claimants is that they are unfounded as the validation agreement with the University of Cambridge Local Syndicate (UCLES) will only come to an end in April 2006. All existing students and new students who enroll on or before 31 December 2004 will be given the opportunity to sit for their examinations until 31 December 2007. Furthermore, all students on the UCLES validated programmes are given an opportunity to switch over to similar Informatics programmes that are validated by NCC Education."

The company continues: "The allegations of misrepresentation are baseless and misleading because Informatics does not make any representations on the potential of a territory or on obtaining relevant government approvals for any territory. The claimants are well aware, and they do recognise, that this franchise venture not only involves business risks but is also dependent on the ability of the franchisee."

Informatics says that the Hainan franchisee still does not have a centre, having yet to start up one, even after a lapse of more than two years since they first signed the agreement.

Informatics is presently seeking legal advice andsays it will vigorously contest the claim.

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