What Are the 12 Key Clauses in an EV Charging Franchise Agreement?

Investing in an EV charging station is not the same as purchasing a conventional retail franchise. A charging project combines electrical infrastructure, commercial property, expensive equipment, software, customer payments, maintenance obligations and a long operating relationship between the investor and charging network. That makes the EV Charging Franchise Agreement one of the most important documents in the entire investment process.

A presentation may explain investment potential, charger capacity, projected utilisation or operating support, but the signed contract determines what each party is actually required to do.

Investors therefore need to examine much more than the advertised revenue model. They should understand who owns the charger, who funds the transformer, who pays electricity bills, how charging revenue is calculated, how maintenance is handled, who controls station data and what happens if the partnership ends early.

India's charging sector also operates within electricity, safety, contractual and data-protection frameworks. The official Ministry of Power EV charging infrastructure guidelines establish the regulatory framework for installation and operation of charging infrastructure, while the final commercial rights between a franchise investor and network operator depend on their executed contract.

This guide explains 12 clauses investors should examine before committing capital.

Quick Answer: Which Franchise Agreement Clauses Matter Most?

The most important clauses are those that determine money, ownership, operational responsibility and exit risk.

Before signing, an investor should clearly understand:

1. Parties, scope and business model

2. Asset ownership

3. Investment and cost responsibility

4. Revenue calculation and settlement

5. Electricity and utility responsibility

6. Operations and maintenance

7. Uptime and service levels

8. Software, CMS and data rights

9. Insurance, indemnity and liability

10. Agreement term and renewal

11. Termination, relocation and exit

12. Dispute resolution and governing law

These clauses should work together. A favourable revenue-share clause means little if the investor unexpectedly bears major transformer replacement, land, downtime or termination costs.

Why an EV Charging Franchise Contract Needs More Detail Than a Normal Franchise Contract

An EV charging station is both a commercial business and an infrastructure asset.

A restaurant franchise may focus heavily on branding, recipes, supply standards and operating procedures. An EV charging station requires additional clarity because several physical and digital systems must operate continuously together.

The project may involve:

• DC or AC charging equipment

• transformer infrastructure

• sanctioned electrical load

• LT or HT panels

• cabling and earthing

• charging bays

• internet connectivity

• charger management software

• customer payment systems

• remote diagnostics

• preventive maintenance

• spare parts

• driver support

• electricity billing

• property rights

• taxation and accounting

The Central Electricity Authority EV charging standards and safety resources include safety requirements applicable to EV charging installations. Therefore, commercial contracts should clearly assign responsibility for installation compliance, inspections, maintenance and electrical safety rather than leaving those areas vague.

Investors who are still comparing the business structure can first review SpeedCharge's EV charging franchise versus independent charging station comparison before moving to contract due diligence.

EV Charging Franchise Agreement Clause 1: Parties, Scope and Business Model

The first clause should identify exactly who is entering the agreement and what commercial model is being created.

This sounds obvious, but ambiguity at this stage can create problems later.

The agreement should state:

• legal company name of the franchisor

• legal name of the investor or franchisee

• registered addresses

• authorised signatories

• GST details where applicable

• project location

• charger configuration

• commercial model

• responsibilities of each party

The distinction between FOCO and FOFO is particularly important.

FOCO — Franchise Owned, Company Operated

In a FOCO structure, the investor generally funds or owns defined charging infrastructure while the charging company handles agreed operational responsibilities.

FOFO — Franchise Owned, Franchise Operated

Under a FOFO arrangement, the investor may assume considerably more day-to-day operational responsibility.

The contract is more important than the label.

Two companies can both call their structure "FOCO" while assigning electricity bills, insurance, maintenance and staffing differently.

SpeedCharge currently describes its EV charging station franchise model in India as a structured franchise and partnership opportunity in which the final investment, station configuration, responsibilities and commercial terms are determined during project evaluation and agreement.

Investors should therefore ensure the agreement contains a complete scope matrix rather than relying only on the model name.

Clause 2: Ownership of Charger, Transformer and Infrastructure

Asset ownership is one of the most important and frequently misunderstood sections of a charging-station contract.

A project can contain several distinct assets:

• EV charger

• transformer

• electrical panels

• cables

• charger pedestal

• civil foundation

• canopy

• signage

• meter

• networking hardware

• CCTV equipment

• energy-management systems

The agreement should specify ownership of each asset separately.

Do not assume that because an investor pays for something, ownership automatically becomes obvious.

The contract should answer:

Who legally owns the charger?

Who owns the transformer?

Who owns the electrical panel and cables?

Who owns improvements made to leased property?

Who owns replacement components installed during the agreement?

Who owns equipment after the contract expires?

Documentation should also clarify whether asset ownership transfers at any point.

Investors should request:

• tax invoices

• equipment serial numbers

• warranties

• asset schedule

• installation records

• insurance records

• commissioning documents

This becomes particularly important if the investor finances the equipment or needs to establish ownership for accounting, insurance or future sale.

Clause 3: Investment Amount and Cost Responsibility

The agreement should clearly separate initial CAPEX from ongoing operating expenses.

An investor should never assume that the quoted charger price represents the complete project cost.

Possible CAPEX components include:

• charger hardware

• transformer

• load enhancement

• LT/HT panels

• cables

• metering

• civil work

• trenching

• foundations

• road markings

• signage

• fire-safety equipment

• network equipment

• installation labour

• testing

• commissioning

Ongoing expenses may include:

• electricity

• demand charges

• rent

• software

• internet

• maintenance

• payment gateway charges

• insurance

• customer support

• security

• staff

• statutory charges

A good agreement should include a cost responsibility matrix.

For example:

A detailed investment framework is discussed separately in SpeedCharge's EV charging station investment guide for India.

Clause 4: Revenue Share, Eligible kWh and Settlement Calculation

For many investors, this is the first clause they read.

It should not be the only one.

A revenue-sharing provision must explain exactly how revenue is measured.

Suppose a contract states that an investor receives a certain amount per eligible kWh. The agreement must then define eligible kWh.

Questions include:

• Is it energy dispensed by the charger?

• Is it energy successfully billed to the driver?

• Are promotional sessions excluded?

• Are free charging sessions excluded?

• Are failed or refunded transactions excluded?

• Are internal test sessions excluded?

• How are partial charging sessions treated?

• Does GST affect the calculation?

• Are payment-gateway costs deducted first?

• Does electricity cost come before or after revenue sharing?

The settlement clause should also specify:

• settlement frequency

• reporting period

• invoice requirement

• tax deduction

• reconciliation process

• correction process

• payment timeline

• disputed transaction process

A commercially attractive number can become misleading when the calculation basis is unclear.

Investors evaluating profitability assumptions should also review SpeedCharge's current analysis of EV charging franchise profitability in India, which distinguishes revenue, payout structure and actual investment returns.

EV Charging Franchise Agreement Revenue Definitions Should Be Auditable

The investor should be able to verify the calculation using real station data.

Useful dashboard information can include:

• charging session ID

• date and time

• charger ID

• connector

• energy dispensed

• tariff

• session value

• payment status

• refunds

• taxable amount

• final settlement value

Without transparent underlying data, monthly payout statements can be difficult to independently reconcile.

The contract should therefore define both the commercial formula and the investor's right to inspect supporting data.

Clause 5: Electricity Connection, Tariff and Utility Responsibility

Electricity is one of the most important recurring costs in an EV charging business.

The contract should state who is responsible for:

• applying for electricity connection

• sanctioned load

• transformer installation

• security deposit

• meter installation

• monthly electricity bills

• demand charges

• penalties

• power-factor issues

• load enhancement

• DISCOM coordination

The 2024 Ministry of Power framework states that charging-station operators can apply for electricity connections and establishes a broader framework for electricity supply to charging infrastructure. It also permits LT connections for qualifying EV-charging loads up to 150 kW, subject to applicable distribution arrangements.

This clause is especially important where the charger shares an electricity connection with a hotel, restaurant, mall or other commercial property.

The agreement should explain how the charging station's electricity consumption will be measured and allocated.

A separate metering or sub-metering arrangement can make reconciliation clearer where appropriate.

Clause 6: Operations, Preventive Maintenance and Breakdown Repair

A charger that is installed but unavailable does not produce charging revenue.

The operations section should therefore identify responsibility for:

• remote monitoring

• routine inspection

• firmware updates

• preventive maintenance

• cleaning

• connector inspection

• emergency repair

• spare parts

• technician visits

• electrical maintenance

• customer complaints

• payment failures

• charger resets

• network connectivity

Investors should look beyond the phrase "complete maintenance included."

Ask what complete maintenance actually means.

Does it include:

• power modules?

• charging guns?

• display?

• contactors?

• communication modem?

• damaged cable?

• cooling system?

• vandalism?

• accidental damage?

• transformer?

• upstream electrical panels?

The agreement should distinguish warranty, AMC, routine maintenance and exclusions.

Investors considering the technical project lifecycle can review SpeedCharge's guide to starting an EV charging station business in India to understand how electrical infrastructure, hardware, CMS and ongoing operations interact.

Clause 7: Uptime, SLA and Fault-Response Requirements

"24/7 support" is not the same thing as an uptime commitment.

The agreement should define measurable service levels.

Potential metrics include:

• charger availability percentage

• remote response time

• technician response time

• resolution target

• spare-parts turnaround time

• scheduled maintenance exclusions

• DISCOM outage exclusions

• telecom outage exclusions

• force-majeure exclusions

For context, current PM E-DRIVE public charging station operational guidelines include technical and operational requirements for programme-supported public charging infrastructure. The relevant scheme specifications include an uptime benchmark for applicable supported stations, showing why availability is treated as an important operating metric.

A private franchise contract does not automatically inherit every PM E-DRIVE requirement, but uptime should still be contractually measurable.

A useful SLA should answer:

When does downtime begin?

What conditions are excluded?

Who records downtime?

Can the investor see the uptime report?

What escalation applies if downtime becomes persistent?

EV Charging Franchise Agreement Clause 8: CMS, Software and Data Rights

Modern charging stations depend heavily on software.

The charging management system may control:

• charger status

• tariffs

• user authentication

• remote start and stop

• payment sessions

• RFID access

• charging records

• fault alerts

• utilisation data

• financial reconciliation

The agreement should state who owns the software platform and what access the investor receives.

Who Controls the EV Charging Data?

This question deserves specific attention.

Possible data categories include:

• charger telemetry

• kWh delivered

• station utilisation

• revenue

• customer mobile number

• customer account information

• RFID details

• payment records

• vehicle-related information

• support tickets

• location information

Where personal information is processed, parties should consider obligations under India's Digital Personal Data Protection Act, 2023 and any applicable rules or subsequent requirements.

The contract should clarify:

• which party collects customer information

• purpose of processing

• access rights

• data retention

• data-security responsibilities

• reporting rights

• what happens to data after termination

The investor should also determine whether historical financial and station-performance data remains accessible if the relationship ends.

Clause 9: Insurance, Liability and Indemnity

Charging stations combine high-power electrical equipment, vehicles and public access.

Risk allocation therefore matters.

Potential incidents include:

• equipment damage

• electrical fault

• fire

• third-party injury

• vehicle damage

• property damage

• theft

• vandalism

• software-related payment dispute

• employee or contractor negligence

The agreement should state which insurance policies are required and who obtains them.

Possible coverage can include:

• equipment insurance

• fire and special-perils cover

• public liability

• machinery breakdown

• contractor-related insurance

• cyber cover where relevant

Insurance requirements should match the actual project rather than appearing as generic boilerplate.

The indemnity clause should also be reviewed carefully.

Avoid assuming that every loss should automatically fall on one party.

Liability should ideally relate to:

• ownership

• negligence

• contractual responsibility

• statutory responsibility

• insurance coverage

Investors should consider having a qualified lawyer review indemnity and limitation-of-liability provisions before execution.

Clause 10: Agreement Term, Lock-In and Renewal

Infrastructure investments usually require a longer commercial horizon than many ordinary service contracts.

The contract should clearly state:

• commencement date

• initial term

• commercial-operation date

• lock-in period

• renewal process

• renewal notice period

• revised commercial terms

• post-expiry asset treatment

One important distinction is the difference between agreement execution date and commercial operation date.

Suppose an agreement is signed in January but DISCOM approval delays station commissioning until April.

If commercial entitlements, minimum payouts, maintenance periods or warranties start from the wrong date, the delay may materially affect economics.

The contract should therefore define important dates separately.

Examples include:

Effective Date: the date the agreement legally becomes effective.

Installation Date: date physical installation is completed.

Commissioning Date: date testing and commissioning are completed.

Commercial Operation Date: date paid charging operations begin.

Ambiguous dates are a common source of contractual disagreement.

Clause 11: Termination, Relocation and Exit Rights

Investors often focus on how to enter a charging franchise but do not spend enough time understanding how they can leave it.

Termination provisions should address:

• breach

• payment default

• repeated downtime

• insolvency

• regulatory change

• property loss

• prolonged force majeure

• misuse of brand

• failure to maintain infrastructure

• agreement expiry

• mutual termination

The contract should also define a cure period where appropriate.

For example, if one party fails to make a payment, does the agreement terminate immediately, or does that party receive a defined period to correct the breach?

What Happens to the Charger After Termination?

The agreement should answer:

• Does the investor retain the charger?

• Can the operator remotely disable software access?

• Can the charger be connected to another CMS?

• Who removes branding?

• Can the charger be relocated?

• Who pays relocation expenses?

• What happens to the transformer?

• What happens to customer deposits?

• What happens to unsettled revenue?

Technology portability is particularly important.

An investor may legally own the charging equipment but still find it commercially unusable if software, firmware or backend access cannot be transferred.

Investors comparing long-term control can use the existing franchise versus own charging station guide as a complementary due-diligence resource.

Clause 12: Governing Law, Arbitration and Dispute Resolution

Even a strong commercial relationship can experience disagreements.

The contract should provide a structured mechanism to resolve them.

A common sequence can include:

1. Written notice

2. Management-level discussion

3. Negotiation period

4. Mediation or conciliation where agreed

5. Arbitration or court proceedings

Where arbitration is used, the contract should clearly specify:

• arbitration mechanism

• number of arbitrators

• appointment method

• seat of arbitration

• venue

• language

• governing law

India's Arbitration and Conciliation Act, 1996 establishes the legal framework governing arbitration and conciliation in India.

The underlying commercial agreement itself must also satisfy applicable contract law. The Indian Contract Act, 1872 contains foundational provisions on contracts, obligations, performance, breach, indemnity and related matters.

Investors should obtain professional legal review where material capital is being committed.

Four Additional Clauses That Are Often Overlooked

Although the 12 clauses above cover the core agreement structure, several supporting provisions deserve close attention.

Force Majeure

The agreement should explain what happens when performance becomes impossible or significantly disrupted due to events outside reasonable control.

Potential examples can include:

• natural disasters

• prolonged grid failures

• government restrictions

• major infrastructure disruption

The clause should also explain notification, mitigation and prolonged-event termination rights.

Confidentiality

Commercial agreements may contain sensitive information relating to:

• revenue share

• pricing

• customer information

• software

• technology

• business strategy

• station performance

Confidentiality obligations should be proportionate and clearly defined.

Branding and Intellectual Property

The investor should understand how the network's:

• trademark

• logo

• station branding

• app

• software

• marketing assets

may be used.

It should also be clear when the investor must stop using those assets after termination.

Assignment and Transfer

Can the investor:

• sell the station?

• transfer the business?

• bring in another investor?

• assign rights to a lender?

• transfer the agreement to another company?

These questions matter if ownership structure changes during a long-term investment.

How to Review Revenue Projections Before Signing

One of the biggest contractual mistakes is treating an illustrative projection as a guaranteed outcome.

Charging-station financial performance can depend on:

• traffic

• EV penetration

• charger utilisation

• electricity tariff

• customer tariff

• rent

• maintenance

• financing

• downtime

• competing stations

• charger capacity

• charging behaviour

If a proposal projects a particular number of daily sessions, ask what evidence supports it.

If the station is expected to dispense a particular number of kWh every month, ask:

• What utilisation rate is assumed?

• How was traffic measured?

• Are existing chargers nearby?

• Is fleet demand contractually secured?

• Is the estimate based on comparable live stations?

SpeedCharge's location-specific content, such as its EV charging station franchise guide for Delhi, also illustrates why city, site and commercial terms should be analysed together rather than treating every market as identical.

Financial projections should be labelled as estimates unless the executed contract expressly creates a defined contractual payment obligation.

Site Approval Should Be Linked to the Agreement

One particularly useful protection is ensuring that site feasibility is not treated as a casual sales-stage formality.

A charging station depends heavily on:

• road access

• parking

• visibility

• EV traffic

• nearby amenities

• electrical feasibility

• transformer availability

• charger competition

• property tenure

The agreement or project annexure should identify the approved site.

Where feasibility conditions are not satisfied, investors should understand whether:

• another site can be substituted

• fees are refundable

• equipment can be relocated

• extra infrastructure cost requires approval

• either party can withdraw

Property owners who are not certain whether they want a franchise investment can also compare SpeedCharge's commercial EV charging partnership options before selecting the final structure.

Documents Investors Should Ask for Before Signing

Contract review becomes easier when commercial claims can be matched to documents.

A practical due-diligence file may include:

Corporate documents

• company legal name

• incorporation information

• GST information

• authorised signatory evidence

• registered office details

Equipment documents

• charger quotation

• make and model

• technical specification

• warranty

• certification

• serial-number process

Site documents

• ownership or lease papers

• landlord consent where relevant

• electrical feasibility

• site layout

• parking plan

• proposed charger configuration

Financial documents

• CAPEX breakup

• operating-cost responsibility

• revenue formula

• sample settlement statement

• projected utilisation assumptions

Operational documents

• maintenance scope

• SLA

• support escalation

• insurance responsibility

• CMS access

• reporting format

The final agreement should not contradict these supporting documents.

If a proposal and agreement contain different terms, the executed agreement will generally become the document requiring greatest attention.

Red Flags Investors Should Not Ignore

Several warning signs deserve additional scrutiny.

Undefined "profit" language

Revenue, revenue share, contribution and net profit are different concepts.

The agreement should use precise financial terminology.

Unspecified operating costs

If nobody can clearly explain who pays electricity, transformer maintenance, insurance or software charges, the investor does not yet have a complete financial model.

Verbal promises missing from the agreement

If a commercial commitment is important enough to influence the investment decision, ask whether it should be included in the signed documentation.

Guaranteed ROI language without defined mechanics

A fixed payout clause does not necessarily mean the investment has a guaranteed ROI.

ROI depends on total investment and expenses.

One-sided termination provisions

Investors should understand whether both sides have reasonable rights when the other party materially fails to perform.

No access to performance data

An investor receiving revenue linked to kWh should ideally be able to verify station utilisation and settlement information.

Unclear asset ownership

The charger, transformer and electrical infrastructure should not fall into an ownership grey area.

How SpeedCharge Investors Should Approach the Agreement Stage

SpeedCharge's current franchise process describes site feasibility, station configuration, commercial proposal, agreement and planning before installation and network activation.

That sequence is important because the agreement should reflect the actual approved project rather than a generic station.

Before execution, an investor should make sure the final documentation reflects:

• approved site

• charger capacity

• number of chargers

• investment responsibility

• asset ownership

• operating model

• revenue structure

• electricity responsibility

• maintenance

• insurance

• settlement

• term

• termination

The agreement should also contain or reference project-specific schedules where necessary.

A well-structured schedule can be easier to verify than repeatedly searching through a long general contract for technical information.

Practical Agreement Checklist Before You Sign

Use this checklist during the final review.

If several boxes remain unanswered, the investor should seek clarification before execution.

Conclusion

An EV charging franchise is a long-term infrastructure relationship, not merely a charger purchase.

Investors should therefore read the contract from four perspectives: asset ownership, financial calculation, operating responsibility and exit rights.

The strongest agreement is not necessarily the longest agreement. It is the one that clearly explains who owns each asset, who pays each cost, how every payout is calculated, what service level must be maintained and what happens when the commercial relationship ends.

Investors interested in a structured company-operated charging model can review SpeedCharge's franchise opportunity and request a project-specific proposal after location and electrical feasibility assessment.