What is Franchise?

Legal Definition
1. A relationship wherein a business organization, called a franchiser, in exchange for a fee and with the franchisor's guidance, allows another business, called the franchisee, to operate under the franchiser's trade name and offer the franchiser's products or services.

2. A right conferred by the government to operate as a legal business entity or provide some service of a public nature in a certain geographic region.
See also
Legal Definition
This word has several significations: 1. It is a right reserved to the people by the constitution; hence we say, the elective franchise, to designate the right of the people to elect their officers. 2. It is a certain privilege, conferred by grant from the government, and Vested in individuals.

2. Corporations, or bodies politic, are the most usual franchises known to our law. They have been classed among incorporeal hereditaments, perhaps improperly, as they have no inheritable quality.

3. In England, franchises are very numerous; they, are said to be royal privileges in the hands of a subject. Vide 3 Kent, Com. 366; 2 Bouv. Inst. n. 1686; Cruise,' Dig. tit. 27; 2 Bl. Com. 37; 15 Serg. & Rawle, 130; Finch, 164.
-- Bouviers Law Dictionary
Legal Definition
A special privllege conferred by government upon an individual or corporation, and which does not belong to the citizens of the country generally, of common right. It is essential to the character of a franchise that it should be a grant from the sovereign authority, and in this country no franchise can be held which is not derived from a law of the state. In England, a franchise is defined to be a royal privilege in the hands of a subject. In this country, it is a privilege of a public nature, which cannot 'be exercised without a legislative grant. See Bank of Augusta v. Earle, 13 Pet. 595, 10 In Ed. 274; Dike v. State, 38 Minn. 366, 38 N. W. 95; Chicago Board of Trade v. People, 91 111. 82; Lasher v. People, 183 111. 226, 55 N. E. 663, 47 L. R. A. 802, 75 Am. St. Rep. 103; Southampton v. Jessup, 162 N. Y. 122, 56 N. Bl 538; Thompson v. People, 23 Wend. (N. Y.) 578; Black River Imp. Co. v. Hol-way, 87 Wis. 584, 59 N. W. 126; Central Pac. R. Co. v. California, 162 U. S. 91, 16 Sup. Ct 766, 40 In Ed. 903; Chicago & W. I. R. Ch. v. Dunbar, 95 III. 575; State v. Weather-by, 45 Mo. 20; Morgan v. Louisiana, 93 U. S. 223, 23 In Ed. 860. A franchise is a privilege or immunity of ft public nature, which cannot be legally exercised without legislative grant. To be a corporation is a franchise. The various powers conferred on corporations are franchises. The execution of a policy of insurance by an insurance company, and the issuing a bank-note by an incorporated bank, are franchises. People v. Utica Ins. Co.., 15 Johns. (N. Y.) 387, 8 Am. Dec. 243. The word "franchise" has various significations, both in a legal and popular sense. A corporation is itself a franchise belonging to the members of the corporation, and the corporation, itself a franchise, may hold other franchises. So, also, the different powers of a corporation, such as the right to hold and dispose of property, are its franchises. In a popular sense, the political rights of subjects and citizens are franchises, such as the right of suffrage, etc. Pierce y. Emery, 32 N. H. 484. The term "franchise" has several significations, and there is some confusion in its use. When used with reference to corporations, the better opinion, deduced from the authorities, seems to be that it consists of the entire privileges embraced in and constituting the grant. It does not embrace the property acquired by the exercise of the franchise. Bridgeport v. New York & N. H. R. Co.., 36 Co.nn. 255, 4 Am. Rep. 63.
See also
-- Black's Law Dictionary
Legal Definition
A special privilege conferred by the government on individuals. See 101 Md. 541, 109 Am. St. Rep. 584, 1 L. R. A. (N. S.) 263, 61 Atl. 532.
-- Ballentine's Law Dictionary