On 8 February 2024 the Federal Government released the Independent Review of the Franchising Code of Conduct by Dr Michael Schaper. The Review found the Code is generally fit for purpose and recommended relatively few amendments. A principal focus of the Review is a need for improved Government education and guidance to the sector. The […]

Big penalties and wider application to commence 9 November 2023 In late 2022 the Australian Parliament passed the Treasury Laws Amendment (More Competition, Better Prices) Act 2022 to expand the protection to small businesses under the Australian Consumer Law against unfair terms in standard form small business contracts. The number of contracts caught by the […]

Two rounds of amendments to the Australian Franchising Code of Conduct come into force during April 2022. Franchisors should take note of the changes including increased penalties for breach of the Code and the new requirement for franchisors to register their details with the Commonwealth government. Franchise Disclosure Register – 1 April 2022 The Code […]

Unfair terms in standard form small business contracts are void under section 23(1) of the Australian Consumer Law. Between 23 August 2021 – 20 September 2021 the Australian government invited public submissions on an Exposure Draft of a bill to strengthen these laws. Persons entering into template supply terms, service agreements, franchise agreements, distribution agreements, […]

Introduction Following a lengthy Parliamentary Inquiry commencing in March 2018, amendments to the Franchising Code of Conduct were released 1 June 2021. Of the 71 earlier recommendations made by the Parliamentary Joint Committee on Corporations and Financial Services some 11 substantive changes have been taken up impacting on the disclosure obligations of the franchisor, the […]

The Australian Competition and Consumer Commission (ACCC) has revealed the key findings of its recent compliance checks of a sample of franchisors in the food services sector. The ACCC investigated 12 separate food services industry franchisors. The report outlines the following issues. 8/12 of the franchisors made it difficult to contact former franchisees The Franchising […]

On 14 March 2019, the Parliamentary Joint Committee on Corporations and Financial Services released its report entitled ‘Fairness in Franchising’. The first recommendation of the Report is that an inter-agency Franchising Taskforce be established to examine the feasibility and implementation of a number of the Committee’s recommendations. It is recommended that the Taskforce include representatives […]

Federal Court gives further direction on required content of annual marketing fund statements  The Australian Competition and Consumer Commission’s recent investigations into the conduct of well known motor repairer, Ultra Tune, have resulted in the Federal Court ordering Ultra Tune to pay a penalty of $2,604,000 to the ACCC. On 18 January 2019, the Federal […]

This is the text of a presentation given by Peter Buberis to the Council for Economic Development in Adelaide recently. The current atmosphere – media/senate inquiry Why the fuss now?  Confusion with Finance Royal Commission – contract v bad behaviour. Concern from offshore investors.  The franchising industry seems to be in a present state of turmoil […]

Recent revelations of wage scandals and the parlous position of franchisees, within certain well known franchise systems, have led to what is being viewed by some as a crisis, perhaps even a crossroads which may determine the future survival of franchising as a business model. This is certainly the line that has been pressed by […]

Profit opportunities for franchise systems arising from changes to competition laws When your franchise system was established, considerable thought was given to the profit centres it would create and achieving from them a return satisfactory to the system and/or its shareholders, which at the same time provided an acceptable income to your franchisees to justify […]

The 7-Eleven scandal, which involved unlawful conduct by franchisees such as requiring employees to pay back a significant amount of their wages and falsely recording data, sparked a thorough investigation by the Fair Work Ombudsman. Following the release of the Ombudsman’s report, the Australian government announced its policy to protect vulnerable workers in light of […]

It is mandatory under the Franchising Code of Conduct for a franchisor to disclose relevant business experience to prospective franchisees, including information about previous insolvency events. For the first time, the Australian Competition and Consumer Commission (ACCC) has sought penalties for breaches of the Code in the Federal Court. The revised Code (which came into […]

On the 23rd June 2016 the voters of the United Kingdom will provide a definitive view on the place of the United Kingdom within the European Union. This commentary will not delve into the pro’s and con’s of the argument but does note the strong possibility of the United Kingdom voting in favour of an […]

As Franchisors and advisors we have just undergone a year of significant change in bedding down the new requirements of the Franchise Code and redrafting our suite of documents. While much remains unanswered about the new regime, including the practical ramifications of the “good faith” relationships parties now must observe, the changes seem somehow more […]

The Federal Court has again reminded us that the law will step in to defend franchisees who have suffered at the hands of overzealous franchisors. The Court recently found that an experienced franchisor, South East Melbourne Cleaning (South East) engaged in unconscionable conduct in its dealings with franchisees and contravened section 21 of the Australian […]