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FRANCHISING CODE OF CONDUCT

Greyson Legal | Franchise Lawyers have a sound understanding of the Franchising Code of Conduct and its application.

If you require assistance:

  • understanding the Franchising Code of Conduct

  • how the Code applies to you; or

  • because the Franchisor may have breached the Franchising Code of Conduct,

give us a call to see how we can help you.

 

Is the Franchising Code of Conduct mandatory?

Yes, the Code is a mandatory industry code prescribed under section 51AD of the Competition and Consumer Act 2010 (CCA) and regulates the conduct of Franchisors and Franchisees.​

 

How does the Franchising Code of Conduct regulate?

The Code regulates in a number of ways, such as:

  • disclosure obligations

  • requirement for certain minimum provisions within a Franchise Agreement

  • provides a dispute resolution procedure

  • incorporates a cooling off period

  • requirement for Franchisors and Franchisees to act in good faith.

The Australian Securities & Investments Commission (ACCC) oversees compliance with the Franchising Code or Conduct and investigates alleged breaches.

The ACCC has a range of compliance and enforcement tools at its disposal to ensure compliance with the Code, such as:

  • the party in breach agreeing to certain remedial action and/or compensate affected parties

  • obtaining court enforceable undertakings

  • issuing of infringement notices

  • imposing fines and penalties 

  • commencing court proceedings

For example, in the matter of Back In Motion Physiotherapy Pty Ltd certain restraint of trade terms in its Franchise Agreements were deemed unfair. The company agreed to provide a court enforceable undertaking, for instance, not to include such terms in its future Franchise Agreements.. Read more here.​

 

If you are thinking about entering into a Franchise Agreement or need help understanding the application of the Franchising Code of Conduct, contact Greyson Legal | Franchise Lawyers for details on how we can help you.