Franchising update: Commonwealth government responds to the review of the franchising code of conduct

The Australian government has released its response to the review of the Franchising Code of Conduct (report) and has accepted in full or in principle the majority of recommendations made by the independent reviewer and industry expert, Mr Alan Wein, including changes to the disclosure provisions, a requirement to act in good faith and greater enforcement powers to the Commonwealth regulator, the Australian Competition and Consumer Commission (ACCC). The government’s response can be accessed in full here.

The proposed changes, once legislated, will represent the largest overhaul of the Franchising Code since its inception and should strengthen the uniform national framework for the regulation of franchising, which has been under attack from certain state legislatures in recent years. Generally, the changes improve the administrative burden on franchisors although the strengthening of the enforcement regime represents increased exposure for franchisors.

The review of the Franchising Code was announced by the Australian government on 4 January 2013…

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