The Commonwealth is in the final stages of implementing the reforms to the regulatory framework for the franchising sector that will commence on 1 January 2015. The Competition and Consumer (Industry Codes-Franchising) Regulation 2014 (New Regulation) contains the new Franchising Code of Conduct (New Code). The headline changes that you should be aware of include the new test for determining whether a wholesale arrangement is considered to be a franchise, the new template form of disclosure document, the prohibition on mandatory significant capital expenditure, changes to the operation and disclosure of marketing funds, the introduction of an obligation to act in good faith and restrictions on restraint of trade clauses in franchise agreements. There are now serious financial penalties for breaches of the New Code so it is important to be aware of the new changes now and take the appropriate action before 1 January 2015.
CLICK HERE TO READ THE FULL FRANCHISE CODE CHANGES
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