UTGB Vol 5.pdf - Robson Hall Faculty of Law

assets are often at risk through the granting of personal guarantees or security to
the franchisor or lending institutions financing a transaction. 26
Although the ULCC advocates for uniformity across Canada, even if it is not
achieved, its message is clear: franchise legislation is needed. Regardless of the
differences that may exist between the Ontario, Prince Edward Island and
Alberta Acts and the ULLC Uniform Franchises Act [UFA], 27 the bottom line is
that the four advocate for franchise legislation as a means of protecting
franchisees from the abuse of franchisors and, consequently, generating more
confidence in the system. In addition to leveling the playing field between
franchisors and franchisees, a further consequence of uniform legislation may be
the eventual standardization of fair business practices.
D. Canadian Franchise Association (CFA)
The Canadian Franchise Association (CFA) represents over 400 franchise
companies and the professionals who support this way of doing business.
Members must abide by the CPA's Code of Ethics, 28 as well as the Association's
rules of disclosure. 29
The CFA's Disclosure Document Guide, revised in 2002, sets similar disclosure
requirements as those seen in Alberta and Ontario's franchise legislation. It
covers issues ranging from the disclosure of business experience of the
franchisor, franchise experience of the franchisor, information regarding other
existing franchisees, bankruptcy and insolvency, and existing litigation. The
CFA recommends the inclusion of a certificate of disclosure where: the
franchisor asserts that the information provided is in accordance with the
CPA's disclosure policy, warns the franchisee to examine the franchise
investment carefully and recommends the consultation of legal advisors prior to
executing the agreement. 30
The advantage the CFA presents to franchisees residing in Manitoba is that it
provides them with similar protection to other provinces where franchises are
statutorily regulated. In other words, franchisees in Manitoba are protected in a
similar way as a franchisee in Alberta, Ontario or Prince Edward Island, where
franchise legislation has been introduced enforcing disclosure.
26
Ibid. at 23-24.
27
Uniform Law Conference of Canada, Uniform Franchises Act [UFAL online: Selected
Uniform Statutes .
28
Canadian Franchise Association, "Code of Ethics", online: Canadian Franchise Association
.
29
Canadian Franchise Association, "Welcome to the Canadian Franchise Association,,
online: About Us .
3° Canadian Franchise Association, "CFA Disclosure Rules," online: Already in Franchising
< http:/lwww.cfa.ca/Page.aspxURL=CFADisclosureRules.html > .