Underneath the Golden Boy - Robson Hall Faculty of Law

Franchise Law: Consultation Paper 2007
MANITOBA LAW REFORM COMMISSION
CHAPTER 1: INTRODUCTION
A. Background to the Project
he Manitoba Law Reform Commission has noted that franchising is a
Tgrowing
and relatively unregulated field of business activity; there has been
occasional media attention focusing on the inequality between franchisors and
franchisees and recently, on alleged franchising frauds in Manitoba. 1 In recent
years, three provinces and several countries have enacted new or revised
franchise legislation. In January 2006, the Commission received a suggestion that
a review of possible reforms to franchise law would be valuable in Manitoba, 2 and
the Commission agreed to undertake the project.
B. Scope
This paper considers whether the regulation of franchises is desirable in
Manitoba. It provides an introduction to the history and various models of
franchising, an overview of existing franchise regulation in Canada and other
countries and a comparison of the elements of Canadian legislative regimes.
Finally, it asks whether franchise legislation is needed in Manitoba, and if so,
what elements should be included in the legislation.
1
For example, A. Paul, “City man burned by pizza franchise scam” Winnipeg Free Press
(February 12, 2007); P. Turenne, “Bitter business tale: Pizza franchise turned out to be scam”
Winnipeg Sun (February 12, 2007). See also T. Davis, “A town tackles a giant” Winnipeg Free
Press (June 17, 1995) A17; residents of the Town of Oakville organized a rally to protest a new
General Motors policy that was forcing a dealer to close his dealership and to press for
legislation that would make it more difficult for franchisors to dictate terms to franchisees.
According to the report, GM was requiring dealers to undertake expensive renovations, and
had refused approval for the Oakville dealer to sell his dealership instead. In the article, NDP
MLA Jim Maloway and the President of the Manitoba Motor Dealers Association advocated
for franchise legislation in Manitoba.
2
The review was suggested by A.L. Weinberg, Q.C., Myers Weinberg LLP, Winnipeg, Manitoba.