Underneath the Golden Boy - Robson Hall Faculty of Law

Franchise Law Consultation Paper 2007 277
• the exemption for international franchisors with only one franchise or
master franchise in Australia should be deleted;
• consideration should be given to prohibiting unilateral material changes
by franchisors and removing or modifying the right of a franchisor to
unilaterally terminate a franchise agreement. If the right is maintained,
adequate franchisee compensation should be required;
• franchisors should be prohibited from inducing prospective franchisees
not to associate or communicate with current or past franchisees (the
current prohibition applies to current franchisees associating with other
franchisees);
• franchisors should be required to register with and submit annual
disclosure documents to the ACCC and the ACCC should undertake
sample audits of disclosure documents;
• the Government should apprise the ACCC of franchisee concerns
respecting the level of enforcement action;
• the Code should include a requirement of good faith and fair dealing. 185
The Australian Government announced in February 2007 that it accepted
most of the recommendations of the Review Committee, and would consult with
the franchising industry on their implementation. The government declined to
implement the recommendations for inclusion of a duty of good faith, mandatory
risk statements, the mandatory registration of franchisors with the ACCC and
ACCC disclosure document audits. 186 The recommendation respecting the right
of franchisors to unilaterally change franchise agreements will be addressed
through amendments to the Trade Practices Act 1974. 187
185
Franchising Code Review Committee, supra note 36.
186
Hon. F. Bailey, Minister of Industry, Tourism and Resources, Reform of Franchising Code of
Conduct (Media Release, February 6, 2007), online:
(date accessed: May 12, 2007); Hon. F. Bailey, Minister
of Industry, Tourism and Resources, Consultation with the Franchising Industry Underway
(Media Release, February 21, 2007), online:
(date accessed: May 12, 2007); S. Giles, Franchising
code amendment announcement, Deacons (February 2007), online:
(date accessed: May 12, 2007); Australia:
Franchising Code Review, DLA Phillips Fox (February 26, 2007), online:
(date accessed: May
12, 2007).
187
Hon. F. Bailey, Minister of Industry, Tourism and Resources, Reform of Franchising Code of
Conduct, supra note 42.