One bugbear under the current Franchising Code of Conduct relates to the requirement to redisclose to a franchisee if amendments are made to the franchise agreement after the initial disclosure takes place. Let me paint the picture for you, the franchise agreement is prepared together with all other associated documents, disclosure is made to the franchisee, the franchisee negotiates changes to the franchise agreement and thus we have to undertake the disclosure process again and ...

Our review of the changes to the Franchising Code of Conduct continues today looking at when franchisor will not be required to update a disclosure document. The standard rule is that a disclosure document must be updated within 4 months of the end of financial year. However, after 1 January, 2015 a franchisor is relieved of the obligation to update its disclosure document if: 1. the franchisor entered into or 1 or no franchise agreements during the year; and 2. the franchi...

The new Franchising Code of Conduct provides that a franchisor must give a franchisee a copy of the disclosure document within 14 days of a written request by the franchisee. That is nothing new and a similar clause is contained in the current Franchising Code of Conduct. However, the new Code provides for a penalty of up to 300 penalty units if the franchisor does not comply with the request on time. That is a potential penalty of up to $51,000! Franchisors be warned, you ...