12 Jul 2021

The Franchising Code of Conduct (the Code) has been amended to improve fairness and transparency and protect small businesses in the franchising sector.

In the updated Code, franchisees will benefit from improvements to financial disclosure, transparency of risk, cooling-off rights and dispute resolution processes.

The amended Code comes in response to the Australian Government's 2019 Fairness in Franchising report and will:

  • improve access to information for franchisees and prospective franchisees
  • better balance the rights of franchisors and franchisees
  • improve access to justice though additional, more efficient dispute resolution processes.

Protections for new vehicle dealership agreements

The Code amendments also includes provisions specifically for new vehicle dealership agreements. It expands the definition of motor vehicle dealership to recognise agency models and provides for fair and reasonable compensation for franchisees in the event of early termination.

When do the changes come into effect?

Most amendments came into effect 1 July 2021 or before. Those relating to the franchisor disclosure documents will apply to documents given from 1 November 2021.

More information

See Changes to the Franchising Code on the Australian Competition and Consumer Commission (ACCC) website for more information.