Franchising code of conduct

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The Government’s Small Business Policy is now administered by Department of Jobs and Small Business, due to the Administrative Arrangements Order introduced on December 20, 2017.

Previously Small Business Policy was administered by the Treasury.

The Franchising Code of Conduct regulates the conduct of franchisees and franchisors, including the obligation to act in good faith and for franchisors to disclose important information before a franchisee enters into a franchise agreement.

The Department of Jobs and Small Business has policy responsibility for the Franchising Code of Conduct.

The Australian Competition and Consumer Commission (ACCC) is responsible for the administration and enforcement of the Franchising Code.

The new Franchising Code of Conduct commenced on 1 January 2015 and puts in place the franchising policy reforms outlined in the Government’s Future of Franchising Statement.

Franchising Inquiry

On 22 March 2018, the Senate referred an Inquiry into the Operation and Effectiveness of the Franchising Code of Conduct to the Parliamentary Joint Committee on Corporations and Financial Services for report by 30 September 2018. The Senate has extended the reporting date of the Inquiry to 14 February 2019.

New penalties framework

The Competition and Consumer Amendment (Industry Code – Penalties) Act 2014 also commenced on 1 January 2015 to work in conjunction with the new Franchising Code.

The reforms to the Franchising Code have introduced pecuniary penalties (up to $54,000) and allow the ACCC to issue infringement notices ($9,000 for a body corporate and $1,800 in any other case) for contravention of a civil penalty provision of that code.

Office of the Franchising Mediation Adviser

The Office of the Franchising Mediation Adviser assists franchisors and franchisees resolve their problems and disputes by referring the parties to trained mediators with experience located across Australia.

Find out more about the Office of the Franchising Mediation Adviser

2013 Review of the Franchising Code of Conduct

On 4 January 2013 Alan Wein commenced an independent review of the Franchising Code of Conduct. The review looked at the 2008 and 2010 amendments to the code and resulted in the development of the new 2015 Franchising Code of Conduct.