Restraint of trade clauses are common in franchise agreements and are designed to protect the franchisor's legitimate business interests.
It is important for franchisees to carefully review and understand the restraint of trade clauses in their franchise agreements to ensure compliance and avoid potential legal issues.
In this article we will consider how the new "Right to Disconnect" law in Australia impacts employees and employers and what factors both employees and employers need to take into account when communicating outside of work hours.
On 8 February 2024, the Minister for Small Business, the Hon Julie Collins MP, released the Independent Review of the Franchising Code of Conduct by Dr Michael Schaper. In this article we consider the key findings and recommendations of the Independent Review.
In this guide we consider the franchise disclosure document, the importance of franchise disclosure document compliance, and best practices to ensure compliance as a franchisor in Australia.
The Importance of Franchise Disclosure Documents
Key Components of Franchise Disclosure Documents
Common Disclosure Document Issues for Australian Franchisors
Traditionally, franchise agreements were not negotiable. However, in our experience, franchisors have become more willing to negotiate terms and obligations contained in a franchise agreement. This trend is likely to be further influenced by the Unfair Contracts Regime which applies to small business standard form contracts. A franchisor who is open to negotiating key terms in a franchise agreement, may be less likely to have the franchise agreement considered a standard form contract.
Franchising is complex and highly regulated.
There are many legal requirements that need to be complied with in order to successfully franchise your business. We consider these requirements in more detail below.
Guide to Franchising Your Business
What happens when a franchisee is not living up to expectations? In this article we explore the challenges of poorly performing franchisees and how they can impact the overall success of a franchise.
The Treasury Laws Amendment (More Competition, Better Prices) Act 2022 ("the Act") came into effect on 9 November 2022.
In this blog post, we will delve into some of the key amendments made to the Fair Work Act 2009 (Cth) ("Fair Work Act") under the Secure Jobs, Better Pay Act 2022 (Cth) ("SJBP"). Our aim is to provide an understanding of the implications of these changes, exploring their direct impact on employee rights and the obligations faced by employers.
On 23 August 2023, the Government released the Consultation Paper for the 2023 review of the Franchising Code of Conduct.
In November 2023, the 12-month transition period for the Treasury Laws Amendment (More Competition, Better Prices) Act 2022 ("the Act") comes to a close. As we reflect on the impact of this act, it becomes even more crucial to understand the ins and outs of standard form contracts and in particular to understand "What is a standard form contract?".
Standard Form Contracts
ACCC reference to Standard Form Contracts
What is a Standard Form Contract under the ACL?
What does the Explanatory Memorandum say about Standard Form Contracts?
Takeaways
A standard form contract is generally referred to as a contract that has pre-drafted terms and conditions that can be easily adapted to different transactions or agreements. This eliminates the need for extensive negotiations and allows parties to quickly and efficiently enter into contracts.
Examples of standard form contracts include software licence user agreements where you tick a box to indicate that you agree to the terms and conditions of use.
The growth strategy for your business will ultimately be determined by the nature of your business and your business objectives. In this article, we have outlined 5 strategies for growing a business in Australia.
1 - Understanding the Australian Business Landscape
2 - Building a Strong Brand Presence
3 - Marketing Effectively for Growth
4 - Product Development
5 - Licensing or Franchising
The regulation of Unfair Contract Terms is about to change. In November 2023 the 12 month transition period for the Treasury Laws Amendment (More Competition, Better Prices) Act 2022 (the Act) will come to an end.
Selling a franchise business in Australia can be a complex process, especially when it comes to understanding the legal and financial aspects involved.
In this article we'll explore how to navigate the legal and financial aspects of selling your franchise business in Australia. From understanding how the Franchising Code of Conduct and your franchise agreement apply to the sale as well as considering the value of the franchise business, we will provide you with information that will help to make the journey smoother.
Franchising in Australia is heavily regulated.
Starting Your Own Business versus Buying a Franchise. Which is the better option?
Introduction
Advantages
Investment and Financial Considerations
Marketing and Branding
Operations and Management
Risk and Reward
Takeaways
Franchising can be a great way for business owners to rapidly grow their products or services with relatively low costs. However, building a successful franchise takes careful planning and long-term commitment.
As a franchisee, it is important to be aware of the financial health of your franchisor.
While there are certain pieces of information that must be included in the franchisor disclosure document, access to detailed information about a franchisor’s finances may be limited. This can leave you vulnerable if your franchisor suddenly becomes insolvent.
In this article we will discuss why it’s important as a franchisee to stay informed about your franchisor’s financial standing and what rights you have should your franchisor become insolvent.
Overview of Franchisor Insolvency
Rights and obligations arising from Franchisor Insolvency
Administration and Liquidation arising from Franchisor Insolvency
Are you thinking of buying a franchise? It’s an exciting proposition that can bring both rewards and risks. Before you dive in and make a commitment, it’s crucial to carefully consider all the elements involved.
Following on from our recent article about misleading or deceptive conduct, we take a look at the case of Lanhai Pty Ltd v 7 Eleven Stores Pty Ltd [2022] VSC 132, which involves allegations of misleading and deceptive conduct about the term of the franchise agreement.
Misleading or deceptive conduct is the most commonly reported complaint by small business to the ACCC. While these complaints will not all relate to franchising issues, misleading or deceptive conduct complaints in franchising are common.
It is a well established principle of Australian law that businesses that illegally exploit their employees can face serious penalties under the Fair Work Act 2009 (Cth) (“Fair Work Act”). It should therefore be unsurprising that franchisees who have engaged in behaviour that illegally disenfranchises their workers can be subject to penalties from the Fair Work Commission.
The ACCC announced on 6 October 2022 that it had issued Jim's Group Pty Ltd with two infringement notices and that Jim's Group Pty Ltd had paid $24,420.00 in penalties.
The infringement notices related to an alleged failure to comply with the Franchising Code of Conduct and an alleged failure to comply with the Australian Consumer Law.
The Franchising Code of Conduct (the Franchising Code) was amended on 1 June 2021, with most amendments applying from 1 July 2021. Given it is the time of year when franchisors must update their disclosure documents, in this article we revisit the current Franchising Code requirements for Significant Capital Expenditure.
We have set out below a number of the approaching Key Franchise Dates, related primarily to a franchisor's end of financial year reporting and disclosure obligations.
The last two and a half years have been tough for small businesses including franchises.
On 1 April 2022 the Franchising Code of Conduct (the Franchising Code) was amended to insert a new clause 53 which sets out the requirements for the Franchise Disclosure Register.
The Franchising Code of Conduct (the Franchising Code) sets out the obligations (including annual obligations) relating to advertising and marketing funds operated by a franchisor.
The Federal Government has released a discussion paper seeking stakeholder views to help the Government assess the practical benefits of a standalone automotive franchising code and options for mandatory binding arbitration.
The Federal Government has substantially changed the Information Statement to be provided to prospective franchisees as part of the pre-disclosure process. It has also clarified that the Information Statement must be given before the other documents given to a prospective franchisee (14 days before a prospective franchisee enters into a franchise agreement).
The Franchising Code of Conduct (the Franchising Code) was amended on 1 June 2021, with most amendments applying from 1 July 2021, including the Exit and Termination amendments.
The long awaited dispute resolution provisions under the Franchising Code of Conduct (the Franchising Code) came into force on 2 June 2021.
So you've started your business, registered a business name and secured your website domain.
Have you protected your brand or business name?
Registration of a business name, or the purchase of a domain name, does not stop other people from using that name. To protect your business name and any logo or representation that you are using, you need to register a trade mark.
A right of renewal in a franchise agreement is a right which gives you the option to "renew" the franchise agreement at the end of the term.
Not all franchise agreements contain a right of renewal.
Even if your franchise agreement contains a right of renewal you may not want to renew the franchise agreement.
A restraint of trade clause is a clause which is included in an agreement typically to stop someone from competing or using confidential information.
Franchising enables you to grow your business and build your brand.
The rights to end the franchise relationship, to sell your franchised business, or to pass your franchised business on to a beneficiary are determined by the terms of your franchise agreement and the Franchising Code of Conduct (the Code).
Are you a business owner considering expanding your success by franchising? There's a lot to consider before taking such an important step, and it can be quite confusing knowing where to start. Consequently, questions arise such as "Can I franchise my business" and "How do I start to franchise my business".
In this article we will explain a number of factors that you need to take into account while exploring the opportunity of franchising your business.
We will delve into understanding branding, systems and consistency as foundational elements required when franchising.
But first we look at what franchising is and how it can help your business grow.
A recent court enforceable undertaking given to the ACCC by Back in Motion Physiotherapy Pty Ltd (Back in Motion) has served as a reminder to ensure that franchise agreements do not contain unfair contract terms.
The Federal Government released its response to the Fairness in Franchising Report on 20 August 2020.
A franchise agreement outlines the conditions under which you can operate the franchise business, including how long you can operate the business for.
When buying a franchise or signing a franchise agreement it is important to consider the "term" of the franchise agreement.
If you are considering franchising your business or you are already a franchisor, we have set out some important considerations to building a successful franchise business.
Franchising your business or buying a franchise can be a major decision for any entrepreneur. It is important to carefully consider the advantages and disadvantages of both options before making a choice.
Guide to Franchising Your Business
In this article, we will look at 5 key advantages of franchising your business or buying a franchise and 5 key disadvantages of franchising your business or buying a franchise.
Dispute resolution, also known as alternative dispute resolution or ADR, encompasses various methods and techniques that aim to resolve conflicts and disagreements. It provides an alternative to traditional legal processes, such as litigation, and offers parties involved in a dispute the opportunity to find mutually satisfactory solutions.
Why is brand consistency important in franchising?
Brand consistency is crucial in franchising for several reasons. Firstly, it helps to maintain a strong and unified brand identity across all franchise locations. This consistency ensures that customers have a consistent experience regardless of which franchise they visit, leading to increased trust and loyalty towards the brand.
Moreover, brand consistency in franchising plays a key role in attracting both customers and prospective franchisees. A well-established and consistent brand image not only appeals to customers, but also entices potential franchisees who are looking to invest in a reputable and recognisable brand.
Restraint of trade clauses are common in franchise agreements and are designed to protect the...
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