Managing pre-contractual representations in franchising

The activities of franchisors and franchisees are strongly regulated by Franchising Code of Conduct.  However, the recent decision in Guirguis Pty Ltd & Ors v Michel’s Patisserie System Pty Ltd & Ors [2016] QDC 117 (Guirguis case) serves as a reminder of why franchisors should also take care in managing their pre-contractual representations to potential franchisees. [Read more…]

2016 Events

18 August 2016 – Franchising demystified – the legals explained

Attendees were introduced to the legal elements of a franchise system including: [Read more…]

What is a Franchise Agreement?

A franchise agreement (Franchise Agreement) is defined in clause 5(1) of the Franchising Code of Conduct (Code), located in Schedule 1 of the Competition and Consumer (Industry Codes–Franchising) Regulation 2014 – as:

  • a written, oral or implied agreement;
  • in which a person (Franchisor) grants to another person (Franchisee) the right to carry on the business of offering, supplying or distributing goods or services in Australia under a system or marketing plan substantially determined, controlled or suggested by the Franchisor; and
  • under which the business will be substantially or materially associated with a trade mark, advertising or a commercial symbol that is owned, used, licensed or specified by the Franchisor or an associate of the franchisor; and
  • under which, before starting or continuing the business, the Franchisee must pay or agree to pay to the Franchisor or their associate an amount; for example, an initial capital investment fee or a payment for goods or services.

[Read more…]

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