Courts Support the Franchising Code Of Conduct
The National Franchising Code of Conduct is designed to protect buyers when they are carrying out due diligence on a franchise opportunity that is for sale. A case has been through the courts and has shown support for the obligations laid out in the code and ruled in favour of the franchisee. When reading the case article it clearly shows the strength of the code and we can take away reassurance that the courts are in full support.
Continually updated, the Franchising Code is the perfect reference check to ensure you are receiving from the franchisor information that is up to date and accurate so as to make an informed decision. The latest update took place on the first of January this year. A complete guide to the Code for both franchisees and franchisors can be found on the ACCC site which can be viewed here.
Franchisors too need to be kept up to date with the changes to the code and ensure that they are following the procedures necessary to avoid any unnecessary claims.
The case referred to above was made public last year and an account was published by Turner Freeman Lawyers in their Franchise Newsletter. The details can be viewed here.
If you have knowledge of the code it could save a confrontation and ensure all parties are well informed. If you are unsure about where you stand or need clarification be sure to seek legal advice from those experienced in franchising. Franchising legal advisors are listed on our suppliers page.