Are you excited to buy a franchise? The Franchising Code of Conduct has some reminders for you.
Read the Franchising Code policies on the following:
- cooling-off period
- disclosure requirements
- dispute resolution mechanism
- good faith obligation
- procedures for ending a franchise agreement
Whenever there’s a breach, the Australian Competition and Consumer Commission will surely intervene to investigate. If you are guilty you might receive an infringement notice, or the courts may issue a penalty (you may have to pay a sum of money).
Don’t ignore the Australian Consumer Law and the Competition and Consumer Act, which lists down your rights and obligations in addition to the provisions of the Franchising Code.
Don’t sign the franchise agreements quickly without reading its terms and conditions.
As a franchisee, you will have to carry on with the business under the strict marketing plan of the franchisor. You have to protect its trademark, even the commercial and advertising symbols they own-and should not exploit it for your own benefit.
You need to meet your financial obligations with the franchisor. Remember, you can only start or continue the business upon making the necessary payments.
Always act in good faith.
Never enter into an agreement with the purpose of stealing company secrets and using it for your own benefit at the expense of the franchisor. Be reasonable in all your dealings, act with honesty, and always consider the legitimate interest of both parties. Acting with ulterior motive or denying the other party with the legal benefits of the agreement could be construed as a violation of the contract. The courts would put matters into account, especially when there are breaches in the contract, especially in connection to the franchising relationship, which covers-
- Dispute resolution
- Performance of the contract
- Pre-contractual negotiations
- Termination or end of an agreement.
If you don’t have enough money to start your franchise operation, GapCap can help you. We offer capital investment to those who would like to explore the franchise market. Contact us today so you can start funding your franchise venture!