The proposed Western Australian franchising legislation has at
the 11th hour been consigned to a Parliamentary Committee for
further consideration thanks to the substantial efforts of the
franchising community. Norton Rose Australia partners Stephen Giles
and Tamra Seaton were on the front line, explaining the true
implications and flaws in this proposed law, and asking the hard
questions. But the battle continues, with those behind the law
flagging a continuation of their activities in WA, SA and possibly
Many commentators and law firms were predicting that the
legislation would be enacted, and indeed one blog sympathetic to
the lobbyists behind the legislation had prematurely popped the
champagne corks. We were more confident that logic would finally
prevail. The one thing we have learnt over the past 12 years or
more assisting the Franchise Council of Australia with its industry
submissions is that the key to political lobbying is not lobbying
per se, it is reasoned argument. In this instance what we believe
changed the tide was extensive face to face contact with
parliamentarians by FCA director Steve Wright and the provision of
simple but comprehensive written submissions to every WA politician
that set out the flaws in, and likely consequences of, the proposed
law. It was also important to put the spotlight on those who were
behind the push to change the law including one or two who were
neither independent nor commentators.
Where to from here? The WA legislation has been consigned to a
Parliamentary Committee which is intended to more carefully
consider the legislation. Whenever these types of legislative
proposals have been carefully and objectively considered in the
past they have been abandoned, so in WA we are reasonably confident
that the wishes of Federal Small Business Minister Nick Sherry will
be honoured. When the WA legislation was stopped in its tracks
Minister Sherry issued a strong statement that reinforced his
comments in his keynote address to the recent FCA National
Convention. His press release welcomed the decision "to reject
a piecemeal state based approach" to franchise regulation,
commenting that it "recognises that a national approach to
franchising makes sense and will deliver the best outcomes for
franchisees, franchisors and the entire Australian
He also took a swipe at SA, commenting that "I hope similar
moves in South Australia will be reconsidered in light of WA's
decision. The decision provides greater certainty for franchise
businesses in WA and national franchise systems that operate in WA.
They will no longer have to face the prospect of regulatory
duplication and additional compliance burdens that could result
from separate WA based franchising legislation."
Not surprisingly, the Minister drew attention to the recently
enacted changes to the Franchising Code of Conduct and the
increased resourcing of the ACCC, noting that "like all
significant reforms, these changes need time to bed down and we
should allow a proper period of time to evaluate their effects. To
do this, and to provide the sector with stability and confidence,
the Government doesn't intend to review the code again before
The South Australian Small Business Minister is apparently
continuing to draft proposed State based legislation, and SA looms
as the next battle front for the franchising community. Prior to
the most recent announcement by Minister Sherry, the SA Minister
had flagged the introduction of the SA legislation, which follows a
flawed Private Members Bill introduced in
December 2009 which lapsed in early 2010, before Christmas.
Whether he does so given the strident remarks of Federal Minister
Sherry and the blowtorch treatment given to WA backbencher Peter
Abetz remains to be seen, but it is clear the protagonists behind
the scene are not intending to go away soon.
If you would like more detailed information on the proposed WA
or SA legislation, or have a better understanding of the policy
issues and what your organisation can do to assist, speak with
Stephen Giles or
The content of this article is intended to provide a general
guide to the subject matter. Specialist advice should be sought
about your specific circumstances.
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