By now you would all be aware that last year's amendments to the Franchising Code of Conduct included that franchisors need to notify franchisees at least 6 months before the end of their franchise agreements of the franchisor's decision to either:
- renew or not renew the franchise agreement; or
- enter into a new franchise agreement.
This applies to franchise agreements for a term of 6 months or longer. If the term is less than 6 months, at least 1 month's notice must be given.
This requirement only applies to franchise agreements entered into on or after 1 July 2010 so does not yet apply to the majority of franchise agreements.
However to ensure compliance with the Code, some franchisors have elected to introduce this requirement now for all their franchisees including those that entered into their franchise agreements before 1 July 2010.
If you are interested to do so, we have template notices available which can be easily adapted to include any relevant exercise of option dates and renewal conditions which need to be complied with prior to the end of the term.
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.
