Franchisors should regularly consider whether their Canadian franchise disclosure document (“FDD”), or other franchise related documents, require updating. This is particularly true following a year that marked the further expansion of franchise disclosure legislation in Canada, with the introduction of the province of Manitoba’s Franchises Act, which came into force on October 1, 2012. As we mentioned in previous Franchise Law updates, Manitoba was Canada’s fifth province to enact franchise disclosure legislation, joining Ontario, Alberta, New Brunswick and Prince Edward Island.
If you plan to offer franchises in any of the Canadian provinces requiring disclosure, you need to ensure that your FDD complies with the requirements of each applicable province’s legislation, and that the contents of your FDD are consistently accurate and up-to-date.
Most franchisors now have a single form of Canadian FDD intended for use in a number of the provinces currently mandating pre-sale disclosure. If an FDD is not yet ready to be used in all five franchise law provinces, a small amount of effort by counsel and the franchisor can yield a form of FDD that is compliant across all five of the Canadian provinces that now have a statutory franchise disclosure regime.
While franchisors should frequently turn their minds to updating and maintaining their Canadian FDDs, the start of a new calendar year marks a time at which if they haven’t already, franchisors should begin the process of updating the contents of their franchise documentation and/or ensuring such documentation is compliant with the requirements of all applicable franchise legislation.
If you have not yet contacted us to update your Canadian FDD for use in all provinces, or if you would like assistance updating your FDD, please contact a member of our Franchise Law Group so that we may assist you in creating and maintaining a FDD that is accurate, up-to-date and compliant with Canadian franchise legislation.
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.
