The Canadian Franchise Association (CFA) recently successfully
advocated for a change to Ontario's proposed menu labelling
law, with significant benefit to food service franchisors with
locations in the province, by reducing their potential liability.
Bill 45, Ontario's proposed Making Healthier Choices Act,
2015 is a proposed law requiring food service establishments
to post the caloric content of standard food and drink items if the
establishment is part of a chain with a minimum of 20 locations in
The Bill, as originally drafted, purposefully defined
franchisors of food services establishments as "owners and
operators" and, as such, made franchisors liable for
franchisee compliance with the legislation. In seeking that this
language be removed, CFA representatives appeared before the
Standing Committee on General Government at the Ontario Legislature
to voice concerns about the definition. Among the representatives
making submissions was Larry Weinberg, Chair of the CFA's Legal
& Legislative Affairs Committee and Chair of the Franchise Law
Group at Cassels Brock & Blackwell LLP.
The CFA's submissions focused on the aspects of the Bill
that applied to franchising. Specifically, the Bill as proposed did
not accurately represent the nature of the franchisor-franchisee
relationship, thereby exposing franchisors to liability if their
franchisees do not act in accordance with the proposed legislation.
Further, the definition of franchisor undermined the independent
nature of the franchisor-franchisee relationship in the franchise
business model. The CFA identified the roles of the franchisor and
franchisee and why the definition as proposed was incorrect and
should be removed.
On April 28, 2015, the Standing Committee, with members of all
political parties in the Ontario legislature, voted in favour of
the proposed amendments to the Bill's reference to franchisors.
The Bill will go forward with new language that is more accurate,
correcting the definition of franchisors as "owner and
The CFA's efforts began months ago with the goal of ensuring
that the franchise business model is not undermined. The CFA's
submissions further warned of the implications of passing the
proposed legislation without the recommended amendments, given the
importance of franchising to the Ontario economy. The CFA made
clear the mistake of imposing on the franchisor increased potential
liability than is reasonable, as it makes franchising a less
attractive method of doing business.
Bill 45 must still undergo Third Reading and a vote by all
Members of Ontario's Provincial Parliament before becoming law.
Cassels Brock will keep track of the progress of this
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Under the Income Tax Act, the Employment Insurance Act, and the Excise Tax Act, a director of a corporation is jointly and severally liable for a corporation's failure to deduct and remit source deductions or GST.
Under the Income Tax Act, the Employment Insurance Act, the Canada Pension Plan Act and the Excise Tax Act, a director of a corporation is jointly and severally liable for a corporation's failure to deduct and remit source deductions.
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