As of July 1, 2016, franchisors can take advantage of the
convenience of email in delivering their franchise disclosure
documents (FDDs) in Ontario. The amendment to the regulations of
the Arthur Wishart Act (Franchise Disclosure), 2000 is a
welcome acknowledgment of the role of email in today's business
transactions. It will allow an FDD to be delivered electronically
if the following requirements are met:
the prospective franchisee can view, store, retrieve and print
the FDD contains no links to external documents or
the FDD contains an index of any separate electronic files,
which must have "sufficiently descriptive" file names or
a statement of that file's subject matter; and
the franchisor receives a written acknowledgment of receipt
from the prospective franchisee.
Franchisors should review these requirements with their lawyers,
document management team and IT team to ensure technical and
procedural compliance. Franchisors should also consider policies
and practices regarding security of their electronic FDDs, such as
password protection, watermarks, serialization of documents,
meta-data, and other issues related to electronic documents.
An additional prescribed method of delivery was also added to
the regulations. The Act previously only permitted FDDs to be
delivered personally or by registered mail. Although, in practice,
personal delivery was widely considered to include delivery by
courier, the amended regulations now expressly provides for the
delivery of FDDs by courier, provided that the franchisor pays the
costs of the delivery.
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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