Issues will inevitably arise in a franchise relationship. Sometimes, those issues can be dealt with quickly and in a way that allows both parties to carry on their business in a positive manner. Other times, an issue has become too big, or a series of smaller issues linger, and some type of third party intervention is required.

The highly-anticipated changes to the Franchising Code of Conduct are now in force.

These changes follow a parliamentary inquiry into the Code, which began in 2018. The inquiry saw many franchisees explain how their franchised business failed, and the consequences on their lives. It also exposed questionable business strategies by some franchisors, and has directly led to at least one enforcement action by the Australian Competition and Consumer Commission.

It is important for both franchisors and franchisees to understand that significant changes to the Code are now in force – many of which involve imposing civil penalties for breach.

This article contains a summary of five core areas that have seen significant change. 

Retail and Commercial tenants in NSW are likely familiar with the operation of the provisions of the National Cabinet Mandatory Code of Conduct – SME Commercial Leasing Principles and the NSW Government’s regulations that followed to give effect to the Code in response to COVID-19 pandemic during 2020 and, for some tenants, the first quarter of 2021.

This piece includes a summary of the Code and the regulations that were made to give legal effect to the Code from April to December 2020 and, to a more limited extent, the first quarter of 2021.

Trade marks are the essence of franchising. 

All franchise systems strive for widespread recognition of their 'brand'. A common thread between successful franchise systems is that their customers receive a consistent level of quality in goods and services provided under instantly recognisable trade marks. 

However, there are often complexities in the registration and use of trade marks within a franchise system. For franchisors, getting the licensing right is not always clear cut, nor is being able to secure registrations for new products. On the other hand, franchisees will often enhance the reputation of a trade mark, but have no ownership interest and can carry the risk of infringing a competitor's trade mark. 

This article explores the importance of trade marks to a franchise system, and the key parties involved in it.