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headlines Jason Gehrke is the director of the Franchise Advisory Centre and has been involved in franchising for more than 30 years at franchisee, franchisor and advisor level. He advises both existing and potential franchisors and franchisees, and conducts franchise education programs throughout Australia. He has been awarded for his franchise achievements, and publishes Franchise News & Events, Australia’s only fortnightly electronic news bulletin on franchising issues. In his spare time, Jason is a passionate collector of military antiques. www.franchiseadvice.com.au
Franchise Disclosure Register website now online The Australian Government’s new Franchise Disclosure Register that was legislated into existence by the latest changes to the Franchising Code of Conduct on March 31 is now available online at www.franchisedisclosure.gov.au Franchisors will be required to upload certain information to create a profile on the Register by logging-in with a MyGov ID, and publish disclosure information about their franchise no later by November 14. The Register will go live and be searchable by potential franchisees and others from November 15. The online Register will be operated by the Government, but will not vet or check documents before they are uploaded. Franchisors will be responsible for the accuracy of all information contained in their disclosure documents, with access to the online register available for free to any member of the public. The Register will require franchisors to keep their information up to date, and must be updated at least once a year by the 14th day of the fifth month following the end of the financial year (ie. within two weeks after the franchisor updates their disclosure document each year). Failure to provide this information will be a breach of the Code and incur a civil penalty. The Code changes state that the Register may contain a franchisor’s disclosure document, key facts sheet and standard form agreement, although at the very least a franchisor must provide their name, trading name, ABN, 62 business franchise MAGAZINE
office address, phone and email contacts, and ANZSIC division and subdivision codes for the industry in which the business operates. To see the Register website, visit www.franchisedisclosure.gov.au
Increased Code penalties up to $10m commence From 15 April 2022 penalties for breaching the Franchising Code increase and more clauses of the Code carry a penalty, according to an Australian Competition and Consumer Commission (ACCC) statement. In most cases where a penalty for breach of the Code is incurred, the maximum penalty will be up to $133,200 according the ACCC, however for certain provisions, greater financial penalties apply. These provisions are: • the disclosure of materially relevant facts (cl 17(1) and (2)) • restricting the freedom of association of franchisees or prospective franchisees (cl 33) • terms of agreement for new vehicle dealership agreements (cl 46A(1)-(3) and cl 46B). For these seven provisions there are greater maximum pecuniary penalties per contravention, which for corporations, will be the greater of $10 million, or three times the value of the benefit received, or 10% of annual turnover in the preceding 12 months, if a court cannot determine then benefit obtained from the offence. For individuals, breaches of these seven provisions will be up to $500,000.
Franchisors are also reminded that if someone expresses an interest or formally applies to buy a franchise, franchisors must give them a copy of the information statement, and from 15 April 2022, this must happen no later than 7 days after a prospective franchisee expresses an interest.
Macca’s knockoff trademark appears in Russia A local alternative to burger chain McDonald’s is gearing up to open in Russia, complete with a yellow and red logo that looks almost identical to McDonald’s golden arches, according to a media report. Russian burger restaurant chain Uncle Vanya filed its trademark, which resembles the golden arches albeit tilted 90 degrees to the right, on March 12 after McDonald’s suspended operations in the country in response to the war in Ukraine. Uncle Vanya’s arches form part of a letter “B” in the Cyrillic alphabet, corresponding to “V” in Vanya. A parliamentary speaker and officials in Russia have encouraged Russian brands to take over McDonald’s locations and ignore patents and trademarks owned by entities from countries deemed hostile by the Russian government.
