Franchise Disclosure Register | Registrations are required by 14 November 2022

All Australian franchisors know that 31 October is a key date annually.  For every franchisor with a standard 30 June end financial year it is the date by which the annual Franchise Disclosure Document must be updated and signed off.  The previous financial year’s financial statement must be included and details of franchisees, system changes etc must all be updated.  Additionally a new Key Facts Sheet must be created.

This year we have another deadline – 2 weeks after the disclosure update date (14 November) is the last date by which all franchisors must lodge the mandatory details on the Franchise Disclosure Register.  All the relevant information can be found here: https://franchisedisclosure.gov.au/Franchisors but to summarise:

• All Franchisors (as defined by the Franchising Code of Conduct) must have a published profile on the Register by 14 November 2022. The site will go live on 15 November and be searchable by the public.
• The following mandatory basic business details must be provided:
• Name, trading name and ABN
• Business email address and contact phone number
• Address(es) of the franchisor
• ANZSIC division and subdivision codes for the industry in which the franchised business operates (Codes are found here https://www.abs.gov.au/statistics/classifications/australian-and-new-zealand-standard-industrial-classification-anzsic/2006-revision-2-0/numbering-system-and-titles/division-and-subdivision-codes-and-titles)
• Financial year on which the franchisor operates (see below if not a standard June end FY)
• The following information is voluntary at the date of this article but is expected to be mandatory very soon following passing of relevant regulations:
  • How long has the franchisor operated the franchise or franchise system in Australia?
  • The number of franchisees in the system (including franchisor operated businesses)
  • Which states/territories the franchisor currently operates in
  • Does the franchise system restrict franchisees choosing suppliers?
  • Information about payments and costs
  • Does the franchisor’s standard form franchise agreement allow the franchisor to vary the agreement without franchisees’ consent?
  • What is the standard term of franchise agreements?
  • Are franchisees given the option to renew a franchise agreement?
  • Are franchisees entitled to compensation for goodwill in the business?
  • Are franchisees subject to a restraint of trade (or similar) clause?
• All of the above information is readily available from the Disclosure Document and Key Facts Sheet.
• Franchisors operating on a non-Australian financial year can initially create and publish a profile and provide disclosure information by 14 November for their most recent completed financial year. This will then need to be updated by the 14^th day of the fifth month following the end of their next financial year.
• To set up the profile on the Register the Franchisor must use the Commonwealth Government’s digital identity myGovID which is linked to their ABN. Franchisors can authorize a representative such as a lawyer to access and provide their details in the Register. If you have not set up a digital identity then this is urgent and should be done now! https://www.mygovid.gov.au/set-up. Please note that myGovID is also needed by individual directors to obtain a Director Identification Number which for many people is required by 30 November 2022 so kill 2 birds and get this done too if you haven’t already.
• The profile of the Franchisor published on the Disclosure Register will need to be updated as required each year following preparation of the Disclosure Document.
• Needless to say financial penalties apply for failure to comply.

For assistance with updating your disclosure document, Key Facts Sheet and publishing on the Franchise Disclosure Register, please feel free to contact our franchising specialist, Corinne Attard.