The new-look Franchising Code takes effect today, 1 April 2025, with changes designed to strengthen franchisee protections and improve the renewal, dispute resolution and termination processes.
One less document for franchisors to worry about is the Key Facts Sheet for prospective franchisees – this is no longer required.
The Treasury recently released a table of key changes to the 2024 Franchising Code of Conduct.
A key change with immediate effect is around restraints of trade in new, renewed or extended agreements issued on or after 1 April 2025.
Franchisors cannot include a restraint of trade clause for franchisees wanting to extend or renew an expiring agreements, and they may face civil penalties if these terms are included.
No changes are required to an existing agreement if it is not scheduled to transfer, extend or renew.
Not all elements of the Code will be enforced immediately; these include disclosure document obligations and compensation for certain instances of early termination.
There is a grace period of 1 November 2025 for full implementation of the Code.
The Australian Competition and Consumer Commission will enforce the remade Code and is expected to provide further guidance on its website.
This article originally appeared on the website of our sister publication, Franchise Executives.
