The federal government will review the Franchising Code of Conduct, calling for submissions from the franchising sector.
Minister for Small Business Brendan O’Connor said the main purpose of the review is to verify the amendments to the Franchising Code of Conduct made in 2008 and 2010 were working as intended.
"The franchising sector is an important part of Australia's economy," O'Connor said.
"It comprises around 73 000 franchises, with an annual turnover of more than $130 billion and employs more than 400,000 people."
The review will consider issues including:
• Questions of good faith in franchising,
• The rights of franchisees at the end of their franchise agreements including recognition for any contribution they have made to building the franchise, and
• The operation of the Competition and the Consumer Act 2010 with respect to enforcing the code.
The Franchise Council of Australia has welcomed this decision.
"We support the ongoing review of the regulatory framework. This scheduled review was flagged at the time the 2010 changes to the Code were introduced. In anticipation of the review the FCA has spent considerable time seeking input from its franchisor and franchisee members, and the FCA Legal Committee has conducted its own extensive review," FCA chairman Michael Paul said.
Alan Wein, an experienced franchise operator and small business adviser, has been appointed to conduct the review.
"Mr Wein brings a wide variety of talent, skills and experience through an impressive history of personal achievement," O'Connor said.
"He has a thorough understanding of the small business sector from his involvement with the Victorian Small Business Advisory Council and has extensive experience in mediation and commercial law, making him ideal to conduct this review."
Submissions close on Friday 15 February 2013.