The Competition and Consumer (Industry Codes—Franchising) Regulations 2024 introduced the new Franchising Code from 1 April 2025, with transitional provisions. Section 23 addresses pre-contract disclosure. The ACCC explains that the disclosure document must generally be supplied at least 14 days before signing. The rules applying to an older, renewed or transferred agreement need separate checking. Receiving disclosure is an opportunity to investigate, not an assurance that the investment is sound.
Sections 18 and 21 of the Australian Consumer Law address misleading conduct and statutory unconscionability. Preserve advertisements, presentations and messages about revenue, setup costs or expected returns. Ask whether figures relate to a comparable operating outlet, a forecast or a selected example. An accountant should test rent, wages, royalties, working capital and the effect of the owners working without a market salary.
In ACCC v Geowash Pty Ltd (Subject to a Deed of Company Arrangement) (No 3) [2019] FCA 72, the Federal Court made findings including misleading representations and unconscionable conduct. The ACCC later reported that the appeal was dismissed. The litigation concerned earlier conduct and the earlier Code, not a direct application of the 2025 regime. Its practical lesson remains relevant: branding and a franchisor’s explanation of costs need independent scrutiny.
Examine territory, renewal, transfer, termination, refurbishment and personal guarantee obligations. Speak with current and former franchisees and investigate the franchisor’s disclosure and register entries. Where negotiations occur in Mandarin but the documents are English, ensure the commercial promises are recorded accurately before paying a substantial amount or signing.
Author: Deanna Ding
Last updated: October 2026
Jurisdiction: Queensland, Australia
Disclaimer: This article provides general information only and does not constitute legal, financial or tax advice. The law may change and its application depends on individual circumstances. You should obtain professional advice before acting on the information contained in this article.