In 2025, the franchising landscape in Australia is transforming. The revamped Competition and Consumer (Industry Codes–Franchising) Regulations 2024 (the New Franchising Code) came into force on 1 April 2025, introducing critical reforms in franchise governance, transparency, and fairness. With enforcement already underway, including fines to well-known franchisors for registration oversights, now is the time for franchisors to act decisively.
1. The New Franchising Code Has Arrived
- From 1 April 2025, all new, transferred, renewed, or extended franchise agreements must comply with the New Franchising Code, while agreements already in place continue under the old Code until they are changed
- Some key obligations—including requirements around marketing/cooperative funds, return-on-investment disclosures, and compensation for early termination—are deferred until 1 November 2025 for non-vehicle dealership agreements, giving franchisors a temporary grace period
- Important new protections include:
- Reasonable return on investment: Franchisees must be able to recoup their investment within the agreement term
- Compensation on early termination: Franchisors must compensate for lost profits, capital expenditures, and goodwill in certain situations
- Limits on post-term non-compete clauses: If a franchisee requests a renewal and isn’t in serious breach, franchisors can’t enforce non-compete restrictions post-termination
2. Enforcement by the ACCC: No Grace for Registration Lapses
Compliance is more than updating your documents—it’s also about keeping your public registration current.
- In June 2025, the ACCC issued infringement notices to Cash Converters and Mobile Travel Agents (MTA), each fined $16,500 for failing to annually update or confirm franchisor information on the Franchise Disclosure Register
- The ACCC emphasized that outdated Register entries undermine transparency and harm the integrity of franchise decision-making
- Notably, MTA described the penalty as “disproportionate,” attributing the breach to an administrative oversight and calling for automated reminders to prevent repeat errors
- But make no mistake: the ACCC is clearly signaling that even administrative slips can trigger enforcement and penalties
3. What Franchisors Should Do Right Now
Here’s your action plan to navigate compliance and protect your business:
- Review and update all franchise agreements:
- Ensure new or renewed agreements after 1 April 2025 reflect the New Code.
- For agreements before that date, confirm whether obligations apply and prepare updates ahead of the November deadline.
- Audit disclosure documents:
- Ensure your disclosure documents match the new obligations, especially around fund transparency and ROI-related disclosures once they commence. f
- Update the Franchise Disclosure Register—on time, every time:
- Confirm or amend your profile before the end of each financial year, ensuring it’s accurate and complete.
- Reassess your practices:
- Check policies around non-compete enforcement, termination procedures, and compensation rules to ensure they align with the new Code.
- Train your team:
- Educate internal staff and franchisees about the new expectations—especially around updates to agreements and the importance of public transparency.
- Seek legal and strategic support:
- Consult with Australian franchise law specialists to review agreements, prepare compliant documents, and streamline disclosure procedures.
4. Why It Matters: Trust, Reputation, Risk
- Protect your brand’s integrity: Compliance reflects professionalism and trustworthiness, fostering stronger franchisee relationships.
- Avoid unnecessary risk: The ACCC is active. Small oversights can result in fines and reputational damage.
- Improve franchisee confidence: Transparent practices and fair terms build confidence among potential franchisees.
- Stay competitive: Franchising Australia-wide has never been more regulated—stay ahead by being compliant, not reactive.
Conclusion: Time to Act—Compliance Is Non-Negotiable
The reforms usher in a new era of transparency and fairness in Australian franchising. Don’t just wait for the clock to run out. Act now—update your documents, audit your disclosures, and confirm your registry status. It’s the difference between safe, sustainable growth and unnecessary legal jeopardy.
Need help drafting compliant language, training materials, or communication plans? I’ve got you covered—just let me know!
