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FCA gets torrid time at SA Franchise Inquiry

by Norton Rose
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The Franchise Council of Australia contingent led by new FCA Executive Director Steve Wright and supported by Deacons partner Stephen Giles received a torrid time at the recent SA Franchise Inquiry. The Parliamentary Inquiry, which has greater status than the WA inquiry, was established by the SA Government prior to Christmas and is expected to continue its deliberations for another few months.

The Parliamentary Inquiry had received a substantial number of submissions from aggrieved franchisees who had allegedly suffered great loss as a consequence of the failure of their franchised business. The FCA was challenged to prove the existing laws were adequate, and to justify its role as the peak industry body. From articles published in South Australia during the course of the inquiry (including one published in the Bunyip on 5 December 2007), it appears that at least some of the inquiry members have an adverse perception of franchising and are predisposed to some form of state intervention. This was demonstrated in the aggressive questioning of franchisors or their representatives and their specific request to hear from current or ex-franchisors who had been treated badly by their franchisors.

It is hard to predict the outcome of this Inquiry as the arguments for an exclusively Federal regulatory framework remain compelling. 03.03.2008
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