The time of year has come for franchisors to prepare and finalise their 2013 disclosure documents. The Franchising Code of Conduct requires franchisors to update their disclosure documents by 31 October each year (or within 4 months of the end of your financial year if you don’t have a 30 June year end).

Franchisors should be aware not to take this requirement lightly as recent court proceedings have shown that there could be considerable consequences for failing to adequately disclosure current and accurate information to new franchisees.

While some aspects of a disclosure document may remain unchanged each year, the most common areas of a disclosure documents that every franchisor will need to update include the payments schedule, details relating to new and former franchisees and the business experience of directors.

Franchisors should also ensure that they do not skim past some of the more tricky areas of the disclosure document when doing their 2013 update.

For example, franchisors are now required to disclose the circumstances where they have unilaterally varied their franchise agreements since 2010, or considered any significant capital expenditure undertaken by franchisees in determining the arrangement to apply at the end of franchise agreements.

Mills Oakley Lawyers provides valuable assistance to franchisors to ensure that their disclosure documents tick all the necessary boxes so as to avoid non-compliance issues arising in the future.