Franchising inquiry: Is it time Australia launched a franchise court?

SmartCompany, Thursday, May 10, 2018

A new submission to the Senate’s inquiry into the effectiveness of the Franchising Code reveals franchisees may not even know they can take a dispute with their franchisor to mediation.

The Office of the Franchising Mediation Adviser, a Commonwealth-appointed body that helps franchisees and franchisors through mediation processes, says in its submission that since its establishment 16 months ago, it has received only 400 requests for mediation from the country’s 79,000 franchisees.

The office says “there well may well be significant unhappiness and financial difficulty being experienced by a large number of franchisees in the industry in certain franchise systems”, but it can’t necessarily tell if this is true or not because all it has to go on is the volume of complaints it receives.

The Mediation Adviser suggests the low number of complaints reflects that its services are not known to franchisees, or they are too scared to make contact with the office, though no formal speculations could be made.

Australian Small Business and Family Enterprise Ombudsman Kate Carnell tells SmartCompany she is investigating how her office can get involved in new dispute resolution models to help franchisees. READ MORE: