The Franchises Act and accompanying regulations set requirements for pre-contractual disclosure in the sale of franchises and provide important protections to franchisees against non-disclosure or misrepresentation in the pre-contract stage. Recognizing the interdependence inherent in the franchise relationship, the Act imposes a statutory duty of fair dealing on franchisors and franchisees alike, requiring them to act in good faith and in accordance with reasonable commercial standards in performing and enforcing the franchise agreement.

In order to ensure that BC-based franchisees will not be blocked from asserting their rights and pursuing just claims for reasons of excessive cost and inconvenience, the Act overrides terms in a franchise agreement that would prevent the Act from applying, oust the jurisdiction of BC courts over a dispute arising under the agreement, or require disputes to be decided out of province.

BC is the sixth province to bring franchise legislation into effect. The others are Alberta, Ontario, Manitoba, New Brunswick, and PEI.  As the six franchise statutes in force across the country are very similar, they set up a harmonious framework of ground rules for franchising on a national scale.

The post Franchises Act Coming Into Force on 1 February 2017 first appeared on British Columbia Law Institute.

The post New BC Franchises Act and regulations in force on 1 February 2017 first appeared on British Columbia Law Institute.

In the 2014 report, BCLI recommended that British Columbia join Alberta, Ontario, Manitoba, New Brunswick, and P.E.I. in enacting franchise legislation modelled on the Uniform Franchises Act developed by the Uniform Law Conference of Canada.  The report proposed some updates to the uniform Act, such as allowing franchisors to deliver pre-sale disclosure documents to prospective franchisees electronically.  The report followed a consultation paper that BCLI published in 2013 to obtain stakeholder input.

“We are extremely pleased that the great majority of our recommendations are reflected in the new BC Franchises Act,” said Kathleen Cunningham, Executive Director of BCLI.  “This legislation is very supportive of small and medium-sized business in B.C., and benefits franchisors and franchisees alike by contributing to the establishment of consistent standards of pre-contractual disclosure and other aspects of franchising practice.”

BCLI’s study was carried out at the invitation of the Ministry of Justice and Attorney General, and involved consultations with stakeholders and an advisory group of leading B.C. franchise law practitioners.

BCLI is an independent, not-for-profit law reform agency that strives to improve and modernize the law.

First reading version of Bill 38, the Franchises Act
BCLI’s Report on a Franchise Act for British Columbia

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Contact:   Greg Blue, Q.C.
Senior Staff Lawyer
(604) 827-5337
gblue@bcli.org

The post New BC Franchises Act Implements BCLI Recommendations first appeared on British Columbia Law Institute.

BCLI issued its Report on a Franchise Act for British Columbia today. The report analyzes franchise legislation in force in Canada, the U.S., and elsewhere, and contains a detailed legislative proposal with commentary. It was preceded by a consultation paper issued by BCLI early in 2013 to seek public input. The recommendations in the report were reached after responses to the consultation paper were reviewed by BCLI’s board of directors.

“Given the prevalence of franchised businesses in BC and their importance to the provincial economy, it is surprising that BC has no franchising legislation,” said Jim Emmerton, executive director of BCLI. “The enactment of franchise legislation in BC along the lines set out in this report would give appropriate and needed protection to BC franchise owners. It would also benefit franchisors by contributing to the establishment of consistent standards across the country.”

Alberta, Ontario, Manitoba, PEI, and New Brunswick already have legislation in place that imposes pre-sale disclosure requirements to guard against investors being misled when purchasing a franchise. Their legislation contains other important protections also aimed at levelling the playing field between franchisors and franchisees. The Uniform Franchises Act developed under the Uniform Law Conference of Canada Commercial Law Strategy was the model for the franchise enactments of several of those provinces.

The BC franchise legislation proposed in the report would also be based primarily on the  Uniform Franchises Act. It contains some updates, such as allowing franchisors to deliver pre-sale disclosure documents electronically.

A copy of the report is available on the Franchise Act project page.

The post BCLI issues Report on a Franchise Act for BC first appeared on British Columbia Law Institute.

BCLI has issued the Consultation Paper on a Franchise Act for British Columbia to obtain input from franchisors, franchisees, business and consumer organizations and the general public on the proposed legislation to govern franchising, which would resemble legislation already in force in five other provinces.

“Given the prevalence of franchised businesses in BC and their importance to the provincial economy, it is surprising that BC has no franchising legislation,” said Jim Emmerton, Executive Director of BCLI. “The introduction of BC franchise legislation would further increase the degree of harmonization of regulatory standards within Canada, while also giving appropriate and needed protection to BC franchise owners.”

Alberta, Ontario, Manitoba, PEI and New Brunswick have legislation in place that imposes pre-sale disclosure requirements to guard against investors being misled when purchasing a franchise.  Their legislation contains certain other important protections also aimed at levelling the playing field between franchisors and franchisees.   The Uniform Franchises Act developed under the Uniform Law Conference of Canada Commercial Law Strategy was the model for the franchise enactments of several of those provinces.  The proposed BC legislation would also be based primarily on the Uniform Franchises Act.

BCLI hopes the Consultation Paper on a Franchise Act for British Columbia will be a catalyst for an informed discussion about franchise regulation in BC.  After consideration of responses received, BCLI will produce a report with final recommendations and draft legislation.

BCLI strives to be a leader in law reform by carrying out the best in scholarly law-reform research and writing and the best in outreach relating to law reform.

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Contact:

Greg Blue

Senior Staff Lawyer

(604) 827-5337

gblue@bcli.org

The post BCLI issues Consultation Paper on a BC Franchise Act first appeared on British Columbia Law Institute.