Franchise Law Changes Landing in 3 Provinces


Jun 29, 2016

Whether you're a current franchisee or a prospective one, it's always wise to stay on top of franchise laws so you know what's coming down the pike. There are big changes coming to franchise laws in three provinces, so read on to discover what is in store for Ontario, Alberta and British Columbia franchise businesses.

Ontario: Bring on Electronic Disclosure

Ontario is seeking to amend the Arthur Wishart Act—legislation that protects franchisees—to make it easier for franchisors to deliver their disclosure documents to possible franchisees.

Right now, there are just two ways a franchisor can give disclosure documents to potential franchisees, and that's in person or via registered mail. The proposed change to the act would allow franchisors to deliver disclosure documents electronically or by courier, bringing the AWA laws there in line with current legislation in New Brunswick, Prince Edward Island and Manitoba.

According to the proposed amendment, electronic disclosures must allow the receiver to view, save, retrieve and print the document, and it can't have links to external content or documents. Disclosures that are made of separate files must have an index with the file names, and the delivery will not be considered complete until the franchisor gets an electronic acknowledgment of receipt from the potential franchisee.

Alberta: "Mature" Franchisors May Lose Exemption

Currently in Alberta, a franchisor that is considered "mature"—a designation defined by meeting specific size, net worth and track record criteria—is not required to include financial statements in their franchisee disclosure documents. There is now an amendment on the table that would cause mature franchisors to lose this exemption, bringing Alberta in line with franchise legislation in other provinces, including Ontario.

British Columbia: A Franchise Law Overhaul 

An entirely new set of laws known as the "British Columbia Franchises Act" is already on its way in the province. The proposed act was given royal assent in November of 2015, making it official, but it isn't expected to come into full force until sometime near the end of 2016, as reported by Lexology. This legislation will bring British Columbia's franchise laws in line with that of other Canadian provinces.

As a franchise, you'll need to stay up-to-date on any legal changes that can affect your location or your franchisor in the future. By keeping yourself current on franchise law changes, you'll be better prepared to handle any change in business tides brought on by new laws and regulations.