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Independent review of the $130 billion franchising sector released

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HON GARY GRAY AO MP Minister for Small Business

HON BERNIE RIPOLL MP Parliamentary Secretary for Small Business

10.30am Friday May 17th 2013

Independent Review of the $130 billion Franchising Sector Released An independent review of Australia's rapidly growing franchise sector was released today.

Minister for Small Business Gary Gray and the Parliamentary Secretary for Small Business Bernie Ripoll welcomed the outcome of the four-month review by Mr Alan Wein.

"The recommendations provide a roadmap for reforms to assist Australia's 73,000 franchise small businesses and the more than 400,000 people who work in the sector," Mr Ripoll said.

"I look forward to consulting and engaging with stakeholders, franchisees and franchisors about them."

"The franchising sector makes up a significant component of small business and contributes over $130 billion to the Australian economy. It is the Government's priority to ensure franchises, and all small businesses, can continue to grow and develop as an essential part of our economy," Mr Ripoll said.

The report makes 18 recommendations including:  strengthening the obligations of parties to act in good faith in a franchise;  a stronger enforcement regime including financial penalties for code breaches;  Improving disclosure on issues such as online trading; and  Better dispute resolution mechanisms including regulating attribution of costs

to franchisees.

"The Government is committed to providing certainty and confidence in the franchising sector," he said.

"I have held discussion with key stakeholders, including the Franchise Council of Australia, the Franchisees Association of Australia, the Franchise Advisory Centre, the Australian Retailers Association, the Council of Small Business of Australia, the

Australian Chamber of Commerce and Industry, and the Opposition, about the review and supplied them with a copy."

Mr Wein was appointed to conduct the review in January 2013. He received 73 submissions and conducted over 30 face to face consultations in the preparation of the review.

"Mr Wein has conducted a comprehensive review that makes recommendations aimed at strengthening franchising in Australia. I want to thank him for his hard work in preparing this report," Mr Ripoll said.

The recommendations arose from the fourth major review of franchising and the Franchising Code at the Commonwealth level since 2006 and fulfils the Government's 2009 commitment to review the code in 2013.

Copies of the review are available at

Media contact: Chris Ramsay (Ripoll) 0478 472 101

John Arthur (Gray) 0408 991 261