Document ID: chunk:federal_register_of_legislation:F2022C01111:clause:1_10
Version: federal_register_of_legislation:F2022C01111
Segment Type: clause
Provision Reference: sch 1 cl 10
Character Range: 42207–44256

10  Franchisee or prospective franchisee to give advice to franchisor before entering into franchise agreement
 (1) The franchisor must not:
 (a) enter into a franchise agreement; or
 (b) renew or transfer a franchise agreement; or
 (c) extend the term or scope of a franchise agreement; or
 (d) enter into an agreement to:
 (i) enter into a franchise agreement; or
 (ii) renew or transfer a franchise agreement; or
 (iii) extend the term or scope of a franchise agreement; or
 (e) receive a non‑refundable payment (whether of money or of other valuable consideration) under a franchise agreement or an agreement to enter into a franchise agreement;
unless the franchisor has received from the franchisee or prospective franchisee a written statement that the franchisee or prospective franchisee has received, read and had a reasonable opportunity to understand the disclosure document and this code.
 (2) Before a franchise agreement is entered into, the franchisor must have received from the prospective franchisee:
 (a) signed statements, that the prospective franchisee has been given advice about the proposed franchise agreement or franchised business, by:
 (i) an independent legal adviser; or
 (ii) an independent business adviser; or
 (iii) an independent accountant; or
 (b) for each kind of statement not received under paragraph (a), a signed statement by the prospective franchisee that the prospective franchisee:
 (i) has been given that kind of advice about the proposed franchise agreement or franchised business; or
 (ii) has been told that that kind of advice should be sought but has decided not to seek it.
 (3) Subclause (2):
 (a) does not apply to:
 (i) the renewal of a franchise agreement; or
 (ii) the extension of the term or scope of a franchise agreement; and
 (b) does not prevent the franchisor from requiring any or all of the statements mentioned in paragraph (2)(a).
 (4) In this clause, a reference to a prospective franchisee includes a reference to a prospective transferee.

Division 3—Information statement