Document ID: chunk:federal_register_of_legislation:F2022C01111:clause:1_23
Version: federal_register_of_legislation:F2022C01111
Segment Type: clause
Provision Reference: sch 1 cl 23
Character Range: 62536–63995

23  Effect of restraint of trade clause if franchise agreement not extended
 (1) A restraint of trade clause in a franchise agreement has no effect after the agreement expires if:
 (a) the franchisee had given written notice to the franchisor seeking to extend the agreement on substantially the same terms as those:
 (i) contained in the franchisor's current franchise agreement; and
 (ii) that apply to other franchisees or would apply to a prospective franchisee; and
 (b) immediately before the expiry, the franchisee was not in serious breach of the agreement or any related agreement; and
 (c) the franchisee had not infringed the intellectual property of, or a confidentiality agreement with, the franchisor during the term of the agreement; and
 (d) the franchisor does not extend the agreement; and
 (e) either:
 (i) the franchisee claimed compensation for goodwill because the agreement was not extended, but the compensation given was merely a nominal amount and did not provide genuine compensation for goodwill; or
 (ii) the agreement did not allow the franchisee to claim compensation for goodwill in the event that it was not extended.
 (2) Subclause (1) also applies in respect of a restraint of trade clause that is incorporated into a franchise agreement:
 (a) by reference to another document; or
 (b) by another document physically attached to the agreement.
Note: See subclauses 3(4) and (5).

Division 4—Transfer of franchise agreement