Document ID: chunk:federal_register_of_legislation:F2022C01111:clause:1_26a
Version: federal_register_of_legislation:F2022C01111
Segment Type: clause
Provision Reference: sch 1 cl 26A
Character Range: 70380–73143

26A  Termination—cooling off after transferring franchise agreement
 (1) This clause applies if a franchise agreement is transferred between a person (the old franchisee) who was the franchisee under the agreement and a person (the new franchisee) who becomes the franchisee for the purposes of the agreement without a new franchise agreement being entered into by the new franchisee and the franchisor.
Note: Clause 26 deals with a transfer that involves a new franchise agreement being entered into by the franchisor and the person to whom the transfer was made by the old franchisee.
 (2) The new franchisee may, by written notice given to the old franchisee and the franchisor in accordance with subclause (3), do all of the following:
 (a) cease to be the franchisee for those purposes;
 (b) if the old franchisee can become the franchisee for those purposes again—cause the old franchisee to do so;
 (c) if there was an agreement (the transfer agreement) between the new franchisee and the old franchisee for the purposes of the transfer—terminate the transfer agreement.
 (3) A notice under subclause (2) must be given within whichever of the following periods ends earlier:
 (a) the period of 14 days starting on the day after the new franchisee becomes the franchisee for the purposes of the franchise agreement;
 (b) the period ending on the day the new franchisee takes possession and control of the franchised business.

Refunds from franchisor to new franchisee
 (4) If, by notice given under subclause (2), the new franchisee ceases to be the franchisee for the purposes of the franchise agreement, the franchisor must, within the period of 14 days starting on the day after the notice was given, repay all payments (whether of money or of other valuable consideration) made by the new franchisee to the franchisor under the franchise agreement.
Civil penalty: 600 penalty units.
 (5) However, the franchisor may deduct from the amount repaid under subclause (4) the franchisor's reasonable expenses if the expenses or their method of calculation have been set out in the franchise agreement.

Refunds from old franchisee to new franchisee
 (6) If, by notice given under subclause (2), the new franchisee terminates the transfer agreement, the old franchisee must, within the period of 14 days starting on the day after the notice was given, repay all payments (whether of money or of other valuable consideration) made by the new franchisee to the old franchisee under the transfer agreement.
Civil penalty: 600 penalty units.
 (7) However, the old franchisee may deduct from the amount repaid under subclause (6) the old franchisee's reasonable expenses if the expenses or their method of calculation have been set out in the transfer agreement.