10Franchise agreements to which the Code does not apply

10 Franchise agreements to which the Code does not apply

Franchise agreements to which another mandatory industry code applies (1) Subject to subsection (2), the Code does not apply to a franchise agreement to which another mandatory industry code, prescribed under section 51AE of the Act, applies. (2) However, the Code applies to a franchise agreement to which either of the following industry codes apply: (a) the industry code set out in Part 2 of the Competition and Consumer (Industry Codes—Food and Grocery) Regulations 2024; (b) the industry code set out in Schedule 1 to the Competition and Consumer (Industry Codes—Unit Pricing) Regulations 2021. Certain franchise agreements relating to pre‑existing business relationships (3) The Code does not apply to a franchise agreement if: (a) the franchise agreement is for goods or services that are substantially the same as those supplied by the franchisee before entering into the franchise agreement; and (b) the franchisee has supplied those goods or services for at least 2 years immediately before entering into the franchise agreement; and (c) sales under the franchise are likely to provide no more than 20% of the franchisee’s gross turnover for goods or services of that kind for the first year of the franchise. (4) Subsection (3) ceases to apply to a franchise agreement if: (a) sales under the franchise provide more than 20% of the franchisee’s gross turnover for the goods or services for 3 consecutive years; and (b) the franchisee notifies the franchisor in writing that paragraph (a) of this subsection applies. Franchise agreements that form part of arrangements relating to certain co‑operatives or mutual entities (5) The Code does not apply in relation to a franchise agreement that forms part of arrangements under which the franchisee is: (a) a member of a co‑operative that is entered on a register maintained under: (i) the Co‑operatives National Law; or (ii) the Co‑operatives Act 2009 (WA), as in force on 1 April 2025; or (b) a member with voting rights of a mutual entity (within the meaning of the Corporations Act).

Note: For Co‑operatives National Law, see subsection 6(1). For mutual entity, see section 51M of the Corporations Act.