44Franchise agreement must provide reasonable opportunity for return on franchisee’s investment—general

44 Franchise agreement must provide reasonable opportunity for return on franchisee’s investment—general

(1) This section applies to a franchise agreement that is not a new vehicle dealership agreement. (2) A franchisor must not enter into a franchise agreement unless the agreement provides the franchisee with a reasonable opportunity to make a return, during the term of the agreement, on any investment required by the franchisor as part of entering into, or under, the agreement.

Note: If expenditure is disclosed in a disclosure document for a franchise agreement, the circumstances in which the expenditure is likely to be recouped must be discussed (see section 47).

Civil penalty: 600 penalty units.