Competition and Consumer (Industry Codes—Franchising) Regulations 2024
46Franchise agreement must provide reasonable opportunity for return on franchisee’s investment—new vehicle dealership agreements
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46 Franchise agreement must provide reasonable opportunity for return on franchisee’s investment—new vehicle dealership agreements
(1) This section applies to a new vehicle dealership agreement. (2) A franchisor must not enter into a new vehicle dealership 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:
(a) for a contravention by a body corporate—the amount under section 17; or
(b) for a contravention by a person who is not a body corporate—$500,000.