11Advice before entering into franchise agreement

11 Advice before entering into franchise agreement

(1) The franchisor must not:

(a) enter into, renew, extend, or extend the scope of a franchise agreement; or

(b) enter into an agreement to enter into, renew, extend, or extend the scope of a franchise agreement; or

(c) receive a non‑refundable payment (whether of money or of other valuable consideration) under a franchise agreement or an agreement to enter into a franchise agreement;

unless the franchisor has received from the franchisee or prospective franchisee a written statement that the franchisee or prospective franchisee has received, read and had a reasonable opportunity to understand the disclosure document and this code.

(2) Before a franchise agreement is entered into, the franchisor must have received from the prospective franchisee:

(a) signed statements, that the prospective franchisee has been given advice about the proposed franchise agreement or franchised business, by any of:

(i) an independent legal adviser;

(ii) an independent business adviser:

(iii) an independent accountant; or

(b) for each kind of statement not received under paragraph (a), a signed statement by the prospective franchisee that the prospective franchisee:

(i) has been given that kind of advice about the proposed franchise agreement or franchised business; or

(ii) has been told that that kind of advice should be sought but has decided not to seek it.

(3) Subclause (2):

(a) does not apply to the renewal, extension or extension of the scope of a franchise agreement with a franchisor; and

(b) does not prevent the franchisor from requiring any or all of the statements mentioned in paragraph (2) (a).