Stop WA inquiry: franchise group

West Australian Premier Alan Carpenter announced an inquiry into franchise arrangements at the beginning of this month, after it was revealed in WA parliament that US-based Yum Restaurants International, which owns the KFC and Pizza Hut brands, is refusing to renew licences for 46 outlets operated by Jack Cowin's Competitive Foods.

http://smallbusiness.smh.com.au
November 12, 2007

Stop WA inquiry: franchise group
Helen Westerman

The Franchise Council of Australia has urged West Australian premier Alan Carpenter not to go ahead with its planned state inquiry into franchising, saying it would ''vigorously oppose'' any attempts to introduce state regulation.

The group also launched an extraordinary attack on the man appointed to lead the inquiry, Chris Bothams, saying it doubted he was ''sufficiently objective or capable'' of handling it.

This is despite awarding Mr. Bothams, who ran a Dymocks book shop franchise in WA, the industry's highest accolade, the Franchisee of the Year award in 2002.

West Australian Premier Alan Carpenter announced an inquiry into franchise arrangements at the beginning of this month, after it was revealed in WA parliament that US-based Yum Restaurants International, which owns the KFC and Pizza Hut brands, is refusing to renew licences for 46 outlets operated by Jack Cowin's Competitive Foods.

The first lease is set to lapse in the WA suburb of Rockingham on November 19.

Among the terms of reference for the inquiry is reviewing whether existing state and federal laws are adequate, as well as identifying ''whether emerging trends in the franchising industry disclose patterns of unconscionable conduct that may not be covered under existing laws''.

The inquiry will also review whether franchisees have sufficient remedies available to them.

FCA Director of Industry Relations Stephen Giles said he would ''vigorously resist any proposal to introduce State regulation of franchising''.

Mr. Giles said the industry was already heavily regulated federally and had just completed a Federal Government inquiry into franchising - the Matthews Report - which beefed up disclosure levels in the Franchising Code of Conduct. These will take effect in March 2008.

''The FCA can see no reason to justify the establishment of this inquiry, particularly when all Governments appear to be united in their push to reduce red tape and harmonise legislation," Mr. Giles said.

''The Franchise Council of Australia is also concerned that Mr. Bothams, a former franchisee with very limited experience, may not be either sufficiently objective or capable to handle any such inquiry," he said.

Mr. Bothams has been twice been named WA Franchisee of the Year, has won the Dymocks chairman's award for excellence in 2002 and the National Retail Association's American Express Rewards for Excellence Best Franchisee 2005.

A spokesman for WA's Small Business minister Margaret Quirk expressed surprise at the criticism, saying it had no credibility.

''In fact, the FCA's criticism defies logic because the FCA in 2002 awarded Mr. Bothams its prestigious National Franchisee of the Year Award. In the FCA's own words, the award recognises franchising excellence,'' the spokesman said.

David Beddall, chairman of the Franchisee Association of Australia said he did not necessarily oppose a state inquiry ''but I do oppose six or eight individual and territory pieces of regulations and legislation.''

Mr. Beddall's group instead wants a national inquiry into franchising and has written to all political parties calling for one.

''Franchising is a national business, it needs a national solution,'' he said.


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Risks: Multi-tradename franchisors are often the most ruthless, Franchisors push for weak national franchise law, Franchisors want the minimum regulation they can get away with, Alpha Male attorney, Australia, 20071112 Stop WA

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