It's enough to make you weep

…the ACCC and "other interested parties". Given that the first-mentioned of the above have had Emerson's ear in the 11 months since the joint parliamentary committee reported, one can easily guess what the expert panel's recommendations will be. "Other interested parties" would, one can only assume, include franchisees and others at the coalface of a $128 billion-a-year industry, but that's a hopeful guess. Emerson showed no inkling to consult with franchisees in the past year…

http://www.theage.com.au
November 6, 2009

It's enough to make you weep
Changes to one of Australia's largest industries won't do much to change its troubles, writes Chalpat Sonti.
Chalpat Sonti

"NO, NO, NO, another friggen inquiry !!!!"

Short and to the point - a bit like the news the sender of the e-mail was referring to when he contacted me yesterday afternoon.

The Perth man is one of a host of people who've had their lives ruined by a failed franchise operation. What appeared to be a great business opportunity turned sour.

He's gone through a hell no one should have to endure. And like many of his ilk, he wants to see that what happened to him can't happen to anyone else.

So, like all those others across Australia, he patiently waited for the Federal Government to announce what, if any, of the recommendations of a joint parliamentary inquiry into franchising it would implement.

And like many of those who pushed for reform, he was disappointed.

On face value, yesterday's announcement by Small Business Minister Craig Emerson is a step forward. But it's a pretty small step.

Sure there are penalties for unconscionable conduct - but not for breaches of the code, as the inquiry recommended - and the ACCC now no longer has to join all franchisees to proceedings when going after rogue franchisors.

That's on the rare occasion they go after someone.

There's tinkering with dispute resolution processes, which will do little to help those that most need it. Mediation isn't much use when you've lost everything and see a company sitting across the table knowing it just needs to outlast you.

End-of-term agreement changes will help newcomers, but it is doubtful that by requiring franchisors to disclose what the processes are when agreements expire will do much more than is the case now.

The real meat has been handed to yet another inquiry - this one going by the name of an "expert panel" - to look into.

These include unilateral contract variation, franchisor-initiated changes to franchise agreements when a franchisee is trying to sell their business and attribution of legal costs.

The panel will report on these by the end of January, after talking to franchising and retail tenancy representatives, small business organisations, the ACCC and "other interested parties".

Given that the first-mentioned of the above have had Emerson's ear in the 11 months since the joint parliamentary committee reported, one can easily guess what the expert panel's recommendations will be.

"Other interested parties" would, one can only assume, include franchisees and others at the coalface of a $128 billion-a-year industry, but that's a hopeful guess.

Emerson showed no inkling to consult with franchisees in the past year, with the only sop a derided "discussion paper" he released after some pressure, including remarks by state Labor ordering on derisive of his handling of the matter.

He probably doesn't want to get his - or the panel's - hands dirty again.

So the end result of two state inquiries, the joint parliamentary one and a Senate investigation into related issues is - another inquiry.

Meanwhile, the troubles will continue. Mums and Dads will continue to believe they've been done over and have no means of testing those claims or seeking redress.

It's enough to make you weep…

http://www.theage.com.au/small-business/its-enough-to-make-you-weep-20091106-i162.html


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Risks: Abuse of business, regulatory & political authority can destroy people, Australian Competition and Consumer Commission , ACCC, Bad faith and unfair dealings, Beggars can't be choosers: take what you're given and shut up, Blocking for the industry, Career Limiting Move, CLM, Devil is in the details & franchisors have much more political influence v. franchisees, Emotional collapse, Evils of the system defined in 1971 (Grange Report), Franchisor fails and consumers lose millions, Franchisor association not trusted by professional journalists, Fraud mushrooms when regulation is dropped, Have needed more statistics for +30 years, Illusion of government oversight, Imbalance of information and power, Industry likes this regulator, Industry muscle, Intellectual incontinence, Justice delayed is justice denied, McKangarooCourt.org: sue Minister for breach of oath to sovereign, Money swears, No justice in legal system for franchisees, Public perception of sleaze and greed, Regulator already has enough power but they don't use it, Regulators only pick on franchisors who can't defend themselves, Regulatory capture breeds its own incompetence, Renewing contract much tougher, Reputational risk, Shame or stigma, Should anyone trust anything associated with franchising anymore?, State refuses to even listen, Symbiotic relationships (industry, banks, lawyers), Thin-skinned politicians not doing their duty, Unilateral changes in business model drive franchisees' profits down, Vacuum of information favours dominant party, War of attrition, When fraud is alleged, politician turns to group that represents perpetrators, Australia, 20091106 Its enough

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