Key takeaways
- By 31 October 2025, Franchisors must have accurate and updated Disclosure Documents.
- April 2025 Code changes regarding reasonable opportunity to make a return and compensation for early termination come into effect on 1 November 2025.
- By 14 November 2025, Franchisors must ensure accurate and updated information on the Franchise Disclosure Register.
- Recent ACCC action warns Franchisors to ensure compliance with effective disclosure under the Code.
Overview
Franchisors are required to update their disclosure document under the Franchising Code of Conduct (Code). The annual update of disclosure documents must be finalised by 31 October 2025.
Franchisors must also confirm or update key information included on the Franchise Disclosure Register (Register) on or before 14 November 2025.
The issue
Recently, the ACCC has been cracking down on franchisors for non-compliance with these requirements. There can be significant penalties to franchisors who do not comply with the deadlines for either the disclosure document update or updating the Franchise Disclosure Register. Both must be up to date before entering into an agreement with a prospective franchisee, and failing to properly disclose information on the Register or otherwise exposes the franchisor to penalties and other sanctions.
Annual update of your disclosure document
Franchisors are required to update their franchise disclosure document within four (4) months from the end of their financial year. Franchisors whose financial year ends 30 June have until 31 October 2025 to complete their update.
Important items of the disclosure document to review and update include:
- changes to officers or associates of the franchisor;
- changes to intellectual property;
- details of any litigation commenced or finished;
- fees, costs and expenses payable by franchisees;
- details of franchisees who have left or joined the franchise system in the last 3 years; and
- financial details including a statement of solvency by the franchisor’s director/s.
Upcoming Code Changes
We also note the following Code provisions are effective 1 November 2025:
- Under section 43, franchise agreements must provide the franchisee with compensation for early termination by the Franchisor; and
- Under section 44, franchise agreements must provide the franchisee with a reasonable opportunity to make a return on investment required by franchisors.
Franchisors are advised to review their documentation to ensure compliance with the Code in preparation for these new requirements.
Specific Purpose Funds
If franchisees contribute to a specific purpose fund (such as a marketing fund), franchisors must also prepare financial statement for all income and expenses paid out of the fund for the past financial year.
The statement must be audited by a registered company auditor unless 75% of franchisees have voted not to comply with this requirement within three (3) months of the end of the financial year.
The statement and auditor’s report must be prepared within four (4) months of the end of the financial year and franchisees must begiven a copy of the statement and auditor’s report within 30 days of its preparation.
Franchise Disclosure Register
Franchisors must update the information from their annual disclosure document onto their Register within 14 days of their annual disclosure document update:
- the franchisor’s name(s), ABN (if applicable), registered address, and principal place of business in Australia;
- basic information about the franchise system (e.g. how long the franchisor operated for, the number of franchisees, use of suppliers, information about payments and costs, the term of the agreement, options to renew and any restraint of trade provisions);
- the franchisor’s business telephone number and email address; and
- the “ANZSIC” division and subdivision codes for the industry in which the franchise operates.
Recently, failure to confirm or update the franchise information on the Register has resulted in the ACCC issuing infringement notices and penalties for breaches of the Code.
In June 2025, the ACCC issued Franchisors Cash Converters Pty Ltd and MTA – Mobile Travel Agents Pty Ltd with infringement notices, requiring each franchisor to pay a $16,500 penalty.
Both franchisors breached the Code by failing to meet their obligation to annually update and confirm their franchisor information in the Register.
Additionally, in early August this year, a Queensland-based Harvey Norman franchisor was issued a $15,650 penalty for failing to include mandatory information on the Register before entering into an agreement with a franchisee in July 2024.
These actions are a clear message to the franchising sector indicating the ACCC’s intent to enforce compliance with the Register, and other obligations under the Code, or face sanctions.
Penalties
Failure to update a disclosure document can attract penalties of up to $198,000. However, failure to disclose financial information or other materially relevant matters (such as any change in majority ownership, criminal proceedings, judgements or change in intellectual property) can attract a penalty which is the greater of:
- $10,000,000;
- three times the commercial benefit achieved from the non-compliant behaviour; or
- 10% of the franchisor’s gross annual turnover.
Failure to upload or confirm information to the Register by 14 November 2025 may also incur civil penalties of up to $198,000.
Key dates
Franchisors are advised to record the following key dates to ensure compliance with the Code and avoid potential penalties:
- update franchise disclosure documents by 31 October 2025;
- ensure documentation is compliant with upcoming Code requirements by 1 November 2025;
- confirm or update the information to the Franchise Disclosure Register on or before 14 November 2025.
If you require a review of your franchise documents or would like to obtain specific advice on the Register, please contact our Franchising team.
