Regulation Impact Statement Updates

Official website for publishing regulatory impact analysis information for regulatory decisions announced by the Australian Government, COAG and COAG Councils.

Changes to the Regulatory Framework Applying to the Franchise Sector

Aust Gov
26th August 2020

Regulation Impact Statement – Department of Industry, Science, Energy and Resources

On 20 August 2020, the Australian Government announced reforms to franchising regulation in Australia in response to the findings of the Parliamentary Joint Committee’s (PJC) Fairness in Franchising report.

A Regulation Impact Statement (RIS) was prepared and certified by the Department of Industry, Science, Energy and Resources (DISER). The RIS highlights several problems in the relationship between franchisees and franchisors and presents and analyses a range of both regulatory and non-regulatory options to rectify these problems.

The OBPR’s assessment is that the RIS is adequate against the Government’s impact analysis requirements. To be consistent with good practice, the RIS should have provided some economic analysis on the aggregate scale and scope of direct financial losses incurred by franchisees and greater evidence of the breakdown of complaints received by the ACCC relating to franchising.

The RIS estimates the total regulatory burden to business, community organisations and/or individuals at $3.92M per year, while a regulatory offset of $3.12M per year was identified. The net regulatory costs are $800,000 per year.

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