ABSTRACT It is thought that evidence based policy is essential for making laws that serve the com... more ABSTRACT It is thought that evidence based policy is essential for making laws that serve the community best. The Australian Government has endorsed evidence based policy making. This paper reports the results of an exploratory study into stakeholder participation in government policy making within the context of the franchise sector in Australia. It is based on the South Australian Parliament’s Inquiry into existing laws governing franchising of 2008. General themes that emerged from this study support the view that policy proposals from the SA inquiry do result from evidence-based research. The value of having all stakeholders participating is identified and it is concluded that final recommendations from the South Australian Inquiry are not drawn primarily from any particular category of stakeholders. Finally, additional areas that will be pursued in the fuller study being conducted during 2010 are noted.
A seminal assumption that underlies current franchise law is that franchisees are intrinsically r... more A seminal assumption that underlies current franchise law is that franchisees are intrinsically rational. As such, franchisees are presumed to be able to rationally assess the risks involved in the franchise contract and avoid those risks. Based on this rationality assumption, current law is predominantly based on the FTC Franchise Rule, in which franchisors are obliged to disclose to franchisees information regarding future risks. Equipped with this information, franchisees, as rational actors, are assumed to be capable of protecting themselves against the franchise risks. This paper questions the validity of the assumption that franchisees are rational actors. Based on a significant body of existing empirical research, which has thus far been overlooked in the legal debate over the FTC Franchise Rule, this article presents the following arguments: First, although franchisees are often perceived as sophisticated business people, they systematically suffer from a common psychologica...
Being seen to be a good corporate citizen weighs far more heavily on the shoulders of multination... more Being seen to be a good corporate citizen weighs far more heavily on the shoulders of multinationals than ever before, particularly when it comes to tax income compliance.
Proceedings of the 23rd Annual International Society of Franchising Conference, 2009
... regulation 20.1 It is widely assumed that the Code protects the franchisee in the key risk ar... more ... regulation 20.1 It is widely assumed that the Code protects the franchisee in the key risk areas. Or, that it provides the franchisees the ... current status of the franchise network, predominantly concerned with the financial and legal fitness of the entity identified as the franchisor. 56 ...
European Journal of Open, Distance and E-Learning, 2020
This article profiles a MOOC on International Franchise Law offered by UNSW Sydney in 2016. The I... more This article profiles a MOOC on International Franchise Law offered by UNSW Sydney in 2016. The IFL MOOC is an example of an open access legal education course that was successfully integrated in real time into an on-campus curriculum for students majoring in business law. Opportunities, and future challenges that emerged for legal education are addressed.
In 21st century business format franchising, the search for solutions has taken the legislature a... more In 21st century business format franchising, the search for solutions has taken the legislature and the courts into the areas of unconscionable conduct and good faith. To date these concepts have lacked the ability to curtail franchisor opportunism in exercising contract-granted discretions. Similar difficulties afflict administrative law approaches to good faith, lawfulness and rationality, errors of law and fact finding, and fairness - criteria against which contract-based discretions have been appropriately exercised by franchisors. We examine franchising cases against the administrative law approaches, acknowledging doctrinal differences (as well as similarities) and conclude that a common body of principle underlies both areas. This allows a fresh approach to interpreting the exercise of franchisor's discretions.
Relying on research data emanating from a MOOC that was designed to take the learning of (franchi... more Relying on research data emanating from a MOOC that was designed to take the learning of (franchise) law across the globe, as well as findings from the literature, this book chapter demonstrates how online learning (in this case, using a MOOC) can transcend barriers to learning, including geographical, cultural and financial barriers.
As entrepreneurship education has broadened to include franchising as an independent course, the ... more As entrepreneurship education has broadened to include franchising as an independent course, the authors sought to understand what elements of a paradigm may be operating. The study presents findings from a content syllabi analysis of 25 stand-alone franchising courses offered in business schools across the United States. The authors identify key characteristics of the higher education institutions offering these courses and explores what the curriculum includes, how the courses are being taught, and by whom. Findings show both Introductory and Advanced courses are available. The majority of Introductory courses cover both the franchisor and franchisee perspectives, but the Advanced courses take either a franchisor or a franchisee orientation. There is some limited agreement on a paradigm for what content is covered in the Introductory courses, but little consistency in course texts. As franchising represents a popular entry path for small business ownership, this study identifies w...
An option is often provided in insolvency legislation to disclaim property belonging to a debtor ... more An option is often provided in insolvency legislation to disclaim property belonging to a debtor whose maintenance within the estate is deemed to constitute a liability. While by no means a generalised rule, enough jurisdictions have adopted this rule that it is recognised in the UNCITRAL Legislative Guide to Insolvency Law 2004 as forming one of the many recommendations for adoption by all insolvency regimes.2 A typical disclaimer provision normally allows an insolvency practitioner administering the estate to disclaim an on-going obligation in circumstances where requiring the debtor to remain bound by a contract would constitute an impediment to the efficient administration and conclusion of proceedings involving that debtor. Other property may be disclaimed where its maintenance may be unprofitable and result in further obligations or burdens being acquired, which ultimately are of little or no value to the estate. Justification for disclaimers sometimes refers to the harm to th...
A franchisee's business is like a honey pot inside a loaded bear trap. This article explores ... more A franchisee's business is like a honey pot inside a loaded bear trap. This article explores the laws that purport to protect the interests of franchisees (namely contract law, the Competition and Consumer Act 2010 (Cth) and the Franchising Code of Conduct) and identifies why those laws are doomed to failure if the franchisor becomes insolvent. The example of failed franchisor Angus & Robertson is used to explain the franchisees' predicament in the face of the responsibilities imposed on insolvency practitioners by the Corporations Act 2001 (Cth). The article concludes that piecemeal reform of consumer protection legislation can never result in fair franchising. An approach that includes amendments to insolvency policy and regulation is required.
This article provides an overview of the development of franchising within Australia since its in... more This article provides an overview of the development of franchising within Australia since its inception, with a particular focus over the last fifty years. It begins by discussing the introduction of some of the major individual franchise systems, and then examines the growth in numbers of franchisees and franchise systems. The history of government policy responses, and the evolution of regulation in the sector, is then outlined. This is followed by an overview of the emergence of franchising industry associations, and a discussion of some of the major advances in research and education. Whilst some early systems were already in operation by the end of World War Two, it was not until the late 1960s and early 1970s that the sector began to have a substantial presence in Australia. Initial activity primarily occurred in the automotive, petroleum and, somewhat later, fast food industries. By 1992 there were an estimated 450 franchise systems operating in the country. By 2002 this had...
Employment relations are well understood. Business format franchising is a newer and rapidly evol... more Employment relations are well understood. Business format franchising is a newer and rapidly evolving business expansion formula, also providing employment. This article compares the fates of employees and franchisees in their employer/franchisor insolvency. Whereas employees enjoy protection, franchisees continue to operate in conditions that have been described as Feudal. We identify the inherence of moral hazard, path dependency and optimism bias as reasons for the failure of policies and corporations laws, globally, to adapt to the franchise relationship. This failure comes into sharp focus during a franchisor’s insolvency. We demonstrate that the models of participation available to employees in the United States, Australia and the United Kingdom could be used to inform a re-balancing of the franchisees’ relationship with administrators and liquidators during the insolvency of their franchisor, providing franchisees with rights and restoring their dignity.
ABSTRACT It is thought that evidence based policy is essential for making laws that serve the com... more ABSTRACT It is thought that evidence based policy is essential for making laws that serve the community best. The Australian Government has endorsed evidence based policy making. This paper reports the results of an exploratory study into stakeholder participation in government policy making within the context of the franchise sector in Australia. It is based on the South Australian Parliament’s Inquiry into existing laws governing franchising of 2008. General themes that emerged from this study support the view that policy proposals from the SA inquiry do result from evidence-based research. The value of having all stakeholders participating is identified and it is concluded that final recommendations from the South Australian Inquiry are not drawn primarily from any particular category of stakeholders. Finally, additional areas that will be pursued in the fuller study being conducted during 2010 are noted.
A seminal assumption that underlies current franchise law is that franchisees are intrinsically r... more A seminal assumption that underlies current franchise law is that franchisees are intrinsically rational. As such, franchisees are presumed to be able to rationally assess the risks involved in the franchise contract and avoid those risks. Based on this rationality assumption, current law is predominantly based on the FTC Franchise Rule, in which franchisors are obliged to disclose to franchisees information regarding future risks. Equipped with this information, franchisees, as rational actors, are assumed to be capable of protecting themselves against the franchise risks. This paper questions the validity of the assumption that franchisees are rational actors. Based on a significant body of existing empirical research, which has thus far been overlooked in the legal debate over the FTC Franchise Rule, this article presents the following arguments: First, although franchisees are often perceived as sophisticated business people, they systematically suffer from a common psychologica...
Being seen to be a good corporate citizen weighs far more heavily on the shoulders of multination... more Being seen to be a good corporate citizen weighs far more heavily on the shoulders of multinationals than ever before, particularly when it comes to tax income compliance.
Proceedings of the 23rd Annual International Society of Franchising Conference, 2009
... regulation 20.1 It is widely assumed that the Code protects the franchisee in the key risk ar... more ... regulation 20.1 It is widely assumed that the Code protects the franchisee in the key risk areas. Or, that it provides the franchisees the ... current status of the franchise network, predominantly concerned with the financial and legal fitness of the entity identified as the franchisor. 56 ...
European Journal of Open, Distance and E-Learning, 2020
This article profiles a MOOC on International Franchise Law offered by UNSW Sydney in 2016. The I... more This article profiles a MOOC on International Franchise Law offered by UNSW Sydney in 2016. The IFL MOOC is an example of an open access legal education course that was successfully integrated in real time into an on-campus curriculum for students majoring in business law. Opportunities, and future challenges that emerged for legal education are addressed.
In 21st century business format franchising, the search for solutions has taken the legislature a... more In 21st century business format franchising, the search for solutions has taken the legislature and the courts into the areas of unconscionable conduct and good faith. To date these concepts have lacked the ability to curtail franchisor opportunism in exercising contract-granted discretions. Similar difficulties afflict administrative law approaches to good faith, lawfulness and rationality, errors of law and fact finding, and fairness - criteria against which contract-based discretions have been appropriately exercised by franchisors. We examine franchising cases against the administrative law approaches, acknowledging doctrinal differences (as well as similarities) and conclude that a common body of principle underlies both areas. This allows a fresh approach to interpreting the exercise of franchisor's discretions.
Relying on research data emanating from a MOOC that was designed to take the learning of (franchi... more Relying on research data emanating from a MOOC that was designed to take the learning of (franchise) law across the globe, as well as findings from the literature, this book chapter demonstrates how online learning (in this case, using a MOOC) can transcend barriers to learning, including geographical, cultural and financial barriers.
As entrepreneurship education has broadened to include franchising as an independent course, the ... more As entrepreneurship education has broadened to include franchising as an independent course, the authors sought to understand what elements of a paradigm may be operating. The study presents findings from a content syllabi analysis of 25 stand-alone franchising courses offered in business schools across the United States. The authors identify key characteristics of the higher education institutions offering these courses and explores what the curriculum includes, how the courses are being taught, and by whom. Findings show both Introductory and Advanced courses are available. The majority of Introductory courses cover both the franchisor and franchisee perspectives, but the Advanced courses take either a franchisor or a franchisee orientation. There is some limited agreement on a paradigm for what content is covered in the Introductory courses, but little consistency in course texts. As franchising represents a popular entry path for small business ownership, this study identifies w...
An option is often provided in insolvency legislation to disclaim property belonging to a debtor ... more An option is often provided in insolvency legislation to disclaim property belonging to a debtor whose maintenance within the estate is deemed to constitute a liability. While by no means a generalised rule, enough jurisdictions have adopted this rule that it is recognised in the UNCITRAL Legislative Guide to Insolvency Law 2004 as forming one of the many recommendations for adoption by all insolvency regimes.2 A typical disclaimer provision normally allows an insolvency practitioner administering the estate to disclaim an on-going obligation in circumstances where requiring the debtor to remain bound by a contract would constitute an impediment to the efficient administration and conclusion of proceedings involving that debtor. Other property may be disclaimed where its maintenance may be unprofitable and result in further obligations or burdens being acquired, which ultimately are of little or no value to the estate. Justification for disclaimers sometimes refers to the harm to th...
A franchisee's business is like a honey pot inside a loaded bear trap. This article explores ... more A franchisee's business is like a honey pot inside a loaded bear trap. This article explores the laws that purport to protect the interests of franchisees (namely contract law, the Competition and Consumer Act 2010 (Cth) and the Franchising Code of Conduct) and identifies why those laws are doomed to failure if the franchisor becomes insolvent. The example of failed franchisor Angus & Robertson is used to explain the franchisees' predicament in the face of the responsibilities imposed on insolvency practitioners by the Corporations Act 2001 (Cth). The article concludes that piecemeal reform of consumer protection legislation can never result in fair franchising. An approach that includes amendments to insolvency policy and regulation is required.
This article provides an overview of the development of franchising within Australia since its in... more This article provides an overview of the development of franchising within Australia since its inception, with a particular focus over the last fifty years. It begins by discussing the introduction of some of the major individual franchise systems, and then examines the growth in numbers of franchisees and franchise systems. The history of government policy responses, and the evolution of regulation in the sector, is then outlined. This is followed by an overview of the emergence of franchising industry associations, and a discussion of some of the major advances in research and education. Whilst some early systems were already in operation by the end of World War Two, it was not until the late 1960s and early 1970s that the sector began to have a substantial presence in Australia. Initial activity primarily occurred in the automotive, petroleum and, somewhat later, fast food industries. By 1992 there were an estimated 450 franchise systems operating in the country. By 2002 this had...
Employment relations are well understood. Business format franchising is a newer and rapidly evol... more Employment relations are well understood. Business format franchising is a newer and rapidly evolving business expansion formula, also providing employment. This article compares the fates of employees and franchisees in their employer/franchisor insolvency. Whereas employees enjoy protection, franchisees continue to operate in conditions that have been described as Feudal. We identify the inherence of moral hazard, path dependency and optimism bias as reasons for the failure of policies and corporations laws, globally, to adapt to the franchise relationship. This failure comes into sharp focus during a franchisor’s insolvency. We demonstrate that the models of participation available to employees in the United States, Australia and the United Kingdom could be used to inform a re-balancing of the franchisees’ relationship with administrators and liquidators during the insolvency of their franchisor, providing franchisees with rights and restoring their dignity.
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