Planning Material Change Notices for Australian Franchises

Your disclosure document describes your franchise at a particular point in time. Your business will not stand still after you issue it. Before franchising an existing Australian business, establish how you will identify important changes and tell the people who need to know. A clear notification process helps protect informed decisions and trust across your franchise community.

Understand the separate duty to notify

Australia’s Franchising Code of Conduct is a mandatory code prescribed under the Competition and Consumer Act 2010. The Australian Competition and Consumer Commission administers and enforces it. The current Code commenced on 1 April 2025, with transitional arrangements affecting how particular requirements apply.

Alongside initial disclosure obligations, the Code requires franchisors to notify franchisees and prospective franchisees in writing about certain changes involving materially relevant facts. A 14-day notification requirement applies to specified changes. Ask your franchise solicitor to confirm the relevant triggers, recipients and deadline calculation for your circumstances.

“Materially relevant facts” is not simply a label for anything management considers important. The Code identifies particular matters and requirements. Nor should you assume that an annual disclosure update will satisfy a separate notification obligation.

The Australian Consumer Law also prohibits misleading or deceptive conduct. Even where a development does not trigger a particular Code notice, continuing to circulate information that has become misleading can create a separate problem.

Before recruitment begins, have your solicitor prepare a practical trigger checklist reflecting the current Code. Keep statutory notification requirements separate from broader decisions about communicating business changes.

Build an early-warning system inside your business

A notification process cannot work if the person responsible for franchising learns about developments too late. Map where potentially relevant information first appears: directors, finance staff, legal advisers and those managing ownership or business transactions may all hold different pieces.

Give one person responsibility for coordinating the process, with a named deputy. They need direct access to decision-makers and authority to obtain urgent legal advice. In a small business, this may be the founder, but the process should still be documented.

Create an internal escalation form covering:

• What happened, and when?
• When did the business first become aware of it?
• Which entities and people are involved?
• What documents support the account?
• Which franchisees or prospective franchisees might be affected?
• Is any related information currently being circulated?

Potential changes involving ownership, financial distress or legal proceedings should be escalated for assessment, rather than automatically treated as notifiable. The precise nature of the event matters.

Set an internal reporting target substantially shorter than the applicable legal deadline. This is a management safeguard, not an additional statutory rule. It creates time to investigate, obtain advice and prepare an accurate notice.

Turn an assessed event into a clear written notice

Once an event is escalated, the coordinator and solicitor should establish whether a notification duty applies, when the clock started and who must receive the notice. Do not assume that only existing franchisees need to be considered: prospective franchisees may also fall within the requirement.

Maintain a current recipient list that distinguishes existing operators from people at different stages of the recruitment process. Check that your delivery method meets applicable requirements and that contact details are correct.

A useful drafting structure is:

• The event: a factual description, without promotional language.
• Relevant timing: dates needed to understand the change.
• The implications: confirmed effects, distinguished from matters still being assessed.
• Next steps: a contact for questions and any further information to follow.

Your solicitor should check the notice against the Code’s actual content requirements. A convenient template is not a substitute for that assessment.

Avoid reassuring statements that go beyond the evidence. If the consequences remain uncertain, say so accurately. Commercial sensitivity is a reason to seek prompt advice about what must be disclosed, not to assume disclosure can wait.

Test the process before offering franchises

Run a tabletop exercise using a hypothetical event from your solicitor’s trigger checklist. Trace it from the first internal report through legal assessment, drafting, approval and delivery.

Check whether the team can identify the deadline, locate all intended recipients and demonstrate what each received. Preserve the assessment, approved notice and delivery evidence in accordance with applicable record-keeping requirements.

Finally, review related recruitment materials, answers to applicant questions and disclosure information. Sending one accurate notice does not resolve contradictory statements elsewhere. Assign responsibility for correcting or withdrawing affected material and obtaining advice on any consequences for a proposed signing.

Practical takeaway: Before granting your first franchise, establish a legally checked trigger list, one accountable coordinator and a tested delivery process. Important changes should prompt timely assessment—not wait for the next annual paperwork review.