Canada: B.C.’s New Franchise Regulation

Nearly a year after the introduction of Bill 38 in the British Columbia legislature, the B.C. government released the regulation to its Franchises Act (the B.C. Act) on October 3, 2016.

The bill was pushed through the legislature in less than a month last October, and, contrary to expectations, the regulation (the B.C. Regulation) was released in its final form without a public consultation process.

The Act and the B.C. Regulation will come into effect on February 1, 2017. B.C. is the 6th province in Canada to pass franchise legislation, together with Alberta, Manitoba, Ontario, New Brunswick, and P.E.I. (together with B.C., the ‘Regulated Provinces’).

Generally, the B.C. Act and the B.C. Regulation mirror the legislation and regulations of the other five Regulated Provinces. For instance, the B.C.’s disclosure obligations and related exemptions, financial statement disclosure obligations and related exemptions, and the certification standards are similar to those of the other Regulated Provinces.

For your information and consideration, outlined below is a list of the key areas that share similarities, as well as those with differences, which will be of interest to franchisors. Please see the source article at this link for a comprehensive outline of each of the following important topics.

  • Wrap-around disclosure documents;
  • Deposits;
  • Risk warnings;
  • Methods of delivery;
  • Financial statements;
  • Advertising funds;
  • Training and manuals;
  • Territory and proximity;
  • Alternative dispute resolution;
  • Certificates;
  • Current and former franchisees;
  • Negative statements;
  • Guarantees and security interests;
  • Trademarks;
  • Licenses, registrations, and authorizations;
  • Unilateral amendments;
  • Alternative dispute resolution; and
  • Large franchisor exemption.

 

Supporting Article Research Sources: Mondaq, Osler, Hoskin & Harcourt LLP, Legislative Assembly of BC

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