Franchise Agreement (Australia)
This Franchise Agreement (the "Agreement") is entered into on [Agreement Date] between:
FRANCHISOR:
[Franchisor Name] (ABN [Franchisor ABN], ACN [Franchisor ACN]), of [Franchisor Address], [Franchisor Suburb] [Franchisor State] [Franchisor Postcode] (the "Franchisor"); and
FRANCHISEE:
[Franchisee Name] (ABN [Franchisee ABN]), of [Franchisee Address], [Franchisee Suburb] [Franchisee State] [Franchisee Postcode] (the "Franchisee").
The Franchisor and Franchisee are referred to collectively as the "Parties" and individually as a "Party".
BACKGROUND
The Franchisor operates and licenses the [Franchise Name] franchise system (the "System"), being a system for the [Franchise Description].
The Franchisee wishes to operate a franchise outlet under the System in accordance with the terms and conditions of this Agreement and the Franchising Code of Conduct (the "Code") set out in Schedule 1 to the Competition and Consumer (Industry Codes — Franchising) Regulations 2014 (Cth).
The Franchisor provided the Franchisee with a copy of the disclosure document required by the Code on [Disclosure Document Date], being at least 14 days before the date of this Agreement.
NOW THEREFORE, in consideration of the mutual promises and covenants contained herein, and for other good and valuable consideration, the Parties agree as follows:
1. GRANT OF FRANCHISE
1.1 The Franchisor grants to the Franchisee, and the Franchisee accepts from the Franchisor, a non-transferable licence to operate the [Franchise Name] franchise business (the "Franchised Business") within the territory described in clause 2 below, in accordance with the System and this Agreement.
1.2 This licence entitles the Franchisee to use the Franchisor's trade marks, trade names, logos, systems, methods, and operational know-how solely for the purpose of operating the Franchised Business.
1.3 The Franchisee acknowledges that this Agreement does not create a partnership, joint venture, employment, agency, or fiduciary relationship between the Parties.
2. TERRITORY
2.1 The Franchisee is licensed to operate the Franchised Business at or within the following territory (the "Territory"): [Franchise Territory].
2.2 The Franchisee must not operate or solicit business outside the Territory without the Franchisor's prior written consent.
3. TERM
3.1 This Agreement commences on [Commencement Date] (the "Commencement Date") and continues for [Franchise Term] (the "Initial Term"), unless terminated earlier in accordance with this Agreement or the Code.
4. COOLING-OFF PERIOD
4.1 In accordance with clause 6B of the Franchising Code of Conduct, the Franchisee has a cooling-off period of 7 days from the date of this Agreement during which the Franchisee may terminate this Agreement by written notice to the Franchisor.
4.2 If the Franchisee terminates this Agreement during the cooling-off period, the Franchisor must refund all money paid by the Franchisee under this Agreement within 14 days, less:
- Any amount specified in this Agreement as non-refundable (which must be reasonable and disclosed in the disclosure document); and
- The Franchisor's reasonable costs incurred in connection with this Agreement prior to termination.
4.3 The Franchisee cannot waive its cooling-off rights under the Code.
5. FRANCHISE FEES
5.1 Initial Franchise Fee: The Franchisee shall pay the Franchisor an initial franchise fee of AUD [Initial Franchise Fee] plus GST upon execution of this Agreement. The initial franchise fee is non-refundable after the cooling-off period.
5.2 Ongoing Royalty Fee: The Franchisee shall pay the Franchisor an ongoing royalty fee of [Royalty Rate] of the Franchisee's gross sales (excluding GST) payable [Royalty Frequency].
5.3 Marketing Fund Contribution: The Franchisee shall contribute [Marketing Fund Rate] of the Franchisee's gross sales (excluding GST) to the marketing fund maintained by the Franchisor, payable [Royalty Frequency] together with the royalty fee.
5.4 All fees under this Agreement are exclusive of GST unless otherwise stated. Where GST applies, the Franchisee shall pay the GST in addition to the fee.
5.5 The Franchisee shall maintain accurate books of account and financial records and provide the Franchisor with monthly sales reports and annual financial statements.
6. MARKETING FUND
6.1 The Franchisor maintains a marketing fund to which all franchisees in the System contribute (the "Marketing Fund").
6.2 The Marketing Fund shall be used exclusively for promoting and marketing the System, the brand, and the products and services offered under the System.
6.3 The Franchisor shall prepare and provide the Franchisee with a statement of marketing fund receipts and expenditure within 4 months after the end of each financial year, in accordance with the Code.
6.4 The Franchisor is not required to spend the Marketing Fund contributions in the Territory or in the period in which they are collected.
7. TRAINING
7.1 The Franchisor shall provide the Franchisee with [Training Details] prior to the commencement of operations. The cost of the initial training is included in the initial franchise fee. The Franchisee is responsible for its own travel, accommodation, and incidental costs during training.
7.2 The Franchisee must complete the initial training program to the Franchisor's satisfaction before commencing operations.
7.3 The Franchisor may require the Franchisee to attend further training from time to time. The cost of further training will be notified to the Franchisee in advance and is payable by the Franchisee.
7.4 The Franchisee must ensure that its employees are trained in the operation of the Franchised Business in accordance with the System.
8. OBLIGATIONS OF THE FRANCHISEE
8.1 The Franchisee agrees to:
- Operate the Franchised Business strictly in accordance with the System, the Operations Manual, and this Agreement;
- Maintain the standards of quality, service, and presentation specified by the Franchisor;
- Use only the products, equipment, and suppliers approved by the Franchisor;
- Obtain and maintain all licences, permits, and registrations required by law to operate the Franchised Business;
- Comply with all applicable laws, including the Australian Consumer Law, Work Health and Safety laws, employment laws, and food safety standards;
- Maintain adequate insurance as required by the Franchisor and specified in the disclosure document;
- Not transfer, assign, or sublicense this Agreement or any interest in the Franchised Business without the Franchisor's prior written consent; and
- Participate in audits and inspections conducted by the Franchisor at any reasonable time on reasonable notice.
9. INTELLECTUAL PROPERTY
9.1 All intellectual property associated with the System, including trade marks, trade names, logos, designs, know-how, and the Operations Manual, remains the property of the Franchisor.
9.2 The Franchisee is granted a non-exclusive, non-transferable licence to use the Franchisor's intellectual property solely for the purpose of operating the Franchised Business during the term of this Agreement.
9.3 The Franchisee must not use the Franchisor's intellectual property for any purpose other than operating the Franchised Business and must cease all use immediately upon termination or expiry of this Agreement.
9.4 The Franchisee shall promptly notify the Franchisor of any actual or threatened infringement of the Franchisor's intellectual property and shall provide all reasonable assistance to the Franchisor in protecting those rights.
10. DISPUTE RESOLUTION
10.1 The Parties must comply with the dispute resolution procedure set out in Part 4 of the Franchising Code of Conduct.
10.2 A Party wishing to raise a dispute must notify the other Party in writing, setting out the nature of the dispute.
10.3 Within 21 days of the dispute notice, the Parties must attempt to resolve the dispute by negotiation between senior representatives.
10.4 If the dispute is not resolved within 21 days of the dispute notice (or such longer period as agreed in writing), either Party may refer the dispute to mediation in accordance with the Code. The costs of mediation shall be shared equally between the Parties unless the mediator otherwise orders.
10.5 The dispute resolution procedure does not prevent a Party from seeking urgent injunctive or other equitable relief from a court to prevent irreparable harm.
11. TERMINATION
11.1 Either Party may terminate this Agreement in accordance with the termination provisions of the Franchising Code of Conduct.
11.2 The Franchisor may terminate this Agreement immediately (without notice) in the circumstances specified in clause 29 of the Code, including if the Franchisee becomes insolvent, ceases to operate the Franchised Business, or is convicted of a serious offence.
11.3 In all other cases, the Franchisor must give the Franchisee written notice of the alleged breach and a reasonable opportunity to remedy it (not less than 30 days), before terminating.
11.4 Upon termination or expiry of this Agreement, the Franchisee must immediately cease using the Franchisor's intellectual property, return all materials and property of the Franchisor, and comply with any post-term restraint obligations.
12. GENERAL PROVISIONS
12.1 Governing Law: This Agreement is governed by the laws of [Governing State], Australia, and the parties submit to the exclusive jurisdiction of the courts of [Governing State].
12.2 Franchising Code: This Agreement is subject to the Franchising Code of Conduct. In the event of any inconsistency between this Agreement and the Code, the Code prevails to the extent of the inconsistency.
12.3 Entire Agreement: This Agreement and the disclosure document together constitute the entire agreement between the Parties and supersede all prior negotiations, representations, and understandings.
12.4 Amendments: No amendment to this Agreement shall be effective unless made in writing and signed by both Parties, subject to the Franchisor's right to update the Operations Manual.
12.5 Severability: If any provision of this Agreement is invalid or unenforceable, the remaining provisions shall continue in force.
12.6 Independent Advice: The Franchisee acknowledges that it has been advised to obtain independent legal, financial, and business advice before entering into this Agreement.
EXECUTED as an agreement on [Agreement Date].
FRANCHISOR: [Franchisor Name]
ABN: [Franchisor ABN] | ACN: [Franchisor ACN]
FRANCHISEE: [Franchisee Name]
ABN: [Franchisee ABN]
Franchisor
________________
Signature
Date: ________________
Franchisee
________________
Signature
Date: ________________
What Is a Franchise Agreement (Australia)?
A Franchise Agreement in Australia grants a franchisee the right to operate under the franchisor's system and brand and sets the fees and obligations of each party under the Corporations Act 2001 (Cth).
The Franchising Code of Conduct (the Code) applies to all franchise agreements entered into in Australia, regardless of which state or territory the parties are located in. The Code is administered by the Australian Competition and Consumer Commission (ACCC) and imposes significant obligations on both franchisors and franchisees. The ACCC has broad enforcement powers, including the ability to seek injunctions, civil penalties, and other remedies for breaches of the Code.
Key obligations under the Code include the requirement for the franchisor to provide a disclosure document to the prospective franchisee at least 14 days before the franchise agreement is signed. This disclosure document must contain prescribed information about the franchisor's business history, litigation history, financial position, details of existing and former franchisees, all fees payable, intellectual property, supply arrangements, and the terms of the franchise agreement. The prospective franchisee also has a 7-day cooling-off period after signing the franchise agreement during which they may withdraw without penalty.
A well-drafted Australian Franchise Agreement must comply with the Code and reflect the commercial reality of the franchise relationship, including the grant of the franchise, the territory, the term and renewal rights, all fees payable (initial franchise fee, royalties, and marketing fund contributions), training obligations, operational standards, intellectual property licence, dispute resolution, and termination provisions.
The Australia Franchise Agreement (Australia) template is designed for use in all Australian states and territories, including New South Wales, Victoria, Queensland, Western Australia, South Australia, Tasmania, the Australian Capital Territory, and the Northern Territory.
The legal framework governing the Franchise Agreement (Australia) in Australia draws on several key statutes and regulatory bodies. Under the Corporations Act 2001 (Cth), the Australian Securities and Investments Commission (ASIC) regulates companies and financial services. Section 127 of the Corporations Act 2001 governs company execution of documents. The Australian Competition and Consumer Commission (ACCC) enforces the Competition and Consumer Act 2010 (Cth). The Australian Taxation Office (ATO) administers the Goods and Services Tax under the A New Tax System (Goods and Services Tax) Act 1999. The Federal Court of Australia and Supreme Courts of each state have jurisdiction over corporate disputes. Parties executing a Franchise Agreement (Australia) in Australia should confirm the document reflects current law, including any amendments enacted since the original drafting date. The Corporations Act 2001 (Cth) sets the foundational requirements.
When Do You Need a Franchise Agreement (Australia)?
A Franchise Agreement is required whenever a franchisor grants a franchisee the right to operate a business under the franchisor's system and brand in Australia. Both existing franchise systems entering into agreements with new franchisees and new franchise systems establishing their first franchisee relationships require a thorough, Code-compliant franchise agreement.
You need a Franchise Agreement when you are: establishing a new franchisee relationship for the first time; renewing or replacing an existing franchise agreement at the end of its term; granting a master franchise or sub-franchise arrangement; converting an existing business owner to a franchisee of your system; or acquiring an existing franchise from a departing franchisee.
For franchisors, the Franchise Agreement is the foundation of the franchise relationship. It must be drafted carefully to protect the intellectual property and goodwill of the system, confirm consistent standards across the network, establish clear fee collection mechanisms, and provide appropriate mechanisms for dealing with underperforming or non-compliant franchisees.
For franchisees, the Franchise Agreement defines the rights and obligations of the franchise relationship and should be read carefully before signing. The Code gives franchisees important protections, including the right to a disclosure document, the cooling-off period, and the right to have disputes resolved through mediation. Prospective franchisees are strongly encouraged to obtain independent legal and financial advice before entering into any franchise agreement.
Franchisors should also be aware that the ACCC actively monitors compliance with the Code and can issue infringement notices, seek injunctions, and impose civil penalties for breaches. The ACCC has published updated guidance on the Code and conducts regular reviews of the franchise sector.
Parties in Australia should prepare a Franchise Agreement (Australia) proactively rather than waiting for a dispute to arise. Courts interpret agreements based on the written terms rather than oral representations. Under the Corporations Act 2001 (Cth), the Australian Securities and Investments Commission (ASIC) regulates companies and financial services. Section 127 of the Corporations Act 2001 governs company execution of documents. The Australian Competition and Consumer Commission (ACCC) enforces the Competition and Consumer Act 2010 (Cth). The Australian Taxation Office (ATO) administers the Goods and Services Tax under the A New Tax System (Goods and Services Tax) Act 1999. The Federal Court of Australia and Supreme Courts of each state have jurisdiction over corporate disputes. Where the transaction involves regulated activities, prior approval from the relevant authority may be required before execution.
What to Include in Your Franchise Agreement (Australia)
A thorough Australian Franchise Agreement must include several essential elements to comply with the Franchising Code of Conduct and adequately protect both parties.
The grant of franchise clause defines the nature and scope of the licence being granted — the right to use the system, trade marks, and know-how to operate the franchised business within the specified territory. The grant should specify whether the territory is exclusive or non-exclusive, and what activities are permitted or prohibited within the territory.
The term and renewal provisions set out the duration of the initial franchise period and any renewal rights available to the franchisee. The Code requires specific provisions dealing with the notification period for renewal and the terms on which renewal may be exercised. Franchisors should note that they have obligations under the Code in relation to non-renewal of franchise agreements, including notice requirements.
The fees clause must clearly set out all fees payable by the franchisee, including the initial franchise fee, ongoing royalties, and marketing fund contributions. These fees must be consistent with those disclosed in the disclosure document. The Code requires franchisors to maintain marketing funds on trust and provide annual audited statements of marketing fund receipts and expenditures to franchisees.
The cooling-off clause must reflect the requirements of clause 6B of the Code, giving the franchisee 7 days from the date of the agreement to withdraw. This right cannot be waived and must be clearly disclosed to prospective franchisees.
The dispute resolution clause must include the mandatory dispute resolution procedure prescribed by Part 4 of the Code, including the notification, negotiation, and mediation steps. Franchisors cannot exclude or modify the Code's dispute resolution requirements.
The termination clause must comply with the Code's requirements regarding notice of breach and opportunity to remedy, and immediate termination rights are limited to the specific circumstances set out in the Code.
Additional compliance elements for a Franchise Agreement (Australia) used in Australia include: Under the Corporations Act 2001 (Cth), the Australian Securities and Investments Commission (ASIC) regulates companies and financial services. Section 127 of the Corporations Act 2001 governs company execution of documents. The Australian Competition and Consumer Commission (ACCC) enforces the Competition and Consumer Act 2010 (Cth). The Australian Taxation Office (ATO) administers the Goods and Services Tax under the A New Tax System (Goods and Services Tax) Act 1999. The Federal Court of Australia and Supreme Courts of each state have jurisdiction over corporate disputes. Forms-legal.com provides this template as a starting point for Australia-compliant documentation.
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Reference this free template in an article, syllabus, or research note:
Forms Legal. (2026). Franchise Agreement (Australia) (Australia) [Legal document template]. Forms Legal. https://forms-legal.com/australia/business/contracts/franchise-agreement-australia
"Franchise Agreement (Australia) (Australia)." Forms Legal, 2026, https://forms-legal.com/australia/business/contracts/franchise-agreement-australia.
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title = {Franchise Agreement (Australia) (Australia)},
year = {2026},
howpublished = {\url{https://forms-legal.com/australia/business/contracts/franchise-agreement-australia}},
note = {Free legal document template. Based on Corporations Act 2001 (Cth)}
}Also available for these jurisdictions:
Frequently Asked Questions
The Franchising Code of Conduct (the Code) is a mandatory industry code prescribed under the Competition and Consumer Act 2010 (Cth) and set out in the Competition and Consumer (Industry Codes — Franchising) Regulations 2014 (Cth). It is administered by the Australian Competition and Consumer Commission (ACCC). The Code imposes obligations on franchisors including the requirement to provide a disclosure document to prospective franchisees at least 14 days before the franchise agreement is signed, the 7-day cooling-off right for franchisees, mandatory dispute resolution procedures, limits on the Franchisor's ability to terminate, and restrictions on the use of marketing funds. All franchise agreements entered into in Australia must comply with the Code. Under Australia law, Corporations Act 2001 (Cth), parties should seek independent legal advice from a qualified lawyer to confirm compliance with all applicable requirements. Under the Corporations Act 2001 (Cth), the Australian Securities and Investments Commission (ASIC) regulates companies and financial services. Section 127 of the Corporations Act 2001 governs company execution of documents. Forms-legal.com provides this template as a starting point for Australia-compliant documentation.
Under clause 6B of the Franchising Code of Conduct, a franchisee has 7 days from the date of signing the franchise agreement to terminate the agreement without penalty. During this period, the franchisee is entitled to a refund of all money paid under the agreement, less any amounts specified in the agreement as non-refundable (which must be disclosed in the disclosure document and must be reasonable) and the franchisor's reasonable costs incurred prior to termination. The cooling-off right cannot be waived by the franchisee. This right exists in addition to any cooling-off rights that may apply under state or territory law. Under Australia law, Corporations Act 2001 (Cth), parties should seek independent legal advice from a qualified lawyer to confirm compliance with all applicable requirements. Under the Corporations Act 2001 (Cth), the Australian Securities and Investments Commission (ASIC) regulates companies and financial services. Section 127 of the Corporations Act 2001 governs company execution of documents. Forms-legal.com provides this template as a starting point for Australia-compliant documentation.
Under the Franchising Code of Conduct, the disclosure document must include prescribed information about the franchisor, including its business experience, any litigation history, details of all other franchisees in the network, financial information, details of all fees payable by the franchisee, intellectual property details, supply arrangements, territory information, site details, the terms of the franchise agreement, and exit arrangements. The disclosure document must be prepared in the form prescribed by the Code and must be updated annually and within a reasonable time of any material change. Failure to provide a disclosure document, or providing one containing false or misleading information, is a breach of the Code and may give rise to significant penalties under the Australian Consumer Law.
Part 4 of the Franchising Code of Conduct sets out a mandatory dispute resolution procedure. Either party may raise a dispute by giving written notice. The parties must then attempt to resolve the dispute by negotiation. If the dispute is not resolved within 21 days, either party may refer it to mediation. The ACCC maintains a list of approved mediators. Mediation costs are shared equally between the parties unless the mediator orders otherwise. If mediation fails, the parties may pursue legal proceedings. The dispute resolution provisions of the Code apply to all disputes arising under or in relation to a franchise agreement, including disputes about the conduct of the parties and the terms of the agreement. Under Australia law, Corporations Act 2001 (Cth), parties should seek independent legal advice from a qualified lawyer to confirm compliance with all applicable requirements. Under the Corporations Act 2001 (Cth), the Australian Securities and Investments Commission (ASIC) regulates companies and financial services. Section 127 of the Corporations Act 2001 governs company execution of documents. Forms-legal.com provides this template as a starting point for Australia-compliant documentation.
The Franchising Code of Conduct significantly limits the circumstances in which a franchisor may terminate a franchise agreement. In most cases, the franchisor must give written notice of any alleged breach and a reasonable opportunity to remedy it (generally at least 30 days) before terminating. The Code permits immediate termination (without notice) only in limited circumstances, such as where the franchisee becomes insolvent, ceases to operate the franchise business, is convicted of a serious offence, or endangers public health or safety. The ACCC can investigate and take enforcement action where a franchisor terminates a franchise agreement in breach of the Code, with significant penalties available under the Australian Consumer Law. Under Australia law, Corporations Act 2001 (Cth), parties should seek independent legal advice from a qualified lawyer to confirm compliance with all applicable requirements. Under the Corporations Act 2001 (Cth), the Australian Securities and Investments Commission (ASIC) regulates companies and financial services. Section 127 of the Corporations Act 2001 governs company execution of documents. Forms-legal.com provides this template as a starting point for Australia-compliant documentation.
This template is provided for informational purposes only and does not constitute legal advice. Laws vary by jurisdiction and change over time. Consult a qualified attorney for advice specific to your situation.Full disclaimer
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