As noted in previous Cassels Brock Franchise Law e-Lert (click here) Manitoba has proclaimed that its Franchises Act will come into force on October 1, 2012. This date is only three months away, so if they haven’t already, franchisors should begin the process of making their franchise documentation compliant with Manitoba’s requirements.
If you plan to offer franchises in the province of Manitoba, or currently have franchises there which require renewal or will be transferred on or after October 1, 2012, you need to consider changing your franchise disclosure document (FDD) in order for it to comply with the new Manitoba requirements. Manitoba is the fifth Canadian province to bring in a franchise law, and this law includes the requirement that franchisors provide to prospective franchisees an FDD at least 14 days prior to the prospective franchisee signing any agreement or paying any consideration in respect of the franchise. This new legislation also means that half of all Canadian provinces now have a statutory franchise disclosure regime.
Most franchisors now have a single form of Canadian FDD intended for use in the other four provinces currently mandating pre-sale disclosure, namely Alberta, Ontario, New Brunswick and Prince Edward Island. With some small amount of effort by counsel and franchisor, a franchisor can most likely then have a form of FDD that is compliant with all five franchise law provinces as of October 1, 2012. That may be good practice, given that the date of Manitoba’s law coming into force is only a few short months away.