Franchisors should regularly turn their minds to whether their Canadian franchise disclosure documents need updating. This is particularly important right now for franchisors who wish to offer franchises in the Province of New Brunswick. As we mentioned in previous Franchise Law updates, the province’s new franchise law came into effect on February 1, 2011.

If you plan to offer franchises in the province of New Brunswick, or have franchisees in that province currently who will be renewing or transferring their agreements, you will need to consider changing your franchise disclosure documents (FDD) in order for them to comply with the new New Brunswick requirements. New Brunswick is the fourth Canadian province to bring in a franchise law, which includes a 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.

Most franchisors now have a single form of Canadian FDD intended for use in the other three provinces currently mandating pre-sale disclosure, namely Alberta, Ontario and Prince Edward Island. With some small amount of effort by counsel and the franchisor, a franchisor can have a form of FDD that is compliant with all four provincial franchise laws.

If you have not already done so, please contact a member of our franchise law team so that the necessary changes can be made to your FDD to ensure compliance with this new legislation.