The Lawyers Weekly - January 27, 2012

Manitoba has drafted franchise legislation that adopts many of the recommendations made by the Uniform Law Commission of Canada, but with a few significant differences. The latest installment in a series of franchise law reform initiatives, the proposed Act and subsequent disclosure regulations are largely compatible with franchise laws already in force in four other provinces: Alberta, Ontario, P.E.I. and New Brunswick. However, some aspects of the new disclosure regulations are markedly distinct from the other provincial requirements and could signify a shift in how franchisors choose to provide disclosure information to franchisees.

The most significant change is that Manitoba’s draft regulations will allow franchisors to provide disclosure information in sequential parts. The required information (e.g. prescribed risk warning statements, extensive background information on the franchise and the franchisor, financial statements, etc.) will not have to be provided in one document, as required in the

KISA
MACDONALD

Manitoba’s draft regulations will allow franchisors to provide disclosure information in sequential parts.

“

Kisa Macdonald, British Columbia Law Institute

other jurisdictions. Instead, the franchisor may choose to provide the necessary disclosure in a series of documents, or more accurately, in prescribed clusters of partial information.

Assuming the draft regula-
tions are proclaimed without
amendment, a franchisor that
chooses to provide franchisees
with “piece-by-piece disclosure”
would need to follow four rules:
(1) Mandatory risk warning
statements must be provided at
the beginning of the first portion
of the disclosure.

Kisa Macdonald is an articled student with the British Columbia Law Institute and Boughton Law Corp. She is expected to be called to the B.C. Bar in May.

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