• State Franchise Laws - Common Sense Prevailing In WA, But SA Remains Uncertain
  • September 26, 2011
  • Law Firm: Norton Rose Canada LLP - Montreal Office
  • Despite the frequent wind changes it seems that common sense is likely to prevail in Western Australia, with the persistent attempts by backbencher Mr Peter Abetz to introduce State franchising legislation unlikely to receive sufficient support to see it enacted.

    The Franchising Bill 2010 will require the WA Labor Opposition to allocate time in their Private Member’s Bill sessions, as Mr Abetz’s own Liberal Party has indicated it does not support the Bill.  This seems increasingly unlikely, as the past efforts to do so were the subject of successful filibusting by the Government.  Further, even if introduced, there seems considerable doubt that Mr Abetz or anyone else will cross the floor to vote with the Opposition even if the Opposition were to support the Bill.

    In South Australia the process has been less transparent.  Although the previous Private Members Bill proposing specific State based franchising legislation lapsed and has not been resurrected, the proposed Small Business Commissioner Bill contains provisions that go beyond similar legislation in Victoria and enable the enactment of State franchising legislation via the back door. 

    The Franchise Council of Australia has drawn attention to this fact, and the fact that the initial draft of the Bill upon which the Minister sought public comment was materially different to the Bill actually introduced.  However the legislation has been introduced by Small Business Minister Koutsantonis, who has been active in promoting it, and has the support of the Labor Government, which controls the Lower House of the SA Parliament.

    Ultimately much seems likely to depend on the voting intentions of the Independents in the SA Upper House unless the FCA and others can raise sufficient substantive concerns to prevent or delay the introduction of the Bill. The Bill has been passed by the Lower House, where the Government has a majority, and is under consideration by the Upper House, where several independents and the Greens hold sway.  The defects in the Bill and the legislative process have been drawn to the attention of all parliamentarians, and the common sense decision would be to reject the Bill or refer the matter to an Upper House Committee for consideration.  However it is very difficult to predict what will occur, with the situation changing almost daily.

    It is difficult to comprehend the logic of introducing State based regulation of franchising given the existence of an existing and comprehensive Federal regulatory regime overseen by the ACCC.  It is even more difficult to predict the political machinations that will ultimately determine the matter.