On February 1, 2017, the British Columbia Franchises Act and Regulations became effective in British Columbia. British Columbia now joins six other provinces (Alberta, Manitoba, New Brunswick, Ontario and Prince Edward Island) which have enacted franchise legislation.
The new British Columbia legislation applies when a franchisee is operating wholly or partly in British Columbia and to: (a) new franchise agreements entered into on or after February 1, 2017; (b) existing franchise agreements that are renewed or extended on or after February 1, 2017; and (c) with respect to certain sections contained in the new legislation mostly dealing with “fair dealing” and the “right to associate” provisions, franchise agreements entered into before February 1, 2017.
Among other things, the new British Columbia franchise legislation generally requires that franchisors provide a disclosure document which includes a long list of prescribed content to a prospective franchisee at least 14 days before signing a franchise agreement or the franchisee paying any consideration on account of the franchise that must be drafted accurately, clearly and concisely.
British Columbia's new legislation is substantially similar to the franchise legislation in the other provinces, however there are a number of important differences any potential franchisor should be aware of even if familiar with franchise legislation in another province and given the remedies and potential penalties for non-compliance it is important that franchisors and franchisees in British Columbia seek legal advice prior to any discussions regarding a potential franchise opportunity.
Does not constitute legal or other advice and must not be used as a substitute for legal advice from a qualified legal professional in your jurisdiction who has been fully informed of your specific circumstances. Information may not be up-dated subsequent to its initial publication and may therefore be out of date at the time it is read or viewed. Always consult a qualified legal professional in your jurisdiction.