Publication
Europe steps up its fight against fraud
European watchdogs have long been focusing on enforcement against corporate crime with a great focus on anti-corruption, economic sanctions and money laundering.
Australia | Publication | October 2020
The COVID-19 pandemic and the ensuing economic fallout has put a strain on many businesses. Franchisees and resellers are certainly not exempt from that strain and may quickly accrue considerable debts and fall in breach of franchise agreements or reseller or distribution agreements.
The question for franchisors is whether and to what extent they should adjust their usual enforcement and recovery procedures. There will be a number of considerations that franchisors should consider before deciding whether an adjustment to usual procedures is necessary. Franchisors should use the following as a checklist to assess their exposure to potential fallout from bad debt or franchise disputes and then devise an appropriate revised enforcement and recovery procedure accordingly:
When revising an enforcement and recovery procedure, it will be important to ensure that any temporary concession offered to franchisees, distributors or resellers are appropriately characterized as ‘temporary’ and cannot be misconstrued as a waiver of the franchisee’s, distributor’s or reseller’s liability for future non-compliance with the usual contractual terms. This will be especially important for franchisor – franchisee arrangements where the franchisor needs to preserve the right to breach the franchisee for non-compliance in the future if that non-compliance continues after any agreed concession period. Accordingly, any concessions made should be properly documented in a way that makes clear what has been agreed and the period of time for which the concession stands.
If having reviewed the checklist above you’ve determined that your business needs to revisit its enforcement and recovery procedures, please contact any member of our Consumer Markets and Franchising team to discuss how your enforcement and recovery procedures might be amended. We can assist with drawing up appropriate temporary variations or ‘standstill’ agreements to suspend certain obligations for a period of time as necessary for your network to emerge successfully from the current economic climate.
Publication
European watchdogs have long been focusing on enforcement against corporate crime with a great focus on anti-corruption, economic sanctions and money laundering.
Publication
The Digital Markets, Competition and Consumers Act (DMCC Act) received Royal Assent on 24 May 2024 and is generally expected to come into force in autumn this year.
Publication
Head of Legal Operations, Stephanie Hamon, will be joining the panel discussion on "Simplifying Legal Tech Adoption and Implementation" at the Legal Tech Talk conference on June 13th (3:30 - 4:15 PM).
Subscribe and stay up to date with the latest legal news, information and events . . .
© Norton Rose Fulbright LLP 2023