We urgently need a Royal Commission into Franchising in Australia.
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To The Honourable Scott Morrison - We urgently need a Royal Commission into Franchising in Australia.
Because the system is corrupt, incredibly sick and millions of dollars of hard-earned money is being stolen from franchisees by corrupt corporations that are getting away with it because successive governments turn a blind eye. It’s all in the too-hard basket for them. The Franchising Council of Australia tried desperately to stop the current Parliamentary Inquiry into Franchising. They claimed that if Australia made it too hard for franchises to invest here, we would lose out. My argument to that is, if you can’t stand up to scrutiny, we don’t need you here. We have enough franchising scumbags already! Take a look at the Pizza Hut story for starters where almost the entire national market joined a class action against the then franchisor when we were all forced to trade towards insolvency. Apparently that didn’t count as unconscionable conduct or breach of good faith according to the court. Then look at all the other franchising nightmares unfolding over recent years. ALL of this could have been prevented if our government and the relevant departments had listened to the warnings and done their jobs.
· Franchisees have NO rights. They do not fall under employee laws, or consumer law or corporate law. Yes, there may be laws that are supposed to protect them, but the reality is that none of them ACTUALLY protect them as the powers that be and the courts choose not to apply that protection.
· Franchisors hold ALL the power. Our “justice” system has seen fit to deny franchisees any kind of justice. Franchisees have NEVER won a court case against a franchisor in Australia despite presenting mountains of evidence of corporate wrongdoing many times over.
· Franchisors have the money, the time, the power and the legal precedent to wait out any kind of legal action while franchisees go bankrupt waiting for “mediation” and courts to hear their side of the story. Franchisors rely on this when they make corrupt decisions, knowing the franchisees cannot afford to fight them.
· Franchisors threaten and bully franchisees into submission because they hold ALL the cards and can simply terminate anybody who dares stand up to them.
· The ACCC is supposed to be the Consumer Watchdog, but is ignoring the plight of franchisees. Franchisees are consumers and have the right to protection under consumer law, but get none. The ACCC has received many complaints that they have refused to act on. They told the Parliamentary Inquiry that they receive comparatively few complaints from the franchising sector. I would question whether those are complaints they RECEIVE or those they choose to ACT on. We complained to them many times and BEGGED them to act. They ignored us repeatedly and did NOTHING while telling us to get a lawyer. The ACCC is asleep at the wheel.
· ASIC is supposed to regulate companies within Australia. Why is the same corporate law not applied the same way to directors of franchises as it is to the directors of companies that buy into a franchise? Why is it that directors of franchises are untouchable and can simply pack up shop and start over again and do the same illegal things again while directors of franchised stores get pursued with the full force of the law? The directors behind the Pizza Hut saga simply sold up the franchise and left the country with no penalties. ASIC is willing to pursue the little guy to death, but too scared to touch the franchisors.
· There are many politicians who are fully aware of what has been happening within franchising for many years. I personally wrote to Kelly O’Dwyer as the then Minister for Small Business. I got no reply to multiple contacts. When I finally did receive a reply, it was clearly written by a staffer who had not properly read what I wrote. I wrote to my local member and the current Attorney General, Christian Porter. I initially got no response and then finally got a response along the lines of, “parliament cannot interfere in an active court case.” I never asked him to! I asked him to look into the sick state of franchising in Australia. I wrote to him again recently and he offered to forward my correspondence to the Employment Minister – Kelly O’Dwyer! Franchisees are NOT employees and her portfolio does not cover franchisees. When her portfolio did cover franchisees, she showed no interest in our plight. I wrote to Senator Nick Xenophon who had shown interest in franchising and got no response. I have written to many other politicians and it seems that nobody with the clout to do anything, wants to do anything so now I'm going straight to the top and addressing this to the Prime Minister himself.
· The current Parliamentary Inquiry is a step in the right direction, but does not go far enough. It has no clout to prosecute anybody or bring any real changes. We have had seventeen inquiries to date and nothing has really changed. It has taken a Royal Commission to uncover the depth of corruption and filth within the banking industry. It is long overdue for the same spotlight to be shone onto the Franchising Sector.
· Small Business is the backbone of Australia so it’s about time one of the largest sectors of Small Business got the protection it is entitled to and deserves. It is about time that mums and dads who invest in a business get to make a go of that business without being hamstrung by their franchisor and going through hell just to survive the experience. Kelly O'Dwyer, as the Minister responsible for the banking sector was quoted recently as saying, "We will make no apologies for protecting the assets of hardworking Australians." So when can franchisees expect the same concern for their assets?
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