Reading time: 2 minutes

Generally, franchise agreements are drafted in a way that makes it very difficult for a franchisee to end a franchise agreement. Franchisees are, however, able to transfer their franchise agreements to another person. Here are the various ways a franchisee can end a franchise agreement:

At the end of the franchising term

Perhaps the most obvious answer is that a franchise agreement will terminate automatically at the end of the term. Unless the franchisee has sought to renew the franchise for an additional term, the franchise agreement will terminate on completion of the term.

Cooling Off Period

A franchisee can end a franchise agreement within seven days after signing the agreement. This is known as the cooling off period.

Franchise Agreement allows termination

Some franchise agreements allow the franchisee to end a franchise under certain circumstances. Such clauses are not common and are often only seen in franchise agreements with long terms of 15 years or more.

Selling a franchise

A franchisee can sell their franchise agreement to another person. By law, the franchisee must first obtain the written consent from the franchisor, which cannot be unreasonably withheld. This is the most common way to end a franchise agreement prior to completion of the term.

Franchisor’s right to terminate

The franchisor has more opportunities to end a franchise agreement, including where the franchisee has not remedied a breach or a right of termination may be granted under the terms of the franchise agreement.

Conclusion

We have provided a general overview of when you can end a franchise agreement. The franchise agreement will outline in detail how you can end the franchise agreement, either by selling or terminating the agreement. We always recommend you speak with a franchise lawyer to help you understand your options and ensure you fully understand your rights and obligations under the franchise agreement.

For more information regarding the circumstances under which you may end a franchise agreement, it is advisable that you speak with your franchise lawyer. Your franchise lawyer will give you a better understanding of any relevant notice or procedural requirements that might be necessary to ensure you are able to terminate the franchise agreement smoothly.

 

Webinars

Redundancies and Restructuring: Understanding Your Employer Obligations

Thursday 7 July | 11:00 - 11:45am

Online
If you plan on making a role redundant, it is crucial that you understand your employer obligations. Our free webinar will explain.
Register Now

How to Sponsor Foreign Workers For Your Tech Business

Wednesday 13 July | 11:00 - 11:45am

Online
Need web3 talent for your tech business? Consider sponsoring workers from overseas. Join our free webinar to learn more.
Register Now

Advertising 101: Social Media, Influencers and the Law

Thursday 21 July | 11:00 - 11:45am

Online
Learn how to promote your business on social media without breaking the law. Register for our free webinar today.
Register Now

Structuring for Certainty in Uncertain Times

Tuesday 26 July | 12:00 - 12:45pm

Online
Learn how to structure to weather storm and ensure you can take advantage of the “green shoots” opportunities arising on the other side of a recession.
Register Now

Playing for the Prize: How to Run Trade Promotions

Thursday 28 July | 11:00 - 11:45am

Online
Running a promotion with a prize? Your business has specific trade promotion obligations. Join our free webinar to learn more.
Register Now

Web3 Essentials: Understanding SAFT Agreements

Tuesday 2 August | 11:00 - 11:45am

Online
Learn how SAFT Agreements can help your Web3 business when raising capital. Register today for our free webinar.
Register Now

Understanding Your Annual Franchise Update Obligations

Wednesday 3 August | 11:00 - 11:45am

Online
Franchisors must meet annual reporting obligations each October. Understand your legal requirements by registering for our free webinar today.
Register Now

Legal Essentials for Product Manufacturers

Thursday 11 August | 11:00 - 11:45am

Online
As a product manufacturer, do you know your legal obligations if there is a product recall? Join our free webinar to learn more.
Register Now

About LegalVision: LegalVision is a commercial law firm that provides businesses with affordable and ongoing legal assistance through our industry-first membership.

By becoming a member, you'll have an experienced legal team ready to answer your questions, draft and review your contracts, and resolve your disputes. All the legal assistance your business needs, for a low monthly fee.

Learn more about our membership

Need Legal Help? Submit an Enquiry

If you would like to get in touch with our team and learn more about how our membership can help your business, fill out the form below.

Our Awards

  • 2020 Innovation Award 2020 Excellence in Technology & Innovation Finalist – Australasian Law Awards
  • 2020 Employer of Choice Award 2020 Employer of Choice Winner – Australasian Lawyer
  • 2020 Financial Times Award 2021 Fastest Growing Law Firm - Financial Times APAC 500
  • 2020 AFR Fast 100 List - Australian Financial Review
  • 2021 Law Firm of the Year Award 2021 Law Firm of the Year - Australasian Law Awards
  • 2022 Law Firm of the Year Winner 2022 Law Firm of the Year - Australasian Law Awards