The majority of franchisors are subject to the Privacy Principles and the Privacy (Enhancing Privacy Protection) Act 2012 (Cth) which restricts the ways in which franchisors (and their franchisees) can deal with and distribute certain information.
Add to that an increasing reliance on the internet and cloud based software to send information to and from franchisees, meaning franchisors must carefully monitor their compliance with privacy obligations.
Privacy in the Cloud
With the advent of cloud-based technologies, many franchisors run websites and/or communicate with their franchisees in ‘the cloud’, and do not have physical access to their information technology in the form of servers and backup drives.
This can raise privacy concerns as it’s hard to control all aspects of online communication, such as social media and the intervention by third parties. Further, if franchisors store data off-shore, those locations may have different privacy considerations to Australia. Franchisors should ensure there is some backup for retrieval of lost information.
Another area of concern for privacy for franchisors is where mobile phone apps or Google searches collect general information to help the franchisor analyse its customer type and base. Although this data can be de-personalised to remove personal details, certain groups of people may still be able to be tracked through the data. If the franchisor can identify a person through the data, the Privacy Act and Privacy Principles will apply, and a franchisor should know of its obligations in this regard.
To ensure franchisors meet these principles, we suggest you review existing databases and ensure they comply with the privacy principles, ensuring that data tracking does not readily identify individuals.
Franchisors also need to be aware of privacy considerations regarding marketing, especially since the introduction of the Spam Act 2003 (Cth). This Act prohibits franchisors (and anyone else conducting marketing) from sending unsolicited emails with an Australian link, noting that any data collected without the consent of the customers of the franchise cannot be used to send spam email marketing.
LegalVision regularly assists franchisors with privacy issues. We can assist with drafting your franchise agreement and privacy policies. Get in touch with our franchise lawyers on 1300 544 755.