Question: When does the Disclosure Document need to be updated?Answer:
A Disclosure Document must be updated within 4 months after the end of each financial year. This means for most Franchisors the Disclosure Document will need to be updated by 31 October of each year. However, an update is not required if the Franchisor only entered into one Franchise Agreement in the last financial year or if the Franchisor does not intend to enter into a Franchise Agreement in the following financial year.
If an existing Franchisee asks for a copy of the updated Disclosure Document and the Franchisor has not updated the Disclosure Document, then the Disclosure Document must be updated and provided to that Franchisee within 2 months of the Franchisee’s request. Note however, if any changes have resulted in a material change or the events set out in clause 17(3) of the Franchising Code have occurred, then the Disclosure Document has to be updated (or at least an addendum setting out the change needs to be added to the Disclosure Document) irrespective of whether it is “time” to update or not.