Franchise laws compared: US, Canada, UK, Australia and beyond

Franchise regulation falls into three broad models. Some places require detailed pre-sale disclosure (the US, most Canadian provinces, Australia). Some add registration with a regulator (about a dozen US states). Others rely on general contract law and voluntary industry codes (the UK, India). This guide summarises the essentials. It is not legal advice; always use a franchise lawyer licensed where you will operate.

United States

The FTC Franchise Rule (16 CFR Part 436) applies nationwide. Franchisors must give prospective franchisees a Franchise Disclosure Document with 23 prescribed items at least 14 calendar days before the buyer signs a binding agreement or pays any money, and must give the completed agreement at least 7 calendar days before signing if the franchisor unilaterally changes material terms. The FTC Rule has no private right of action, but many state laws do.

Registration states require franchisors to register or file their FDD with a state regulator before offering franchises there. They include California, Hawaii, Illinois, Indiana, Maryland, Michigan, Minnesota, New York, North Dakota, Rhode Island, South Dakota, Virginia, Washington and Wisconsin. Several states also have relationship laws that limit how and when a franchisor may terminate or refuse to renew.

Canada

Franchising is regulated provincially. Six provinces have franchise disclosure statutes: Alberta, Ontario, Prince Edward Island, New Brunswick, Manitoba and British Columbia. Under these laws:

• The franchisor must deliver a disclosure document at least 14 days before the franchisee signs any agreement or pays any consideration.
• Franchisees can rescind the agreement within 60 days of receiving the disclosure document if it was late or materially deficient, and within two years of signing if no disclosure document was provided at all (the exact provisions vary slightly by province).
• The parties owe each other a duty of fair dealing, and franchisees have a right to associate.

Quebec has no franchise-specific disclosure statute, but the Civil Code imposes duties of good faith, standard-form (adhesion) contract rules apply, and the Charter of the French Language sets requirements for contracts and commercial documents in French. Saskatchewan, Nova Scotia, Newfoundland and Labrador and the territories rely on general law. A franchise lawyer in the province where you will operate is essential.

United Kingdom

The UK has no franchise-specific legislation. Franchise agreements are governed by general contract, competition and consumer law. The British Franchise Association (BFA) sets ethical standards for its members, including pre-contract disclosure expectations, and member brands are generally preferred by UK bank franchise lending teams. Because there is no statutory disclosure period, buyers should insist on full information and take advice from a BFA-affiliated solicitor.

Australia

Franchising is governed by the mandatory Franchising Code of Conduct, enforced by the Australian Competition and Consumer Commission (ACCC). The Code was remade in 2025. It requires franchisors to provide a disclosure document, a key facts sheet and a copy of the agreement at least 14 days before the franchisee signs or pays, gives franchisees a cooling-off period after signing, requires an annual marketing fund statement, and sets out dispute-resolution procedures. Penalties for breaching the Code can be significant.

India

India has no dedicated franchise law. Franchise relationships are governed by the Indian Contract Act, the Trade Marks Act, competition law and, for foreign franchisors, foreign-exchange rules on royalties. Disclosure is a matter of negotiation, so buyers should demand audited financials, unit-level performance data and franchisee references, and have agreements reviewed carefully — especially termination, territory and exclusivity clauses.

European Union

There is no single EU franchise law. Several countries require pre-contractual disclosure — France's Loi Doubin, for example, requires a disclosure document at least 20 days before signing — while others rely on general law and national franchise association codes. EU competition rules on vertical agreements affect price controls, territorial restrictions and non-competes in franchise agreements.

Comparison at a glance