What's negotiable in a franchise agreement (and what usually isn't)

• The franchisor can't sign until 14 days after giving you the disclosure document, a copy of the Code and the agreement in the form it will be signed (s23(6)).
• Changes you ask for, filled-in particulars, address changes, minor clarifications and error fixes don't restart that clock. Other changes the franchisor makes do (s23(7)).
• If something you were promised matters, get it into the agreement. The ACCC warns that 'entire agreement' and 'no agent' clauses can override earlier verbal or written statements.
• The franchisor can't make you sign a general release of its liability, or a waiver of what it told you (s39).
• Its legal costs for the agreement are limited to a fixed amount stated in the agreement, paid before you start trading and no more than its reasonable and genuine costs (s38).

The ACCC gives the site, a mobile or site-based model, the minimum term and the franchisee's corporate structure as examples of options a franchisee may be able to choose. Terms like these depend on your site, timing or circumstances, so ask about them.

• Site and territory: the specific site, the territory boundary on a map, and any first right of refusal over neighbouring areas.
• Timing: the start date, opening deadline and training dates, so they fit around your current job and your finance approval.
• Fit-out: the specification, the approved contractors, and whether you can reuse equipment already on site.
• Fee timing: a delayed start to royalties or levies during ramp-up, or staged payment of the initial fee. Ask rather than assume.
• Personal guarantees: who gives them, whether they are capped, and when they end, for example on a sale.
• Performance targets: minimum performance criteria that fit your area, and what happens if you miss them.
• Renewal: an option to renew with clear conditions. The Code's limit on post-term restraints only helps franchisees whose agreement contains an option to renew or extend (s42).
• Exit terms: transfer fees, first-refusal timelines and any franchisor buy-back of stock and equipment (item 18).
• Structure: whether you contract as a company, a trust or an individual, which your accountant should advise on.

Franchisors keep some terms identical so the system runs the same way everywhere, and the law fixes others.

• The royalty rate and formula, because changing one franchisee's rate affects the economics of the whole network.
• Specific purpose fund contributions, such as marketing levies. Item 15 must say whether other franchisees contribute at a different rate, and company-owned units must pay on the same basis as franchisees (s61).
• Brand standards, the operations manual and the approved product range.
• Supply arrangements with nominated suppliers, and the rebates the franchisor receives, which item 10 must disclose.
• Ownership of the brand's intellectual property, which item 8 describes.
• Rights the law gives you: the 14-day consideration period, cooling-off for a new agreement (which only repeat franchisees can opt out of), and good faith, which the agreement can't limit or exclude (s18).
• Terms the Code bans outright, such as forcing disputes outside your state (s40) or making you pay the franchisor's costs of settling a dispute (s41).

Negotiation happens inside the Code's timetable. Knowing which changes restart the clock stops either side being surprised.

1. The franchisor gives you the disclosure document, a copy of the Code and the agreement in the form it will be signed. The 14 days start.
2. You ask for changes in writing. If the franchisor agrees, the change is made at your request and doesn't restart the 14 days (s23(7)).
3. If the franchisor makes other changes, such as new fees it proposes itself, it must give you the changed agreement, and the 14 days run again from that day (s23(3) and s23(6)).
4. If the franchisor gives you new earnings information during negotiations, the 14 days also run again from that day (s23(6)).
5. Any payment you make during the consideration period must be refunded within 14 days of your written request (s23(8)).
6. After you enter into a new agreement, you have 14 days' cooling-off, even if you negotiated the terms yourself (s50).

For site-based franchises the lease can matter as much as the franchise agreement. It is negotiated with the landlord, or with the franchisor if it or an associate holds the head lease.

• If the franchisor or an associate will sublease the premises to you, it must give you the head lease, or a summary of its commercial terms including incentives, before signing (s23(2)).
• It must also pass on any lease disclosure the landlord gave it under state or territory law.
• If you lease from the franchisor or an associate, it must give you a copy of the lease and details of any incentive or financial benefit it receives because of it, within 1 month of signing (s29).
• If the franchisor or an associate proposes to lease you the premises and the lease isn't in force when you sign, you can end the franchise agreement within 14 days of receiving the proposed lease terms, or later terms that aren't substantially identical (s50(3)).
• Points worth raising with the landlord include a rent-free fit-out period, a lease term and options that match your franchise term, the rent review method, make-good obligations and any fit-out contribution.
• State and territory retail lease laws add their own disclosure rules, which differ from state to state. Our guide to franchising rules by state explains the main differences.

1. Have your lawyer review the agreement and the disclosure document first, and list the issues by priority.
2. Separate what matters from what is nice to have. A short list of requests tied to your risk or cash flow is easier to agree to than a long one.
3. Put each request in writing with a short reason tied to your site or circumstances, not the system as a whole.
4. Ask current franchisees what they were able to change, but don't assume you will get the same.
5. Make sure agreed changes go into the agreement itself or a signed variation, not an email or a verbal assurance.
6. Before signing, check the final version against your requests, and confirm whether any change the franchisor made restarted the 14 days.

Unfair contract terms law applies to standard form contracts with businesses that have fewer than 100 employees or less than $10 million in annual turnover. The ACCC considers many franchise agreements are likely to be standard form, and a contract can still be standard form even if you negotiated minor terms.

• One-sided variation: terms letting the franchisor change the agreement without your consent. The Register profile and item 17 show whether one-sided changes are allowed.
• Set-off: terms letting the franchisor deduct money it says you owe from money it owes you.
• Audit powers broader than the franchisor needs, with the costs charged to you.
• Restraints of trade wider in area or longer in time than the franchisor needs to protect its legitimate interests.
• Termination rights for minor breaches without a real chance to fix them.
• In December 2023 the ACCC reported terms it considered potentially unfair in all 10 agreements it checked. In September 2026, after ACCC concerns, a fitness franchisor narrowed its restraints, reduced late-payment interest and removed early-termination fees.
• Since 9 November 2023, using an unfair term in a standard form small business contract can attract penalties up to the greatest of $50 million, three times the benefit or 30% of turnover for a company.

• Every agreed change is in the agreement or a signed variation, and nothing important rests on a verbal promise.
• You know whether any franchisor change restarted the 14-day consideration period, and when it now ends.
• Your lawyer has checked the final version against the version you reviewed.
• The lease terms are final and match the franchise term and any renewal option.
• The franchisor's legal costs are a fixed amount stated in the agreement.
• You have kept copies of every request and reply.
• You know your cooling-off right: 14 days from entering into a new agreement.