44 LEXPERT MAGAZINE
|
APRIL 2016
FEATURE
WHEN ONTARIO'S BUSINESS
Law Agenda Stakeholder Panel, created to make the province a more
competitive business jurisdiction, filed its report in July 2015, one of the 12 pieces of legislation targeted
for a major revamp was the Arthur Wishart Act (AWA), which governs franchising law.
In terms of the sheer scope of the industry, that's no surprise: Canada has the second-largest fran-
chise industry in the world, behind the US. ere are an estimated 1,300 franchise brands with more
than 78,000 franchise units across the country employing more than one million Canadians repre-
senting upwards of 7 per cent of the working force. Franchising is particularly significant in Ontario,
which boasts 56 per cent of the country's franchise headquarters and 65 per cent of its outlets.
Some 20 per cent of Canadian consumer dollars for goods and services are spent at a franchise.
Franchise brands are pervasive, found in a wide variety of industries including food, hotel, car rental,
travel, real estate, pharmaceuticals, optical, education, day care and in-home care. e hospitality sec-
tor is the largest, comprising almost 40 per cent of franchised brand names. In recent years, home-
based and mobile franchises have enjoyed the most growth. All the Canadian banks have established
national franchise departments.
For all this activity, only six provinces have franchise legislation. Alberta was first in 1971 and en-
acted a major update in 1995. Six years later, Ontario borrowed heavily from Alberta in passing the
AWA. Subsequently, Manitoba, New Brunswick and Prince Edward Island followed with legislation
that was substantially similar to that in Ontario.
FUTURE
THE
OF FRANCHISING
Lingering uncertainty surrounding legislation and case law
has made it increasingly challenging and costly for franchisors
to comply with governing legislation in Canada
BY JULIUS MELNITZER
PHOTO:
SHUTTERSTOCK
