Stay Compliant. Stay Protected. Stay Ahead.
Every franchisor in Australia is legally required to update their Disclosure Document annually — no exceptions.
Failure to do so can expose your brand to legal penalties, invalidation of franchise agreements, and regulatory action under the Franchising Code of Conduct.
At Franchise Legal Partners, we specialise in preparing, reviewing, and updating Disclosure Documents for Australian franchisors — so you can recruit franchisees with confidence and meet your ongoing obligations with ease.
What Is the Annual Disclosure Obligation?
Under the Franchising Code of Conduct, franchisors must update their Disclosure Document within 4 months after the end of each financial year (i.e. by 31 October for most franchisors using the standard 30 June year-end).
The updated Disclosure Document must include:
- Audited financial statements (or an independent audit report on solvency).
- Details of franchisees who left the system (if consent obtained).
- Marketing fund income and expenditure reports.
- Any changes to fees, obligations, litigation or intellectual property.
What Does the Annual Update Involve?
At Franchise Legal Partners, we conduct a thorough, Code-compliant annual update process:
1. Legal Review of Your Current Disclosure Document
We examine:
- Whether financial, operational, and legal data is current.
- Whether the document reflects any new fees, terms or suppliers.
- That all dispute and litigation disclosures are accurate and complete.
2. Incorporation of Yearly Updates
We update the following sections:
- Contact details for franchisor and key personnel.
- Details of existing franchisees and former franchisees.
- Changes to intellectual property ownership or licensing.
- New or discontinued rebates, suppliers, or revenue-sharing models.
- End-of-term obligations and renewal procedures.
- Marketing fund reporting for the last financial year.
- Summary of disputes, terminations and mediations.
3. Review of Supporting Documents
We cross-check your:
- Franchise Agreement.
- Information Statement.
- Representation Questionnaire.
These must all align — discrepancies between them are a key cause of franchisee disputes and ACCC action.
What Happens if You Don't Update?
Failing to update your Disclosure Document by the due date (31 October) means:
- You cannot legally recruit new franchisees.
- You are in breach of the Franchising Code.
- You may face fines of up to $198,000 per breach.
- A franchisee may be able to rescind their agreement or lodge a dispute.
- The ACCC may investigate, leading to enforceable undertakings or litigation.
Real-World Examples of Disclosure Failures
Real-World Examples of Disclosure Failures
Case Study 1: Franchisee Withdrawal Due to Defective Disclosure
A QLD franchisor issued a Disclosure Document that incorrectly listed a franchisee as “operating” when in fact they had terminated their agreement two months earlier due to poor system support. The new franchisee relied on this as evidence of a “stable network”, signed up, and later sued for misrepresentation and unconscionable conduct.
Outcome: The matter settled with the franchisor paying $75,000 in compensation and updating their compliance process.
Real-World Examples of Disclosure Failures
In 2021, a national food chain failed to update its Disclosure Document on time for two consecutive years. The ACCC investigated, found systemic breaches, and the franchisor entered into an enforceable undertaking requiring:
- Immediate updates to documentation.
- Mandatory legal compliance training for senior staff.
- Independent audit of franchise operations.
Lesson: The ACCC takes a serious view of non-compliance, especially when patterns emerge.
When Should I Start the Update Process?
We recommend starting your update process between July and September each year so you’re ready to issue current Disclosure Documents before the 31 October deadline.
Starting early allows time to:
- Finalise audited accounts or solvency reports.
- Review new supplier arrangements.
- Capture accurate marketing fund figures.
When Should I Start the Update Process?
We recommend starting your update process between July and September each year so you’re ready to issue current Disclosure Documents before the 31 October deadline.
Starting early allows time to:
- Finalise audited accounts or solvency reports.
- Review new supplier arrangements.
- Capture accurate marketing fund figures.
How Franchise Legal Partners Can Help
We offer:
- Fixed-fee annual Disclosure Document updates.
- Full legal review of your franchise documentation suite.
- Compliance checklists and recordkeeping tools.
- Optional integration with Franchise Agreement updates.
- Advice on proper issuance and record-keeping procedures.
Our lawyers handle these updates for leading Australian franchise systems — across food & beverage, retail, health, education, and home services.
Frequently Asked Questions
What’s the deadline for updating the Disclosure Document each year?
For franchisors using a 30 June financial year, the deadline is 31 October each year. You must ensure the Disclosure Document is up-to-date before offering it to any prospective franchisee after that date.
Do I still need to update the Disclosure Document if I’m not recruiting this year?
Technically, no — but it’s strongly recommended. If a franchisee requests a copy (under the Code), you must provide the current version, even if you’re not actively recruiting.
Do I need an audit of my financials every year?
Yes, unless:
- You are a small franchisor (fewer than 2 franchisees in the past year), or
- You obtain a solvency statement from an independent registered company auditor.
If not exempt, you must include either audited financial statements or a financial report audit in the Disclosure Document.
What if I missed the 31 October deadline?
You must not issue your Disclosure Document to any prospective franchisee until it’s properly updated. If you’ve already done so, seek legal advice immediately — the franchisee may have rights to terminate.
Do I need to lodge my Disclosure Document with the ACCC?
No — franchisors are not required to lodge their Disclosure Document unless requested by the ACCC during an investigation. But you must retain copies and provide them to:
- Prospective franchisees.
- Existing franchisees upon written request.
- Your legal advisors when conducting reviews.
Can I update the Disclosure Document myself?
You can, but it’s risky. Many franchisors:
- Use outdated templates.
- Miss changes in the law.
- Fail to synchronise documents.
- Include incorrect fee disclosures.
Having your update prepared or reviewed by a franchise law specialist ensures your documents are accurate, enforceable, and low-risk.
Let’s Get Your Disclosure Document Compliant — and Keep It That Way
Whether you need a once-off update or want to build an annual compliance program, we’re here to help.
