Franchisee Rights in Ontario
This information is not exhaustive and does not constitute legal advice. Please consult a lawyer to obtain specific guidance for your situation.
1. Disclosure Rights: Franchisors are required to provide a prospective franchisee with a disclosure document containing pertinent information about the franchise at least 14 days before signing the franchise agreement or any other agreement relating to the franchise or before the franchisee makes any payment. The disclosure document should include financial statements, details of any litigation, names and contact information of current and former franchisees, and other essential information.
2. Right to Associate: Franchisees have the right to associate with other franchisees and form or join an organization of franchisees without interference from the franchisor.
3. Right to Rescind: If a franchisor fails to provide a disclosure document or an incomplete or misleading one, the franchisee has the right to rescind the franchise agreement within 60 days of receiving the document or within two years if they have yet to receive a disclosure document.
4. Right to Fair Dealing: Both parties in a franchise relationship have the right to fair dealing, which includes the duty of good faith and fair dealing in the performance and enforcement of the franchise agreement.
5. Right to Compensation and Damages: Franchisees may be entitled to compensation or damages if they suffer a loss due to misrepresentation or breach of the franchise agreement by the franchisor.