Automotive Franchising Code of Conduct Final Submission

Public news

On the 13th of February, the MTAA lodged its Final Submission to the Federal Government in response to its Regulatory Impact Statement (RIS) in December, which proposed an Automotive Franchising Code of Conduct.

Once again, we thank the MTA members who attended our Automotive Franchising Reform Working Groups, along with the MTAA’s CEO Richard Dudley.

Click here to access the Final Submission which we contributed to and assisted to develop.

Importantly, our recommendations to the Federal Government include:

  • Extending the non-renewal notice period, requiring greater detail in the pre-contractual disclosure of significant capital expenditure to limit what franchisors can alter mid-agreement
  • Mandating that manufacturers buy back stock when an agreement is not renewed.
  • We are also recommending that rather than allowing for the terms of any buyback to be negotiated subsequent to the non-renewal notice, a standard formula for determining stock value should be in place at the commencement of the Code, and a transition plan for the return of stock should be developed to ensure that businesses are not left short during the notice period.

Information about the MTA's Working Groups can be seen on pages 10 and 11 of the Final Submission.

There will now be an Industry Roundtable to be held in Canberra, consultations with the Australian Small Business and Family Enterprise Ombudsman and a final stage RIS prepared by the Federal Government prior to final decisions being made.

For more information in regards to the Automotive Franchising Code of Conduct submission, click here to contact the MTA’s Industry Policy Specialist, Nathan Robinson.