The Franchises Act protects people buying a franchise in New Brunswick by ensuring franchise information is provided to them before they enter into a franchise agreement, and by providing avenues of recourse if they encounter problems.
The Act requires fairness in the legal relationship between franchisors and franchisees. It contains five key elements:
a duty of fair dealing
the franchisees' right to form an association
the franchisor's duty of disclosure
a mediation procedure
protection from being forced to litigate outside New Brunswick
The company granting the franchise is required to provide a disclosure document with prescribed information that will enable the purchaser to make an informed decision before they buy in.