Compliance 

Section 54 of the Franchising Code of Conduct (or if applicable, clause 26B of the Franchising Code of Conduct 2014) allows the franchisee to request an early termination of a franchise agreement for any reason. Changes in personal circumstances or economic hardship are common reasons.  

Proposal for early termination: Franchisees can propose early termination of their franchise agreement, outlining the proposed terms and reasons for the termination.  

Franchisor's response: The franchisor must provide a written response within 28 days. This response must be substantive (comprehensive) and detail reasons for accepting or rejecting the proposal. 

Good faith negotiations: The franchisor does not have to accept the proposal or accept the proposal on the terms the franchisee prefers. However, both parties are required to negotiate in good faith. 

Acting in good faith means that both franchisors and franchisees must act honestly, fairly, and reasonably in their dealings with each other. This includes being transparent, cooperative, and sincere in all interactions. A party will not be in breach of the obligation to act in good faith just for acting in its own legitimate commercial interests. 

Should the franchisor not agree to terminate on the terms proposed, the matter may be considered to be in dispute and trigger the dispute resolution process.