Franchise Agreement

A basic Franchise Agreement outlining the commercial relationship between a franchisor and a potential franchisee.

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Last updated May 15, 2025

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Suitable for Australia

Franchise Agreement

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What is a franchise agreement?

A franchise agreement is a legal contract outlining the rights and obligations between a franchisor and a franchisee for operating a business under an established brand.
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When should you use a franchise agreement?

Use a franchise agreement when granting or acquiring the rights to operate a business using an established system, brand, and support from a franchisor.
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What should be in a franchise agreement?

A franchise agreement should include fees, rights and obligations, operational standards, territory restrictions, use of intellectual property, dispute resolution, and compliance requirements.
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Frequently asked questions

What is a franchise agreement?

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When should you use a franchise agreement?

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What should be in a franchise agreement?

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Who is this franchise agreement suitable for?

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What are the main protections for the franchisor?

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What are the key risks for franchisees?

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Does this agreement comply with Australian franchise laws?

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Can this agreement be used for motor vehicle dealerships?

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How can the agreement be changed before signing?

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What ongoing obligations do parties have under this agreement?

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View Sample Franchise Agreement

Franchise Agreement
risk level indicator at Medium level

The Legal Risk Score of a Franchise Agreement Template is Medium

Our legal team have marked this document as medium risk considering:

  • The document allows the franchisor to unilaterally change operational systems and marketing strategies, which could impact the franchisee's ability to plan and control costs effectively.
  • The franchisor retains the right to sell or supply goods or services through alternative channels like the internet, which could potentially compete with the franchisee's business.
  • There are a range of compliance requirements stemming from franchise legislation that both parties must comply with.

Potential franchisees should be aware of these factors and consider whether they have the financial stability and flexibility to adapt to changes imposed by the franchisor.

Articles about Franchise Agreement

What Risks Are Involved in Becoming a Franchisee?
By Jenelle Miranda|May 3, 2019

What Risks Are Involved in Becoming a Franchisee?

Thinking of becoming a franchisee? Find out the risks associated with owning a franchise.

Top Reasons Franchise Agreements Are Terminated
By Cecilia Tran|Dec 2, 2025

Top Reasons Franchise Agreements Are Terminated

Do you want to know what the most common reasons for terminating a franchise agreement are? Read our guide to find out how you can be protected.

What Is a Perpetual Franchise Agreement?
By Daniel Alkurdi|Jul 3, 2020

What Is a Perpetual Franchise Agreement?

A perpetual franchise agreement is an ongoing contract made between you and a franchisee which lays out the rights and responsibilities that each party has.

How to Terminate a Franchise Agreement
By Alex Moore|Jun 9, 2020

How to Terminate a Franchise Agreement

Are you a franchisee or franchisor in a deal that isn't working out so well? Find out in this article how you can terminate a franchise agreement.

5 Things to Consider Before Franchising Your Business
By Sydney Rae|Dec 1, 2025

5 Things to Consider Before Franchising Your Business

Thinking of expanding your business? Here are 5 things to consider before franchising your business.

What You Need to Start Franchising
By Youstina Armanyous|Dec 2, 2025

What You Need to Start Franchising

Are you thinking of franchising your business? Follow our A-B-C-D-E acronym to ensure that your franchising journey starts on the right foot.

Considering Becoming a Franchisee? What to Know
By Dominic Woolrych|Nov 21, 2025

Considering Becoming a Franchisee? What to Know

Dominic Woolrych CEO Dominic is the CEO of Lawpath, dedicating his days to making legal easier, faster and more accessible to businesses. Dominic is a recognised thought-leader in Australian legal disruption, and was recognised as a winner of the Australian Legal Innovation Index and recently a winner of the LexisNexis 40 Under 40 (APAC). 💡 Key […]

What is a Master Franchise?
By Kyle McIndoe|Sep 12, 2019

What is a Master Franchise?

A master franchise can take your business to the next level. Our article breaks down what a master franchise is, and whether it's right for you.

Good Faith in Franchisor/Franchisee Agreements
By Vincent Appleton|Nov 28, 2025

Good Faith in Franchisor/Franchisee Agreements

What does Good Faith mean for franchises? Why must franchisors/franchisees need to know it? Find out everything about Good Faith here.

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