NEW ZEALAND Law and Practice Contributed by: Christopher Young, MinterEllisonRuddWatts
3.2 Franchise Registration Process This is not applicable as there is no franchise registra - tion process in New Zealand. 3.3 Consequences of a Failure to Register This is not applicable as there is no franchise registra - tion process in New Zealand. 4. Other Requirements 4.1 Past-Profitability Requirements There are no past-profitability requirements under New Zealand law. If a franchisor is a member of FANZ, the franchisor is required to comply with the FANZ Code, which includes a requirement to provide potential fran - chisees with a franchisor solvency certificate as well as ongoing disclosure requirements. Similarly, the Fair Trading Act 1986 prohibits misrepre - sentations in the course of trade, and representations need to be true and substantiated. 5. Duration, Renewal and Termination 5.1 Duration of a Franchise Agreement In New Zealand, there are no legal or regulatory requirements that prescribe a minimum or maximum duration for franchise agreements. The duration is agreed between the franchisor and franchisee. Note, however, New Zealand contract and commercial law requirements, including a prohibition on unfair con - tract terms – see 7.4 Prohibited Provisions in Local Law . 5.2 Franchise Renewal In New Zealand, there are no legal or regulatory requirements that prescribe renewal rights. Note, however, New Zealand contract and commercial law requirements, including a prohibition on unfair con - tract terms – see 7.4 Prohibited Provisions in Local Law .
enforceability of such clauses depends on whether they were clearly communicated before or at the time of contracting. Courts interpret exclusion clauses strictly, and any ambiguity is typically resolved against the party relying on the clause. Notably, clauses attempting to exclude liability for fraudulent misrep - resentation are always unenforceable. FANZ In addition to the foregoing, for FANZ members there is a complaints procedure for breaches of the FANZ Code. Sanctions that may be issued include: • written censure of the member (confidential); • suspension or removal from FANZ membership; • a direction to undertake remedial action in respect of the conduct; • a written apology to the complainant; and • the recovery of reasonable costs incurred by FANZ. 2.3 Franchise Disclosure Exemptions In New Zealand, there are no statutory franchise dis - closure obligations under general law. If a franchisor is a member of FANZ, they are required to comply with the FANZ Code, which includes man - datory disclosure requirements. There are limited exemptions under the FANZ Code – eg, full disclo - sure requirements do not apply to assignment of an existing franchise, and may not apply to renewals or extensions of an existing franchise. 2.4 Franchise Disclosure Language/ Translation Requirements The official languages of New Zealand are English, Te Reo Māori and New Zealand Sign Language. Typically, contracts are in English.
3. Franchise Registration 3.1 Mandatory Registration
There are no franchise registration requirements under New Zealand law. Franchisors are not required to reg - ister their franchise agreement, disclosure document or themselves with any government authority before operating in New Zealand.
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