NEW ZEALAND Law and Practice Contributed by: Christopher Young, MinterEllisonRuddWatts
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 maxi - mum duration for franchise agreements. The dura - tion is agreed between the franchisor and franchisee. Note that New Zealand contract and commercial law requirements include a prohibition on unfair contract terms – see 8.4 Prohibited Provisions in Local Law . 5.2 Franchise Renewal In New Zealand, there are no legal or regulatory requirements that prescribe renewal rights. As men - tioned previously, note the New Zealand contract and commercial law requirements including a prohibition on unfair contract terms – see 8.4 Prohibited Provi- sions in Local Law . 5.3 Termination of the Franchise Agreement There are no legal requirements around termination or minimum notice periods specific to franchises under New Zealand law. As mentioned previously, note the New Zealand contract and commercial law require - ments including a prohibition on unfair contract terms – see 8.4 Prohibited Provisions in Local Law . In addi - tion, laws and regulations relevant to the particular industry of the franchise should be assessed for any requirements of this nature. 6. Restrictions on Competition in Franchise Agreements 6.1 Treatment of Competition Restrictions in Franchise Agreements The Commerce Act 1986 (New Zealand) prohibits the following. • The entering into or giving effect to cartel provi - sions between competitors (Section 30). A cartel provision is a provision contained in a contract, arrangement or understanding between competi - tors (including potential competitors) for the supply or acquisition of goods or services which has the purpose, effect or likely effect of fixing prices, restricting output or allocating markets. Breach of
the FANZ Code, which includes mandatory disclosure requirements. 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. 3.2 Franchise Registration Process There is no franchise registration process in New Zea - land. 3.3 Consequences of a Failure to Register This topic is not applicable. 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 and 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.
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