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Abetz to push ahead with franchising bill despite committee rebuffal

Friday, 24 June 2011 | By Michelle Hammond
Liberal MP Peter Abetz is to push ahead with his controversial WA franchise bill despite a parliamentary investigative committee advising against it.

 

Late last year, Abetz introduced a private member’s bill in the WA State Parliament, calling for state-based legislation to protect WA franchisees from “rogue” franchisors.

 

The proposal was met with criticism from the Franchise Council of Australia, which argued state-based legislation would duplicate national regulation and cripple the WA franchising industry.

 

As a result, the Franchising Bill 2010 was put before a Parliamentary Committee, which sought to investigate the proposals.

 

Releasing its report yesterday, the committed said it had found limited evidence of rogue operators in the industry.

 

It also said the laws would impose costs and that recent changes to federal regulation – combined with the consumer watchdog’s oversight – were sufficient protection.

 

Abetz could not be reached for comment, but has said he plans to push ahead with his bill regardless of the committee’s verdict.

 

While the bill has the support of the WA Labor party, it has caused conflict among Abetz’s own party members, who are concerned the bill will hinder the state’s franchising industry.

 

Professor Frank Zumbo, who drafted the controversial bill, says Abetz should be applauded for his pursuit of a “better deal” for WA franchisees.

 

According to Zumbo, the committee’s verdict is a “sad example” of where an important issue to small business has been “unnecessarily politicised”.

 

“A failure to support the Western Australian Franchising Bill simply gives those franchisors, who are not complying with the Franchising Code, the green light to continue with their breaches of the code,” Zumbo says.

 

“The majority of Liberal MPs on the Western Australian Parliamentary Committee are clearly out of step with earlier parliamentary reports and their stance fails to recognise the ongoing failure of the ACCC to stamp out non-complying or unethical franchisors.”

 

“Similarly, pointing to recent changes at a Federal level as a reason for inaction on the Western Australian Franchising Bill is also a seriously flawed approach... There’s a strong likelihood that those changes are also not being fully complied with because of the absence of a clear deterrent against breaches of the Franchising Code.”

 

FCA executive director Steve Wright says he isn’t overly concerned about Abetz’s plan to push ahead with the bill.

 

“What he decides to do is up to him, but I think if he was to contemplate putting up the same bill, he’ll get the same reaction,” Wright says.

 

“The Parliamentary Committee did a very thorough investigation – there was a 100-page report and 115 submissions... and the outcome is fairly clear.”