The campaign to fundamentally change franchising laws in Western Australia (WA) has taken another twist, with the Labor Opposition now introducing its own franchising bill into the Upper House of the Parliament of WA.
The move follows last week's rejection of the Peter Abetz bill in the Lower House -- the third unsuccessful attempt by the Liberal backbencher to push the bill through Parliament.
Yesterday, Labor small business spokesperson Ljiljanna Ravlich introduced a bill very similar to the Abetz bill, but with some changes added to ensure it is not regarded as the same bill -- which would mean it would not be able to be presented to Parliament again.
The Labor move means there is a chance for another debate on what is effectively the same bill, but with some minor differences, in the Upper House, which it previously has not reached because of defeat in the Lower House.
Legislative process means the bill will not be able to be debated until the last day of the WA Parliament's 2011 sitting calendar, next Thursday. This means that even if the debate was completed and the bill passed, it would not be considered by the Lower House until next February, at the earliest, when the 2012 sitting calendar begins.
If Lower House MPs vote the same way they did two weeks ago when the Abetz franchising bill was presented, then the Labor bill should suffer the same fate and be defeated (if the bill gets through the Upper House).
The latest move in WA continues the Labor defiance of its Federal counterparts, who do not support the actions. The Federal Minister for Small Business, Senator Sherry, told the FCA national convention in Melbourne last month that moves to introduce state laws which differed from Federal laws were "bizarre and unhelpful" and a recipe for confusion and increased conflict. New ACCC Chairman Rod Simms added his voice against state-based deviations from the Federal regime. The Law Council of Australia, the Queensland Law Society, the WA Small Business Development Corporation, the FCA, the International Franchise Association and others have all expressed their serious concerns at the negative impact on franchisees and franchisors likely to flow from the proposed changes.
Earlier this year, Competitive Foods owner Jack Cowin told a WA Parliamentary inquiry into the Abetz bill that he had been conducting a three-year campaign to change franchising laws. Mr Cowin owns about 50 KFC stories in WA, many of which are now operating in holdover, as the global owner of KFC, Yum! Brands, has declared it does not want to continue the relationship with Mr Cowin's company as franchisee of the WA KFC stores. Yum! wrote to Mr Cowin seven years ago, advising him of the decision to allow the agreements to lapse, as their terms expired -- a decision taken against a background of successful litigation by Competitive Foods against Yum! interests.
A key element of the Abetz and Labor bills is that the Yum! decision to not write new agreements for Competitive Foods could be regarded as contravening a new 'good faith negotiations' obligation, and therefore be subject to fines and damages claims.
The WA Government, which did not support the Abetz bill, has not yet made a public response to the Labor bill tabled yesterday.
