Franchisor’s directors and officers (disclosure item)

This item shows a buyer who is behind a franchise system. It sits in the disclosure document alongside the franchisor’s own details. The disclosure answer lists the other items. The same people also matter at signing, because under both regulations the certificate that comes with the document is signed by officers or directors of an incorporated franchisor.

What each regulation asks

Ontario’s O. Reg. 581/00, s. 2, covers the directors, general partners and officers of the franchisor. For each person it asks for the name and current position, prior relevant business experience, time in the line of business, and principal occupation and employers during the five years before the date of the disclosure document. Alberta’s Schedule 1 asks for the names of directors, general partners and officers who will have management responsibilities relating to the franchise, with their principal occupation and employers over the five years before the document’s date. Alberta’s version need only cover those with day-to-day management responsibilities.

What to check or ask

• Whether the people named match those who will deal with franchisees day to day
• Whether any of them appears in the convictions, litigation or insolvency history items
• Who signed the certificate of the franchisor