Receipt of disclosure

A franchise buyer meets this term when a franchisor asks for confirmation that the disclosure document arrived. The date matters because the statutes speak of the franchisee receiving the document, not merely of the franchisor sending it.

What the statutes count from it

Ontario’s Arthur Wishart Act says the prospective franchisee shall receive the disclosure document not less than 14 days before the earlier of signing the franchise agreement or another related agreement, and paying consideration, subject to exceptions in section 5. British Columbia’s Franchises Act says the document must have been received at least 14 days before the earlier of the same two events, subject to the exceptions in its section 5. Section 6(1) of the Ontario Act lets a franchisee rescind no later than 60 days after receiving the document, if it or a statement of material change was late or its contents fell short; s. 6(2) allows two years after signing if no document was ever provided.

Ontario’s regulation adds that electronic delivery is allowed if conditions are met, including that the franchisor receives a written acknowledgment of receipt from the prospective franchisee. Manitoba’s Franchises Act uses the same 14-day and 60-day periods, also counted from receipt, and its s. 5(11) lists cases its disclosure rules do not apply to.

What to ask

Ask for the date and method of delivery in writing, and keep your own copy. See what a franchisor must disclose and the rescission right.