Subfranchisor (subfranchise agreement)
A subfranchisor is a person who grants a subfranchise. Alberta’s Franchises Act includes a person to whom a master franchise is granted, and Ontario’s Arthur Wishart Act treats a subfranchisor as the franchisor toward its subfranchisee and as a franchisee toward the franchisor.
The term describes a person in a chain: a franchisor above it, subfranchisees below it. A subfranchise agreement is the agreement by which it grants rights to a local operator. The rights it holds come from a master franchise, and area development agreements are covered separately.
Two roles at once
Ontario’s s. 1 defines “franchisor” to include a subfranchisor with regard to its relationship with a subfranchisee, and “franchisee” to include a subfranchisor with regard to its relationship with a franchisor. British Columbia’s Franchises Act defines both terms the same way. Alberta’s s. 1(1)(w) defines a subfranchisor as one or more persons who grant a subfranchise, including a person to whom a master franchise is granted.
What to check or ask
- Which entity granted your agreement and under what master agreement
- Whether that entity received a disclosure document from the franchisor above it
- Whether the rights it can grant extend to your territory
- Who the franchisor is for the purposes of the provincial Act that applies
Sources
This definition is checked against primary sources. Links were last confirmed on the dates shown.
- 01Government of OntarioGovernmentArthur Wishart Act (Franchise Disclosure), 2000, S.O. 2000, c. 3
- 02Government of AlbertaGovernmentFranchises Act, R.S.A. 2000, c. F-23
- 03Government of British ColumbiaGovernmentFranchises Act, S.B.C. 2015, c. 35
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