Elizabeth Crawford Spencer

Conditions for effective disclosure in the regulation of franchising

This paper outlines the use of disclosure in the regulation of the franchise sector in Australia, demonstrating that it does not meet conditions considered necessary for effective informational regulation. First, there is not enough reliable information to gauge the risks in informing the design of regulatory process and the choice of tools; second, the information in the disclosure document is not uniformly reliable, accessible and useable; and, third, a franchisee’s ability to act on the information is limited because the franchise contract is not subject to negotiation and there are limited alternatives in the market. As potential solutions, this paper proposes that increased cooperation among and fuller representation of stakeholders, better information from dispute resolution processes, and registration of disclosure would improve the level of information about the sector generally. To ensure reliable, accessible and useable information, the information that is required to be disclosed should be identified by all stakeholders, with assurance that it is provided in an accessible, useable way. Finally, educational initiatives are needed to enhance franchisees’ ability to act on the information. This paper also briefly surveys some other regulatory tools used in the regulation of franchising, but urges that these tools be selected as part of a democratic and participative regulatory process that accurately represents the interests of all stakeholders.

An Exploration of the Legal Meaning of Franchising

There is no one settled definition of franchising. Its meaning is interpreted differently depending on discipline, jurisdiction, and the particular application or structure of the franchise arrangement in any given context. This article surveys the elements of statutory definitions of franchising in the law of jurisdictions that have enacted franchise-specific legislation, and it interprets these elements with a focus on the ways in which they reflect the quality of franchisee reliance upon and vulnerability to the franchisors business, system, management, policies, and operations. This dependency of a franchisees business upon that of its franchisor is idiosyncratic to franchising, and, along with related issues of alignment of interests, is well documented in the academic literature. Existing statutory definitions, however, may fail to adequately capture this essential element, with the risk that legislation may fall short of accurately and fully addressing this aspect of the relationship.

Revising the role of contract in development cooperation

Abstract Given the ongoing controversy over official development assistance (ODA) and the reduction to Australia’s commitment to aid funding, it is important that Australia’s ODA is effective and is perceived to be so. Among the diverse objectives identified by AusAID’s Office of Development Effectiveness Independent Review of Aid Effectiveness is the need to build local capacity. “Capacity building” is one of the Paris Declaration’s development assistance effectiveness principles, and several of the 2013 DAC Recommendations for AusAID refer to capacity building. Australia works with private contractors, governments of partner countries, civil society organizations and multilateral agencies. Partnering with multilateral organizations represents over 30% of Australia’s development assistance budget, and the DAC Report recommends further increases in partnering for sustainable capacity development. Because small, localized nongovernmental organizations (NGOs) can be flexible, sensitive to local needs, offer grassroots networks, potential specialization, and the ability to assist directly, a strong focus on local NGOs (LNGOs) is recommended to sustainably achieve the aim of capacity building. As is characteristic of the development assistance channel, LNGOs do not work in isolation; their work often involves partnering and cooperation. At a time of increasing multilateral aid and partnering, this study looks at issues of concern to LNGOs through the lens of contracting. Contract and the contracting process can provide critical, though sometimes overlooked, levers of control in the development assistance. The politics of contract law, however, assumes supportive infrastructures of both the government and the market. The utility of contract may take on different dimensions where the legal infrastructure for enforcement is limited and the cultural infrastructure for interpretation requires a pluralistic approach. By framing development assistance effectiveness as a contractual matter, this research adduces relevant threads of contract and organizational theory in its empirical analysis of contracting in development assistance. Semistructured interviews conducted with international and local NGOs and AusAID officials in Southeast Asia shed light on how LNGOs understand the contracting process, how they view contracts and agreements in partnering, what they perceive to be the important issues, and how contracts function. Local context matters nevertheless, this study suggests several common themes with interesting parallels to those in commercial contracting, including issues of control, information, allocation of risk and balance of power. From a theoretical perspective, controversy over the significance and meaning of contract has been part of the academic discourse for decades. This study contributes to better understanding of the role of contract in the development assistance context. Its implications extend to contract theory generally applicable in both commercial and noncommercial realms. From a practical perspective, this study suggests ways contract can better serve the aim of capacity building, and it informs the design of contracting processes better tailored to the actual objectives of contracting parties.