4. When is a franchisor required to provide a disclosure document (and to whom)?
A franchisor must give a copy of the disclosure document, together with copies of the Franchising Code and the franchise agreement (in the form in which it is to be executed), to:
a prospective franchisee at least 14 days before they:
enter into a franchise agreement (or an agreement to enter into a franchise agreement) or
make a non-refundable payment to the franchisor in connection with the franchise agreement.
a franchisee at least 14 days before the renewal or extension of the franchise agreement.
Under the code, a master franchisee (sometimes called a sub-franchisor) has the same disclosure obligations as the franchisor. This means that if a master franchisee is proposing to grant a sub-franchise to a prospective sub-franchisee, the franchisor and master franchisee must either give:
two separate disclosure documents or
a joint disclosure document (which details the respective obligations of the franchisor and the master franchisee in the operation of the franchise)
to the prospective sub-franchisee.
A franchisor must also give to a franchisee a current disclosure document within 14 days after a written request by the franchisee. This request can only be made once in 12 months.