Geoff Gwilym

FRANCHISED dealers with complaints against their OEM franchisor now have an online dispute tool rolled out by the Victorian Automobile Chamber of Commerce (VACC) that can negate expensive legal advice and become a valuable database that tracks how various OEMs interact with their dealers.

The Franchise Code Dispute Assist online tool is currently available free of charge to VACC members, with plans to roll it out across the country once a pilot program is completed.

VACC executive director Geoff Gwilym said the tool was designed to provide an efficient, low-cost and effective pathway to dispute resolution services for members.

“It also has an added purpose of capturing all information involved in franchisee-franchisor disputes,” he said.

“It’s a new tool for VACC’s franchised dealer members designed to manage franchise disputes. It can also assist members in the management of their franchise relationships, while potentially saving them money.”

VACC spokesperson David Dowsey told GoAutoNews Premium that the online tool came about because of a large number of recent disputes, mainly involving the franchise relationship between the dealer and the OEM.

“The biggest complaints are over franchise agreements,” he said.

“We are now aggregating a database of complaints and we will look at the trends in the industry and how we can assist our members.

“We will offer advice on the cases and discuss the next steps and – if warranted – take the case to the relevant authorities.

“Issues that have come up recently include a country dealer who was told to spend about $1 million on a refit and new corporate identity and soon after, was told the OEM was cancelling the franchise agreement. That’s a case where the tool can be instrumental in helping the dealer.”

The tool allows the member to upload all data including supporting evidence – such as the letters of demand, contract agreements and so on – so the VACC has all the necessary information to take the case further.

Mr Dowsey said there are many businesses in regional centres and those that are sole traders with one or two franchises that have little chance of standing up to the financial strength of a multinational OEM.

“The VACC is designed to protect its members and take the problems further so a solution can be found,” he said.

“It has started as a pilot program in Victoria with VACC members but we envisage that after the trial, it will be rolled out across Australia. We’re not keeping this to ourselves.”

Disputes could be in the form of non-renewal or termination of agreements, unilateral alteration to prime marketing areas, unfair contract terms, or unreasonable pressure from franchisors with regard to ‘cyber cars’.

The tool identifies if both parties in the franchise agreement are adhering to their obligations under the current Franchising Code.

By Neil Dowling