What disclosures are required before signing a franchise agreement in Ontario?

Ontario's Arthur Wishart Act (Franchise Disclosure), 2000 requires franchisors to provide prospective franchisees with a disclosure document at least fourteen days before the franchise agreement is signed or any money changes hands. The fourteen-day clock is mandatory — any attempt to waive or shorten it is void.

The disclosure document must contain comprehensive information about the franchisor's business, the franchise system, the franchise territory, the financial statements of the franchisor, a description of the initial and ongoing fees, the obligations of the franchisee and franchisor, and any litigation involving the franchise system within the past few years, among other required items.

If the disclosure document is deficient — missing material information or materially inaccurate — the franchisee may have a right of rescission. The Act also establishes a duty of good faith and fair dealing in the performance and enforcement of franchise agreements and grants franchisees the right to associate with other franchisees.

Franchise agreements are typically long, complex, and heavily one-sided in favour of the franchisor. Getting a lawyer to review the disclosure document and franchise agreement before signing is strongly advisable — not just to spot legal issues, but to understand what you are actually committing to.