Franchise Act 1998
Franchise Act 1998
Franchise Act 1998
Act 590
PREVIOUS REPRINTS
LAWS OF MALAYSIA
Act 590
ARRANGEMENT OF SECTIONS
PART I
PRELIMINARY
Section
PART II
PART III
FRANCHISE AGREEMENT
PART IV
PART V
PART VI
MISCELLANEOUS
PART VII
ENFORCEMENT
PART VIII
ENFORCEMENT
LAWS OF MALAYSIA
Act 590
PART I
PRELIMINARY
Short title
Commencement
Application
3. (1) This Act applies throughout Malaysia to the sale and operation
of any franchise in Malaysia.
8 Laws of Malaysia ACT 590
(3) Nothing in this Act shall affect the provisions of any other
written laws, but if there is any conflict between the provisions of this
Act and the provisions of the other written laws, the provisions of this
Act shall prevail.
Interpretation
Minister means the Minister for the time being charged with the
responsibility for matters relating to franchises;
PART II
(4) The Deputy Registrar may perform all the duties and exercise
all the powers conferred upon the Registrar under this Act.
(5) The Registrar or Deputy Registrar may perform all the duties
imposed and exercise all the powers conferred upon an Assistant
Registrar under this Act.
Registration of franchisor
(2) Any franchisor who fails to comply with this section, unless
exempted by the Minister under section 58, commits an offence and
shall, on conviction, be liable
(2) The Registrar may impose any conditions for the approval of
registration of franchise referred to in subsection (1).
Registration of franchisee
(4) The Registrar shall give the applicant a written notice of his
decision under this section.
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(a) the Registrar has notified the applicant that the applicant
has failed to comply with the requirements of section 6
and subsections 7(1), (2) and (3); or
Period of effectiveness
(4) Any person who fails to comply with this section commits an
offence.
16 Laws of Malaysia ACT 590
13. (1) A franchisor may, at any time after the franchise term,
apply to the Registrar for cancellation of the registration of the
franchise from the register.
(2) The franchise broker or franchise consultant must meet all the
requirements as prescribed on the qualifications of a franchise broker
or franchise consultant before he can be registered.
(5) The registration under this section shall be effective for two
years from the date of registration, unless determined otherwise by
the Registrar.
Compulsory practice
Annual report
16. (1) The franchisor shall, within six months from the end of
each financial year of the franchise business, submit a report to the
Registrar in the prescribed form.
(2) The report shall contain the disclosure documents which have
been updated.
(4) Any person who fails to comply with this section commits an
offence.
PART III
FRANCHISE AGREEMENT
Promotion Fund
(2) The Fund shall be managed under a separate account and shall
only be used for the promotion of the product under the franchise.
Franchise term
Confidential information
Waivers void
(2) This section shall not prevent any person from entering into a
settlement agreement or executing a general release regarding a
potential or actual civil action filed in respect of the franchise nor
shall it prevent the arbitration of any claim.
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PART IV
Conduct of parties
(3) The franchisee shall operate the business separately from the
franchisor, and the relationship of the franchisee with the franchisor
shall not at anytime be regarded as a partnership, service contract or
agency.
(b) the franchisee has not been given a written notice of the
franchisors intent not to renew the franchise agreement
at least six months prior to the expiration date of the
franchise agreement.
(b) where the court has decided that there are certain
conditions in the franchise agreement which merit the
agreement to be terminated earlier than the minimum
term.
PART V
36. (1) The Franchise Advisory Board shall advise the Minister
and the Registrar on matters relating to franchises, and the due
administration and enforcement of laws relating to franchises.
(2) The Minister and the Registrar shall not be bound to act upon
the advice or report of the Franchise Advisory Board.
PART VI
Obstruction of officers
commits an offence.
General penalty
39. (1) A person who commits an offence under this Act for
which no penalty is expressly provided shall, on conviction, be
liable
Compounding of offences
41. (1) The Registrar may, with the consent in writing of the
Public Prosecutor, compound any offence committed by any person
under this Act and prescribed by the Minister to be a compoundable
offence by making a written offer to the person suspected to have
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(2) An offer under subsection (1) may be made at any time after
the offence has been committed, but before any prosecution for it has
been instituted.
(3) If the amount specified in the offer is not paid within the time
specified in the offer or within such extended period as the Registrar
may grant, prosecution for the offence may be instituted at any time
after that against the person to whom the offer was made.
PART VII
ENFORCEMENT
Authorized officer
Power to investigate
(2) For the purposes of subsection (1), the authorized officer may
issue orders to a franchisor, franchise broker or franchisee to further
his investigation and secure compliance with this Act.
(3) In addition to his powers under subsections (1) and (2), in any
case relating to the commission of an offence under this Act, an
authorized officer carrying on an investigation may exercise all or
any of the powers in relation to police investigation in seizable cases
given by the Criminal Procedure Code [Act 594].
Search by warrant
(2) Where the premises are unoccupied, the seizing officer shall
whenever possible post a list of the things seized conspicuously on
the premises.
Additional powers
Prosecution
PART VIII
MISCELLANEOUS
56. The Registrar may allow the public inspection of any disclosure
documents filed with the Registrar unless, in his opinion, the
inspection may bring harm to a franchisor or franchisee or any person
involved in the franchised business related to the inspection or the
inspection is not necessary or appropriate in the public interest.
Power to exempt
Protection of officers
Regulations
60. (1) The Minister may make regulations for all or any of the
following purposes:
(2) The regulations made under subsection (1) may prescribe any
act in contravention of the regulations to be an offence and may
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LAWS OF MALAYSIA
Act 590
LIST OF AMENDMENTS
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LAWS OF MALAYSIA
Act 590
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