The Regulation of Franchising in the New Global Economy
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The Regulation of Franchising in the New Global Economy

Elizabeth Crawford Spencer

While franchising promotes economic and social welfare objectives, Elizabeth Crawford Spencer argues that monitoring and regulation are needed to address potential areas of abuse of the form that can result in costly market inefficiencies.
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Chapter 6: Summary of Trends in Franchise-specific Legislation

Elizabeth Crawford Spencer

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6. Summary of trends in franchisespecific legislation Twenty years ago there would have been little to report in a global survey of franchise-specific legislation, but clearly there has been a trend toward an increase in legislation directed toward the franchise sector. In 1990 only four countries had implemented such legislation, but regulation has increased at a steady rate since the 1990s, so that today approximately 30 countries have adopted franchise-specific legislation, and others such as New Zealand and the province of Manitoba have been actively engaged in the process of investigating their options for implementing such legislation. Certainly one reason for the growth in the regulation of the sector is the growth of the sector itself, as was outlined in the introduction to this book. For the purposes of this research into the operation of franchising and its regulation globally, the presence of McDonald’s in any given country was adopted as a proxy for the presence of a franchising sector in the local economy. While the reach of franchising is clear, given its extensive coverage, the growth of legislation seems, if anything, to have proceeded at a conservative pace. Figure 6.1 indicates the presence of franchise-specific regulation as well as that of a trade association in countries around the globe. The Americas: Of approximately 36 countries in North, Central and South America, unofficial data indicate that there are 22 countries where McDonald’s operates units. There would be about 14 in which McDonald’s appears not to operate, generally very small Caribbean...

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