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Options paper to help resolve business disputes

26 May 2011

Small Business Minister, Senator Nick Sherry, has released an options paper designed to generate comment on ways to help small businesses resolve disputes.

Senator Sherry flagged his intention to release this paper earlier in the year and his announcement appears to be in line with what he foreshadowed. The paper raises the possibility of creation of a small business tribunal; however, it is understood this idea does not envisage a tribunal on franchising or others matters of specific legislation or regulation. FCA is seeking to clarify this aspect as soon as possible.

Interestingly, Senator Sherry said the Government believed as many as one in five small businesses found themselves in dispute - an estimate which puts a different light on recent political and academic commentary on the incidence of disputes in franchising.

The Government paper prefers a continuing national approach and does not seek to change franchising settings, but add to them, especially for small disputes. It seeks to “identify where there may be gaps in Australia’s current disputes resolution landscape and bring about a national business to business disputes resolution process that is accessible, prompt and as low cost as possible for small businesses.

The paper follows on from a survey last year from the Department of innovation Industry, science and Research, the Federal Ministry which includes Small Business.

The options paper outlines four areas of consideration;
1. National Information and Referral Service
This would provide a telephone hotline and website directing small businesses to available dispute resolution services and assistance. Callers would be guided through dispute resolution options and then referred to appropriate services in their state or territory.

2. National Dispute Resolution Service
This service would provide information and referrals similar to option one, but also offer mediation where no appropriate low cost dispute resolution service exists.

3. National Small Business Tribunal
A tribunal would specifically deal with small business disputes. It would have the role of investigation and conciliation, backed by Commonwealth legislation. The tribunal would be both a national network and a one-stop shop for small businesses in dispute. It could be based in a capital city and potentially use existing federal court infrastructure.

4. Small Business Advocate
The Small Business Advocate would offer independent representation of small business interests and concerns within the Australian Government.
The Government is accepting responses to the Options Paper until 30 June. To pass on your views contact FCA at info@franchise.org.au.

Read more about the Options Paper

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