Bakers Delight: The ACCC Investigation Confirmed

Australian Competition and Consumer Commission Takes Unusual Step to Publicly Confirm Investigation of Franchisor

CANBERRA, Australia (Blue MauMau) - In an unusual move the Australian Competition and Consumer Commision (ACCC) has posted a statement on their website, confirming that they are investigating the conduct of franchisor Bakers Delight. Normally the ACCC remains non-committal about investigations that they are undertaking and refrains from confirming that investigations are underway.

Bakers Delight, which trades as COBs Bread in the USA and Canada, continues to receive regular media attention with respect to their business practices. Following the ACCC statement (below) it is expected that more former and current Bakers Delight franchisees will be emboldened to relate to the ACCC their experiences with this franchisor. Other angry franchisees have already made their experiences public on the site bakersdelightlies.com.

ACCC Statement - Bakers Delight

Earlier this year a number of former Bakers Delight franchisees raised concerns in the media about the Bakers Delight franchising system. Subsequently a number of existing and former franchisees within the Bakers Delight system also lodged complaints with the ACCC about the conduct of the franchisor. These complaints include allegations that Bakers Delight:

• failed to provide adequate training and support for franchisees
• inappropriately breached and terminated franchisees       
• failed to mediate       
• provided or failed to provide information to franchisees about the sales of their businesses, which meant they could not make properly informed decisions.

After an initial investigation a number of franchisees were advised that the ACCC had chosen not to investigate their concerns in relation to these issues as the information they were able to supply either was not adequate to support a breach of the Act or pointed to circumstances that were best resolved by reference to the terms and conditions of their franchise agreement or the Franchising Code of Conduct.

The remaining franchisee complainants have been advised that the investigation of their complaints is continuing. The ACCC has chosen to progress the matter to an in-depth investigation and a key focus of its inquiries will be ensuring that there is ongoing compliance with the law. The ACCC has been in contact with Bakers Delight about the allegations raised and Bakers Delight have been responsive to the ACCC's inquiries. At this stage the ACCC has not formed a view on whether the alleged conduct took place and, if it did, if it breaches the Act.

As the investigation is still continuing, the ACCC is not in a position to outline in any further detail the nature of the alleged conduct. Due to the nature of this investigation, including the number of complaints and the complex issues involved, the investigation into these allegations is anticipated to continue for some time.