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Franchisors who fail to adhere to the CPA requirements regarding disclosure place their company at a substantial risk and may even find themselves facing stiff fines and/or imprisonment.

As you may recall, the Consumer Protection Act, no. 68 of 2008 ("CPA"), introduced franchise legislation into the franchise industry in South Africa, on or about 1 April 2011.

Traditionally, South African franchise arrangements have not been subject to specific regulation.