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The Motor Trades Association of Australia (MTAA) today welcomed reforms announced by the Commonwealth Government to address a power imbalance between car manufacturers and new car dealers that will better protect automotive small businesses and consumers.

The reforms announced by Industry Minister Karen Andrews and Employment and Small Business Minister Michaelia Cash will see the introduction of specific regulations as part of a revitalised Franchising Code of Conduct with a penalty regime for breaches.

MTAA CEO Richard Dudley said the regulations released for final consultation today are significant and will go a long way to addressing significant problems experienced by new car retailing franchisees in the areas of capital expenditure requirements, adequate time to secure returns on substantial investments, better clarity and protections for end of franchise obligations and improved resolution mechanisms for disputes.

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