South Africa’s (SA) franchise sector is in for a major shake-up now that the Competition Commission (CompComm) is launching a full-scale market inquiry into the industry.

The antitrust watchdog has just published its draft Terms of Reference, and the focus is squarely on whether the way franchises operate locally is blocking smaller players or killing competition. Legal experts over at Werksmans Attorneys are already warning that this could spell trouble for standard franchise setups, especially things like exclusive supplier deals, mandatory pricing structures, and those corporate rebate setups that franchisors love.

The Commission decided to step in after noticing a wave of big mergers that have left the market dominated by just a few massive players. They’ve also been fielding a lot of complaints about the massive power imbalance between franchisors and franchisees. Essentially, they want to look into why franchise ownership in SA is still so untransformed, while also digging into rigid contract terms, crazy high upfront capital requirements, and potentially exploitative supply chain controls.

Public comments on the draft are open until August 7, 2026. Once the final framework is locked in, the Commission has 20 days to launch the probe and 18 months to wrap it up. Given that previous market inquiries have forced entire industries to completely change how they do business, franchisors are being told to audit their contracts and agreements right now before the Commission comes knocking.

–ChannelAfrica/ Werksmans Attorneys —