Franchise Disclosure Document

News & Analysis as of

FRANCHISOR 101: Outdated FDDs and Unregistered Franchises

The California Department of Business Oversight ("DBO") recently issued three Orders against franchisors for violating California's franchise laws....more

Electronic and Courier Delivery Coming to Ontario

After long anticipation from the franchise industry, the government of Ontario has finally amended regulations under the Arthur Wishart Act (Franchise Disclosure), 2000 (“Act”) to expressly allow a franchisor to deliver its...more

Legislative Update: Electronic Disclosure to Prospective Franchisees Coming to Ontario July 1, 2016

Effective July 1, 2016, Ontario will permit disclosure documents required under the Arthur Wishart Act (Franchise Disclosure), 2000 (Act) to be delivered electronically to prospective franchisees. The Act provides that a...more

An Intellectual Property Primer for Franchisors

Intellectual property is a core asset of any franchisor. In fact, intellectual property is important to virtually all businesses. For some companies, it’s their most valuable asset. A basic knowledge of intellectual property...more

FRANCHISEE 101: Relying on Franchisor’s Profit Projections

Most experienced franchisors know better than to make claims about profits franchisees can expect when those claims do not match the information in the franchisor's Franchise Disclosure Document. However, if a franchisor or...more

What’s an FPR?

Every franchise buyer wants to know how much money he or she can make from the franchised business. Franchise sellers naturally want to answer that question in order to make the sale. But many say that they cannot give...more

[Webinar] Franchise Disclosure Compliance: The Nuts & Bolts - United States - January 19, 3:00pm EST

Please join us for Franchise Disclosure Compliance: The Nuts & Bolts a webinar highlighting many of the “must do” or “must consider” matters for compliance with franchise disclosure legislation in U.S. ...more

[Webinar] Franchise Disclosure Compliance: The Nuts & Bolts - Canada - January 19, 1:00PM EST

Please join us for Franchise Disclosure Compliance: The Nuts & Bolts a webinar highlighting many of the “must do” or “must consider” matters for compliance with franchise disclosure legislation in Canada. ...more

Franchise POST: The Reformation of Financial Performance Representations; Has the Time Arrived?

Financial Performance Representations (“FPR’s), or earnings claims, have been an integral part of franchise sales process well before the Federal Trade Commission (“FTC”) began its supervision of the franchise model. The...more

FRANCHISOR 101: Catch-all Disclaimers No Substitute for Untrained Salespeople

How strong are "non-reliance disclaimers" or "integration" or "merger" provisions in franchise agreements at protecting a franchisor when it really matters? Only so much, a New York court recently decided....more

What’s an Exclusive Territory?

The extent of a franchisee’s territorial rights is the subject of Item 12 of the franchise disclosure document (FDD). One of the questions franchisors must address in Item 12 is whether the territory is exclusive....more

FRANCHISOR 101: California Increases Time for Automatic Effectiveness from 15 to 30 Business Days

A new California law has given the California Department of Business Oversight, the State's regulator of franchises, more time to review franchise registration and renewal applications, with the result that franchisors, their...more

Deciphering the Franchise Disclosure Document Part 2

If you are going to buy a franchise, federal law requires the franchisor to make certain information available to help you evaluate what you are getting into. This information is provided in a “franchise disclosure document”...more

FRANCHISOR 101: Accidental Franchises in Industries Not Typically Associated With Franchising

Almost everyone recognizes the nation's most prominent franchises: McDonald's, Domino's, Hilton or 7-Eleven, to name a few. And business people are becoming aware that arrangements that look like franchises, but are...more

Deciphering the Franchise Disclosure Document Part 1

If you are going to buy a franchise, federal law requires the franchisor to make certain information available to help you evaluate what you are getting into. This information is provided in a “franchise disclosure document”...more

Why Subfranchising is Rare in the U.S.

Subfranchising is one of three multi-unit franchise structures that the North American Securities Administrators Association, Inc. (NASAA) addressed in their Multi-Unit Commentary, which was the subject of an earlier post. ...more

How to Disclose Multi-Unit Franchise Offerings

Multi-unit franchising is a good way to grow a franchise system quickly. We now have guidance on how franchisors should present multi-unit franchise offerings....more

Five Tips To Launching A Franchise Program Successfully

CONGRATULATIONS! You’ve spent years building your business, developing a loyal following, and honing your operations into a replicable format. You own two, three or maybe ten different locations, all profitable, and...more

An Export Plan Should Include the Consideration of U.S. Distribution Laws if Selling Into the United States Through Sales...

A Canadian or other foreign company looking to obtain a presence in the U.S. market without having to set up its own U.S. sales operation may consider using intermediariesn such as independent distributors and sales...more

Are Franchise Agreements Negotiable?

In theory, yes, franchise agreements are negotiable. In practice, they may not be negotiable – particularly in ways that are meaningful. Every franchisor has a form of franchise agreement that defines the rights and...more

Financial Performance Representations

On Tuesday February 11th, the Charlotte Business Franchise Network met on the 15th floor conference room at Nexsen Pruet. The attendees, representing a broad cross section of franchisors, master franchisees, and franchise...more

Franchising Update - February 2014

To begin 2014, we remind franchisors of the Government's response to the changes to the Franchising Code recommended last year. On 6 January 2014, Small Business Minister Bruce Billson advised that the Coalition advocated...more

Ten Contract Provisions That a Prospective Franchisee Should Consider Before Signing a Franchise Agreement

The saying that “love is blind” is as true in picking a franchise as in finding a soul-mate. Most prospective franchisees tend to shop franchise concepts instead of franchise agreements. They focus their search on hot...more

Thinking about Buying a Franchise?

If you’re considering purchasing a franchise, you’re probably overwhelmed by the size of the Franchise Disclosure Document (or, as it’s colloquially called, the “FDD”) and firmly believe that the franchisor’s lawyer gets paid...more

Focused on Franchise Law - December 2013

FRANCHISOR 101: LEARNING THE HARD WAY - Franchisors entering into settlement agreements with current or former franchisees must be certain that the agreements give the franchisors the right to make required FDD...more

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