Franchise State Registration

California, Hawaii, Illinois, Indiana, Iowa, Maryland, Minnesota, New York, North Dakota, Rhode Island, South Dakota, Virginia, Washington, and Wisconsin

In addition, the following states require Franchisors to file statements of exemption from business opportunity statutes and/or notices of intent to sell franchises:

Texas, Florida, Michigan, Nebraska, and Utah

It is important that you review each state's franchise statute with regard to your company's particular offering. However, general state definitions can be summarized using the following qualifiers:

A written contract or agreement between two or more persons, by which:

• A franchisee is granted the right to engage in the business of offering, selling or distributing goods or services at retail under a marketing plan or system prescribed in substantial part by a franchisor;
• The operation of the franchisee's business pursuant to such plan or system is substantially associated with the franchisor's trademark, service mark, trade name, logotype, advertising or other commercial symbol designating the franchisor or its affiliate; and
• The franchisee is required to pay, directly or indirectly, a franchise fee of $500 or more.

In fiscal year 1994, the registration states listed above will require Franchisors to revise and submit their UFOCs according to the newly adopted FTC guidelines. Required revisions will include the disclosure of operational information never before mandated by the states or the FTC, as well as the complete redrafting of the UFOC language into "plain English".

Some states require even companies with franchise offerings and UFOCs to register under their non-franchised business opportunity statutes. In some cases, only because the franchisor's trademarks have not yet been registered (®), just applied for pending registration approval. States like this include Connecticut and Utah.

Before you offer your franchise program to the public, check with an attorney expert in the offering of franchised and/or non-franchised business opportunities. At the very least, check with the Federal Trade Commission in Washington D.C. and/or your state Attorneys General office, Secretary of State office or your local Better Business Bureau to see if they can provide you with specific registration information.

Disclaimer: Neither InterAct Concept Development Corp. nor Centercourt, or its representatives or affiliates can offer legal advice. As such , neither InterAct nor Centercourt assume any responsibility or liability with regard to information contained in the section. Sellers of franchise offerings are advised to consult with legal counsel prior to developing and/or offering their program(s) to the public.