Changes in Florida Franchising Law

There have been significant changes to federal and state franchise laws and regulations in recent years. The Amended FTC Franchise Rule changed disclosure requirements in several ways including the following:

• The FTC Franchise Rule now requires franchisors to disclose prospective franchisees with a written Franchise Disclosure Document (FDD) at least 14 calendar days before the signing of an agreement or the receipt of any money by the franchisor or its affiliates.
• Under the new FTC Rule, franchisors must disclose lawsuits that they filed against franchisees to enforce non-compete agreements or collect royalties.
• The new FTC Rule requires franchisors to disclose the names and contact information of any formal franchisee associations.
• In certain situations, the new FTC Rule requires that a franchisor must provide the audited financial statements of a parent company.
• The new FTC Rule allows for use of financial statements prepared by foreign accountants in limited circumstances.

Read about Florida franchising law

Comprehensive franchise disclosure guidelines

This federal law did not preempt states from enacting more restrictive franchise legislation. The North American Securities Administrators Association (NASAA) issued more comprehensive franchise disclosure guidelines in June 2008 that have been updated and adopted by the states that enacted franchise registration laws.

These franchise registration states now require all FDDs to comply with the NASAA guidelines that have become the national disclosure standard in the franchise industry. Most of these states not only require the pre-sale registration of franchise offerings, but also conduct exhaustive examinations of FDDs to ensure legal compliance before granting any franchise registrations. Some states restrict the content of advertising materials provided to prospective investors and also regulate other forms of business opportunity sales.

Seek out an experienced Florida franchising law attorney for help

The attorneys at Protonentis & Remley, PA stay current with changing laws, including Florida franchise laws, and have years of experience providing guidance and legal counsel to clients who need help with Florida franchises and franchising. Your best bet in understanding all elements of franchise laws in Florida, such as the interplay between state and federal regulations, is to seek out an attorney skilled in franchising law. If you have questions about Florida franchising laws, do not hesitate to speak to a skilled and experienced attorney from our firm.