Posted on 11/ 9/2012
by Charles Internicola
Posted on 10/26/2012
by Charles Internicola
Registration Status:
Non-Registration State
Relevant State Franchise Law(s):
Georgia Franchise Act. Also refer to the FTC Franchise Rule.
Relevant Registration Entity:
Not Applicable
Useful Links:
Georgia Fair Business Practices Act and Georgia Department of Revenue
Registration Status:
Franchise Registration State
Relevant State Franchise Law(s):
Hawaii Franchise Investment Law. Also refer to the FTC Franchise Rule.
Relevant Registration Entity:
Hawaii Department of Commerce and Consumer Affairs
Useful Links:
Hawaii Department of Commerce and Consumer Affairs and the Hawaii Department of Taxation
Statutes from the Hawaii Franchise Investment Law
Registration Status:
Non-Registration State
Relevant State Franchise Law(s):
Idaho Franchise Act. Also refer to the FTC Franchise Rule.
Relevant Registration Entity:
Not Applicable
Useful Links: Idaho State Tax Commission
Registration Status:
Franchise Registration State
Relevant State Franchise Law(s):
Illinois Franchise Disclosure Act. Also refer to the FTC Franchise Rule.
Relevant Registration Entity:
Illinois Attorney General
Useful Links:
Illinois Attorney General and Illinois Department of Revenue
Statutes from the Illinois Franchise Disclosure Act
Registration Status:
Non-Registration State
Relevant State Franchise Law(s):
Kansas Responsible Franchise Practices Act. Also refer to the FTC Franchise Rule.
Relevant Registration Entity:
Not Applicable
Useful Links:
Kansas Department of Revenue
Registration Status:
Franchise Filing State
Relevant State Franchise Law(s):
Not Applicable. Refer to the FTC Franchise Rule.
Relevant Registration Entity:
Not Applicable
Useful Links:
Kentucky Sale of Business Opportunities (360.00..80 – 360.00.819) and the Kentucky Department of Revenue
Registration Status:
Non-Registration State
Relevant State Franchise Law(s):
Not Applicable. Refer to the FTC Franchise Rule.
Relevant Registration Entity:
Not Applicable
Useful Links:
Louisiana Department of Revenue
Registration Status:
Franchise Filing State
Relevant State Franchise Law(s):
Not Applicable. Refer to the FTC Franchise Rule.
Relevant Registration Entity:
Not Applicable
Useful Links:
Maine Regulation of the Sale of Business Opportunities and Maine Revenue Services
Registration Status:
Franchise Registration State
Relevant State Franchise Law(s):
Maryland Franchise Law. Also refer to the FTC Franchise Rule.
Relevant Registration Entity:
Maryland Attorney General
Useful Links:
Maryland Attorney General and the Comptroller of Maryland
Statutes Relevant to Maryland Franchise Law:
Statute 02.02.08.01 - Definitions
Statute 02.02.08.02 - Franchise
Statute 02.02.08.03 – Franchise Fee
Statute 02.02.08.04 – Application for Registration
Statute 02.02.08.05 – Initial Registration
Statute 02.02.08.06 – Amendment of Registration
Statute 02.02.08.07 – Renewal of Registration
Statute 02.02.08.08 – Escrow Condition
Statute 02.02.08.09 – Advertising
Statute 02.02.08.10 - Exemptions
Statute 02.02.08.11 – Exemptions Form F-1
Statute 02.02.08.12 – Denial Suspension or Revocation of Registration or Exemption
Statute 02.02.08.13 – Financial Statements
Statute 02.02.08.14 – Reports by Registrants
Statute 02.02.08.15 – Franchisor Record
Statute 02.02.08.16 – Fraudulent and Prohibited Practices
Statute 02.02.08.17 – Interpretive Opinions
Statute 02.02.08.18 – Internet Offers
Registration Status:
Non-Registration State
Relevant State Franchise Law(s):
Not Applicable. Refer to the FTC Franchise Rule.
Relevant Registration Entity:
Not Applicable
Useful Links:
Massachusetts Department of Revenue
Registration Status:
Franchise Registration State (notice only)
Relevant State Franchise Law(s):
Michigan Franchise Investment Law. Also refer to the FTC Franchise Rule.
Relevant Registration Entity:
Michigan Attorney General
Useful Links:
Michigan Attorney General and Michigan Department of Treasury
Statutes relevant to Michigan franchise law:
Statute 445.1501 – Short Title; Construction
Statute 445.1502 - Definitions
Statute 445.1503 - Additional Definitions; Burden of Proof
Statute 445.1504a – Applicability of Law
Statute 445.1505 – Prohibited Conduct in Connection with Offer, Sale, or Purchase of Franchise
Statute 445.1505a – Franchise Opportunities Handbook
Statute 445.1507 – Excerpt of Repealed Law
Statute 445.1509 – 445.1511 – Excerpt of Repealed Law
Statute 445.1513 – Conditions Prohibiting Offering for Sale or Selling Franchise
Statute 445.1514 – 445.1518 – Excerpt of Repealed Franchise Law
Statute 445.1519 – Filing Change in Information Contained in Notice
Statute 445.1520 – Accounts of Franchise Sales; Reports; Examination of Records
Statute 445.1522 – Service of Process
Statute 445.1523 – Untrue Statement, Omission or Failure to Give Notice of Change
Statute 445.1524 – Filing of Advertisement or Sales Literature; Exemption from Liability
Statute 445.1525 – Publication of False or Misleading Advertisement Prohibited
Statute 445.1526 – Excerpt of Repealed Franchise Law
Statute 445.1527 – Void and Unenforceable Provisions
Statute 445.1528 – Pyramid or Chain Promotion or Distribution
Statute 445.1529 & 445.1530 – Excerpt of Repealed Franchise Law
Statute 445.1531 – Liability for Damages or Rescission; Basis of Damages
Statute 445.1532 – Joint and Several Liability
Statute 445.1533 – Statute of Limitations
Statute 445.1534 – Civil Liability; Liability Under Other Statute of Common Law
Statute 445.1537 – Excerpt of Repealed Franchise Law
Statute 445.1538 – Violation; Penalty; Punishing Crime Under Other Statute
Statute 445.1543 – 445.1545 – Excerpt of Repealed Franchise Law
Statute 445.1546 – Prior Acts, Offenses, Rights, Liabilities, Forfeiture, or Punishments Not Impaired or Affected; Transfer of Records, Personnel and Funds
Registration Status:
Franchise Registration State
Relevant State Franchise Law(s):
Minnesota Franchise Act. Also refer to the FTC Franchise Rule.
Relevant Registration Entity:
Minnesota Department of Commerce
Useful Links:
Minnesota Department of Commerce and the Minnesota Department of Revenue
Statutes relevant to Minnesota franchise law:
Statute 80C.02 – Registration Requirement
Statute 80C.04 – Application for Registration
Statute 80C.05 – Registration Provisions
Statute 80C.06 – Public Offering Statement
Statute 80C.07 – Amendment of Registration
Statute 80C.08 – Annual Report
Statute 80C.10 – Books, Records and Accounts
Statute 80C.11 – Opinions, Appraisals, and Reports
Statute 80C.12 – Denial, Suspension or Revocation of Registrations or Exemptions
Statute 80C.13 – Prohibited Practices
Statute 80C.14 – Unfair Practices
Statute 80C.144 – Exempt Motor Fuel Franchises; Alternative Compliance
Statute 80C.145 – Motor Fuel Franchises; Right of Survivorship
Statute 80C.146 – Elimination of Service Bays Prohibited
Statute 80C.147 – Change in Ownership
Statute 80C.15 – Repealed Statute Summarized
Statute 80C.16 – Enforcement; Penalties and Remedies
Statute 80C.17 - Civil Liability
Statute 80C.18 – Administrative Pronouncements
Statute 80C.19 – Scope of Sections 80C.01 to 80C.22
Statute 80C.20 – Service of Process
Statute 80C.22 – Commissioner’s Duties
Statute 80C.30 – Burglar Alarm Franchises
Registration Status:
Non-Registration State
Relevant State Franchise Law(s):
Not Applicable. Refer to the FTC Franchise Rule.
Relevant Registration Entity:
Not Applicable
Useful Links:
Mississippi Department of Revenue
Registration Status:
Non-Registration State
Relevant State Franchise Law(s):
Not Applicable. Refer to the FTC Franchise Rule.
Relevant Registration Entity:
Not Applicable
Useful Links:
Missouri Department of Revenue
Registration Status:
Non-Registration State
Relevant State Franchise Law(s):
Not Applicable. Refer to the FTC Franchise Rule.
Relevant Registration Entity:
Not Applicable
Useful Links:
Montana Department of Revenue
Registration Status:
Franchise Filing State
Relevant State Franchise Law(s):
Nebraska Franchise Practices Act (87-401 through 87-410). Also refer to the FTC Franchise Rule
Relevant Registration Entity:
Not Applicable
Useful Links:
Nebraska Department of Banking and Finance and Nebraska Department of Revenue
Registration Status:
Non-Registration State
Relevant State Franchise Law(s):
Not Applicable. Refer to the FTC Franchise Rule.
Relevant Registration Entity:
Not Applicable
Useful Links:
Nevada Department of Taxation
Registration Status:
Non-Registration State
Relevant State Franchise Law(s):
Not Applicable. Refer to the FTC Franchise Rule.
Relevant Registration Entity:
Not Applicable
Useful Links:
New Mexico Taxation and Revenue Department
Registration Status:
Non-Registration State
Relevant State Franchise Law(s):
Not Applicable. Refer to the FTC Franchise Rule.
Relevant Registration Entity:
Not Applicable
Useful Links:
New Hampshire Department of Revenue Administration
In 2010 two trends have become abundantly clear: With the ever accelerating "shift" in the United States economy a substantial number of successful business owners and qualified individuals have and continue to consider and explore"franchising" as an avenue for growth and income stability. That is, (1) successful business owners are considering the prospects and benefits of "franchising their business and becoming a franchisor" and (2) certain exceptionally qualified individuals are evaluating the prospect of "buying a franchise and becoming a franchisee" as a potential opportunity for income stability and growth.
The interesting thing about these "trends" is that they do not relate to and are not evidenced by franchise system development or franchise unit sales (in fact these "metrics" are, markedly, down with declining growth levels) but, rather, the "intensity levels" by which certain "exceptionally qualified" individuals and business owners have and continue to - for the first time - seriously consider the "franchising business model" . Faced with economic declines and economic uncertainty comes, what I believe to be, an exceptional "filtering process" and opportunity whereby a select number of exceptional prospective franchisees and franchisors will be presented with the economic incentive to create successful franchise relationships and, quite possibly, help redefine the franchisor/ franchisee relationship.
So, for both prospective franchisors and franchisees, my advice for 2012 is to evaluate opportunities thoroughly, understand that franchising is not right for everyone (in fact it is not right for "most" business owners and individuals), and, recognize that for a select few - who get it right - with our current state of economic uncertainty also exists a substantial opportunity for growth through franchising. However this "opportunity" requires precise planning and commitment - do not rush into the purchase of a franchise or the development of a franchise system.
If you are researching the benefits of franchising, buying a franchise or starting a franchise, chances are that you have come across articles and promotional materials discussing the benefits of a "proven franchise system". That is, prospective franchisees are advised that if they become a franchisee of a particular franchise they will benefit from a "proven system". While this vague term is used often and claimed by almost all franchisors, not every franchisor possesses legitimate systems and not every franchise system is "proven".
So, what is a "proven franchise system"? While this question is subject to a broad range of interpretation, the following is some fundamental information about "systems" and "franchise systems" that must be considered by prospective franchisees and franchisors:
Considerations for Prospective Franchisees:
Effective and legitimate "systems" are critical for the successful operation of a franchised business. Don't just assume that a franchisor's "systems" are "proven" or "effective". Ask the franchisor's representatives detailed questions about what makes their "systems" unique, effective and profitable and recognize that the "proven" nature of a start-up franchisor's "systems, in most cases, may be extremely limited.
Considerations for Prospective Franchisors:
Successful franchise systems depend on successful franchisees. The mere act of preparing franchise disclosure documents and registering disclosure documents does not create a franchise. Strong franchises require thought out and tested business "systems" and procedures that have been tested and proven successful. During the start-up franchising stage controlled growth (with limited franchise sales) may be necessary to will permit the necessary monitoring and refinement of your business systems.
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