Franchise Laws: What You Need to Know 

The franchise laws in your state, combined with FTC rules, will determine how your franchise agreement and other franchise documents will be enforced. You need to understand the franchise laws in order to negotiate reasonable terms in your franchise agreement.  You need to understand the laws well enough to decide whether or not you can live with their terms and proceed to buy the franchise.

Federal franchise laws and rules are regulated by the FTC. Several states have additional requirements. The most typical additional state requirement is to require a review and registration of the Franchise Disclosure Document (FDD) with the state. If a franchise has been long established or is above a certain size, states may exempt that franchise from registering the FDD at the state level.

The FDD: Franchise Disclosure Document -Resources

Click to see a sample FDD Disclosure:
Sample FDD/ UFOC Franchise Disclosure Document

Click for in information about the FDD :
FDD franchise disclosure information

Click to learn what the "FDD Items" are containing all your franchise agreement documents and outlining how the relationship between the franchise and you will be governed: FDD Items

Click to see the rule authorizing the FTC FDD disclosure process

Franchise Agreements

Any franchise agreement you sign will be subject to state and federal laws. It is very important that you take the time with a franchise attorney to understand the franchise agreement and how it will govern the relationship between yourself and the franchisor.

Click to see a Sample franchise agreement

Just as Consumer Reports® helps you buy consumer goods and autos, use the independent franchise investment information from Best Franchise.org to:

• Thoroughly search for your best franchise opportunities
• Uncover risks
• Get a Free FDD or UFOC franchise disclosure document
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• Get help selecting franchise