TL;DR
The Federal Trade Commission regulates franchises in the U.S. and some states require franchise registration and disclosure documents. States such as California, Hawaii, and Illinois require a franchisee's Federal Disclosure Document to be registered before opening.
The Federal Trade Commission is in charge of setting regulations for franchises in the U.S., many of which were established when the Federal Franchise Rule was enacted in 1979.
Franchisees are protected under a Franchise Disclosure Document, but because this form isn’t federally required, some states have taken it upon themselves to ensure that franchisors and franchisees are following the rules set forth in the Federal Franchise Rule.
The states that require a franchisee’s Federal Disclosure Document to be registered with a state before opening are:
California
Hawaii
Illinois
Indiana
Maryland
Michigan
Minnesota
New York
North Dakota
Rhode Island
Virginia
Washington
Wisconsin
In this story
This story was originally published in 1851 Franchise on November 12, 2021. Burnaze summarizes and links to the original reporting.
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