Franchise Registration States and State Franchise Laws – part III

Any future franchisor should be well aware of all federal and state franchise laws. This is the only way to ensure smooth and trouble free operations. Most Federal and state laws coinside and if you manage to cover the requirements of the Federal laws you are pretty much set to go. However there are some state regulations that differ from the Federal ones and, if you plan to operate in such states, you need to comply with those too. It is always recommended to seek professional advice of an experienced franchise attorney who can review all your franchise documents and advertising materials. Here are the key points of several state franchise regulations.

Key points of several state franchise regulations.

• New York. You need to register your franchise at the Franchise & Securities Division State Department of Law. All of your franchise sale agents should also be registered there. You will be allowed to offer your franchise over the internet however not to residents of the state. Ultimately, if you get any sales from your online pages, you will need to register them the same way you do with all other sales.
• Rhode Island. New franchises should register at the Department of Business regulation prior to offering or selling franchise units. The franchise registration fee has been recently increased from $500 to $600 and must be paid upon registration. Another thing to take into account is that you need to submit your franchise registration application along with any other documents on a CD-ROM as paper documents are no longer accepted.
• North Dakota. In order to register your franchise at North Dakota you have to submit your FDD and a fee of $250. Similar to other states, you will also need to submit any advertising materials that you intend to use 5 days prior their media distribution.
• South Dakota. The registration is done by submitting a clean copy of your franchise disclosure documents, a uniform consent of service to proceed and a fee of $250. If your initial investment requirements exceed one million you will be exempt of registration. There is no need to file your advertising materials with the South Dakota Division of Securities.
• Virginia. The registration is done at the State Corporation Commission. You will need to prepare a franchise registration application and file it enclosing several other forms – costs and sources of funds, consent to service of process, affidavit of compliance, guarantee of performance, security bond, notice of claim exemption, escrow agreement and application for coordinated review of the franchise application.
• Washington. Filing is required prior to offering or selling franchises. This is done at the State Department of Financial Institutions. You need to submit all your advertising materials too prior to their use.
• Wisconsin. The registration should be done at the State Department of Financial Institutions. Your franchise disclosure documents should be prepared according the amended FTC Franchise rule.