franchising laws

Franchising laws regulate the relationship between franchisors (owners of the franchise system) and franchisees (individuals operating a franchise). They ensure disclosure of important information before a franchisee commits, promote fair practices, and prevent deceptive or unfair conduct. Key laws, like the Federal Trade Commission’s Franchise Rule, require franchisors to provide a detailed Franchise Disclosure Document (FDD) outlining costs, risks, and obligations. Additionally, some states have specific laws covering franchise registration and operation. These laws aim to protect franchisees from misinformation and ensure transparent, lawful business arrangements.