The BizBuySell Small Business Community

  • Get Expert Advice

  •  • Find Local Service Professionals

  •  • Share Your Experiences

At what point is a Franchisor required to provide you with their Franchise Disclosure Document?

No User Photo

Answer This Question

max 5000 characters

Web Reference (optional)

e.g., ""

Review Community Guidelines

Help keep our Community clean and on topic. The BizBuySell Community is a place where you can discuss your questions, concerns and knowledge with others you can trust. It is not OK to use this forum to solicit others for personal or financial gain, or to rant about personal issues. It's all in the guidelines.

Submit Your Answer
Answers (2)
Chuck Woolweaver
Franchise Your Business in 60 Days
Palm Beach County, FL

First Meeting Between Franchisor and Franchisee....
Previously, the franchisor was required to provide a potential franchisee with the UFOC document at their first meeting. This will no longer apply. Franchisors or their representatives are permitted to have an initial meeting with a potential franchisee without offering the FDD at that meeting, but it needs to be provided at least 14 calendar days before the franchisee signs a contract.

Sep 25, 2009
No User Photo
The BAF Group LLC

The FTC Rule requires you to receive the UFOC at the earliest of the following:

(1) the "first personal meeting" with the franchisor; or

(2) at least 10 business days before:

(a) you sign any agreement; or

(b) you make any payment or provide any consideration to the franshisor.

The first-face-to-face meeting occurs when the franchisor or its broker meets with you for the purpose of discussing the sale or possible sale of the franchisel This generally does not include telephone calls or e-mail exchanges. Exhibiting at trade shows will generally not constitute a face-to-face meeting (and trigger disclosure obligations), as long as the discussions are general and do not involve earnings claims.

When you receive the UFOC, the Company must obtain a signed and dated Receipt from you, stating that you have received the document. This is the franchisor's documentation that it has met its responsibility in that area.

This rule pertains to the sale of franchises by and from the franchising company. It does not pertain to purchases you may try to make from an individual franchisee, who owns and is trying to sell his own franchise, either individually or through a Business Broker.

For any other, more detailed information, see an attorney that specializes in franchises. If you wish, I can provide you with the name of at least one such attorney.

Sep 25, 2009

Start a Discussion