When considering the establishment of a franchise in the State of Florida, it is highly recommended that you engage the services of an experienced franchise law attorney. The reality is that entering the realm of franchising or initiating your own franchise system is a multi-faceted endeavor. Therefore, hiring an experienced lawyer from Xander Law Group can ensure that you follow the necessary laws to establish a franchise network or to become a franchisor in South Florida.
Franchising is the distribution of products or services involving a relationship between a franchisor and a franchisee. The franchisor is responsible for shaping the trade name and system, while the franchisee, in turn, compensates through royalty payments and an initial fee for the privilege of conducting business under the designated name and system.
It is important to acknowledge that franchise law encompasses both franchisor and franchisee. The State of Florida exercises stringent regulation over these franchises and their business operations. Although the initiation of franchises demands substantial financial investment and adherence to franchise laws, the potential for profitability is considerable.
What Type of Contract Do I Need to Become a Franchisor?
The franchising process is a contractual relationship between a licensor or franchisor and a licensee, the franchisee. In the United States, franchising constitutes a unique category of licensing arrangement that falls under the purview of the Federal Trade Commission, along with specific state regulations, including those in Florida. The franchisor grants the franchisee the license to utilize its trade or service mark and to identify its business when marketing specific products or services associated with the franchise.
When contemplating the initiation of a franchise, it is important to familiarize yourself with the exemptions that must be pursued to ensure full compliance with all applicable franchising laws.
Sale of Business Opportunities Act
Your franchise must meet all Federal FTC rules and regulations regarding franchises. This means that you must maintain a Franchise Disclosure Document (FDD). The State of Florida has a Sale of Business Opportunities Act, which applies to any sale of franchises and requires franchisors to file an annual Franchise Exemption Notice. Within this exemption notice, you will claim an exemption from Florida business opportunity laws. This filing shows that you are complying with the Federal Franchise Rule. It must be filed annually with the state.
On this notice, you must provide the legal name of your franchise company, brand name, business address, your business’s contact information, your tax ID number, and the acknowledgment that your franchise complies with all FTC guidelines. This application is filed with the Florida Department of Agriculture & Consumer Services. Submit this renewal application at least 60 days prior to the expiration of your existing filing. Include a filing fee of $100 in a check payable to “FDACS.” Our experienced franchise lawyer can help you complete this application and file it to the appropriate address.
How Long is The Exemption Approval Process?
Provided that your application is complete, and you have included all the required information, you can typically expect a response within one week. Once submitted, your application is assigned directly to a regulatory specialist. Upon the approval of your application, you will receive a notification affirming your granted exemption, accompanied by details of the effective commencement date and expiration date of your exemption status.
Schedule a Consultation to Learn About Franchise Law and How to Start a Franchise
When you’re interested in starting a franchise, it is advisable to arrange a consultation with our experienced Miami attorneys at Xander Law Group. To learn more about franchise laws and to schedule a consultation, call our legal team at 305-767-2001.