Franchising in Texas
Texas Franchise Law
Is Texas a Franchise Registration State?
No, Texas is not a franchise registration state; however, Texas is a one-time filing state. Essentially, franchisors are required to complete a form with certain business information to disclose that it will offer franchises in Texas. This is a one-time filing and is good for the life of the franchise offering (subject to changes in Texas law). This means franchisors do not have to gain specific approval to offer franchises or undergo any formal review process. This does not mean franchisors are excused from following federal law.
Franchisors must comply with the federal franchise rule throughout the United States.
What Federal Laws Effect Franchises?
Franchise opportunities are regulated on the federal level through the federal Franchise Rule. The rules imposed by federal law apply to all states and provinces in the United States. We provide an overview of federal franchise law. There are a few basic things that anyone considering a franchise, or considering becoming a franchisor, must know.
The offer of a franchise opportunity can only occur through disclosure of a franchise disclosure document (the “FDD”). The requirements for disclosure documents are laid out in the federal franchise rule and cover 23 separate items. The FDD must be provided and receipt must be acknowledge.
The franchise rules require a 14-day waiting period between the prospect receiving the FDD and signing any agreement or exchanging any funds. The rule requires these periods to ensure prospects have sufficient time to evaluate any franchise opportunity.
In addition to the 14-day waiting period, franchisors are required to observe a 7-day waiting period if there are certain changes made to teh franchise agreement. In practice, many franchisors observe this period after producing the final agreement.
How do Franchise Attorneys Help Franchisors and Franchisees?
Franchisor Support
Our franchise attorneys support franchisors nationwide providing reliable and readily accessible legal guidance. We represent franchisors and provide ongoing legal support. We works with small business owners planning to franchise and work with leaders in franchising. Big or small, every client matters and will get the priority and attention they deserve. Prompt and reliable legal advice – on demand.
Franchisor legal services include:
- Developing and implementing a plan to franchise
- Drafting the franchise disclosure document (the “FDD”)
- Drafting the franchise agreement and all franchise contracts
- Securing franchise registration in Virginia and across the U.S.
- Disclosing prospects and sending franchise agreements
- Managing and resolving franchise disputes
- Providing day-to-day franchise legal support
How much does a franchisor lawyer cost?
Once we know a little about your business, we will provide a flat fee to develop the FDD. We often serve existing franchisors on a monthly basis for a fixed monthly rate.
Franchisee Support
Our franchise attorneys understand what matters to franchisors because we work with leading franchisors, franchise sellers, and franchise consultants on a daily basis. We leverage this industry knowledge and experience to help clients who are considering the purchase of a franchise opportunity before they sign a franchise agreement.
Franchisee legal services include:
- Nationwide and Virginia FDD review
- Nationwide and Virginia franchise agreement review
- Comprehensive franchise legal review report
- Consultation and legal advice on rights and obligations
- Consultation and negotiation on business legal terms
- Direct dispute resolution and litigation
- Day-to-day legal support
How much does a franchise lawyer cost?
We provide a comprehensive FDD review and unlimited consultation for a competitive flat fee ($1,850). We can assist on other projects at an agreed fixed cost or our hourly rate.
