NASAA's Model Franchise Exemptions: Game Changer or Much Ado About Nothing?

The exemptions were designed to: * reduce the rate of increase in the workload of state administrators based on risk assessment; * identify categories of franchise offerings less likely to require comprehensive review by state franchise examiners, either because of the nature of the offering or the...

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Bibliographic Details
Published inFranchise law journal Vol. 32; no. 4; pp. 191 - 210
Main Authors Satterlee, Karen Boring, Karp, Eric H., Ekberg, Adam
Format Journal Article
LanguageEnglish
Published Chicago American Bar Association Forum on Franchising 22.03.2013
American Bar Association
Subjects
Boards of directors
Business
Direct sales
Exemption (Law)
Financial investments
Franchise agreements
Franchisees
Franchises
Franchising
Investors
Laws, regulations and rules
Natural persons
Net worth
Proposals
Public interest
Public welfare
Registration
Risk assessment
Sales operations
Service of process
Tax exemptions
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Summary:The exemptions were designed to: * reduce the rate of increase in the workload of state administrators based on risk assessment; * identify categories of franchise offerings less likely to require comprehensive review by state franchise examiners, either because of the nature of the offering or the nature of the prospective investor; * be at least revenue-neutral, meaning that there will be savings in administrative costs but no decrease in revenue from franchise filings and registrations that would otherwise fall within applicable regulations; * put the franchisor front and center with the state administrator in effectuating service of process; * ensure where appropriate that the prospective franchisee is aware that the offer and sale are pursuant to an exemption; * seek to employ a "highest common denominator" approach based on the existing exemptions, meeting or exceeding each state's respective existing standards while creating a uniform national standard; and * look to the existing FTC Franchise Rule exemptions, but not treat them as controlling.
ISSN:8756-7962
2163-2154