Note: all the information presented here about State franchise laws is based on public information online I gathered and organized.
If you’re thinking about turning your independent business into a franchise business, you need to know about State franchising regulations.
Finally, any U.S. franchising attorney listed on this site should be able to help you navigate the expansion of your franchise opportunity on a State by State basis.
State Franchise Laws: Registration, Disclosure and Relationship Agreements
Franchise compliance isn’t one-size-fits-all. Beyond the federal Franchise Rule, many states add their own registration, disclosure, and relationship requirements. Here’s the landscape—clear, current, and practical.
- Registration and disclosure states (pre-offer and pre-sale): Fourteen states require franchisors to register and/or file disclosures before offering or selling franchises. These are California, Hawaii, Illinois, Indiana, Maryland, Michigan, Minnesota, New York, North Dakota, Rhode Island, South Dakota, Virginia, Washington, and Wisconsin.
- Oregon’s unique approach: Oregon has a franchise-specific statute but does not require filing documents with the state. Translation: you’re still subject to the law, even if no paperwork is submitted.
- Business opportunity laws that can capture franchises: Twenty-five states regulate “business opportunities” or seller‑assisted marketing plans. Most exempt franchisors that meet specific criteria, but six of those states still require franchisors to file certain documents before offers or sales. Those six are Connecticut, Florida, Kentucky, Nebraska, Texas, and Utah.
- Relationship laws (post-sale obligations): Twenty-five jurisdictions regulate the franchisor–franchisee relationship after a franchise is granted. These typically govern terminations, nonrenewals, renewals, and transfers. Covered jurisdictions include Alaska, Arkansas, California, Connecticut, Delaware, Hawaii, Idaho, Illinois, Indiana, Iowa, Louisiana, Maryland, Michigan, Minnesota, Mississippi, Missouri, Nebraska, New Jersey, North Dakota, Rhode Island, Virginia, Washington, Wisconsin, plus Puerto Rico and the U.S. Virgin Islands.
Pro-tip: Bookmark this page now.
That way, you can refer to it as needed, when you expand your winning franchise opportunity to all the different states.