What You Need to Know About Franchising
You may come for the sand and sunshine in Florida, but make sure you stay for the small business opportunities! The ‘Sunshine State’ is home to more than 2.5 million small businesses, with the majority of franchises being in the commercial/residential cleaning sector.
Florida is a franchise registration state, though not in a traditional sense. It is considered a notice filing state, which means that it does not have a state examiner review the FDD, but you must submit annual paperwork and pay a $100 fee each year. Florida has enacted the Sale of Business Opportunities Act, which is a business opportunity law that applies to the sale of franchises and requires franchisors to file an annual Franchise Exemption Notice with the Florida Department of Agriculture & Consumer Services.
Florida Franchise Filing Fees
$100
Initial
$100
Renewal*
$0
Amendments**
*Renewal filings must be submitted before the expiration date each year.
**Florida does not require the submission of amendment filings.
Overview of Franchise Laws in Florida
Franchising in Florida offers a lucrative opportunity for entrepreneurs looking to tap into the state’s vibrant economy. While Florida is a franchise registration state, it operates as a notice filing state rather than through traditional regulatory oversight. This means franchisors must submit annual paperwork and pay a $100 fee each year, but there isn’t a state examiner reviewing the Franchise Disclosure Document (FDD).
The Sale of Business Opportunities Act governs the sale of franchises in Florida and mandates franchisors to file an annual Franchise Exemption Notice with the Florida Department of Agriculture & Consumer Services (FDACS). Initial filings must be made via check, whereas renewals can be paid online through ACH or credit card, with a nominal convenience fee for ACH payments.
Potential Legal Challenges for Franchisors
Operating a franchise in Florida comes with its own set of legal challenges that franchisors must navigate meticulously:
- Compliance with State-Specific Laws: Even though Florida is a notice filing state, failure to submit the required paperwork and fees can result in penalties or even the suspension of franchise operations.
- Intellectual Property Issues: Protecting trademarks and other intellectual property is critical, and any lapses can lead to costly legal battles.
- Contractual Disputes: Disagreements between franchisors and franchisees over the terms of the franchise agreement can lead to litigation.
- Employment Law Compliance: Ensuring that both franchisors and franchisees comply with local, state, and federal employment laws to avoid lawsuits related to labor violations.
Importance of Franchise Attorneys for Franchise Agreements
Navigating the complexities of franchise law requires specialized legal expertise. Franchise attorneys play a crucial role in ensuring that all legal aspects of the franchise are properly managed:
- Drafting and Reviewing Agreements: They help draft and review franchise agreements to ensure they are legally sound and protect the interests of the franchisor.
- Regulatory Compliance: Attorneys ensure that all state and federal regulations are met, helping to avoid fines and legal issues.
- Dispute Resolution: In the event of a dispute between franchisor and franchisee, attorneys can provide mediation or represent their clients in court if necessary.
Benefits of Hiring a Franchise Attorney
Engaging a qualified franchise attorney provides numerous advantages:
- Expert Guidance: Attorneys offer expert advice on all aspects of franchising, from initial setup to ongoing operations, ensuring that you remain compliant with all legal requirements.
- Risk Management: They help identify potential legal risks and provide strategies to mitigate them, safeguarding your business.
- Efficiency: Legal professionals streamline the filing process for FDDs and other necessary documents, saving time and reducing administrative burdens.
- Peace of Mind: Knowing that you have a legal expert on your side allows you to focus on growing your franchise without worrying about legal pitfalls.
By understanding the intricacies of Florida’s franchise laws and engaging experienced franchise attorneys, franchisors can effectively mitigate risks and set their businesses up for long-term success.
What Are the Typical Costs Associated With Hiring a Franchise Lawyer?
The costs can vary depending on your specific needs. Our CORE program offers flat fees for ongoing legal services to ensure fairness and transparency.
How Long Does It Take to Draft a Franchise Agreement?
The timeline can differ, but our efficient processes are designed to meet your business deadlines quickly.
Can a Franchise Lawyer Help With Franchise Expansion and Growth Strategies?
Yes, we provide strategic advice on expansion while ensuring compliance with relevant laws.
What Are the Common Legal Pitfalls Florida Franchisors Should Be Aware Of?
Franchisors need to be aware of registration requirements, advertising guidelines, financial assurance demands, and maintaining up-to-date Franchise Disclosure Documents (FDDs). California, in particular, has stringent registration requirements that can take months to secure approval. The sooner you file in California, the better.
At Spadea Lignana, we understand the complexities of franchise laws. Our aim is to help you navigate these challenges smoothly, ensuring your franchise’s success while minimizing legal risks.
Notes
The filing fee for initial filings must be made via check made payable to “FDACS”. Renewal filings are completed online and Florida accepts payment of the filing fee via ACH or credit card. For ACH payments, you will be required to complete and submit an ACH authorization form to us before we will submit the filing for you, and the state will charge a $1.00 convenience fee for payments submitted via ACH. For credit card payments, you will be required to complete and submit a credit card authorization form to us before we will submit the filing for you.
We will provide the Florida initial or renewal form to you via email or DocuSign for your signature. If we provide the form via email, you must print it, sign it, and scan it back to us via email so we may complete the filing on your behalf.
Florida is a filing state and approval of the FDD is not required. The filing is typically approved within two weeks.
The filing fee for initial filings must be made via check made payable to “FDACS”. Renewal filings are completed online and Florida accepts payment of the filing fee via ACH or credit card. For ACH payments, you will be required to complete and submit an ACH authorization form to us before we will submit the filing for you, and the state will charge a $1.00 convenience fee for payments submitted via ACH. For credit card payments, you will be required to complete and submit a credit card authorization form to us before we will submit the filing for you.
We will provide the Florida initial or renewal form to you via email or DocuSign for your signature. If we provide the form via email, you must print it, sign it, and scan it back to us via email so we may complete the filing on your behalf.
Florida is a filing state and approval of the FDD is not required. The filing is typically approved within two weeks.
Florida has the most golf courses of any state in America.
My Improv
With 87.3 million visitors in 2011 (a record number), Florida is the top travel destination in the world.
State of Florida
Everglades National Park– a UNESCO World Heritage Site – is the only place on the planet where crocodiles and alligators co-exist.
Visit Florida
Flat Fee Program for Franchisors
Spadea Lignana’s CORE program for franchisors is a cost-effective and practical solution for the ongoing legal needs of franchisors, including but not limited to, FDD updates, state registrations and franchise agreement executions. Through a proprietary cloud-based system we can effectively and efficiently manage FDD Disclosures and Franchise Agreement executions for fair flat fees billed monthly. We believe that hourly billing, although necessary in certain circumstances like complex M&A deals and litigation, can weigh on the relationship between client and attorney. By coming up with a fair flat monthly fee, the uncomfortable negotiating of whether or not a 6 minute increment in your bill for replying to an email was legitimate goes away.
Attorneys Who Understand FL Franchise Law
Franchise laws vary from state to state, and it can be difficult to understand the requirements. Spadea Lignana has streamlined the process to ensure you remain compliant as you grow nationally.
We also work with franchisors all over Florida including Boca Raton, Davie, Miami, Wellington, and Orlando.
