What are the laws regarding franchising agreements?

Franchising agreements in Washington are governed by the Washington Franchise Investment Protection Act (WIFPA). This law applies to franchisors or companies who wish to franchise their products or services in Washington state. It requires franchisors to provide potential franchisees with the following materials prior to entering into a franchise agreement: (1) a franchise disclosure document, (2) a copy of the franchise agreement, and (3) a copy of the current financial statements of the franchisor. The WIFPA also requires franchisees to receive a minimum of 8 days to review the franchise agreement and any other related documents. During that time, franchisees must: (1) be provided a copy of the franchisee’s financial statements, (2) receive a complete description of the franchise system, (3) receive a description of any applicable restrictions or limitations on the franchisee’s right to sell or assign its franchise, (4) understand the terms of any guarantee or warranty offered, (5) receive a complete list of any fees or other payments due, (6) be given the opportunity to consult with an attorney or accountant, and (7) be able to cancel the franchise agreement within 5 days of signing. In addition to the WIFPA, franchisors must comply with all applicable local, state, and federal laws and regulations. This includes laws governing labor and employment, discrimination, and health, safety, and environmental standards. Overall, franchising in Washington is subject to a number of laws and regulations regarding the disclosure of information to franchisees, their rights and obligations, and their ability to cancel a franchise agreement.

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What are the laws regarding franchising agreements?

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