The Franchise Registration Process (Part B)

The Review Process

Once your registration application has been submitted properly, it will enter into the review process. This is a specified period of time in which the state either accepts or rejects the application. The state administrator's response to the application usually comes in the form of a "deficiency" or "comment" letter requesting additional information or revisions. While it is not uncommon for an applicant to satisfy all comments on the first try, it is also not uncommon for an administrator to issue more than one deficiency letter to satisfy all the terms of the application. It is generally recommended to have a franchise lawyer assist with the response to the comment letter.

Denial of Registration

There are several reasons that a state administrator might deny a registration application, or suspend or revoke an effective registration. These reasons include:

• A failure to comply with the provisions of state law;
• The offer or sale of the franchise would constitute a misrepresentation to purchasers or has been, or would be, a fraud upon purchasers;
• An order imposing an escrow or impounding of franchise fees has not been met; and
• Any person identified in the franchisor's application or disclosure document has been convicted of a felony or held liable in a civil action involving certain specified causes relating to the sale of franchises, and the state believes the continued involvement of such persons in the sale or management of the franchise creates an unreasonable risk to prospective franchisees.

However, one might appeal the denial of a registration application or file a lawsuit for wrongful denial in the proper court of law. To do so, you will need the help of a franchise lawyer.

How can a franchise lawyer help me?

A franchise lawyer can guide you through every step of the franchise registration process. By gathering the right information, properly submitting your forms, corresponding with attorney general, and, if need be, appealing a denial, you will have the best chance of having your franchise application approved.

If you are an entrepreneur who is interested in franchising a business, there is a lot you need to know that goes outside of how to run a successful business. To get started with franchising your business contact franchise lawyer Charles N. Internicola, Esq. regarding our Start-Up Franchise Program and Franchise Compliance Program. Call 1-800-976-4904.

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