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What is a Franchise Disclosure Document?

A Franchise Disclosure Document ("FDD") is a required legal document that contains information and disclosures that a franchisor must provide to a prospective franchisee before selling a franchise. The disclosures contained in an FDD are governed by the Federal Franchise Rule, are regulated by the Federal Trade Commission. Various states (known as registration states) have supplemented the disclosures that must be contained in the FDD. In certain states, the FDD must be registered with the appointed state agency prior to the offer or sale of a franchise.

Prior to the amendment of the Federal Franchise Rule, the mandated franchisee disclosure was known as a Uniform Franchise Offering Circular (UFOC).

Charles Internicola

by Charles Internicola
National Business and Franchise Lawyer

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