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What Constitutes an Offer to Sell a Franchise in Washington State?

In terms of a franchisors FDD and franchise disclosure obligations franchise regulation is triggered by a franchisors offer and/or sell of a franchise. So, when it comes time to evaluating the operations of your franchise and your franchise compliance program, in the State of Washington - pursuant to the Washington Franchise Investment Act - an offer to sell a franchise is made in the state when any of the following is true:

  • The offer is directed by the offeror into this state from within or outside this state and is received where it is directed;
  • The offer originates from this state and violates the franchise or business opportunity law of the state or foreign jurisdiction into which it is directed;
  • The offeree is a resident of this state; or
  • The franchise business that is the subject of the offer is to be located or operated, wholly or partly, in this state.

An offer to sell a franchise is not solely made because the offer appears:

  • In a newspaper or other publication of general and regular circulation if the publication has had more than two-thirds of its circulation outside this state during the twelve months before the offer is published; or
  • In a broadcast or transmission originating outside this state.

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Charles Internicola

by Charles Internicola
National Business and Franchise Lawyer

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