Texas Franchise Filing and FDD Registration: Texas Franchise and Business Opportunity Laws
Texas is a Franchise Filing State. The one-time filing fee for a Texas filing exemption is $25.
Texas is not a franchise registration state. Prior to offering or selling a franchise in Texas you do not need to register your Franchise Disclosure Document ("FDD"). However, because Texas has enacted business opportunity laws, as a franchisor, you are required to file a Business Opportunity Exemption Notice with the Texas Secretary of State before selling a franchise in Texas.
The Texas Business Opportunity Act, which governs the offer and sale of business opportunities in the state of Texas, requires that business opportunities be registered with the State, and requires a pre-sale disclosure similar to an FDD. As a franchisor, if your FDD is current and in compliance with the franchise rules and regulations of the Federal Trade Commission, you may claim an exemption to Texas's business opportunity laws by filing a one-time "Business Opportunity Exemption Notice."
To learn more about registering your FDD in Texas and how we can help, give us a call at (800) 976-4904 or contact us.
Texas Franchise and Business Opportunity FAQs
Who Regulates Franchises in Texas?
Texas has not enacted franchise laws but has enacted business opportunity laws, and the Texas Secretary of State regulates and oversees the enforcement of the Texas Business Opportunity Act.
Does the Texas Business Opportunity Act Apply to Franchises?
The definition of a "business opportunity" under the Texas Business Opportunity Act is broad and includes franchise relationships. However, if you maintain a current and valid FDD and are in compliance with the Federal Franchise Rule (learn more about the Federal Franchise Rule) and the FTC's FDD disclosure requirements, you may claim an exemption to the business opportunity laws. Once an exemption notice is filed, you will be in compliance with Texas's business opportunity laws.
What Should I Include with My Texas Franchise Filing?
You are required to file the Business Opportunity Exemption Notice that is referred to as Form 2703. When filed, it provides the Texas Secretary of State with the required information necessary to claim an exemption to the Business Opportunity Investment Act. Information included in the exemption notice:
- The name of your franchise company;
- Any assumed names of your franchise system;
- The principal business address of your franchise company;
- Authorized signature affirming that your franchise offering is in compliance with the Federal Franchise Rule and regulations issued by the FTC; and
- Check payable to the Secretary of State in the amount of $25, representing the exemption notice filing fee.
Where Is the Texas Franchise Exemption Notice Filed?
Business opportunity exemption notices are sent to:
Texas Secretary of State
P.O. Box 13193
Austin, TX 787-3193
What If I Don't Have a Current or Compliant FDD?
Then the exemption will be invalid, and you will be required to comply with the Texas Business Opportunity Act, which requires registration of your business opportunity and a pre-sale disclosure process.
Helpful Links Concerning Texas Franchise and Business Opportunity Laws:
- Texas Business Opportunity Act - This is a link to the actual text of the Texas Business Opportunity Act as published by the Texas Secretary of State. The Act defines what constitutes a business opportunity, registration and disclosure requirements imposed on sellers of business opportunities, and the exemption for franchisors.
- Business Opportunity FAQs - This FAQ section is published by the Texas Secretary of State and includes helpful information about the regulation of business opportunities, including the registration process and the exemption process for franchisors.
Visit our interactive franchise registration map and learn more about state franchise laws, FDD registration states, and required franchise filings.
To learn more about how we can help you with your franchise registrations and growing your franchise in Texas and across the United States, contact us at (800) 976-4904 or contact us online.