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A Guide to Franchise Registration State Filing Extensions


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Several franchise registration states are making adjustments to filing deadlines and are updating other guidelines for renewals and applications in an effort to assist franchisors experiencing a severe disruption to their business.

Fourteen states—California, Hawaii, Illinois, Indiana, Maryland, Michigan, Minnesota, New York, North Dakota, South Dakota, Rhode Island, Virginia, Washington and Wisconsin—require franchisors to register their franchise disclosure documents with a specific state agency before selling franchises within their borders. Franchisors are also required to update their FDDs each year, most with a deadline of April 30. Often, that deadline also coincides with their renewal deadlines that require franchise registration or exemption filings.

The International Franchise Association is tracking the developments in each state, and we’ve summarized the new policies as of April 6, 2020:

California

The state’s Department of Business Oversight is not granting an extension but is requesting businesses to file online and is allowing the use of DocuSign in lieu of physical signatures for electronic filings. It is waiving the $225 late fee, at least temporarily.

Hawaii

The state's filing deadline has been extended to April 30, 2020.

Illinois

While there’s been no official delay in the filing deadline, the IFA says the state is looking for “good faith effort” and is not strictly enforcing FDD filings and renewals. If a franchise makes a sale between the time of lapse and registration, private right of action is still applicable.

Indiana

No extension has been granted, but the state is willing to discuss on a case-by-case basis.

Maryland

Gov. Larry Hogan declared a state of emergency on March 5, 2020, and on March 17, the Maryland securities commissioner issued an order extending registrations and exemptions for currently registered or exempt franchisors whose registrations or exemptions would have expired during the state of emergency. The registration and exemption dates will be extended for 30 days after the governor of Maryland declares the end of the state of emergency. Registration applications are to be filed solely on CD-ROM, removing the requirement of paper copies.

Michigan

No extension has been granted, but the state is willing to discuss on a case-by-case basis.

Minnesota

The deadline for franchisors required to file by April 30 has been extended to June 30, 2020. Notarization requirements for franchises have also been waived.

New York

The deadline for filings due before April 30 has been delayed 90 days.

North Dakota and South Dakota

The states are making exceptions to deadlines on a case-by-case basis.

Rhode Island

The IFA was informed there will be no penalties for filings due in March or April.

Virginia

The State Corporation Commission announced a Judicial Emergency Declaration that states any franchise registered or exempted by the Virginia Retail Franchising Act has now been granted an extension of 21 days for their registration or exemption ("or such other time period as may be subsequently ordered by the SCC or the Supreme Court of Virginia"). Paper application submissions are no longer required; franchises can submit their FDD and application on a CD or USB.

Washington

No extension has been granted, but the state is willing to discuss on a case-by-case basis. The state encourages use of its online filing system.

Wisconsin

No changes at this time.

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About This Blog

The latest news, opinions and commentary on what's happening in the franchise arena that could affect your business.

Laura MichaelsLaura Michaels is editor of Franchise Times. She can be reached at 612.767.3210, or send story ideas to lmichaels@franchisetimes.com.
 
Beth EwenBeth Ewen is senior editor of Franchise Times. She can be reached at 612.767.3212, or send story ideas to bewen@franchisetimes.com.
 
Nicholas UptonNicholas Upton is restaurants editor at Franchise Times. He can be reached at 612.767.3226, or send story ideas to nupton@franchisetimes.com.
 
Mary Jo LarsonMary Jo Larson is the publisher of Franchise Times Magazine and the Restaurant Finance Monitor.  You can find her on Twitter at
 twitter.com/mlarson1011.
 

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