About the Franchise Investment Law

In 1970, the California Legislature enacted one of the first franchise disclosure laws in the country. The Franchise Investment Law generally requires franchisors to register with the Department before offering and selling franchises in California.

The Franchise Investment Law also requires that registration disclosure documents and final franchise agreements be provided to prospective franchisees at least fourteen days before the sale of a franchise. The purpose of the pre sale disclosure is to provide, fully and truthfully, material information about the franchisor and its franchise offering to the prospective franchise, prior to a purchase decision.

The California Franchise Investment Law (begins at section 31000 of the the California Corporations Code).