Fairness in Franchising

The Coalition of Franchise Associations (CFA) has released a “Universal Franchisee Bill of Rights,” which calls for a number of changes in the way franchisors and franchisees contract with one another. The document, which the CFA terms a “fairness doctrine,” calls for greater disclosure and transparency by franchisors, the uniform application of franchise operating standards, and the right to renew or transfer a franchise free of “unreasonable costs and/or stipulations.” The document also recommends giving franchisees the right to set their own prices, to freely associate with other franchisees and independent associations, and to terminate their franchise without penalty in the event of a costly change to the franchise system.

While the Universal Franchise Bill of Rights is not law, and we are currently unaware of any introduced legislation relating to the matter, the document has received endorsements from a number of national franchisee associations.

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