Alaska State Registration

Alaska State Registration

Aside from dark, frigid winters and long summers, the state of Alaska has a lot to offer in terms of business. Alaska is famous for business niches like restaurants, boat building and repairs, and many other food-related businesses. With big oil money, most of the constraints in business are outweighed by tax credits, which most entrepreneurs benefit from that are offered by the state. The state provides tax credits specific to different industries, projects, and associations like education and new area development. In addition, when registering a new company, Alaska offers loan programs which include small business economic development, rural development initiative fund, and microloan loan program for women entrepreneurs. These are among the key advantages of starting or relocating your business in the state of Alaska.

Alaska is among the states that do not require a franchisor to register their Franchise Disclosure Document (FDD) when offering or selling a franchise in the state. Franchisors who comply with the Federal Franchise Laws are exempted from the business opportunity laws that are enacted by the state. However, if you are not a franchisor or comply with franchise laws and FDD disclosures, the state requires you to adhere to its Business Opportunity Laws. Under the franchise laws, all franchisors are mandated to have updated FDDs, and that you disclose any prospective franchisee in the state. 

Unlike most states in the country that have regulatory bodies for enforcing and regulating the offering or selling of franchises, Alaska has not enacted franchise laws; the state has enacted Business Opportunity Laws controlled and administered by the Alaska Department of Law. This body ensures that all franchisees in the state comply with the set laws and regulate the franchisor-franchisee relationship. 

The state requires all franchisors who comply with the Federal Franchise Laws to be exempted from the Business Opportunity Laws since you do not need to register your franchise as a business opportunity. The state clearly defines a “business opportunity” under the Alaska Business Opportunity Act, section 45.66.220, clearly exempts franchises.

As long as you operate a franchise, the state excludes you from Sale of Business Opportunity Laws, as defined under the Federal Trade Commission Amended Franchise Rule (the FTC Rule) and other requirements within the FTC Rule’s 16.C.F.R.436.1-.11. Franchisors should expand their territory in the state or start their franchise to comply with the FTS Rule. You will not have to make additional filing before providing a prospective franchisee with a Franchise Disclosure Document within the state.

The state has distributorship laws covering specific broad business franchises and regulating the relationship between franchisors and franchisees. Following particular terminations, these laws require the franchisor to repurchase unused merchandise, repair parts, assets, and machinery. These laws also prohibit franchisors from coercing franchisees to perform certain acts under duress.

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