Missouri Franchise Registration

Missouri Franchise Registration

Missouri is one of the top states to do business in the United States, as it offers interactions with several advantages. Companies in Missouri can expand and thrive from tax credits to low operating costs and easy access to grants and loans. The state has a diverse industry base, including top-tier sectors such as food processing, chemicals, publishing, aerospace, and electrical equipment. The state has an enormous workforce of 2.78 million workers, more than the population of nineteen states. This ensures that businesses have a sufficient industry-ready force, which is a critical factor for growth.

The state of Missouri does not have any franchise registration laws or business opportunity laws. As a non-registration state, franchisors are not required to file or register their franchise with the state before offering or selling a franchise location. Due to the lack of enacted franchise laws, if you are looking to franchise your business in Missouri, you must comply with the Federal Trade Commission Amended Franchise Rule (FTC Rule). 

While there are no requirements to be satisfied at the state level, franchisors need to ensure that their franchise complies with franchise laws at the federal level. According to the FTC Rule, franchisors are required to provide prospective franchisees with an updated Franchise Disclosure Document (FDD). This document contains relevant information about the business that a franchisee would like to know before investing. However, most franchisors are not aware of what to include in their Franchise Disclosure Document. Failure to draft a comprehensive FDD, the franchisor risks federal franchise law infringements. 

Before issuing a prospective buyer with a Franchise Disclosure Document, it is advisable to consult a franchise attorney to help in ensuring it covers critical aspects of the business. Professional advice also enables you to familiarize yourself with the various requirements for franchising at the state level. There are at least 23 items that comprise a well-drafted Franchise Disclosure Document. These items focus on several key aspects that help the franchisee make an informed decision before investing.

The Federal Trade Commission Amended Franchise Rule (FTC Rule) stipulates the conditions for a healthy franchisor-franchisee relationship. The law mandates that franchisors provide a prospective franchisee with an updated copy of the Franchise Disclosure Document 14 days before any payment or agreement. Although Missouri does not require registration or filing fees, franchisors can access pertinent information from the Missouri Department of Revenue.

Like other non-registration states in the United States, franchisors need to familiarize themselves with the franchise laws at the federal level. These laws help propagate a healthy relationship before both parties agree where the franchisee is disadvantaged. Working closely with a franchise attorney is recommended to help you navigate the franchise laws at the federal level that are continuously changing. Failure to comply with federal franchise laws results in costly fines and penalties.

For more information on how to register your franchise in Missouri, visit the Franchise Marketing Systems site:  https://www.fmsfranchise.com/learn/resources/state-guidelines/

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