Oregon Franchise Registration
The state of Oregon has become a favourite destination for businesses because of its incentives to companies operating there, which has attracted outside companies and investors. Oregon offers easy access to capital and favourable taxes, which are some of the incentives offered to business owners, aside from being a great place to reside whether you love outdoor or indoor spaces. Its pro-business climate, with Oregon Investment Advantage encouraging all kinds of businesses to relocate or start in selected counties in the state. The state is suitable for franchises since any company that offers five full-time jobs within specific conditions gets a substantial reduction or elimination of business income tax liability for up to ten years.
Oregon is not a franchise registration state and requires a franchisor to maintain an updated Franchise Disclosure Document (FDD) compliance with Federal Franchise law. Although you are not required to register your franchise or file your FDD, the state has enacted franchise relationship laws that dictate the relationship between franchisors and franchisees. These laws are enforced and regulated by the Director of the Department of Consumer and Business Services, and failure to adhere to these laws results in penalties and fines.
According to Oregon law, a franchise is defined under the Oregon Trade Regulation and Practice Act as any agreement, whether written or oral, whereby a franchisee is given the right to engage in the business of selling, offering, or distributing goods and services under a system that is substantially prescribed by the franchisor. This means that the operations of the franchisee’s business are associated with the franchisor’s trademark, trade name, service mark, advertising, logotype, or other commercial symbols affiliated with the franchisor.
The Oregon Trade Regulation and Practice Act also recognize a franchise as a verbal or written contract whereby the franchisee is required to give the franchisor a valuable consideration for the consent to transact business under the system or plan. The payment for trading stamps is not considered a consideration for transaction rights with a business pursuant system or strategy. Therefore, before any action of selling or offering a franchise in Oregon, as in all non-registration states in the country, you are not required to disclose your Franchise Disclosure Documents 14 days before signing any contract or payment of any funds beyond what is stipulated by the Federal Trade Commission Amended Franchise Rule.
Therefore, franchisors in Oregon are required to comply with the Federal Trade Commission Rule above all else, which requires them to disclose a valid Issued Franchise Disclosure Document before engaging in a franchise agreement or accepting any form of payment from a prospective franchisee. Since the state does not have well-defined laws that require franchisors to register with the state, the only state laws that can affect franchisors in the state are stipulated under the Franchise Transactions statutes, which regulate limited aspects of the franchisor-franchisee relationship.
For more information on how to register your franchise in Oregon, visit the Franchise Marketing Systems site: https://www.fmsfranchise.com/learn/resources/state-guidelines/