South Carolina Franchise Registration

South Carolina Franchise Registration

Many citizens in other states do not think of South Carolina when looking for places to start a business. However, the state has one of the most business-friendly environments in the country. In addition, South Carolina offers companies a wide range of benefits such as reduced cost of operation, favorable tax climate, incentive programs, easy access to capital, labor, low utility rates, and many others. These factors contribute immensely to the success of businesses in the state and economic growth. As a result, South Carolina remains on the upward trend in development, focusing on critical development factors such as infrastructure and transport.

South Carolina is not a franchise registration but a filing state. Although it has not enacted franchise laws, the state has Business Opportunity Laws that govern the offering or sale of a franchise location. According to the business opportunity laws, franchisors must file a notice with the state before selling or offering a franchise.

However, franchisors who operate a business with a registered watermark are exempted from South Carolina’s business opportunity laws but must still issue a notice to the Secretary of State. According to your Franchise Disclosure Documents (FDD), the state usually registers franchises that lack a registered mark as a business opportunity, according to your Franchise Disclosure Documents (FDD).

The South Carolina Business Opportunity Sales Act defines the term business opportunity broadly [which includes franchise offerings. This act also stipulates the issuance of a notice to South Carolina’s Secretary of State. Only franchises with a state or federal registered trademark are exempted from this act. Therefore, franchisors should file a statement with the Secretary of State regardless to ensure compliance. 

Franchisors looking to offer their franchise in South Carolina must also ensure that they comply with the Federal Trade Commission Amended Rule (FTC Rule). The FTC Rule governs the offering or selling in all states, both registration, and non-registration. The state of South Carolina is referred to as a franchise notice state since franchisors are required to submit a letter as proof of having a registered mark and seeking exemption from business opportunity registration requirements. 

Filing in South Carolina varies depending on the status of your business. Franchises that have registered trademark file in the form of a letter to the Secretary of State notifying them of your intent to offer or sell a franchise. For businesses that lack a registered trademark, you should contact the Secretary of State to determine whether you need to file or register as a business opportunity.

It is advisable to work with a franchise attorney before franchising in South Carolina to ensure you avoid infringements with franchise laws at the state and federal levels. In addition, whether or not you plan on registering or filing your business in the state, it is advisable to contact the office of the Secretary of State.

For more information on how to register your franchise in South Carolina, visit the Franchise Marketing Systems site:  www.FMSFranchise.com/about-franchising/guidelines/stateregulations

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