State Franchise Registration Status and Franchise Laws

Florida


Registration or Filing Required? Yes, Filing
Business Opportunity Laws? Yes

Florida is considered a franchise filing state, and franchisors must make an annual filing with the Florida Department of Agriculture and Consumer Services before offering or selling franchises in the state. The annual filing fee is $100. More information can be found on the Florida Department of Agriculture and Consumer Services Website.

How Do I File an Exemption in Florida?

Florida’s Sale of Business Opportunities Act governs the sale or lease of business opportunities in the state, but exempts franchises provided they comply with federal laws governing the offer and sale of franchises. In order to be exempt, the franchisor must annually submit a Franchise Exemption Application Packet, along with a payment of $100 to the Florida Department of Agriculture and Consumer Services. The form only requires basic information about your franchise, including your name, trade name, physical and mailing addresses, and your federal employer ID number. The application and payment can be physically mailed, or submitted online. The state makes it very clear that this filing must be done annually BEFORE the offer or sale of a franchise.

If I’m Not Considered a Franchise, What Does the Business Opportunity Act Require?

If you plan to sell business opportunities but are not considered a franchise under the FTC rules, you will be subject to the additional requirements mandated by Florida’s Business Opportunity Act. The Act defines a business opportunity as the sale or lease of any products, equipment, supplies, or services which are sold or leased to a buyer to enable them to start a business where the buyer is required to pay an initial fee exceeding $500, and where the seller represents one of the following:

  1. That the seller will provide the buyer with, or assist them in finding, a location for the use or operation of vending machines, racks, display cases, or other devices;
  2. The seller will purchase products made by the buyer using the supplies or services sold to them by the seller;
  3. The seller guarantees the buyer will derive income from the business or that the seller will refund all or part of the price paid by the buyer if they don’t; or
  4. The seller will provide a sales or marketing program that will allow the buyer to derive income from the business.

It should be noted that the definition specifically excludes, the sale of ongoing businesses (provided there are no more than 5 of them), the not-for-profit sale of demonstration goods for a price less than $500, and the sale or lease of laundry and dry-cleaning equipment.

If a business qualifies as a business opportunity and it is not exempt from the Act, then the Act imposes additional disclosure requirements, similar to those required by franchises, on the seller. Also, if the seller guarantees that the buyer will derive income from the business (including promising to provide refunds if it doesn’t), the seller will be required to obtain a surety bond (or suitable alternative) of at least $50,000. Not surprisingly, the Act also prohibits the seller from misrepresenting terms of the business opportunity or potential success of the opportunity to the seller.

Fun Fact: Florida has a prison with arguably the best view of any in the U.S. The John E. Goode Pre-Trial Detention Facility peacefully overlooks the St Johns River in Jacksonville.