State Franchise Registration Status and Franchise Laws


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

Texas is not a franchise registration state but does require a one-time filing for franchisors planning to offer or sell franchises in the state. More information can be found on the Texas Secretary of State Website.

What does Texas Consider a Business Opportunity?

Texas defines a business opportunity as a sale or lease of products, equipment or services, for more than $500, that will be used by the buyer to begin a business in which the seller represents one of the following:

  1. The buyer is likely to earn a profit exceeding the purchase price,
  2. The seller will provide or assist the buyer in finding a location for the use or operation of the products equipment or services,
  3. The seller will provide a sales, production or marketing program, or
  4. The seller will buy back products, equipment or supplies purchased or produced by the buyer.

The law also excludes certain business situations from the definition of a business opportunity, including franchises that comply with the federal franchise rules.

Do I Need to Register My Franchise in Texas?

The Texas Business Opportunity Act governs the sale of business opportunities in the state and requires those selling business opportunities to register with the state. Franchisors that are using a properly issued FDD are exempt from registering under the Act, but must first submit an Exemption Notice and a one-time $25 filing fee to the Texas Secretary of State Registrations Unit at P.O. Box 13193, Austin, TX 78711. The notice requires franchisors to provide a list of all the names under which they intend to do business and their principal business address. The exemption notice does not have a term or expiration date; it is a one-time filing. However, a franchisor should notify the Texas Secretary of State in writing if the franchisor changes its principal business address. There is no fee for an address update.

What Should I Do if I Don’t Qualify for Exemption?

If your business opportunity does not qualify for the franchise exemption, you must register your business opportunity with the Texas Secretary of State. In order to register, you must file a copy of your disclosure statement that includes all of the information required by the Act, and a list of the names and addresses of all persons selling your business opportunities. The filing must also include the $195 registration fee. Alternatively, you can complete and submit a Business Opportunity Registration Form, which includes all of the information required for business opportunity disclosures.


The registration is effective on the date the completed registration documents and filing fee are received by the Secretary of State. There is no expiration date for a business opportunity registration, but the registrations must be updated regularly. The list of individual sellers of the business opportunity must be updated every 6 months, and the disclosure statement must be updated once a year or whenever there is a material change.

Additionally, if the seller of a business opportunity represents that a buyer will make a profit, they must also obtain a surety bond, establish a trust account or obtain an irrevocable letter of credit in the amount of $25,000. The seller must then file proof of this financial assurance with the Secretary of State before offering or selling a business opportunity.

Fun Fact: Not only does Texas have the fastest road in the United States (85mph) it also has the fastest average road speed (78mph). Yeehaw!