Franchises Rulemaking - NASAA Statement of Policy Regarding the Use of Franchise Questionnaires and Acknowledgments — CR-103P

RULE-MAKING ORDER
PERMANENT RULE ONLY
CODE REVISER USE ONLY
CR-103P (December 2017)
(Implements RCW 34.05.360)
Agency: Department of Financial Institutions, Securities Division Effective date of rule:
Permanent Rules
☒ 31 days after filing.
☐ Other (specify) (If less than 31 days after filing, a specific finding under RCW 34.05.380(3) is required and should be stated below) Any other findings required by other provisions of law as precondition to adoption or effectiveness of rule? ☐ Yes ☒ No If Yes, explain:
Purpose: The Securities Division hereby amends Chapter 460-80 WAC to adopt the Statement of Policy Regarding the Use of Franchise Questionnaires and Acknowledgments promulgated by the North American Securities Administrators Association, Inc. (“NASAA”). On September 18, 2022, NASAA adopted the Statement of Policy Regarding the Use of Franchise Questionnaires and Acknowledgments (“Statement of Policy”). The Statement of Policy sets uniform standards for the proper use of questionnaires and acknowledgments in franchise offerings. The Statement of Policy prohibits provisions that would require a prospective franchisee to make statements that are subjective, unreasonable, or that attempt to absolve the franchisor or its agents of liability in connection with the sale of a franchise. These provisions are also inconsistent with the Franchise Investment Protection Act’s anti-waiver provisions. See RCW 19.100.220(2) and RCW 19.100.180(2)(g). It is important to note that the adoption of the Statement of Policy does not represent a material change in requirements for franchise offerings in Washington. However, adoption of the Statement of Policy will aid franchisors in complying with existing Washington law by providing specific examples of prohibited questionnaires and acknowledgments, while also increasing compliance with anti-waiver and anti-fraud requirements across the states with such requirements. Citation of rules affected by this order:
New: WAC 460-80-325
Repealed: N/A
Amended: N/A
Suspended: N/A
Statutory authority for adoption: RCW 19.100.250 Other authority: None PERMANENT RULE (Including Expedited Rule Making) Adopted under notice filed as WSR 23-10-048 on April 28, 2023 (date). Describe any changes other than editing from proposed to adopted version: None If a preliminary cost-benefit analysis was prepared under RCW 34.05.328, a final cost-benefit analysis is available by contacting:
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Federal statute: New Amended Repealed
Federal rules or standards: New Amended Repealed Recently enacted state statutes: New Amended Repealed The number of sections adopted at the request of a nongovernmental entity:
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Pilot rule making: New Amended Repealed
Other alternative rule making: New Amended Repealed Date Adopted: 8/18/2023 Name: Charlie Clark Title: Director Signature: