What You Need to Know About Franchising in Pennsylvania
Pennsylvania is a very active franchising state. It is one of the top 10 states in the U.S. with the highest number of franchise establishments (26,626 according to FRANdat, Inc), corresponding to states with the highest populations.
Whether you are starting a new franchise or buying or selling an existing franchise, it is a good idea to keep an eye on state legislature for any proposed legislation that may affect franchise operations.
In Pennsylvania, there is an important house bill under review that, if passed, will affect most businesses operating within the state. It is the Consumer Data Privacy Act, HB 1049. Like a recently passed privacy bill in California (California Consumer Privacy Act), HB 1049 could govern how franchisors and franchisees collect, share, and use consumers’ personal information to create business opportunities. The bill is pending, submitted to the Consumer Affairs committee in April of 2019.
Pennsylvania is not a registration state for franchises, which means that you don’t have to submit your FDD to a state regulator for review. While there are no specific franchise requirements for the state of Pennsylvania, you must still comply with national franchise laws.
Fun Fact About the Pennsylvania Franchise Industry
Although franchising history tells us that the first franchise established in the U.S. was by Singer Sewing Machines, an argument can be made that franchising goes all the way back to 1731 in Philadelphia, when Benjamin Franklin signed a “co-partnership” for a printing service with a gentleman by the name of Thomas Whitmarsh. The details of the co-partnership read much like the language we see today within a Franchise Agreement document. If it looks like a duck and quacks like a duck – it may very well have been a duck.
(or potential franchisors)
Franchisees & Franchisors
(or potential franchisees)
Working With a Franchise Attorney in Pennsylvania
The franchise registration process can be grueling and intimidating. You may be required to go through many rounds of FDD revisions, and if it is not handled correctly, the process can take months to gain approval. Spadea Lignana has streamlined the registration process to ensure you remain compliant as you grow nationally.
Our corporate office is located in Philadelphia, making it easy for PA franchisees and franchisors to meet with us in person.
Flat Fee CORE Program for Franchisors
Spadea Lignana’s CORE program for franchisors is a cost-effective and practical solution for the ongoing legal needs of franchisors, including but not limited to, FDD updates, state registrations and franchise agreement executions. Through a proprietary cloud-based system we can effectively and efficiently manage FDD Disclosures and Franchise Agreement executions for fair flat fees billed monthly. We believe that hourly billing, although necessary in certain circumstances like complex M&A deals and litigation, can weigh on the relationship between client and attorney. By coming up with a fair flat monthly fee, the uncomfortable negotiating of whether or not a 6 minute increment in your bill for replying to an email was legitimate goes away.