Miami, FL commercial litigation attorney Robert Zarco talks about franchise disclosure documents (FDD) and why it’s so important to get experienced legal advice early in the negotiation process. The law firm is involved in various aspects of franchising and franchise relationships. Prospective franchisees seeking to purchase a franchise are advised to engage an experienced lawyer familiar with the rules and laws governing franchising. The Federal Trade Commission mandates that franchisors provide each franchisee with an FDD (Franchise Disclosure Document), containing approximately 23 items of disclosure. This document informs franchisees about crucial aspects such as the nature of the business, leadership, bankruptcy history, required investments, supply sources, vendors, and other essential details.

Of particular significance among the exhibits in the FDD is the franchise agreement. Serving as an exhibit to the FDD, this agreement outlines the document that governs the relationship between the franchisor and the franchisee. Thoroughly reading every word of the FDD, especially the franchise agreement, is imperative for every prospective franchisee and their legal representatives. Failure to do so would be considered reckless and irresponsible, potentially leading the franchisee down a regrettable path.