The North American Securities Administrators Association, Inc. (NASAA) is requesting public comments on a proposed Financial Performance Representations Commentary (FPR Commentary). This proposal is a second request for public comment following the feedback received from the FPR Commentary proposal released for public comment in October of 2015. Comments are due on or before October 13, 2016

Download: Notice of Request for Public Comment


The FPR Commentary answers frequently asked questions about how franchisors can make a financial performance representation (also known as an earnings claim) under federal and state franchise disclosure guidelines. Those guidelines provide that a franchisor can make an FPR when it has a “reasonable basis” for making the claim and substantiation for the representation. There is very little guidance, however, regarding what constitutes a reasonable basis for making an FPR. Examiners agree that it would be helpful to have additional clarification about how franchisors should make an FPR in their disclosure documents. With help from our Industry Advisory Committee and franchise law practitioners, the Franchise Project Group reached a consensus on questions about FPRs that are worthy of clarification.

Note: After the comment period has closed, NASAA will post to its website the comments it receives as submitted by the authors. Parties should therefore only submit information that they wish to make publicly available. Further, the following notice will appear on NASAA’s website where comments are posted: NASAA, its agents, and employees accept no responsibility for the content of the comments posted on this Web page. The views, expressions, and opinions expressed in the comments are solely those of the author(s).

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