WASHINGTON, D.C. – (December 7, 2021) – The North American Securities Administrators Association (NASAA) announced that its Board of Directors recently approved the release for public comment of a proposed NASAA Statement of Policy Regarding the Use of Franchise Questionnaires and Acknowledgments.
Franchisors routinely use questionnaires and acknowledgements to try to limit their potential liability in franchise offerings, and some franchisors are doing so inappropriately. The proposed statement of policy is intended to set appropriate regulatory standards in this regard.
“NASAA is concerned with inappropriate uses of questionnaires and acknowledgments in franchise offerings,” said Melanie Senter Lubin, NASAA President and Maryland Securities Commissioner. “The proposed statement of policy should help address these concerns. I wish to thank the members of NASAA’s Corporation Finance Section Committee and the Franchise and Business Opportunities Project Group for their diligent work in developing this important statement of policy.”
“We developed this statement of policy as a means to better protect franchisees from unscrupulous franchisors. It should be the franchisor’s burden to police its own sales personnel and agents,” said Dale Cantone, Chair, Franchise and Business Opportunities Project Group, Maryland Assistant Attorney General, and Maryland Deputy Securities Commissioner.
The proposed statement of policy is now posted on the NASAA website with instructions on how to submit comments. The deadline for submitting comments is on or before January 5, 2022. Upon the conclusion of the public comment process, the statement of policy may be presented for potential approval by the NASAA membership.
Formed in 1919, NASAA is a nonprofit association of state, provincial and territorial securities regulators in the United States, Canada and Mexico. NASAA has 67 members, including the securities regulators in all 50 states, the District of Columbia, Puerto Rico, and the U.S. Virgin Islands with a shared mission of protecting investors from fraud and abuse. For more information, visit: www.nasaa.org.
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