05.01.2009 Settlement with the Virginia State Corporation Commission May be More Expensive Than Franchisors Believe
05. 2009The Division of Securities and Retail Franchising (the “Division”), an arm of the Virginia State Corporation Commission (“SCC”), administratively enforces franchisor violations of the Virginia Retail Franchising Act, Va. Code § 13.1-557, et seq. (the “Act”). Violations of the Act include, among others, making material misrepresentations to a franchisee prospect, failing to provide a prospective franchisee with a properly registered franchise disclosure document and making an offer or sale of a franchise without state registration. Suspected or claimed violations of the Act are often reported to the Division by disgruntled franchisees, usually after they have bought and commenced operation of the franchise.
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