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Franchise disclosure and the right to future exemptions

Thursday, August 09, 2018 @ 8:51 AM | By Ben Hanuka

Canadian provincial franchise statutes oblige franchisors to provide prospective franchisees with a franchise disclosure document (FDD) and create several exemptions from this obligation. The exemptions deal with certain limited circumstances such as the extent of a franchisor’s involvement in a transfer, prescribed investment amounts and renewals or extensions.

This article addresses the question of whether a franchisor may deliver an FDD during the franchise grant process, while reserving a future right to rely on one or more of the statutory disclosure exemptions. More specifically, whether a...