Did you know that last May (2019) that NASAA adopted new state cover sheets and state effective dates page for franchise disclosure documents. Beginning January 1, 2020, any FDD must now include three new cover sheets following the guidelines provided by NASAA.
All of these new pages are standardized and should appear behind the cover page of the FDD, before the main body of the FDD (Items 1-22).
- “How to Use This Franchise Disclosure Document” is a table that includes general questions a franchisee may have and the table indicates where in the FDD that the information can be found.
- “What You Need to Know About Franchising Generally” has a list of certain common franchise terms and questions.
- “Special Risks to Consider About This Franchise” is similar to the previous state-specific disclosure page and franchisors must still include a page listing the effective dates of the states in which they operate.
Although relatively easy to add these compliance changes, it is a trap for the unwary and franchisors will need to make sure they are added to have a compliant FDD.
*https://www.nasaa.org/wp-content/uploads/2019/06/New-Frachise-State-Cover-Sheets-Instructions.pdf