What Are The Franchise Laws in Kentucky?
Kentucky has a unique legal framework for franchises, as it is a non-registration state but requires a specific filing.
In this case, the state does not have a dedicated franchise act; instead, it operates under the Kentucky Business Opportunity Act.
However, franchisors are exempt from the more stringent requirements of this act if they meet the definition of a “franchise” as defined by the Federal Trade Commission’s (FTC) Franchise Rule.
To qualify for this exemption, a franchisor must file an “Affidavit of Business Opportunity Exemption” along with a copy of their Franchise Disclosure Document (FDD) with the Kentucky Attorney General’s Office.
This one-time filing is a mandatory step for a franchisor to legally offer and sell franchises in Kentucky, even though it doesn’t involve the same formal registration and renewal process as in other states. Plus, the state does not charge a fee for this filing. This means that while Kentucky is not a traditional “franchise registration state,” it is a “franchise filing state” that requires a specific submission to the Attorney General’s office to ensure legal compliance.
Franchisors must still adhere to the federal FTC Franchise Rule, which requires them to provide a prospective franchisee with the FDD at least 14 days before a franchise agreement is signed or payment is made.
For prospective franchisees thinking of opening a franchise in Kentucky, it’s important to recognize that they do not have the same state-level relationship protections concerning termination or non-renewal that are available in states with dedicated franchise relationship laws.
Therefore, seeking advice from qualified Kentucky Franchise Attorneys to review the FDD and the agreement is an essential step before making an investment.
Here is a list of franchise lawyers you can hire in Kentucky
Kevin P. McGann
101 S. 5th St, Suite 2500
Louisville, Kentucky
J. David Rodgers
300 W. Vine St, Suite 2100
Lexington, Kentucky
Robert W. Sparks
400 W. Market St, Suite 2300
Louisville, Kentucky
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Joel Libava, President.
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