New Mexico Franchise Laws
While it’s true that the state of New Mexico operates as a “non-registration” state for franchising, creating a straightforward regulatory landscape for franchisors, you still need to find and hire New Mexico Franchise Attorneys.
To clarify, there are no state-specific laws that require franchisors to register their franchise or file disclosure documents with a state agency before they can offer or sell franchises.
This means the entire pre-sale process is governed exclusively by the Federal Trade Commission’s (FTC) Franchise Rule. This federal regulation requires franchisors to provide prospective buyers with a comprehensive Franchise Disclosure Document (FDD), ensuring the buyer has access to crucial information about the franchising system well before any binding agreement is signed or payment is made.
Note: Check out the N.M. Deceptive Franchise Practices Act.
In contrast to states with robust franchisee protections, New Mexico does not have a general franchise relationship law. Consequently, the ongoing relationship between the franchisor and the franchisee, including critical aspects like contract termination, renewal rights, and the process for transferring ownership, is not governed by a specific state statute.
Instead, these matters are dictated by the terms and conditions detailed within the franchise agreement itself. Should a dispute arise, both parties must rely on the negotiated contract and general principles of business and contract law for resolution.
However, while general business format franchisees must depend on their contracts, New Mexico does provide specific statutory protections for dealers in select industries.
The state has a “Franchise Termination Act,” but its application is very narrow, applying only to businesses dealing in farm, utility, and industrial tractors and implements.
Similarly, the state has specific laws that regulate the franchise relationship for motor vehicle dealers and for wholesalers of alcoholic beverages. For franchises operating outside of these specific sectors, the franchise agreement remains the paramount document defining the rights and obligations of both the franchisor and the franchisee.
Here is a list of franchise lawyers you can hire in New Mexico
C. William Sutherland, Esq
Sutherland Law Firm, LLC
2901 Juan Tabo Blvd., Ne Suite 100-E
Albuquerque, NM
