The real estate franchisee business is the industry most anticipated to rise in the United States in the coming years. In addition to purchasing and selling real estate, real estate specializes in rental and property management, redecorating, home inspection, and other related services. Unsurprisingly, like other major industries, the master franchisee industry also now calls for an experienced attorney on board.
What is a Franchisee?
The Federal Trade Commission and its rules govern the sale and purchase of franchisee business in the United States. Any franchisee business and agreement will be deemed a franchise business if they fulfill the following conditions:
- The franchisor will transfer all rights to sell, operate, or distribute products or services linked to its trademark to the franchisee.
- The franchisor will have the authority to exercise some control over the company’s management and operations, offering the franchisee substantial support in their operational strategy.
- For the franchisor or its affiliate to manage the franchisee’s business under their supervision, the franchisee will either make the required payment or promise to make the necessary payment.
While many states have franchise-related laws, no uniform legal definition of a franchise exists. Various state laws mirror the FTC Franchise Rule’s definition of a franchise.
The real estate franchise laws in the US
In the United States, real estate franchise laws guarantee transparent relations and equity between parties. Similar to a master franchisee, franchisors must provide a franchise disclosure document (FDD) outlining the real estate property’s costs, responsibilities, and financial performance. Depending on the state real estate franchise laws, the agreement may require additional registration or compliance, and a seasoned attorney can help the parties produce it.
Real estate franchisee agreements frequently overlap with the terms of commercial leases, mainly retail or specialty leasing. Holdover lease clauses usually require tenants to pay higher rent after the term ends to encourage prompt renewal or eviction, which may also impact the agreement in real estate franchisees.
The law also ensures that the franchisor must consider how he grants the franchisee a license to use a trade name, trademark, service mark, or related characteristic of a similar business when delegating a real estate master franchisee.
How does an attorney help?
In master franchisee or real estate, the role of an attorney is crucial, considering the legal requirements of establishing a franchise business from scratch to a well-known franchisee.
An experienced real estate franchisee attorney usually engages in different franchisee models, including real estate, drafts and negotiates contracts, intellectual property, business formation, and commercial leasing transactions.
A franchise lawyer acts as a mediator and arbitrator in franchisee-related litigation in state and federal courts and alternate dispute resolution. With stellar experience, an experienced attorney ensures that franchisors and franchisees enter into legally compliant agreements and excel in their respective business roles.
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