HF 1670

as introduced - 89th Legislature (2015 - 2016) Posted on 03/10/2015 03:17pm

A bill for an act
relating to commerce; regulating franchises; amending Minnesota Statutes 2014,
sections 80C.06, subdivision 5; 80C.14, subdivision 2, by adding subdivisions.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

Section 1.

Minnesota Statutes 2014, section 80C.06, subdivision 5, is amended to read:

Subd. 5.

Copy to franchisee; receipt.

Any person offering for sale or selling any
franchise which is subject to the registration requirements imposed by section 80C.02
shall, at the person's own expense, present to the prospective franchisee, at least deleted text begin seven deleted text end new text begin
90 new text end days prior to the execution by the prospective franchisee of any franchise or other
agreement, or at least deleted text begin seven deleted text end new text begin 90 new text end days prior to the payment of any consideration by the
franchisee, whichever occurs first, a copy of the current public offering statement together
with a copy of all proposed agreements relating to the sale of the franchise. The franchisee
shall be permitted to retain the public offering statement prior and subsequent to the
execution of any franchise or other agreement. The person offering or selling the franchise
shall obtain a receipt, signed by the prospective franchisee, acknowledging receipt of a
copy of the public offering statement prior to executing any franchise or other agreement
and prior to paying any consideration. The receipt shall be kept in the possession of the
person offering or selling the franchise, subject to inspection by the commissioner, for
a period of three years from the date the receipt is taken.

Sec. 2.

Minnesota Statutes 2014, section 80C.14, subdivision 2, is amended to read:

Subd. 2.

Acts constituting.

All franchise contracts or agreements, other than those
classifications of franchises specifically recognized by the commissioner under subdivision
1, and any other device or practice of a franchisor must conform to subdivisions 3 new text begin , 3a, new text end
and 4. It is an unfair and inequitable practice for a person to commit an act specified
in subdivisions 3 to deleted text begin 5 deleted text end new text begin 7 new text end .

Sec. 3.

Minnesota Statutes 2014, section 80C.14, is amended by adding a subdivision
to read:

new text begin Subd. 3a. new text end

new text begin Exception. new text end

new text begin Notwithstanding subdivision 3, a franchisee may terminate
or cancel a franchise, without penalty or cost, within 30 days of the execution of the
franchise agreement.
new text end

Sec. 4.

Minnesota Statutes 2014, section 80C.14, is amended by adding a subdivision
to read:

new text begin Subd. 6. new text end

new text begin Selection of suppliers. new text end

new text begin It is unfair and inequitable for a franchisor to select
the supplier of goods or services on behalf of the franchisee, unless the goods or services
have the brand of the franchisor or are reasonably related to the brand of the franchisor.
new text end

Sec. 5.

Minnesota Statutes 2014, section 80C.14, is amended by adding a subdivision
to read:

new text begin Subd. 7. new text end

new text begin Attorney fees. new text end

new text begin It is unfair and inequitable for a franchisor to require a
franchisee to pay the franchisor's attorney fees.
new text end

Sec. 6. new text begin EFFECTIVE DATE; APPLICATION.
new text end

new text begin Sections 1 to 5 apply to franchise agreements executed or renewed on or after
August 1, 2015.
new text end