North Carolina
Franchise Registration
North Carolina
North Carolina is not a franchise registration state, but it regulates business opportunities under the North Carolina Business Opportunity Sales Act and a traditional franchise can fall within that definition.
However, many traditional franchise offerings fall outside the marketing-program prong of North Carolina’s business opportunity definition because they are offered in conjunction with the licensing of a federally registered trademark or service mark. As a result, most franchisors do not need to make a North Carolina business opportunity filing, but they should confirm that no other statutory trigger applies.
North Carolina Franchise Laws
North Carolina does not have franchise-specific registration or disclosure laws. Franchisors may offer and sell franchises in North Carolina without registering an FDD, provided they comply fully with the FTC Franchise Rule.
However, if the arrangement does not involve a federally registered trademark, or if the seller makes separate location-assistance, income, refund, repurchase, or buy-back representations, the offering should be reviewed under North Carolina’s Business Opportunity Sales Act.
North Carolina Franchise Relationships and Termination Laws
North Carolina does not have franchise relationship or termination laws. It does not impose statutory good-cause termination requirements, nonrenewal restrictions, transfer rights, or franchise-specific notice and cure obligations. The terms of the franchise agreement and general contract law principles govern franchise relationships, renewals, non-renewals, transfers, and terminations in North Carolina.
North Carolina Business Opportunity Laws
North Carolina regulates business opportunities under Chapter 66, Article 19 of the North Carolina General Statutes. A business opportunity includes the sale or lease of products, equipment, supplies, or services for the purpose of enabling the purchaser to start a business when the seller makes one of the representations listed in N.C. Gen. Stat. § 66-94.
- The seller will provide or assist in finding locations for vending machines, racks, display cases, currency-operated machines, or similar devices
- The seller will purchase goods made using the seller’s products, equipment, or supplies
- The purchaser will earn income that exceeds the price paid for the business opportunity
- The seller will refund all or part of the price paid, or repurchase products, equipment, supplies, or chattels if the purchaser is dissatisfied
- The seller will provide a sales or marketing program that enables the purchaser to derive income from the business
N.C. Gen. Stat. § 66-94
North Carolina’s business opportunity definition excludes certain transactions, including the sale of an ongoing business where the owner sells and intends to sell only that one business opportunity, and the not-for-profit sale of sales demonstration equipment, materials, or samples for a total price of $200 or less. A marketing program offered in conjunction with the licensing of a federally registered trademark or service mark is also excluded from the marketing-program prong of the definition. Because many franchise offerings license a federally registered mark, they typically fall outside this prong and do not require a North Carolina business opportunity filing. The analysis should still be confirmed if the seller makes income guarantees, refund or buy-back promises, or location-assistance representations.
North Carolina Business Opportunity Registration
Before offering or selling a business opportunity in North Carolina, the seller must file with the Secretary of State:
- Two copies of the required disclosure statement or an FTC-compliant FDD
- Consent to Service of Process
- Surety Bond or Trust Account documentation, if required
- A $250 filing fee
N.C. Gen. Stat. § 66-97
The registration must be updated when any material change occurs and at least annually with a $250 renewal fee. North Carolina does not send renewal reminders.
North Carolina Business Opportunity Disclosure Requirements
The sale of a business opportunity in North Carolina requires registration with the state, including a copy of a written disclosure document, surety bond, and payment of a fee. N.C. Gen. Stat. § 66-95.
At least 48 hours before the purchaser signs a business opportunity contract or pays any consideration, whichever occurs first, the seller must provide a written disclosure document. The disclosure document may be an FTC-compliant FDD or a North Carolina business opportunity disclosure statement containing the information required by N.C. Gen. Stat. § 66-95.
Franchise Exclusion from North Carolina Business Opportunity Laws
North Carolina does not require a separate franchise exemption filing. Instead, the key question is whether the offering falls outside the definition of a business opportunity or qualifies for a statutory exclusion. For traditional franchise offerings, the most important exclusion is the federally registered trademark language in N.C. Gen. Stat. § 66-94(4): a sales or marketing program offered in conjunction with the licensing of a federally registered trademark or service mark is excluded from that prong of the definition. Franchisors should still review the full structure of the offering, because other business opportunity triggers may apply if the seller makes location-assistance, buy-back, refund, repurchase, or income guarantee representations.
More information about North Carolina's Business Opportunity Laws
More information is available from the North Carolina Secretary of State, Business Opportunity Sales Office.
Business Opportunity and Registration Guidelines
If you offer a franchise or business opportunity in North Carolina, we can help determine whether an exemption or exclusion applies and assist you with compliance under federal and state requirements.
If you would like to learn more about our franchise services and franchise compliance in North Carolina, contact us or call (757) 263-4596 to schedule a consultation. You can also visit our interactive map to explore franchise laws in other states.
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