Utah
Franchise Registration
Utah
Utah is not a franchise registration state and does not review or approve Franchise Disclosure Documents (FDDs). However, before offering or selling a franchise to be located in Utah or to a Utah resident, a franchisor must obtain a Franchise Proof of Notice Receipt from the Utah Division of Consumer Protection. Utah also regulates non-franchise business opportunities under the Utah Business Opportunity Disclosure Act.
Utah Franchise Laws
Utah does not require franchisors to register an FDD with the state. However, before offering or selling a franchise to be located in Utah or to a Utah resident, a franchisor must obtain a Franchise Proof of Notice Receipt from the Utah Division of Consumer Protection.
Franchisors must also comply with the Federal Trade Commission’s (FTC) Franchise Rule, which requires providing a current FDD to prospective franchisees at least 14 calendar days before execution of any agreement or payment of any consideration.
Utah Franchise Proof of Notice Filing
To obtain a Proof of Notice Receipt, a franchisor must file a notice with the Division stating that the franchisor is in substantial compliance with the FTC Franchise Rule and providing:
- The applicant's name;
- The name of the franchise;
- Any different name under which the applicant transacts business;
- The address of the applicant's principal place of business;
- The applicant's state-issued business entity number or other government-issued, publicly available identifying number; and
- Any additional information required by the Division.
The initial and renewal filing fees are $100 (non-refundable). A Proof of Notice Receipt is valid for 1 year after issuance. The franchisor must renew the filing at least 30 days before expiration and must update the filing within 30 days after any information in it becomes incorrect or incomplete. Utah accepts Franchise Proof of Notice applications online only.
A Proof of Notice Receipt does not constitute approval or endorsement of the franchisor by the Division or the state, and a seller may not represent otherwise. The Division may impose administrative fines and may deny, suspend, or revoke a Proof of Notice Receipt for incomplete, false, or misleading filings and other violations. (Utah Code §§ 13-15-201, 13-15-301, 13-15-303)
Utah Franchise Relationship and Termination Laws
Utah does not have generally applicable franchise relationship or termination laws. It does not impose franchise-specific good-cause termination requirements, nonrenewal restrictions, transfer rights, or notice and cure obligations. The terms of the franchise agreement and general contract law principles govern franchise relationships, renewals, transfers, and terminations.
One narrow exception applies. Under the Utah Franchise Protection Act, when a franchisee asserts a sincerely held religious belief, a franchisor may not unilaterally impose a requirement that the franchisee operate on a religious day, require the franchisee to accept such a requirement in an amendment to the franchise agreement, or refuse to renew the franchise agreement based solely on the franchisee’s noncompliance with such a requirement. The prohibition does not apply if the original franchise agreement contains a religious day operation requirement or the franchisee agrees to one in a renewal or amendment. (Utah Code §§ 13-75-101, 13-75-201)
Utah Business Opportunity Laws
Utah regulates business opportunities under the Utah Business Opportunity Disclosure Act, Utah Code §§ 13-15-102 to 13-15-303.
A business opportunity generally includes an arrangement under which a person sells or leases a product, equipment, a supply, or a service, upon payment of initial required consideration of at least $500, for the purpose of enabling the buyer or lessee to start a business, and represents that:
- The seller will provide or assist in finding locations for vending machines, racks, display cases, or similar devices, or currency-operated amusement machines or devices;
- The seller will purchase products the purchaser makes, produces, fabricates, grows, or modifies;
- The seller guarantees that the purchaser will receive income exceeding the amount paid and will repurchase the product, equipment, supply, or service if the purchaser is dissatisfied; or
- The purchaser will or may derive income from the business exceeding the amount paid.
The definition excludes the sale of an ongoing business when the owner sells and intends to sell only that one business, and the not-for-profit sale of sales demonstration equipment, materials, or samples for a total price of $500 or less. (Utah Code § 13-15-102)
Utah Business Opportunity Requirements
Before acting as a business opportunity seller in Utah, a seller must obtain a Proof of Disclosure Receipt from the Utah Division of Consumer Protection. The seller must:
- File the disclosure statement required by Utah Code § 13-15-202;
- Submit any additional information required by the Division;
- Pay a $200 non-refundable initial filing fee;
- Renew the filing annually, at least 30 days before the current receipt expires, with a $200 renewal fee; and
- Update the filing within 30 days after any information becomes incorrect or incomplete.
The required disclosure statement includes information about the seller, its principals and affiliates, business experience, fees, products and services, training, earnings representations, litigation history, contracts, cancellations, refund requests, and a financial statement that is less than 13 months old.
The seller must provide the disclosure statement to a prospective purchaser at least 10 business days before the earlier of the purchaser executing a binding agreement or making any payment or providing other consideration. (Utah Code §§ 13-15-201 to 13-15-203)
Franchise Filing in Place of Business Opportunity Registration
A franchisor whose offering qualifies as a franchise under the FTC Franchise Rule and that is in substantial compliance with that rule may obtain a Franchise Proof of Notice Receipt instead of completing the more extensive business opportunity disclosure filing. A seller that does not qualify for the franchise notice-filing procedure is subject to Utah’s full business opportunity filing and disclosure requirements. (Utah Code § 13-15-201(2))
Purchaser Remedies
A purchaser may bring an action against a seller that does not comply with the Utah Business Opportunity Disclosure Act. If a court finds a violation, the purchaser is entitled to rescission of the contract, reasonable attorneys’ fees and court costs in an action to enforce the right of rescission, and the greater of actual damages or $2,000. (Utah Code § 13-15-302)
More information about Utah's Business Opportunity Laws
For more information, please visit:
Utah Business Opportunity Disclosure Act
Utah Division of Consumer Protection – Business Opportunities
Utah Franchise Proof of Notice and Business Opportunity Applications
Utah Business Opportunity Statutes and Rules
If you offer a business opportunity in Utah, we can help you determine if, and how, your company must comply with Utah’s Business Opportunity Laws.
Franchise Compliance in Utah
To learn more about our franchise services and how we can assist with franchise compliance in Utah, please contact us at (757) 263-4596 or visit our interactive map to explore franchise laws in other states.
