Who is responsible for the costs and expenses associated with complying with Franchise Regulations for Anago subfranchises?
Anago Franchise · 2025 FDDAnswer from 2025 FDD Document
- (a) Subfranchisor acknowledges that there are federal, state and local laws governing the offer and sale of franchises ("Franchise Regulations") and that it is Subfranchisor's sole responsibility to ensure that it complies with all such laws, rules and regulations.
Subfranchisor will retain a qualified franchise attorney to assist and counsel Subfranchisor in its legal obligations under all Franchise Regulations and other applicable laws.
Subfranchisor will send copies of its proposed FDD (Subfranchisor - Single Unit) to Franchisor and its counsel for approval.
Subfranchisor shall not modify its FDD without first obtaining Franchisor's prior written approval.
Subfranchisor will also register its franchise offering and maintain its registration with the appropriate state agency, if required.
Subfranchisor shall be responsible for all costs and expenses, including, without limitation, Subfranchisor's attorneys' fees and any applicable registration and filing fees in connection with complying with Franchise Regulations.
- (b) Subfranchisor further acknowledges that Franchise Regulations require updating of disclosure information, amendments and renewals of disclosure documents and registration filings and that there may be periods of suspended sales and solicitation activity during any such renewals and/or amendments.
Franchisor shall not be liable to Subfranchisor for any delays or any franchise sales that may be lost due to Franchisor's or Subfranchisor's efforts and actions to comply with Franchise Regulations.
- (c) Subfranchisor shall be responsible for delivering to each prospective franchisee in the Area a complete copy of Subfranchisor's then-current FDD that has been approved by Franchisor.
Subfranchisor shall not make any representations or statements to prospects for franchises which are (i) in addition to, inconsistent with or contradictory to the contents of the FDD; or (ii) misleading, incomplete, fraudulent or untrue.
SUBFRANCHISOR SHALL NOT, UNDER ANY CIRCUMSTANCES, MAKE ANY FINANCIAL PERFORMANCE REPRESENTATIONS (AS DEFINED BY THE FTC Franchise Rule) TO ANY PROSPECTIVE FRANCHISEE, EXCEPT AS EXPRESSLY STATED IN ITEM 19 OF THE FDD (Subfranchisor – Single Unit).
Source: Item 23 — RECEIPTS (FDD pages 62–298)
What This Means (2025 FDD)
According to Anago's 2025 Franchise Disclosure Document, the subfranchisor is solely responsible for all costs and expenses associated with complying with franchise regulations. This includes, but is not limited to, attorney's fees and any applicable registration and filing fees. Anago subfranchisors must comply with federal, state, and local laws governing the offer and sale of franchises.
To ensure compliance, Anago subfranchisors must retain a qualified franchise attorney to assist and counsel them on their legal obligations. They are also required to submit copies of their proposed Franchise Disclosure Document (FDD) to Anago and its counsel for approval and must not modify their FDD without prior written approval from Anago. Additionally, the subfranchisor is responsible for registering and maintaining the registration of their franchise offering with the appropriate state agency, if required.
Anago's FDD also states that franchise regulations require updating of disclosure information, amendments, and renewals of disclosure documents and registration filings, which may lead to periods of suspended sales and solicitation activity. Anago will not be liable for any delays or lost franchise sales due to efforts to comply with franchise regulations. The subfranchisor is also responsible for delivering a complete and approved FDD to each prospective franchisee and must not make any representations that are inconsistent with the FDD or are misleading. Subfranchisors are prohibited from making any financial performance representations to prospective franchisees unless expressly stated in Item 19 of the FDD.