Under the Beem Light Sauna franchise agreement, where will all arbitration proceedings be held?
Beem_Light_Sauna Franchise · 2025 FDDAnswer from 2025 FDD Document
Except to the extent governed by the Federal Arbitration Act or other federal law, Illinois law governs this Agreement.
- CONSENT TO JURISDICTION. The following is added to the end of Section 16.3(d) of the Franchise Agreement:
Notwithstanding the foregoing, in conformance with Section 4 of the Illinois Franchise Disclosure Act, any provision in this Agreement that designates jurisdiction and venue in a forum outside of Illinois is void. However, this Agreement may provide for arbitration to take place outside of Illinois.
Source: Item 23 — RECEIPT (FDD pages 71–230)
What This Means (2025 FDD)
According to the 2025 Beem Light Sauna Franchise Disclosure Document, the location of arbitration proceedings depends on whether federal law or the Illinois Franchise Disclosure Act applies. Except to the extent governed by the Federal Arbitration Act or other federal law, Illinois law governs the agreement.
However, the rider to the franchise agreement for use in Illinois states that any provision in the agreement that designates jurisdiction and venue in a forum outside of Illinois is void, in conformance with Section 4 of the Illinois Franchise Disclosure Act. The agreement may provide for arbitration to take place outside of Illinois.
For prospective Beem Light Sauna franchisees in Illinois, this means that while the franchise agreement might initially suggest a venue outside of Illinois for arbitration, the Illinois Franchise Disclosure Act could void that provision, potentially allowing arbitration to occur within Illinois, or another location as agreed upon and compliant with Illinois law. Franchisees should consult with legal counsel to fully understand their rights and obligations regarding arbitration locations, especially considering the interplay between the franchise agreement, federal law, and state-specific regulations.