Under what condition may Belocal franchisees be required to register as franchise brokers in Washington?
Belocal Franchise · 2025 FDDAnswer from 2025 FDD Document
Franchisees who receive financial incentives to refer franchise prospects to Franchisor may be required to register as franchise brokers under the laws of the Washington State. The Franchise Referral Program described in Item 1 of the disclosure document is not available to referrals made in connection with franchises offered or sold in the state of Washington.
No more than one referral fee will be paid to franchisees living in or operating a Franchised Business within the state of Washington, and no franchisee, regardless of location, will receive more than one referral fee for referrals made to franchisees living in or operating a Franchised Business in Washington.
Source: Item 22 — CONTRACTS (FDD page 71)
What This Means (2025 FDD)
According to Belocal's 2025 Franchise Disclosure Document, franchisees who receive financial incentives for referring franchise prospects to Belocal may be required to register as franchise brokers under Washington state law. This means that if a Belocal franchisee in Washington is compensated for successfully connecting potential new franchisees with Belocal, they might need to comply with franchise broker registration requirements in Washington.
This requirement is specific to Washington State, as indicated in the Washington Addendum to the Franchise Agreement. The Franchise Referral Program described in Item 1 of the disclosure document is not available to referrals made in connection with franchises offered or sold in the state of Washington.
Furthermore, Belocal specifies that no more than one referral fee will be paid to franchisees living in or operating a Franchised Business within the state of Washington. Also, no franchisee, regardless of location, will receive more than one referral fee for referrals made to franchisees living in or operating a Franchised Business in Washington. This limitation on referral fees, combined with the potential registration requirement, suggests that Belocal is carefully managing franchise referral activities within Washington to comply with state regulations.