What are the franchisee's responsibilities regarding compliance with federal and state laws relating to franchises and subfranchises for Bhc?
Bhc Franchise · 2025 FDDAnswer from 2025 FDD Document
dling, and food service.
In addition, you, your Affiliated Franchisee, and your Subfranchisees are responsible for complying with all applicable federal and state laws relating to the offer, sale, maintenance, default, termination and non-renewal of franchises and subfranchises, including the FTC Franchise Rule, state franchise registration and disclosure laws, state relationship laws and state business opportunity laws (collectively, "Franchise Laws"). Further, you are solely responsible for preparing, amending and annually updating a franchise disclosure document ("Subfranchise FDD") to use in offering and selling subfranchises for BHC Restaurants to prospective subfranchisees in accordance with all Franchise Laws (although, upon your request, we will provide relevant information about ourselves and our business to include in your Subfranchise FDD), registering your Subfranchise FDD with the states, as applicable, properly providing your Subfranchise FDD to us and to prospective subfranchisees and complying with all applicable waiting periods before a prospective subfranchisee pays any consideration to you or your Affiliates or signs a binding agreement, and requesting information from us to allow you to prepare, amend, update and register your FDD in a timely manner. Further, you also will be responsible for complying with all applicable federal, state and local laws and regulations relating to your importation, storage, sale and delivery of the Approved Supplies (as defined in Item 8), including the Products.
(vi) Competition
The general market for unit franchisees is well developed. You will have to compete with brokers, franchisors, national chains and independently owned companies for prospective BHC franchisees.
The fried chicken and sandwich restaurant market is very well developed and highly competitive. You, your Affiliate Franchisee, and your Subfranchisees will compete with many other fried chicken and sandwich chains and individual fried chicken and sandwich restaurants.
(7) Prior Experience of Franchisor, Predecessors and Affiliates
The original System was founded in Korea, in 2004 by the principal owner of BHC Korea. BHC stands for "Better, Happier & Choice" and holds three guiding principles "Cleaner, Friendlier, and Tastier" to achieve our mission of offering flavors that bring happiness, no matter where or when. BHC also operates two (2) BHC-owned Restaurants of the type being franchised at Los Angeles, California. We have sold franchises providing the type of business you will operate. We do not offer franchises in other lines of business or engage in other business activities.
Item 2: Business Experience
The individuals at BHC who has management responsibility are as follows:
Chief Executive Officer: David Hosup Song
Mr.
Source: Item 1 — The Franchisor, And Any Parents, Predecessors, And Affiliates (FDD pages 7–10)
What This Means (2025 FDD)
According to Bhc's 2025 Franchise Disclosure Document, franchisees, their affiliated franchisees, and subfranchisees are responsible for complying with all applicable federal and state laws relating to franchises and subfranchises. These laws include the FTC Franchise Rule, state franchise registration and disclosure laws, state relationship laws, and state business opportunity laws.
Specifically, if a Bhc franchisee intends to offer subfranchises, they are solely responsible for preparing, amending, and annually updating a franchise disclosure document (Subfranchise FDD) that complies with all franchise laws. While Bhc will provide relevant information about themselves and their business to include in the Subfranchise FDD upon request, the franchisee is responsible for registering the Subfranchise FDD with the states, properly providing the Subfranchise FDD to prospective subfranchisees and to Bhc, and complying with all applicable waiting periods before a prospective subfranchisee pays any consideration or signs a binding agreement. The franchisee is also responsible for requesting information from Bhc in a timely manner to allow them to prepare, amend, update, and register their FDD.
In addition to franchise-specific laws, franchisees, their affiliated franchisees, and subfranchisees must comply with all local, state, and federal laws and regulations relating to the importation, storage, sale, and delivery of approved supplies, including the products. They must also adhere to laws governing the food-service industry, including health, sanitation, EEOC, OSHA, discrimination, employment, and sexual harassment laws. Furthermore, compliance with the Americans with Disability Act of 1990, PCI Data Security Standards, and regulations pertaining to sanitation, labeling, food preparation, food handling, and food service is mandatory.