For Cicis franchises in Illinois, can a Cicis franchise agreement or area development agreement provide for arbitration to take place outside of Illinois?

According to Cicis's 2025 Franchise Disclosure Document, for franchises in Illinois, a Cicis franchise agreement or area development agreement can stipulate that arbitration proceedings occur outside the state of Illinois. This is despite the fact that any provision designating jurisdiction and venue for legal proceedings outside of Illinois is considered void under the Illinois Franchise Disclosure Act.

This allowance for out-of-state arbitration offers Cicis some flexibility in managing disputes, potentially selecting a venue more convenient or favorable to the company. However, franchisees should be aware that while they may be required to participate in arbitration outside of Illinois, this does not prevent Illinois law from governing the agreement, except for matters covered by the U.S. Federal Arbitration Act and other federal laws.

It is important for prospective franchisees to understand the implications of agreeing to arbitration outside of Illinois. While the Illinois Franchise Disclosure Act aims to protect franchisees, agreeing to out-of-state arbitration may present logistical and financial challenges for franchisees should a dispute arise. Franchisees should seek legal counsel to fully understand their rights and obligations under the franchise agreement, particularly concerning dispute resolution processes and governing law.