COMMENT TO FTC

RE BAN ON NON-COMPETE CLAUSES

IN FRANCHISE AGREEMENTS

Here’s How:

On January 5, 2023, the Federal Trade Commission (FTC) published a proposed rule that would ban post-termination non-compete covenants in employment agreements – both for existing and future contracts. While the proposal does not apply to franchise agreements, the FTC has specifically asked for comments on whether it (i.e., the ban on non-compete clauses) should apply to franchise agreements.

Specifically regarding post-contract noncompete clauses, the FTC proposal states as follows:

By restricting a franchisee’s ability to start a new business, franchisor/franchisee non-compete clauses could potentially stifle new business formation and innovation, reduce the earnings of franchisees, and [read more here]...

NAASF and the Coalition of Franchisee Associations (CFA) urge all franchisees to respond* to the FTC requests and file individual comments on this important issue. We have drafted talking points for you and encourage all franchisees to tell their personal stories of how the inclusion of non-compete clauses have or will affect your business and livelihood. [read the talking points and how to respond, HERE]...

All comments must be filed/received by April 19, 2023.

* Comments made are individual's; NAASF advises a review of your franchise agreement(s) prior to commenting.