California Corporations Code

§ 31108

CORP § 31108 Effective Jan 1, 2000Div. 5 · Title 4 · Part 2 · Ch. 1

Statute text

There shall be exempted from the provisions of Chapter 2 (commencing with Section 31110), any offer or sale of a franchise if the franchise involves the adding of a new product or service line to the existing business of a prospective franchisee, provided all of the following requirements are met:

(a)For at least the last 24 months prior to the date of sale of the franchise, the prospective franchisee, or if the prospective franchisee is not a natural person, an existing officer, director, or managing agent of the prospective franchisee who has held that position with the prospective franchisee for at least the last 24 months, has been engaged in a business offering products or services substantially similar or related to those to be offered by the franchised business.

(b)The new product or service is substantially similar or related to the product or service being offered by the prospective franchisee’s existing business.

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Legislative history

Added by Stats. 1999, Ch. 325, Sec. 1. Effective January 1, 2000.