The FTC administers the federal franchise sales law, which requires all franchisors engaged in franchise sales in the United States to deliver a franchise disclosure document (FDD) to their prospective franchise buyers unless the transaction qualifies for an exemption. The federal pre-sale disclosure rule aims to prevent unfair and deceptive practices by ensuring that potential franchise buyers have information in the form of a legally-compliant FDD so they can make an informed investment decision about a franchise opportunity
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