FRANCHISING IN Iowa
Registration or Filing Required?
No
Business Opportunity Laws?
Yes
Iowa is not a franchise registration state nor a franchise filing state. You can offer or sell your franchise without registering or filing your FDD if you are compliant with the FTC Franchise Rule. Iowa does have a Business Opportunity Law, which requires sellers of business opportunities to make written disclosures to prospective buyers before selling a business opportunity.
Under this Act, Iowa defines a business opportunity as a contract where the buyer pays an initial payment of greater than $500, and the seller will provide goods or services for the purpose of enabling the purchaser to start the business, and represents one of the following:
- Seller will provide locations or assist buyer in finding locations for vending machines, racks or devices;
- Seller will provide or assist buyer in finding outlets or accounts for the buyer’s products or services;
- Seller will buy any products made by buyer;
- Buyer will derive income exceeding purchase price;
- Seller will refund some/all money or buy back some/all products if buyer is not satisfied;
- Seller will provide marketing plan.
The Act applies to any business opportunities where the offer is made or accepted in the state, where the buyer is a resident of the state, or where the business will be operated in the state. Business opportunities subject to the law are required to provide disclosures documents to potential buyers at least 10 business days before the purchase. The disclosure document also be accompanied by a statement that the business opportunity does not have the approval, recommendation, or endorsement of the state of Iowa.