California Code of Regulations
Title 10 - Investment
Chapter 3 - Commissioner of Financial Protection and Innovation
Subchapter 2.6 - Franchises
Section 310.156.3 - Exemption for Internet Advertisements

Universal Citation: 10 CA Code of Regs 310.156.3

Current through Register 2024 Notice Reg. No. 38, September 20, 2024

(a) Any communication made in connection with an offer or sale of a franchise posted on a website on the Internet ("Internet advertisement") is exempt from the requirements of Corporations Code Section 31156 for filing advertisements with the Commissioner provided a franchisor complies with all of the following:

(1) The franchisor files with the Commissioner a written notice, executed by an officer or general partner of the franchisor having direct responsibility for the conduct of the franchisor's activities, and verified pursuant to Section 2015.5 of the Code of Civil Procedure, that includes:
(A) The Uniform Resource Locator ("URL") address or similar address or device identifying the location of any Internet advertisement;

(B) A statement that the franchisor, or anyone acting with the franchisor's knowledge, agrees to comply with the California Franchise Investment Law, and Rules thereunder, when posting any Internet advertisement on a website; and

(C) The franchisor's name, address, telephone number, and contact person.

(2) The Internet advertisement is not directed to any person in the State of California by or on behalf of the franchisor or anyone acting with the franchisor's knowledge. For the purposes of this section, "directed to any person in the State of California," means directed to a specifically named person, or group of persons, and not to the public generally, and includes, but is not limited to, non-passive forms of communication such as e-mail, instant messages, or other similar modes of communication; and

(3) A preface, exhibit or appendix of the franchisor's offering circular includes the URL address of the franchisor's website, and the following statement, in clear readable type, of not less than 12-point size:

OUR WEBSITE HAS NOT BEEN REVIEWED OR APPROVED BY THE CALIFORNIA DEPARTMENT OF BUSINESS OVERSIGHT. ANY COMPLAINTS CONCERNING THE CONTENT OF THIS WEBSITE MAY BE DIRECTED TO THE CALIFORNIA DEPARTMENT OF BUSINESS OVERSIGHT at www.dbo.ca.gov.

(b) Any notice filed in compliance with subsection (a) shall be effective from the date the notice is filed with the Commissioner until the end of the franchisor's then-currently effective registration period, as specified in Section 310.120. The exemption may be renewed for additional periods of one year by submitting to the Commissioner no later than the end of the franchisor's then-currently effective registration period, as specified in Section 310.120, an additional written notice that complies with the requirements of subsection (a).

(c) Nothing in this regulation shall be construed to limit the Commissioner's authority to bring any action against any person violating any of the provisions of the California Franchise Investment Law.

1. New section filed 6-10-2003; operative 7-10-2003 (Register 2003, No. 24).
2. Change without regulatory effect amending subsection (a)(3) filed 8-13-2014 pursuant to section 100, title 1, California Code of Regulations (Register 2014, No. 33).

Note: Authority cited: Sections 31156 and 31506, Corporations Code. Reference: Sections 31110, 31111, 31114 and 31156, Corporations Code.

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