Illinois General Assembly - Bill Status for HB 3977

Amends the Business Brokers Act of 1995. Exempts any franchise seller as defined in the Federal Trade Commission rule entitled Disclosure Requirements and Prohibitions Concerning Franchising, as it may be amended, from the registration requirements and other duties imposed under the Act (rather than exempting persons registered under the Illinois Franchise Disclosure Act of 1987 from the Act's requirements as to (1) offers and sales in connection with franchising activities or (2) assisting their franchisees in the offer or sale of a franchise). Amends the Business Opportunity Sales Law of 1995. Provides that a seller of a business opportunity that is defined as a franchise under the Franchise Disclosure Act of 1987 is exempt from registering certain disclosure documents if the seller delivers either (1) The Franchise Offering Circular or (2) a disclosure document as required by the Illinois Franchise Disclosure Act of 1987, as it may be amended, to each purchaser 14 days prior to (rather than delivery by the earlier of the first personal meeting, or 10 business days) the purchaser's execution of specified documents. Makes other changes. Amends the Franchise Disclosure Act of 1987. In the definition of the term "franchise", provides that a person granted the right to operate a franchise business is required to pay the franchisor or the franchisor's affiliate a fee of $500 or more at any time prior to or within the first 6 months of the commencement of operations of the franchise business. Also enumerates specific franchise agreements and relationships not governed by the Act. Makes changes to provisions concerning the sale and extension or renewal of an existing franchise; exemptions from the Act's registration requirements; registration and annual reports; amendments to disclosure statements; the deferral of payment of the initial franchise fee; and other matters. Repeals the provision prohibiting a franchise broker from selling a franchise that requires registration under the Act unless the franchise broker submitted an application for registration and a consent to service of process. Repeals the provision creating a franchise advisory board.

Deletes everything after the enacting clause and reinserts similar provisions with the following additional changes. Eliminates language providing that a seller of a franchise is exempt from registering certain disclosure documents if the seller delivers the Franchise Offering Circular to each purchaser within a specified time period. Expands the list of disclosure documents a seller can chose from for filing and registration purposes to include disclosure documents prepared pursuant to the Federal Trade Commission rule entitled Disclosure Requirements and Prohibitions Concerning Business Opportunities. Eliminates language exempting certain types of franchise agreements from the Franchise Disclosure Act of 1987; language providing that members of the Franchise Advisory Board shall be reimbursed for actual and necessary expenses incurred in their official capacities; language repealing provisions concerning the Franchise Advisory Board; language providing that no franchisee may sue for damages; and language providing an exemption for prospective franchisees as to registration requirements. Makes changes to the defined terms "franchise", "subfranchisor", and "subfranchisor". Exempts certain franchisees and interest partners in a franchise from specific registration requirements. Adds language providing that the Attorney General may accept an Assurance of Voluntary Compliance statement from persons alleged to be in violation of the Franchise Disclosure Act of 1987 and that evidence of a violation of the statement shall be prima facia evidence of a violation of the Act. Establishes an initial $500 fee for filing a large franchisor exemption and a $100 renewal fee. Makes other changes. Effective October 1, 2009.

Date	Chamber	Action
1/11/2011	House	Session Sine Die

Date	Chamber	Action
2/26/2009	House	Filed with the Clerk by Rep. Michael J. Zalewski
2/26/2009	House	First Reading
2/26/2009	House	Referred to Rules Committee
3/3/2009	House	Assigned to Judiciary I - Civil Law Committee
3/11/2009	House	Do Pass / Short Debate Judiciary I - Civil Law Committee; 017-000-000
3/11/2009	House	Placed on Calendar 2nd Reading - Short Debate
3/25/2009	House	House Floor Amendment No. 1 Filed with Clerk by Rep. Michael J. Zalewski
3/25/2009	House	House Floor Amendment No. 1 Referred to Rules Committee
4/1/2009	House	House Floor Amendment No. 1 Recommends Be Adopted Rules Committee; 005-000-000
4/1/2009	House	Second Reading - Short Debate
4/1/2009	House	House Floor Amendment No. 1 Adopted by Voice Vote
4/1/2009	House	Placed on Calendar Order of 3rd Reading - Short Debate
4/3/2009	House	Rule 19(a) / Re-referred to Rules Committee
1/11/2011	House	Session Sine Die

	Adds reference to:
	815 ILCS 705/21	from Ch. 121 1/2, par. 1721