SB 376: "Georgia Restaurant Franchise Relations Act"; enact

Currently Georgia law does not have specific protections for restaurant franchise owners in their dealings with the companies that license them to use a brand (franchisors). This bill would add a new set of rules to Georgia's trade practices law (O.C.G.A. Title 10, Chapter 1) covering food and food service franchises. The bill would require franchisors to have good cause before ending a franchise early, give franchise owners a chance to fix problems, and treat automatic renewal as happening if a franchisor lets someone keep operating for 30 days past the contract's end. It would also stop franchisors from treating their own company-owned locations better than franchise locations, void contract clauses that force disputes into another state's courts or laws, and let a franchisee's surviving spouse, heirs, or estate keep running the business for at least six months after the owner's death. Violations would count as unfair trade practices under Georgia's Fair Business Practices Act. The law would take effect July 1, 2025, applying to franchises entered into or renewed on or after that date.

• Bars a franchisor from ending a restaurant franchise early unless there is "good cause," generally requiring 90 days' notice and a chance to fix the problem.
• Lists specific situations, like bankruptcy, felony conviction, or material misrepresentation, where a franchisor can terminate immediately without letting the franchisee fix things first.
• Treats a franchise as automatically renewed on the same terms if the franchisor allows the franchisee to keep operating 30 or more days after the agreement expires.
• Prohibits a franchisor from imposing stricter standards or pricing on franchise locations than on its own company-owned locations in Georgia.
• Voids contract clauses that require disputes to be decided under another state's law or in a court outside the franchisee's choice.
• Requires franchisors to let a deceased franchisee's spouse, heirs, or estate keep running the franchise, without new training requirements, for at least six months.

Restaurant franchise owners (franchisees) and the companies that license restaurant brands to them (franchisors) operating in Georgia, along with the surviving spouses, heirs, or estates of franchise owners who die while operating a franchise.

Franchise owners would gain stronger legal protection against sudden contract termination, unequal treatment compared to corporate-owned locations, and out-of-state legal fights, while families of deceased owners would get guaranteed time to keep the business running before facing new requirements from the franchisor.

• New Code Section 10-1-961 defines key terms, including 'franchise,' 'franchise fee,' and exceptions for small fees under $100 annually or certain retail concession arrangements.
• Code Section 10-1-965 requires 'good cause' and generally 90 days' notice to cure before a franchisor can terminate a franchise early.
• Code Section 10-1-966 sets notice requirements: termination notices must be written, delivered by mail, email, or in person, and state the reasons and effective date.
• Code Section 10-1-967 lists events, such as bankruptcy, felony conviction, or business seizure, that allow immediate termination without a cure period.
• Code Section 10-1-969 deems a franchise automatically renewed if the franchisor lets the franchisee keep operating 30 or more days past the contract's expiration.
• Code Section 10-1-975 bars franchisors from imposing different standards or pricing on franchise locations versus their own company-owned locations.
• Code Section 10-1-976 voids contract clauses requiring another state's law or a chosen court outside Georgia for disputes.
• Code Section 10-1-977 requires franchisors to let a deceased franchisee's spouse, heirs, or estate operate the franchise for at least six months without new training requirements.

1. 2025-04-04Senate Read and Referred (Senado)
2. 2025-04-04Senate Hopper (Senado)

• Randy Robertson (R, SD-029)Patrocinador principal

• franchise law
• restaurant industry
• small business protections
• consumer and trade practices