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Earnings claims
The Amended FTC Franchise Rule
... Further, the franchisor must provide an estimated initial investment for a franchisee to enter into the franchise and it may, at its option, provide a financial performance representation (formerly referred to as an “earnings claim”). Under the Amended Rule, “earnings claims” have become “financial performance representations.” Noting that Item 19 is one of the most important sections of the Amended Rule, particularly as it relates to anti-fraud disclosures, the FTC took several steps to allow franchisors to share material and reasonable financial performance representations with prospective franchisees. ...
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