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Maryland has amended its Maryland Franchise Registration and Disclosure Law. The changes are effective October 1, 2026. Franchisors registered in Maryland or otherwise offering franchises subject to Maryland law should take immediate steps to ensure compliance.
Key Provisions
Extended Enforcement Authority. The period during which the Maryland Securities Commissioner may bring enforcement actions for violations of the franchise law increases from three years to five years after the violation occurs.
Expanded Franchisee Claims Period. The statute of limitations for private civil actions by franchisees changes from three years after the grant of the franchise to the earlier of (i) four years after the franchise is granted or (ii) two years after the franchised business opens to the public.
Jurisdictional Clarification. The private civil action provisions now apply only to franchisees who are Maryland residents or whose franchised business operates, or will operate, in the state.
Franchisee Association Rights. Franchisees now have a statutory right to join and participate in trade associations composed of franchisees of the same brand for any lawful purpose. Franchisors may not restrict or inhibit this right, and franchisees have a private right of action for violations.
Fast-Track Renewal Program Codified. The FDD Renewal Fast-Track Review Pilot Program, introduced during the 2026 renewal cycle, is now formally established by statute.
Filing and Compliance
Registered franchisors are not required to file an amendment or cease offering franchises solely to reflect these changes. However, beginning October 1, 2026, franchisors must use FDDs and franchise agreements that have been updated to comply with the amendments when offering or selling franchises. The Securities Division will review compliance at the franchisor’s next amendment or renewal filing.
Franchisors must include the following disclosure verbatim in the FDD, Maryland addendum, or other appropriate documents: “Any claims arising under the Maryland Franchise Registration and Disclosure Law must be brought by the earlier of: (i) four (4) years after the franchise is granted; or (ii) two (2) years after the date the franchise opened to the public.”.
Action Items
Franchisors should review and update their FDDs, franchise agreements, and Maryland addenda now to ensure that all materials used on or after October 1, 2026 comply with the amended statute.
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