You may not understand how much information you actually have to provide in your disclosure document. Many businesses will err on the side of less disclosure. This could be extremely dangerous. The Act states that a failure to disclose a material fact, or a failure to disclose a required piece of information could lead to rescission of the franchise agreement. Furthermore, the Act states that a failure to disclose a material fact, or the disclosure of inaccurate information constitutes misrepresentation, and the franchisee is deemed to have relied on that misrepresentation.
Significant liability flows from a reliance on a misrepresentation.
For instance, a franchisee that relied on a misrepresentation can sue the franchisor to recoup any costs associated with purchasing that franchise. This includes not only the franchise fees and royalty payments, but fees paid to lawyers, accountants, consultants, or other costs associated with starting a business. Needless to say, the scope and monetary amount of these actions could be quite extreme. A franchisor does not want to find their business in the situation of not having provided enough, or the proper information on a disclosure document. This failure could lead the business to extremely expensive and time-consuming litigation.