reglab/statecodes huggingface dataset:
2023 Maryland Statutes › Business Regulation › Title 13 - Trading Stamp Companies › Section 13-108 - End or Suspension of Redemption of Trading Stamps

At least 90 days before a trading stamp company ends or suspends the redemption of trading stamps in the State, the trading stamp company shall:
(1)    notify the Secretary of State in writing of its intention to end or suspend the redemption of trading stamps; and
(2)    mail a copy of the notice to each retailer in the State that, within the previous 12 months, issued trading stamps that the trading stamp company is bound to redeem.
2023 Maryland Statutes › Business Regulation › Title 14 - Business Opportunities, Franchises, and Multilevel Distribution Companies › Subtitle 1 - Business Opportunities › Section 14-101 - Definitions

(a)    In this subtitle the following words have the meanings indicated.
(b)    “Business opportunity” means an arrangement between a buyer and seller in which:
(1)    the seller or a person recommended or referred by the seller provides to the buyer products, equipment, supplies, or services that enable the buyer to start a business;
(2)    the buyer is required to pay the seller or a person recommended or referred by the seller $300 or more during the period beginning any time before commencing operations and ending 6 months after commencing operations of the business; and
(3)    the seller represents, directly or indirectly, orally or in writing, that:
(i)    the seller or a person recommended or referred by the seller will help the buyer in finding locations for the use or operation of vending machines, racks, display cases, or other similar devices on premises that are not owned or leased by the buyer or seller;
(ii)    the seller or a person recommended or referred by the seller will help the buyer in finding outlets or accounts for the buyer’s products or services;
(iii)    the seller or a person specified by the seller will buy products made, produced, fabricated, grown, bred, or modified by the buyer;
(iv)    the seller guarantees that the buyer will receive from the business income an amount that exceeds the price paid to the seller;
(v)    if the buyer is not satisfied with the business, the seller will refund all or part of the price paid to the seller, or repurchase any of the products, equipment, or supplies provided by the seller or a person recommended or referred by the seller; or
(vi)    the seller will provide a marketing plan.
(c)    “Buyer” means a person who buys or leases products, equipment, supplies, or services in connection with a business opportunity.
(d)    “Commissioner” means the Securities Commissioner in the Office of the Attorney General.
(e)    “Marketing plan” means advice or training that a seller or a person recommended or referred by the seller provides to the buyer, relating to the sale of any products, equipment, supplies, or services, and the advice or training includes preparing or providing:
(1)    promotional literature, brochures, pamphlets, or advertising materials;
(2)    training regarding the promotion, operation, or management of the business opportunity; or
(3)    operational, managerial, or financial guidelines or assistance.
(f)    “Seller” means a person who sells or leases products, equipment, supplies, or services in connection with a business opportunity.
2023 Maryland Statutes › Business Regulation › Title 14 - Business Opportunities, Franchises, and Multilevel Distribution Companies › Subtitle 1 - Business Opportunities › Section 14-102 - Legislative Policy

The General Assembly finds that:
(1)    the sale of business opportunities is a field in which investment problems and deceptive practices are common; and
(2)    this subtitle is needed to regulate this field adequately and prevent these deceptive practices.
2023 Maryland Statutes › Business Regulation › Title 14 - Business Opportunities, Franchises, and Multilevel Distribution Companies › Subtitle 1 - Business Opportunities › Section 14-103 - Scope of Subtitle

(a)    This subtitle applies to an offer to sell or sale of a business opportunity if:
(1)    the offeree or buyer is a resident of the State;
(2)    the business opportunity will be or is operated in the State;
(3)    the offer to sell is made in the State; or
(4)    the offer to buy is accepted in the State.
(b)    (1)    For purposes of this section, an offer to sell is made in the State, whether or not either party is then present in the State, if the offer:
(i)    originates from the State; or
(ii)    is directed by the offeror to the State and is received at:
1.    the place to which it is directed; or
2.    a post office in the State.
(2)    For purposes of this section, an offer to sell is not made in the State only because the publisher circulates or there is circulated on the publisher’s behalf in the State:
(i)    a newspaper or other publication of general, regular, and paid circulation that:
1.    is not published in the State; or
2.    is published in the State but has had more than two-thirds of its circulation outside the State during the past 12 months; or
(ii)    a radio or television program that originates outside the State and is received in the State.
(3)    For purposes of this section, an offer to buy is accepted in the State if acceptance:
(i)    is communicated to the offeror in the State; and
(ii)    has not been communicated previously to the offeror, orally or in writing, outside the State.
(4)    For purposes of this section, acceptance is communicated to the offeror in the State, whether or not either party is then present in the State, if:
(i)    the offeree directs acceptance to the offeror in the State reasonably believing the offeror to be in the State; and
(ii)    the acceptance is received at:
1.    the place to which it is directed; or
2.    a post office in the State.
2023 Maryland Statutes › Business Regulation › Title 14 - Business Opportunities, Franchises, and Multilevel Distribution Companies › Subtitle 1 - Business Opportunities › Section 14-104 - Exclusions

(a)    This subtitle does not apply to:
(1)    a sale of an ongoing business if the owner of the business sells and intends to sell only that one business opportunity;
(2)    a not-for-profit sale, for less than $500, of sales demonstration equipment, materials, or samples;
(3)    an offer to sell or sale of a franchise registered or exempt from registration under Subtitle 2 of this title;
(4)    an offer to sell or sale of a business if the offer or sale is regulated under the Maryland Gasohol and Gasoline Products Marketing Act or the federal Petroleum Marketing Practices Act;
(5)    an offer to sell or sale of a business opportunity with a marketing plan made in conjunction with the licensing of a federally registered trademark or service mark, provided that the seller has a minimum net worth of $1,000,000 as determined on the basis of the seller’s most recent audited financial statement prepared within 13 months of the first offer that the seller makes in the State; or
(6)    any other sale or transaction if the Commissioner:
(i)    exempts the sale or transaction, by regulation or order, as not being within the purposes of this subtitle; and
(ii)    finds the registration of the sale or transaction to be unnecessary, inappropriate, not in the public interest, or not for the protection of investors.
(b)    Net worth may be determined on a consolidated basis if:
(1)    at least 80% of the seller is owned by one person; and
(2)    the person that owns at least 80% of the seller expressly guarantees the obligations of the seller with regard to the offer or sale of a business opportunity that the seller seeks to exclude under this paragraph.
2023 Maryland Statutes › Business Regulation › Title 14 - Business Opportunities, Franchises, and Multilevel Distribution Companies › Subtitle 1 - Business Opportunities › Section 14-107 - Publication of Information

The Commissioner may:
(1)    publish information about violations of this subtitle and of regulations adopted and orders passed under it;
(2)    report to the appropriate law enforcement officer information about violations of this subtitle; and
(3)    help, develop, and hold programs of public education and information about this subtitle.
2023 Maryland Statutes › Business Regulation › Title 14 - Business Opportunities, Franchises, and Multilevel Distribution Companies › Subtitle 1 - Business Opportunities › Section 14-109 - Hearings

(a)    The Commissioner may hold public hearings in connection with an investigation under this subtitle.
(b)    Unless otherwise provided in this subtitle or in regulations adopted under it, the Commissioner shall hold hearings authorized by this subtitle in accordance with Title 10 of the State Government Article.
2023 Maryland Statutes › Business Regulation › Title 14 - Business Opportunities, Franchises, and Multilevel Distribution Companies › Subtitle 1 - Business Opportunities › Section 14-110 - Civil Enforcement of Subtitle

(a)    (1)    Whenever the Commissioner determines that a person has engaged or is about to engage in an act or practice that constitutes a violation of this subtitle or a violation of a regulation adopted or order passed under this subtitle, the Commissioner may, without a prior hearing, pass a summary order directing the person to cease and desist from engaging in the activity that constitutes a violation.
(2)    The summary order shall provide:
(i)    notice of the opportunity for a hearing before the Commissioner to determine whether the cease and desist order should be vacated, modified, or entered as final; and
(ii)    notice that the Commissioner shall enter the order as final if the person subject to the cease and desist order fails to request a hearing within 15 days after the receipt of the cease and desist order.
(3)    Whenever the Commissioner determines after notice and a hearing that a person has engaged in any act or practice constituting a violation of this subtitle, the Commissioner may in the discretion of the Commissioner and in addition to taking any other action authorized under this subtitle:
(i)    pass a final cease and desist order against the person;
(ii)    bar the person from engaging in the offer and sale of business opportunities in the State; or
(iii)    take any combination of the actions specified in this section.
(b)    (1)    The person subject to the cease and desist order may waive the right to a hearing.
(2)    If a person subject to a cease and desist order waives the right to a hearing, the Commissioner is not required to hold a hearing to take any action under subsection (a)(3) of this section.
(c)    (1)    Whenever the Commissioner determines that any person has engaged in or is about to engage in an act or practice constituting a violation of this subtitle or a violation of a regulation or order under this subtitle, the Commissioner may sue in the circuit court to obtain one or more of the following remedies:
(i)    a temporary restraining order;
(ii)    a temporary or permanent injunction;
(iii)    a declaratory judgment;
(iv)    the appointment of a receiver or conservator for the defendant or the defendant’s assets;
(v)    a freeze of the defendant’s assets;
(vi)    a civil penalty up to a maximum amount of $5,000 for any single violation of this subtitle;
(vii)    restitution;
(viii)    rescission; or
(ix)    any other relief as the court finds just.
(2)    The Commissioner may not be required to post a bond in any action under this section.
2023 Maryland Statutes › Business Regulation › Title 14 - Business Opportunities, Franchises, and Multilevel Distribution Companies › Subtitle 1 - Business Opportunities › Section 14-111 - Miscellaneous Powers

In connection with a hearing, investigation, or other proceeding under this subtitle, the Commissioner may:
(1)    administer oaths;
(2)    receive evidence; and
(3)    issue subpoenas for the attendance of witnesses to testify or to produce evidence.
2023 Maryland Statutes › Business Regulation › Title 14 - Business Opportunities, Franchises, and Multilevel Distribution Companies › Subtitle 1 - Business Opportunities › Section 14-112 - Privilege Against Self-Incrimination

(a)    A person is not excused from attending, testifying, or producing evidence before the Commissioner, in a proceeding brought by the Commissioner, or in obedience to a subpoena of the Commissioner on the ground that the testimony or evidence may:
(1)    tend to incriminate the person; or
(2)    subject the person to a penalty or forfeiture.
(b)    (1)    If a person claims the privilege against self-incrimination as to a specific subject, and is then compelled to testify or produce evidence on that subject, the person may not be prosecuted or subjected to a penalty or forfeiture in connection with that subject.
(2)    A person who testifies is not exempt from prosecution and punishment for perjury or contempt committed while testifying.
2023 Maryland Statutes › Business Regulation › Title 14 - Business Opportunities, Franchises, and Multilevel Distribution Companies › Subtitle 1 - Business Opportunities › Section 14-115 - Bond or Trust Account

(a)    If a seller guarantees that a buyer will derive from a business opportunity income that will exceed the price paid for the business opportunity or represents that the seller will refund all or part of the price paid or repurchase the products, equipment, or supplies sold or leased by the seller if the buyer is not satisfied with the business opportunity, the seller shall:
(1)    get a surety bond in favor of the State from a surety company authorized to do business in the State; or
(2)    establish a trust account in favor of the State with an insured bank or savings institution in the State.
(b)    The amount of the bond or trust account shall be at least $50,000.
(c)    (1)    A person may bring an action against the bond or trust account to recover damages resulting from:
(i)    a violation of this subtitle; or
(ii)    the seller’s breach of the contract for the sale of a business opportunity.
(2)    The surety or trustee is liable only for actual damages up to the amount of the bond or trust account.
2023 Maryland Statutes › Business Regulation › Title 14 - Business Opportunities, Franchises, and Multilevel Distribution Companies › Subtitle 1 - Business Opportunities › Section 14-116 - Amendments to Documents

The seller shall:
(1)    file with the Commissioner an amendment to the documents previously submitted to the Commissioner whenever a material change in the required information occurs; and
(2)    pay a fee of $50 for filing the amendment.
2023 Maryland Statutes › Business Regulation › Title 14 - Business Opportunities, Franchises, and Multilevel Distribution Companies › Subtitle 1 - Business Opportunities › Section 14-117 - Renewal

(a)    Unless the registration of a business opportunity is renewed for a 1-year term as provided in this section, the registration expires on the first anniversary of its effective date.
(b)    Before the registration expires, the registrant periodically may renew it for an additional 1-year term, if the registrant:
(1)    files with the Commissioner:
(i)    a renewal application on the form that the Commissioner provides;
(ii)    a current disclosure document along with any other documents or information that the Commissioner may require by order or regulation; and
(iii)    proof that the seller has satisfied the bond and trust account requirements under § 14-115 of this subtitle; and
(2)    pays a renewal fee of $100.
(c)    The Commissioner shall renew the registration of a business opportunity if the registrant complies with the requirements of this section.
2023 Maryland Statutes › Business Regulation › Title 14 - Business Opportunities, Franchises, and Multilevel Distribution Companies › Subtitle 1 - Business Opportunities › Section 14-118 - Contracts for the Sale of Business Opportunities

(a)    Each contract for the sale of a business opportunity shall be in writing.
(b)    The contract shall include:
(1)    the terms and conditions of payment;
(2)    a full and detailed description of the acts or services that the seller agrees to perform for the buyer;
(3)    the address of the seller’s principal office;
(4)    the name and address of the seller’s resident agent; and
(5)    the approximate date that the seller will deliver to the buyer any products, equipment, or supplies.
(c)    When a buyer signs a contract for the sale of a business opportunity, the seller shall give the buyer a copy of the contract.
2023 Maryland Statutes › Business Regulation › Title 14 - Business Opportunities, Franchises, and Multilevel Distribution Companies › Subtitle 1 - Business Opportunities › Section 14-120 - Untrue Statements or Omissions of Material Facts

In connection with an offer to sell or sale of a business opportunity, a person may not make any untrue statement of a material fact or omit to state a material fact necessary in order to make the statement made, in light of the circumstances under which it is made, not misleading.
2023 Maryland Statutes › Business Regulation › Title 14 - Business Opportunities, Franchises, and Multilevel Distribution Companies › Subtitle 1 - Business Opportunities › Section 14-121 - Fraud or Deceit

In connection with an offer to sell or sale of a business opportunity, a person may not engage in any act, practice, or course of business or employ any device, scheme, or artifice to defraud that operates or would operate as a fraud or deceit on another person.
2023 Maryland Statutes › Business Regulation › Title 14 - Business Opportunities, Franchises, and Multilevel Distribution Companies › Subtitle 1 - Business Opportunities › Section 14-122 - Representations of Income or Earning Potential

In connection with an offer to sell or sale of a business opportunity, a person may not represent that the business opportunity provides income or earning potential of any kind unless:
(1)    the seller has documentation to substantiate the representation; and
(2)    the person discloses the documentation to the prospective buyer when the representation is made.
2023 Maryland Statutes › Business Regulation › Title 14 - Business Opportunities, Franchises, and Multilevel Distribution Companies › Subtitle 1 - Business Opportunities › Section 14-123 - Use of Commercial Symbol

In connection with an offer to sell or sale of a business opportunity, a person may not use the trademark, service mark, trade name, logotype, advertising, or other commercial symbol of a business unless:
(1)    the business controls the ownership interest in the seller;
(2)    the business accepts responsibility for each representation that the seller makes about the business opportunity; or
(3)    it is clear from the circumstances that the owner of the commercial symbol is not involved in the sale of the business opportunity.
2023 Maryland Statutes › Business Regulation › Title 14 - Business Opportunities, Franchises, and Multilevel Distribution Companies › Subtitle 1 - Business Opportunities › Section 14-124 - Reference to Compliance

In connection with an offer to sell or sale of a business opportunity, a person may not make or authorize making a reference to compliance with this subtitle in an advertisement or other contact with prospective buyers other than by use of the disclosure statement or other disclosure documents required by this subtitle.
2023 Maryland Statutes › Business Regulation › Title 14 - Business Opportunities, Franchises, and Multilevel Distribution Companies › Subtitle 1 - Business Opportunities › Section 14-125 - Failure to Deliver Products, Equipment, or Supplies

(a)    In connection with an offer to sell or sale of a business opportunity, a person may not fail to deliver products, equipment, or supplies necessary to begin substantial operation of the business within 45 days after the delivery date stated in the contract for the sale of the business opportunity.
(b)    This section does not apply if the Commissioner or a court in a civil proceeding finds that the failure is due to the conditions stated in § 2-615 of the Commercial Law Article.
2023 Maryland Statutes › Business Regulation › Title 14 - Business Opportunities, Franchises, and Multilevel Distribution Companies › Subtitle 1 - Business Opportunities › Section 14-126 - Remedies for Violation

(a)    (1)    If a seller violates a provision of §§ 14-120 through 14-125 of this subtitle, the buyer, within 1 year after the date of a contract for the sale of a business opportunity:
(i)    may void the contract; and
(ii)    is entitled to receive from the seller a refund of any money paid to the seller.
(2)    On receipt of the refund, the buyer shall make available to the seller any products, equipment, or supplies received from the seller at:
(i)    the buyer’s address; or
(ii)    the place where the products, equipment, or supplies were located when notice to void the contract was given.
(3)    However, the buyer may not be unjustly enriched by exercising a remedy under this subsection.
(b)    A buyer may sue for damages, including reasonable attorney’s fees, if the buyer is injured by:
(1)    a violation of this subtitle; or
(2)    the seller’s breach of a contract for the sale of a business opportunity.
(c)    On complaint that a seller has violated this subtitle, the circuit court may enjoin the seller from further violation.
(d)    The remedies in this section are in addition to any other remedy provided by law or in equity.
2023 Maryland Statutes › Business Regulation › Title 14 - Business Opportunities, Franchises, and Multilevel Distribution Companies › Subtitle 1 - Business Opportunities › Section 14-127 - False or Misleading Statement or Omission of Material Fact

(a)    A person who sells a business opportunity may not, in a disclosure statement or amendment to it, willfully make a false or misleading statement of a material fact or willfully omit to state a material fact required or necessary to make the statements in a disclosure statement not misleading.
(b)    A person who violates this section is guilty of a felony and, on conviction, is subject for each violation to a fine not exceeding $10,000 or imprisonment not exceeding 5 years or both.
2023 Maryland Statutes › Business Regulation › Title 14 - Business Opportunities, Franchises, and Multilevel Distribution Companies › Subtitle 1 - Business Opportunities › Section 14-128 - General Penalty

A person who violates this subtitle is guilty of a misdemeanor and, unless another criminal penalty is specifically provided elsewhere, on conviction, is subject to a fine not exceeding $1,000 or imprisonment not exceeding 1 year or both.
2023 Maryland Statutes › Business Regulation › Title 14 - Business Opportunities, Franchises, and Multilevel Distribution Companies › Subtitle 2 - Franchises › Section 14-202 - Legislative Policy

(a)    The General Assembly finds that:
(1)    the widespread sale of franchises has created many investment and business problems; and
(2)    franchisees have suffered substantial losses when the franchisor or its representative has not given complete information about:
(i)    the franchisor-franchisee relationship;
(ii)    the franchise agreement; and
(iii)    the business experience of the franchisor or its representative.
(b)    The intent of this subtitle is to:
(1)    give each prospective franchisee necessary information about any franchise offer;
(2)    prohibit the sale of franchises if the sale would lead to fraud or a likelihood that the franchisor’s representations would not be fulfilled; and
(3)    protect the franchisor-franchisee relationship.
2023 Maryland Statutes › Business Regulation › Title 14 - Business Opportunities, Franchises, and Multilevel Distribution Companies › Subtitle 2 - Franchises › Section 14-203 - Scope of Subtitle

(a)    This subtitle applies to an offer to sell or sale of a franchise if:
(1)    the franchisee must pay a franchise fee of more than $100; and
(2)    (i)    the offeree or franchisee is a resident of the State;
(ii)    the franchised business will be or is operated in the State;
(iii)    the offer to sell is made in the State; or
(iv)    the offer to buy is accepted in the State.
(b)    (1)    For purposes of this section, an offer to sell is made in the State if the offer:
(i)    originates from the State; or
(ii)    is directed by the offeror to the State and is received at the place to which it is directed.
(2)    For purposes of this section, an offer to sell is not made in the State only because the franchisor circulates or there is circulated on the franchisor’s behalf in the State an advertisement in:
(i)    a newspaper or other publication of general, regular, and paid circulation that has had two-thirds of its circulation outside the State during the past 12 months; or
(ii)    a radio or television broadcast that originates outside the State and is received in the State.
(3)    For purposes of this section, an offer to buy is accepted in the State when acceptance is communicated to the offeror in the State.
(4)    For purposes of this section, acceptance is communicated to the offeror in the State when:
(i)    the offeree directs acceptance to the offeror in the State reasonably believing the offeror to be in the State; and
(ii)    the acceptance is received at the place to which it is directed.
(c)    This subtitle does not apply to the renewal or extension of an existing franchise if there is no interruption in the operation of the franchised business.
2023 Maryland Statutes › Business Regulation › Title 14 - Business Opportunities, Franchises, and Multilevel Distribution Companies › Subtitle 2 - Franchises › Section 14-208 - Investigations

The Commissioner may:
(1)    investigate in or outside the State to:
(i)    determine if a person has violated this subtitle or a regulation adopted or order passed under it;
(ii)    adopt regulations or forms under this subtitle; or
(iii)    enforce this subtitle; and
(2)    require or allow a person to submit a written statement, under oath or otherwise as the Commissioner determines, about the matter being investigated.
2023 Maryland Statutes › Business Regulation › Title 14 - Business Opportunities, Franchises, and Multilevel Distribution Companies › Subtitle 2 - Franchises › Section 14-209 - Interpretive Opinions

(a)    On request, the Commissioner may issue an interpretive opinion.
(b)    (1)    A request for an interpretive opinion shall be in writing.
(2)    The requester shall pay a fee of $100.
2023 Maryland Statutes › Business Regulation › Title 14 - Business Opportunities, Franchises, and Multilevel Distribution Companies › Subtitle 2 - Franchises › Section 14-210 - Civil Enforcement of Subtitle

(a)    (1)    Whenever the Commissioner finds that a person has violated or is about to violate this subtitle or a regulation adopted or order passed under it, the Commissioner may order the person to cease and desist from the further offer to sell or sale of the franchise until the offer or sale complies with this subtitle.
(2)    After passage of a cease and desist order, the alleged violator may submit to the Commissioner a written request for a hearing.
(3)    The hearing shall begin:
(i)    within 15 business days after the Commissioner receives the request for a hearing; or
(ii)    at a later date, with the consent of the alleged violator.
(4)    Unless there is a timely hearing, the cease and desist order is rescinded.
(b)    (1)    Whenever the Commissioner finds that a person has violated or is about to violate this subtitle or a regulation adopted or order passed under it, the Commissioner may sue in the circuit court to enjoin the violation or enforce this subtitle or the regulation or order.
(2)    The court shall:
(i)    determine if a violation of this subtitle has been or is about to be committed; and
(ii)    if so, pass any order the court considers necessary to prevent the violation or remove the effects of the violation and prevent it from continuing or being renewed in the future.
(3)    The court may exercise all equitable powers necessary for this purpose, including:
(i)    injunction;
(ii)    revocation, forfeiture, or suspension of the charter authority or privileges of a business organization operating under the laws of the State;
(iii)    dissolution of a corporation or association organized under the laws of the State;
(iv)    suspension or termination of the right of a corporation or association organized under the laws of another state or country to do business in the State;
(v)    restitution;
(vi)    restraining order;
(vii)    award of damages to be paid by a franchisor or subfranchisor to a person injured by a violation of this subtitle; and
(viii)    appointment of a receiver or conservator.
(4)    The court may not require the Commissioner to post bond.
(c)    The Commissioner may not exercise a power under this section more than 3 years after the violation occurs.
2023 Maryland Statutes › Business Regulation › Title 14 - Business Opportunities, Franchises, and Multilevel Distribution Companies › Subtitle 2 - Franchises › Section 14-211 - Criminal Proceedings Authorized

(a)    (1)    The Commissioner may refer to the State’s Attorney evidence of a criminal violation of this subtitle.
(2)    With or without the referral of evidence, a State’s Attorney may bring appropriate criminal proceedings under this subtitle.
(b)    A criminal proceeding may not be brought more than 3 years after the alleged violation.
2023 Maryland Statutes › Business Regulation › Title 14 - Business Opportunities, Franchises, and Multilevel Distribution Companies › Subtitle 2 - Franchises › Section 14-212 - Miscellaneous Powers

In connection with an investigation or proceeding under this subtitle, the Commissioner may:
(1)    administer oaths;
(2)    receive evidence; and
(3)    issue subpoenas for the attendance of witnesses to:
(i)    testify; or
(ii)    produce evidence.
2023 Maryland Statutes › Business Regulation › Title 14 - Business Opportunities, Franchises, and Multilevel Distribution Companies › Subtitle 2 - Franchises › Section 14-213 - Privilege Against Self-Incrimination

(a)    A person is not excused from attending, testifying, or producing evidence before the Commissioner, in a proceeding brought by the Commissioner, or in obedience to a subpoena of the Commissioner on the ground that the testimony or evidence may:
(1)    tend to incriminate the person; or
(2)    subject the person to a penalty or forfeiture.
(b)    (1)    If a person claims the privilege against self-incrimination as to a specific subject, and is then compelled to testify or produce evidence on that subject, the person may not be prosecuted or subjected to a penalty or forfeiture in connection with that subject.
(2)    A person who testifies is not exempt from prosecution and punishment for perjury or contempt committed while testifying.
2023 Maryland Statutes › Business Regulation › Title 14 - Business Opportunities, Franchises, and Multilevel Distribution Companies › Subtitle 2 - Franchises › Section 14-214 - Registration Required; Exemptions

(a)    Except as otherwise provided in this subtitle, a person must register the offer of a franchise with the Commissioner before the person offers to sell, through advertisement or otherwise, or sells the franchise in the State.
(b)    The registration requirement of this section does not apply to:
(1)    a transaction by an executor, administrator, sheriff, receiver, trustee in bankruptcy, guardian, or conservator;
(2)    an offer to sell or sale of a franchise that is substantially similar to a franchise already owned by the offeree or buyer; and
(3)    any other transaction that the Commissioner exempts by regulation because:
(i)    the transaction is not within the purpose of this subtitle; and
(ii)    the registration of the transaction is not necessary or appropriate in the public interest or for the protection of investors.
(c)    (1)    The registration requirement of this section does not apply to the offer to sell or sale of a franchise by a franchisee for the franchisee’s own account, or the offer to sell or sale of the entire area franchise owned by a subfranchisor for the subfranchisor’s own account.
(2)    A sale is not effected by or through a franchisor merely because a franchisor has a right to approve or disapprove a different franchisee.
(d)    (1)    The Commissioner may require by regulation that a franchisor or subfranchisor who claims under subsection (b)(3) of this section to be exempt from the registration requirements of this section:
(i)    file with the Commissioner a notice of claim of exemption in the form that the Commissioner requires; and
(ii)    pay a fee of $250.
(2)    The franchisor or subfranchisor shall sign and verify the notice of claim of exemption.
2023 Maryland Statutes › Business Regulation › Title 14 - Business Opportunities, Franchises, and Multilevel Distribution Companies › Subtitle 2 - Franchises › Section 14-215 - Applications for Registration

(a)    Except as otherwise provided in this section, an applicant for registration shall:
(1)    file with the Commissioner:
(i)    an application in the form that the Commissioner requires; and
(ii)    a prospectus for the franchise; and
(2)    pay an application fee of $500.
(b)    Instead of the application for registration and prospectus described in subsection (a) of this section, the Commissioner may accept an application for registration and prospectus that:
(1)    are found by the Commissioner to include disclosure requirements similar to those of this subtitle; and
(2)    are:
(i)    required by a unit of the federal government or another state government; or
(ii)    approved by an association of administrators of state franchise laws.
(c)    The applicant shall sign and verify the application for registration.
2023 Maryland Statutes › Business Regulation › Title 14 - Business Opportunities, Franchises, and Multilevel Distribution Companies › Subtitle 2 - Franchises › Section 14-217 - Escrow Requirements

(a)    If the Commissioner finds that it is necessary and appropriate for the protection of prospective franchisees or subfranchisors because a franchisor has not made adequate financial arrangements to fulfill the franchisor’s obligations under an offering, the Commissioner may require the franchisor to escrow franchise fees or other money paid by a franchisee or subfranchisor until the obligations have been satisfied.
(b)    (1)    At the option of the franchisor, the franchisor may post an adequate surety bond as provided by regulations of the Commissioner.
(2)    The total liability of the surety under the bond may not exceed the penal sum of the bond.
2023 Maryland Statutes › Business Regulation › Title 14 - Business Opportunities, Franchises, and Multilevel Distribution Companies › Subtitle 2 - Franchises › Section 14-218 - Issuance and Effective Date of Registration

(a)    The Commissioner shall register an offer of a franchise if it meets the requirements of this subtitle.
(b)    Unless a stop order is in effect, registration of the offer of a franchise automatically takes effect at:
(1)    noon on the 30th business day after an application for registration or the last amendment to it is filed; or
(2)    an earlier time that the Commissioner sets.
2023 Maryland Statutes › Business Regulation › Title 14 - Business Opportunities, Franchises, and Multilevel Distribution Companies › Subtitle 2 - Franchises › Section 14-219 - Term and Renewal of Registration

(a)    (1)    Unless registration of an offer of a franchise is renewed for a 1-year term as provided in this section, the registration expires on the first anniversary of its effective date.
(2)    However, the Commissioner by regulation or order may set a different term of registration.
(b)    (1)    Before registration expires, the registrant periodically may renew it for an additional 1-year term, if the registrant:
(i)    at least 15 business days before the expiration of registration files with the Commissioner:
1.    a renewal application on the form that the Commissioner provides; and
2.    a prospectus;
(ii)    otherwise is entitled to be registered; and
(iii)    pays a renewal fee of $250.
(2)    The registrant shall sign and verify the renewal application.
(3)    The Commissioner by order may allow a registrant to submit a renewal application after the 15th business day before expiration of the registration.
(c)    The Commissioner shall renew the registration of an offer of a franchise if it meets the requirements of this section.
(d)    Unless a stop order or other order is in effect under this subtitle, renewal of the registration of the offer of a franchise automatically takes effect at:
(1)    noon on the day when the previous registration is due to expire; or
(2)    an earlier time that the Commissioner sets.
2023 Maryland Statutes › Business Regulation › Title 14 - Business Opportunities, Franchises, and Multilevel Distribution Companies › Subtitle 2 - Franchises › Section 14-220 - Amendments to Registration

(a)    If there is a material change in the information that a registrant previously filed with the Commissioner, the franchisor shall:
(1)    file promptly with the Commissioner an application to amend the registration; and
(2)    pay a fee of $100.
(b)    The registrant shall sign and verify the application to amend the registration.
(c)    The Commissioner by regulation may state:
(1)    what constitutes a material change; and
(2)    the circumstances under which a revised prospectus shall accompany an application to amend the registration.
(d)    If the Commissioner approves the amendment to the registration, the amendment takes effect on the date the Commissioner sets after considering the public interest and the protection of franchisees.
2023 Maryland Statutes › Business Regulation › Title 14 - Business Opportunities, Franchises, and Multilevel Distribution Companies › Subtitle 2 - Franchises › Section 14-221 - Grounds for Issuing Stop Order

The Commissioner summarily may pass a stop order to deny, suspend, or revoke a registration if the Commissioner finds that:
(1)    there has been a violation of this subtitle or a regulation adopted under it;
(2)    the offer to sell or sale of the franchise would constitute misrepresentation to, deceit of, or fraud on the buyer;
(3)    a person identified in an application has been convicted of an offense or has had a civil judgment entered against the person as described in § 14-216(c)(8) of this subtitle or is subject to an order described in § 14-216(c)(9) of this subtitle, and the involvement of the person in the sale or management of the franchise creates an unreasonable risk to prospective franchisees;
(4)    the prospectus or amendment to it is incomplete or inaccurate in any material respect;
(5)    the prospectus or amendment to it includes a false or misleading statement of a material fact or omits to state a material fact required to be stated in the prospectus or amendment or necessary to make the statements in the prospectus or amendment not misleading;
(6)    in connection with an offer to sell or sale of a franchise, a person in the State is engaging or is about to engage in a false, fraudulent, or deceptive practice or in a device, scheme, or artifice to defraud; or
(7)    the financial condition of the franchisor affects or will affect the ability of the franchisor to meet an obligation under the franchise or other agreement and the franchisor is not able or willing to comply or has failed to comply with a regulation, order, or administrative determination of the Commissioner under § 14-217 of this subtitle.
2023 Maryland Statutes › Business Regulation › Title 14 - Business Opportunities, Franchises, and Multilevel Distribution Companies › Subtitle 2 - Franchises › Section 14-222 - Notice; Hearing; Vacating or Modifying Stop Order

(a)    After passing a stop order, the Commissioner promptly shall send to the applicant or registrant a notice that:
(1)    states that the stop order has been passed;
(2)    states the reasons for the stop order; and
(3)    informs the applicant or registrant of the right to a hearing under this section.
(b)    (1)    The applicant or registrant may submit to the Commissioner a written request for a hearing on the stop order.
(2)    The Commissioner shall schedule a hearing within 15 business days after the Commissioner receives the request unless the applicant or registrant consents to a later date.
(3)    The Commissioner may schedule a hearing even if the applicant or registrant does not request a hearing.
(c)    (1)    If a hearing is not requested and is not scheduled by the Commissioner and therefore is not held, the stop order remains in effect until the Commissioner modifies or vacates it.
(2)    If a hearing is held, after the hearing, the Commissioner may modify or vacate the stop order or extend it until the Commissioner makes a final determination.
(3)    The Commissioner may modify or vacate a stop order if the Commissioner finds that:
(i)    conditions have changed; or
(ii)    it is otherwise in the public interest to vacate or modify the stop order.
2023 Maryland Statutes › Business Regulation › Title 14 - Business Opportunities, Franchises, and Multilevel Distribution Companies › Subtitle 2 - Franchises › Section 14-223 - Copies of Documents to Franchisees

A franchisor may not sell a franchise in the State without first giving a prospective franchisee a copy of the offering prospectus and a copy of each proposed agreement that relates to the sale of the franchise at the earlier of:
(1)    14 calendar days before the execution by the prospective franchisee of any binding agreement with the franchisor;
(2)    14 calendar days before payment of any consideration that relates to the franchise relationship; or
(3)    a reasonable request by a prospective franchisee to receive a copy of the offering prospectus.
2023 Maryland Statutes › Business Regulation › Title 14 - Business Opportunities, Franchises, and Multilevel Distribution Companies › Subtitle 2 - Franchises › Section 14-225 - Advertisements Offering Franchises

A person may not publish an advertisement offering to sell a franchise subject to registration under this subtitle unless:
(1)    the person submits a copy of the advertisement to the Commissioner for review at least 7 business days before the first publication of the advertisement unless the Commissioner by regulation or order allows a later submission; or
(2)    the advertisement is exempted from review by regulation of the Commissioner.
2023 Maryland Statutes › Business Regulation › Title 14 - Business Opportunities, Franchises, and Multilevel Distribution Companies › Subtitle 2 - Franchises › Section 14-226 - Release From Liability as Condition of Sale

As a condition of the sale of a franchise, a franchisor may not require a prospective franchisee to agree to a release, assignment, novation, waiver, or estoppel that would relieve a person from liability under this subtitle.
2023 Maryland Statutes › Business Regulation › Title 14 - Business Opportunities, Franchises, and Multilevel Distribution Companies › Subtitle 2 - Franchises › Section 14-227 - Civil Liability

(a)    (1)    A person who sells or grants a franchise is civilly liable to the person who buys or is granted a franchise if the person who sells or grants a franchise offers to sell or sells a franchise:
(i)    without the offer of the franchise being registered under this subtitle; or
(ii)    by means of an untrue statement of a material fact or any omission to state a material fact necessary in order to make the statements made, in light of the circumstances under which they are made, not misleading, if the person who buys or is granted a franchise does not know of the untruth or omission.
(2)    In determining liability under this subsection, the person who sells or grants a franchise has the burden of proving that the person who sells or grants a franchise did not know and, in the exercise of reasonable care, could not have known of the untruth or omission.
(b)    The person who buys or is granted a franchise may sue under this section to recover damages sustained by the grant of the franchise.
(c)    A court may order the person who sells or grants a franchise to:
(1)    rescind the franchise; and
(2)    make restitution to the person who buys or is granted a franchise.
(d)    (1)    Joint and several liability under this section extends to:
(i)    each person who directly or indirectly controls a person liable under this section;
(ii)    each partner in a partnership liable under this section;
(iii)    each principal officer or director of a corporation liable under this section;
(iv)    each other person that has a similar status or performs similar functions as a person liable under this section; and
(v)    each employee of a person liable under this section, if the employee materially aids in the act or transaction that is a violation under this subtitle.
(2)    However, liability under this subsection does not extend to a person who did not have knowledge of or reasonable grounds to believe in the existence of the facts by which the liability is alleged to exist.
(e)    An action under this section must be brought within 3 years after the grant of the franchise.
2023 Maryland Statutes › Business Regulation › Title 14 - Business Opportunities, Franchises, and Multilevel Distribution Companies › Subtitle 2 - Franchises › Section 14-228 - Offer or Sale of Franchise Without Registration

(a)    Except as otherwise provided in this subtitle, a person may not offer to sell, through advertisement or otherwise, or sell a franchise in the State unless the offer of the franchise has been registered under this subtitle.
(b)    A person who willfully sells a franchise knowingly violating this section is guilty of a felony and, on conviction, is subject for each violation to a fine not exceeding $10,000 or imprisonment not exceeding 5 years or both.
2023 Maryland Statutes › Business Regulation › Title 14 - Business Opportunities, Franchises, and Multilevel Distribution Companies › Subtitle 2 - Franchises › Section 14-229 - Fraud or Deceit; Untrue Statements or Omissions of Material Fact

(a)    In connection with an offer to sell or sale of a franchise, a person, directly or indirectly, may not:
(1)    employ a device, scheme, or artifice to defraud;
(2)    make an untrue statement of a material fact or omit to state a material fact necessary in order to make the statement made, in light of the circumstances under which it is made, not misleading; or
(3)    engage in an act, practice, or course of business that operates or would operate as a fraud or deceit on another person.
(b)    A person who willfully sells a franchise knowingly violating this section is guilty of a felony and, on conviction, is subject for each violation to a fine not exceeding $10,000 or imprisonment not exceeding 5 years or both.
2023 Maryland Statutes › Business Regulation › Title 14 - Business Opportunities, Franchises, and Multilevel Distribution Companies › Subtitle 2 - Franchises › Section 14-230 - False or Misleading Statement or Omission in Prospectus or Amendment

(a)    In a prospectus or amendment to it, a person may not willfully make a false or misleading statement of a material fact or willfully omit to state a material fact required to be stated in the prospectus or amendment or necessary to make the statements in the prospectus or amendment not misleading.
(b)    A person who violates this section is guilty of a felony and, on conviction, is subject for each violation to a fine not exceeding $10,000 or imprisonment not exceeding 5 years or both.
2023 Maryland Statutes › Business Regulation › Title 14 - Business Opportunities, Franchises, and Multilevel Distribution Companies › Subtitle 2 - Franchises › Section 14-231 - Untrue Statements or Omissions of Material Fact in Applications, Notices, or Reports

(a)    A person may not make or cause to be made an untrue statement of a material fact or omit to state a material fact in an application for registration, to amend registration, or for renewal or in a notice or report filed with the Commissioner under this subtitle.
(b)    A person who willfully sells a franchise knowingly violating this section is guilty of a felony and, on conviction, is subject for each violation to a fine not exceeding $10,000 or imprisonment not exceeding 5 years or both.