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Keeping The Peace

Franchise dispute? Try mediation, says New York.

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This story appears in the November 1999 issue of Entrepreneur. Subscribe »

The National Franchise Council (NFC) took one step forward inits quest to turn franchisors and franchisees away from litigationand toward mediation. This spring, state Attorney General EliotSpitzer made the first of 12 states with franchiseregulation to adopt the NFC's education process. Now theNFC's goal is to get the other states on board.

As it stands, if a franchisor commits a minor violation of theNew York Franchise Act (for example, not upholding the disclosurerequirement), the franchisor can go through NFC retraining infranchise sales practices rather than endure an enforcementproceeding and its consequences. "This shows franchisors arewilling to step up to the plate to solve problems and cooperatewith regulatory agencies, whether it's on a federal or statelevel," says NFC chair Morton Aronson.

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