Cal. CORP § 31011
This is the official text of Cal. CORP § 31011, part of California’s Corporations Code — governs the formation and operation of corporations, LLCs, and partnerships, and regulates securities.
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Official statutory text
“Franchise fee” means any fee or charge that a franchisee or subfranchisor is required to pay or agrees to pay for the right to enter into a business under a franchise agreement, including, but not limited to, any payment for goods and services.
However, the following shall not be considered the payment of a franchise fee:
(a) The purchase or agreement to purchase goods at a bona fide wholesale price if no obligation is imposed upon the purchaser to purchase or pay for a quantity of the goods in excess of that which a reasonable businessperson normally would purchase by way of a starting inventory or supply or to maintain a going inventory or supply.
(b) The payment of a reasonable service charge to the issuer of a credit card by an establishment accepting or honoring that credit card.
(c) Amounts paid to a trading stamp company under Chapter 3 (commencing with Section 17750) of Part 3 of Division 7 of the Business and Professions Code by a person issuing trading stamps in connection with the retail sale of merchandise or service.
However, the following shall not be considered the payment of a franchise fee:
(a) The purchase or agreement to purchase goods at a bona fide wholesale price if no obligation is imposed upon the purchaser to purchase or pay for a quantity of the goods in excess of that which a reasonable businessperson normally would purchase by way of a starting inventory or supply or to maintain a going inventory or supply.
(b) The payment of a reasonable service charge to the issuer of a credit card by an establishment accepting or honoring that credit card.
(c) Amounts paid to a trading stamp company under Chapter 3 (commencing with Section 17750) of Part 3 of Division 7 of the Business and Professions Code by a person issuing trading stamps in connection with the retail sale of merchandise or service.
Status: in_force · Read it on the official government site
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