California Franchise Relations Act.

The California Franchise Relations Act sets forth certain requirements related to the termination, nonrenewal, and transfer of franchises between a franchisor, subfranchisor, and franchisee, as those terms are defined. The act authorizes a franchisor, upon the termination or nonrenewal of a franchise, to offset any amounts owed to the franchisee against any amounts owed by the franchisee to the franchisor. This bill would authorize that offset provided the franchisee agrees to the amount owed or the franchisor has received a final adjudication of any amounts owed. Existing law requires a franchisee, before the sale, assignment, or transfer of a franchise, as specified, to another person, to notify, in writing, the franchisor of the franchisee's intent to sell, transfer, or assign the franchise. Existing law requires this notice of transfer to include specified information and meet certain criteria. This bill would specify that these provisions apply to any transfer if a new franchise agreement is required to be signed as a result of the transfer. The bill would limit its application to a franchise agreement entered into, amended, or renewed on or after January 1, 2021, or to franchises of an indefinite duration that may be terminated without cause.