Maryland Amends Franchise Law: Key Changes Take Effect October 1, 2026

On May 12, 2026, Maryland enacted significant amendments to the Maryland Franchise Registration and Disclosure Law. The amendments become effective on October 1, 2026, and affect both franchisors and franchisees operating in the state.

Key Changes

The amendments introduce several noteworthy changes, including:

Extended Enforcement Authority

The period during which the Maryland Securities Commissioner may pursue enforcement actions for violations of the statute is extended from three years to five years after the violation occurs.

Clarification of Jurisdictional Scope

The Maryland Franchise Law will apply only if:

• The franchisee is a Maryland resident
• The franchised business is, or will be, located in Maryland

Expanded Time for Franchisee Claims

The amendments extend the period for private actions under the statute. Franchisees may now bring claims until the earlier of:

• Four years after the franchise is granted; or
• Two years after the franchised business opens to the public.

This replaces the prior limitations period of three years from the date the franchise was granted.

Protection of Franchisee Association Rights

The amended law expressly protects a franchisee’s right to join and participate, for lawful purposes, in trade associations composed of franchisees of the same brand. Franchisees are also granted a private right of action for violations of these protections.

Fast-Track Renewal Review Program Made Permanent

Maryland has codified its Fast-Track Review Program for franchise renewal filings, which was initially introduced as a pilot program during the 2026 renewal cycle.

Compliance Expectations for Existing Registrants

On September 2, 2026, the Maryland Securities Commissioner issued guidance regarding compliance with the amendments.

The guidance confirms that franchisors currently registered in Maryland are not required to make a special filing solely because of the statutory changes. Instead, franchisors may incorporate the required revisions into their next filing that would otherwise be required, such as an annual renewal or amendment filing prompted by a material change.

However, the filing for accommodation does not postpone the law’s effective date. Beginning October 1, 2026, franchisors offering or selling franchises subject to Maryland law must use disclosure documents and franchise agreements that comply with the amended statute, regardless of whether those revisions have been filed with the state.

Required Disclosure

Beginning October 1, 2026, Maryland regulators expect franchisors to include the following disclosure in the FDD, Maryland addendum, or other appropriate disclosure document:

“Any claims arising under the Maryland Franchise Registration and Disclosure Law must be brought by the earlier of: (i) four (4) years after the franchise is granted; or (ii) two (2) years after the date the franchise opened to the public.”

Practical Takeaways for Franchisors

Franchisors registered in Maryland, or otherwise offering franchises subject to Maryland law, should take steps now to:

• Update Maryland addenda and FDD disclosures to reflect the revised limitations period.
• Review franchise agreement provisions addressing statutes of limitation and claims procedures for consistency with the amended law.
• Evaluate any provisions that could restrict franchisee participation in franchisee associations.
• Ensure that all disclosure and sales materials used on or after October 1, 2026, comply with the amended statute.

Although Maryland is allowing franchisors to defer filing revised documents until a regularly required filing is due, compliance with the substantive requirements of the amended law begins on October 1, 2026.

Why This Matters

The amendments increase regulatory risk by expanding both the Commissioner’s enforcement window and the period during which franchisees may bring claims. As a result, franchisors should view these changes not merely as disclosure updates, but as an opportunity to review existing agreements and compliance practices before the October 1 effective date.