                                 CODE OF VIRGINIA

DEFINITIONS; APPLICABILITY OF CHAPTER (§ 13.1-559)

A. As used in this chapter, unless the context otherwise requires:
			&#8220;Commission&#8221; means the State Corporation
Commission.			&#8220;Controlling person&#8221; means a natural person who is an
officer, director, or partner, or who occupies a similar status or performs a
similar function, of a franchisor organized as a corporation, partnership, or
other entity, or any person who possesses, directly or indirectly, the power to
direct or cause the direction of the management and policies of a franchisor,
whether through the ownership of voting securities, by contract, or
otherwise.			&#8220;Franchise&#8221; means a written contract or agreement
between two or more persons, by which:

   1. A franchisee is granted the right to engage in the business of offering,
   selling or distributing goods or services at retail under a marketing plan or
   system prescribed in substantial part by a franchisor;

   2. The operation of the franchisee&#8217;s business pursuant to such plan or
   system is substantially associated with the franchisor&#8217;s trademark,
   service mark, trade name, logotype, advertising or other commercial symbol
   designating the franchisor or its affiliate; and

   3. The franchisee is required to pay, directly or indirectly, a franchise fee
   of $500 or more.
   				&#8220;Franchise fee&#8221; means a fee or charge for the right to enter
   into or maintain a business under a franchise, including a payment or deposit
   for goods, services, rights, or training, but not including: (i) the payment
   of a bona fide wholesale price for starting and continuing inventory of goods
   for resale or (ii) the payment at fair market value for the purchase or lease
   of real property, fixtures, equipment, or supplies necessary to enter into or
   maintain the business.				&#8220;Franchisee&#8221; means a person to whom a
   franchise is granted or sold.				&#8220;Franchisor&#8221; means a person,
   including a subfranchisor, who grants or sells, or offers to grant or sell, a
   franchise.				&#8220;Offer&#8221; or &#8220;offer to sell&#8221; includes
   every attempt to offer to dispose of or grant, and every solicitation of an
   offer to buy, a franchise or an interest in a franchise for
   value.				&#8220;Place of business&#8221; means a building or portion thereof
   from which the goods or services authorized by the franchise are sold or
   offered for sale in person by the franchisee or employees or agents of the
   franchisee, or a truck or van used in the sale of such goods which is of a
   type designated by the franchisor and is equipped and marked in conformance
   with requirements of the franchisor.				&#8220;Preopening obligations&#8221;
   means the franchisor&#8217;s obligations to provide to the franchisee, prior
   to the opening of the franchisee&#8217;s business, real estate, improvements,
   equipment, inventory, training, or other items to be included in the
   offering.				&#8220;Sale&#8221; or &#8220;sell&#8221; includes every contract
   or agreement of sale or grant of, contract to sell, or disposition of a
   franchise or interest in a franchise for value.				&#8220;Subfranchisor&#8221;
   means a person who is authorized by a franchisor to grant a franchise within a
   particular geographic region.

B. This chapter shall apply only to a franchise the performance of which
contemplates or requires the franchisee to establish or maintain a place of
business within the Commonwealth of Virginia.
			A franchise does not include a contract or agreement by which a retailer of
goods or services is granted the right either (i) to utilize a marketing plan or
system to promote the sale or distribution of goods or services which are
incidental and ancillary to the principal business of the retailer (sales under
such a plan or system accounting for less than 20 percent of the
retailer&#8217;s gross sales being deemed incidental and ancillary); or (ii) to
sell goods or services within, or appurtenant to, a retail business
establishment as a department or division thereof provided such retailer is not
required to purchase such goods or services from the operator of such
establishment.

HISTORY: 1972, c. 561; 1978, c. 670; 1990, c. 420; 1991, c. 475; 2007, c. 668;
2009, c. 148.