523H.12 Independent sourcing.
128 words·~1 min read·
/ia/chapter-523h-franchises/523h-12·A research copy — for the controlling text, always check the official state or federal source. Not legal advice.
1. Except as provided in subsection 2, a franchisor shall allow a franchisee to obtain equipment, fixtures, supplies, and services used in the establishment and operation of the franchised business from sources of the franchisee’s choosing, provided that such goods and services meet standards as to their nature and quality promulgated by the franchisor.
2. Subsection 1 of this section does not apply to reasonable quantities of inventory goods or services, including display and sample items, that the franchisor requires the franchisee to obtain from the franchisor or its affiliate, but only if the goods or services are central to the franchised business and either are actually manufactured or produced by the franchisor or its affiliate, or incorporate a trade secret owned by the franchisor or its affiliate.