AB 1228 would establish joint liability for quick-service restaurants, eliminating independent business ownership of impacted restaurants

WASHINGTON, May 31, 2023 – The International Franchise Association (IFA) today released the following statement after the California Assembly passed AB 1228, the Fast-Food Franchisor Responsibility Act, legislation that would establish joint liability between California quick-service franchise brands and their independent franchisees with 100 or more locations nationwide.

“California voters have made it clear they do not want a government takeover of their local restaurants, yet Assemblymembers today voted in favor of special interests against the will of their constituents,” said Jeff Hanscom, IFA vice president of state and local government relations. “AB 1228 has the potential to destroy tens of thousands of local franchised restaurants by taking away their independence in favor of corporate control and more government intervention. This will eliminate the equity local restaurant owners have built over decades and take away any future opportunities for franchise business ownership, especially people of color, women, immigrants and other underrepresented communities. The California Senate should reject this misguided bill before it will force restaurant closures, crush jobs, and raise prices on hardworking Californians.”

New polling released this week from Oxford Economics shows that California franchised restaurant owners overwhelmingly oppose AB 1228 with 92 percent saying they are “strongly” opposed while 98 percent believe the law would interfere with their freedom to run their businesses independently.

Earlier this month, over 100 California franchise owners from 21 brands traveled to Sacramento to urge their legislators to reject AB 1228, highlighting their concerns that the legislation will take away their independence as business owners, force corporate control on their restaurants, hurt jobs, and raise prices.

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About the International Franchise Association:

Celebrating over 60 years of excellence, education, and advocacy, the International Franchise Association (IFA) is the world’s oldest and largest organization representing franchising worldwide. IFA works through its government relations and public policy, media relations, and educational programs to protect, enhance and promote franchising and the approximately 790,492 franchise establishments that support nearly 8.4 million direct jobs, $825.4 billion of economic output for the U.S. economy, and almost 3 percent of the Gross Domestic Product (GDP). IFA members include franchise companies in over 300 different business format categories, individual franchisees, and companies that support the industry in marketing, law, technology, and business development.

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