Franchise Acquisition Lawyer in Oregon

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Acquisition Stars advises buyers and sellers on franchise acquisition lawyer matters across Oregon.

Serving 1 market across Oregon.

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Franchise Acquisition Lawyer Practice in Oregon

Acquisition Stars advises buyers and sellers on franchise acquisition lawyer matters across Oregon. Alex Lubyansky leads every engagement, and has been M&A counsel since 2013 across transactions of varying complexity, from lower-middle-market deals to multi-party structures.

Oregon Transaction Considerations

  • Oregon has no sales tax, eliminating successor sales tax liability risks and simplifying asset purchase mechanics
  • Oregon's Corporate Activity Tax (CAT), enacted in 2019, is a gross receipts tax that applies in addition to the corporate excise tax, creating a dual tax burden that differs from most states
  • Oregon's strong environmental regulations (DEQ oversight) can create significant due diligence requirements for acquisitions involving manufacturing or natural resource businesses

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Franchise Acquisition Lawyer Service Areas in Oregon

Acquisition Stars represents clients in each of the following markets. Click any city to learn about franchise acquisition law services in that area.

Portland

Portland Franchise Acquisition Lawyer

Oregon Legal Framework for Franchise Acquisition Law

Non-Compete Agreements

The seller's covenant and the franchisor's in-term and post-term covenants must both fit what the state will enforce.

Restricted by role, income threshold, and 12-month maximum. Sale-of-business exception.

Restricted under ORS 653.295 (amended effective January 1, 2022). Non-competes are limited to employees who are engaged in administrative, executive, or professional roles and earn above the state median household income (approximately $76,000). The maximum duration is 12 months. Employers must inform employees of the non-compete terms at least two weeks before the start of employment or upon a bona fide advancement. Non-competes in connection with the sale of a business are exempt.

Tax Considerations

Sales tax on transferred equipment and inventory, plus successor liability, shape the resale price allocation.

Oregon imposes a corporate excise tax with a minimum tax based on Oregon sales (ranging from $150 to $100,000) plus a 6.6% rate on the first $1 million of taxable income and 7.6% above $1 million. Oregon has no sales tax, which eliminates successor sales tax liability in asset purchases. The Corporate Activity Tax (CAT) adds a 0.57% tax on gross receipts over $1 million.

Filing Requirements

Franchise registration and relationship laws add a franchisor consent step and disclosure timing to the standard entity filings.

Entity mergers and conversions must be filed with the Oregon Secretary of State. Annual reports are required. The absence of sales tax simplifies asset purchase filings. The Department of Revenue handles CAT registration and compliance.

Bulk Sales / Asset Purchases

If the transaction transfers assets, check whether creditor-notice or tax-clearance rules in the state affect the closing date.

Oregon has repealed UCC Article 6 (Bulk Sales). The Oregon Department of Revenue may impose successor liability on asset purchasers for the seller's unpaid taxes. Oregon Revised Statutes Section 305.620 provides for tax liens that follow assets.

The federal framework for a franchise resale

  • Buying an existing franchised location is not the same transaction as buying an independent business. The buyer is stepping into a relationship the franchisor controls, so the purchase depends on the franchisor's consent to the transfer, not only on agreement between the buyer and the seller. The franchise agreement, not the purchase agreement, usually sets the conditions the transfer has to satisfy.
  • Whether the buyer has a federal right to current disclosure depends on the franchisor's role and any exemption. Where the franchisor signs the incoming owner to its current agreement with significant involvement, the rule can reach the transaction; where the buyer only takes assignment and the franchisor merely consents, it may not. The remaining term, and whether renewal survives the transfer, changes what the buyer pays for.
  • Franchisors commonly charge a transfer fee and require a general release from the seller as conditions of consent, protecting the franchisor from claims tied to the outgoing owner's tenure. A buyer's counsel reviews the transfer conditions in the franchise agreement early, because a franchisor's refusal to consent, or a demand the seller cannot meet, can stall or kill a deal that both sides have already priced.

Advance disclosure depends on the deal shape

For a franchise sale that is not exempt, the FTC Franchise Rule requires furnishing the current disclosure document at least 14 calendar days before the franchisee signs a binding agreement with, or makes any payment to, the franchisor or an affiliate, under 16 CFR 436.2(a). A payment to the selling franchisee, or a signed purchase agreement with the seller, does not by itself start that period. Two definitions can exclude a resale: a transfer by an existing franchisee is not a sale where the franchisor had no significant involvement with the buyer, and approval or disapproval alone is not significant involvement, under 16 CFR 436.1(t); a franchisee selling only its own outlet is not a franchise seller, under 16 CFR 436.1(j). Exemptions in 16 CFR 436.8 can also apply. Confirm which path applies before assuming a federal 14-day review right.

Sources: 16 CFR 436.2(a), 16 CFR 436.1(t), 16 CFR 436.1(j), 16 CFR 436.5, 16 CFR 436.8

Diligence focus for a franchise resale

  • Remaining term on the franchise agreement and renewal eligibility
  • Franchisor's consent conditions and any transfer fee
  • Training requirements the incoming owner must complete before opening
  • Scope of the general release the franchisor is requiring
  • Whether the current form of agreement differs from the seller's

Other M&A and Securities Services in Oregon

Acquisition Stars handles M&A transactions for Oregon clients and works with securities counsel on securities matters. Alex Lubyansky leads every M&A engagement.

Due Diligence Attorney in Oregon

Ready to Discuss Your Oregon Deal?

Alex Lubyansky leads every franchise acquisition law engagement, with an associate supporting the work.

M&A counsel since 2013. Nationwide practice. LOI through closing.

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We review every transaction inquiry within one business day.

Your information is kept strictly confidential and will never be shared. Privacy Policy