1. Misleading filings. It is unlawful to make or cause to be made, in a document filed with the administrator or in a proceeding under this chapter, a statement which is, at the time and in the light of the circumstances under which it is made, false or misleading in a material respect or, in connection with such a statement, to omit to state a material fact necessary in order to make the statement made, in the light of the circumstances under which it is made, not misleading.
2. Unlawful representations. The fact that an application for registration has been filed or the fact that a business opportunity is effectively registered does not constitute a finding by the administrator that a document filed under this chapter is true, complete, and not misleading. The fact that an application for registration has been filed, that a business opportunity is effectively registered, or that an exemption or exception is available for a business opportunity does not mean that the administrator has passed in any way upon the merits or qualifications of, or recommended or given approval to, a person or business opportunity. It is unlawful to make, or cause to be made, to a purchaser, any representation inconsistent with this subsection.
3. Advertising. It is unlawful for a seller, in connection with the offer or sale of a business opportunity in this state, to publish, circulate, or use advertising which contains an untrue statement of a material fact or omits to state a material fact necessary in order to make the statements made, in the light of the circumstances under which they are made, not misleading.
4. Misrepresentations, omissions, and misleading conduct. It is unlawful for a business opportunity seller to do any of the following:
a. Misrepresent, by failure to disclose or otherwise, the known required total investment for such business opportunity.
b. Misrepresent or fail to disclose efforts to sell or establish more business opportunities than it is reasonable to expect the market or market area for the particular business opportunity to sustain.
c. Misrepresent the quantity or the quality of the products to be sold or distributed through the business opportunity.
d. Misrepresent the training and management assistance available to the business opportunity purchaser.
e. Misrepresent the amount of profits, net or gross, which the business opportunity purchaser can expect from the operation of the business opportunity.
f. Misrepresent, by failure to disclose or otherwise, the termination, transfer, or renewal provision of a business opportunity agreement.
g. Falsely claim or imply that a primary marketer or trademark of products or services sponsors or participates directly or indirectly in the business opportunity.
h. Assign a so-called exclusive territory encompassing the same area to more than one business opportunity purchaser.
i. Provide vending locations for which written authorizations have not been granted by the property owners or lessees.
j. Provide merchandise, machines, or displays of a brand or kind substantially different from or inferior to those promised by the business opportunity seller.
k. Fail to provide the purchaser a written contract.
l. Misrepresent the ability of a person or entity providing services to provide locations or assist the purchaser in finding locations expected to have a positive impact on the success of the business opportunity.
m. Misrepresent or omit to state a material fact or create a false or misleading impression in the sale of a business opportunity.
91 Acts, ch 205, §9; 98 Acts, ch 1189, §20
Referred to in § 523B.7, 523B.11
Previous Section 523B.11
Next Section 523B.13
© 1999 Cornell College and League of Women Voters of Iowa
Comments about this site or page?
webmaster@legis.iowa.gov.
Please remember that the person listed above does not vote on bills. Direct all comments concerning legislation to State Legislators.
Last update: Thu Mar 18 15:00:31 CST 1999
URL: /DOCS/IACODE/1999/523B/12.html
jhf