Start-up & business operations

How to Register a Franchise Disclosure Document — The 1-Year Directly Operated Store Rule and Annual Amendment Deadlines

A franchisor that wants to recruit franchisees must register the disclosure document it will give to prospective franchisees in advance, and this duty applies equally to small franchisors with low sales. If the principal office is in Seoul, Incheon, Gyeonggi or Busan, the application goes to that city or province; otherwise it goes to the Fair Trade Commission. A new registration is accepted only if the franchisor has operated a directly operated store under the same brand for at least 1 year. The registration certificate is issued within 30 days of the application, and after registration, changes and each fiscal year's financial information must be filed as amendments within the set deadlines.

Procedure

  1. 1. Check the directly operated store requirement

    A new registration is accepted only if the franchisor has run a directly operated store with the same brand and business method as the franchise described in the disclosure document for at least 1 year. Periods during which an officer serving at the time of application ran the store are counted. The requirement does not apply if the franchisor holds a permit, license, report or registration under related laws, or has run the same type of business in Korea or abroad for at least 1 year.

  2. 2. Identify the registering authority

    If the principal office is in Seoul, apply to the Mayor of Seoul; in Incheon, to the Mayor of Incheon; in Gyeonggi-do, to the Governor of Gyeonggi-do. Regions designated by the Fair Trade Commission (Busan under the current form) file with that mayor. All other regions apply to the Fair Trade Commission, and applications can also be filed online through the Franchise Information System.

  3. 3. Prepare the disclosure document

    The disclosure document consists of a cover, a table of contents and the items in Annex 1 of the Enforcement Decree, and a separate document is made for each brand. It covers the franchisor's general status and financial information for the previous 3 fiscal years, numbers of franchised and directly operated stores and average sales, law violations, franchisee costs, business conditions and opening procedures, and training.

  4. 4. File the new registration and supplement it

    Attach the disclosure document (paper and electronic file), financial statements, a list of directly operated and franchised stores, the franchise agreement form, proof of the number of employees and proof of directly operated store operation to the new registration application. The authority issues the certificate within 30 days of the application; if items are missing or untrue, it may request a change or supplement once, and the date of supplementing becomes the new application date.

  5. 5. Amendment registration and amendment report

    Items such as the trade name, principal office and representative must be amended within 30 days of the change; numbers of franchised and directly operated stores within 30 days after each quarter ends; and financial information within 120 days after each fiscal year ends. The processing period for an amendment registration is 20 days, and minor items such as changes of officers other than the representative are reported within 30 days after the quarter ends.

Required documents

  • Application for new registration of a disclosure document
  • Disclosure document (paper and electronic file)
  • Statements of financial position and income statements for the previous 3 fiscal years (or documents showing sales if not prepared)
  • List of directly operated and franchised stores as of the end of the previous fiscal year
  • Copy of the franchise agreement form
  • Document showing the number of officers and employees as of the end of the previous fiscal year
  • Document confirming the operation and operating period of the directly operated store
  • Letter of authorization (when filed by an agent)

Fees

There is no fee for registering a disclosure document. Business reports and permits needed to open franchise outlets are quoted per business type after consultation.

Legal basis and review date

  • Fair Transactions in Franchise Business Act, Article 2
  • Fair Transactions in Franchise Business Act, Article 3
  • Fair Transactions in Franchise Business Act, Article 6-2
  • Fair Transactions in Franchise Business Act, Article 6-3
  • Fair Transactions in Franchise Business Act, Article 6-4
  • Fair Transactions in Franchise Business Act, Article 7
  • Enforcement Decree of the Fair Transactions in Franchise Business Act, Article 4
  • Enforcement Decree of the Fair Transactions in Franchise Business Act, Article 5-2
  • Enforcement Decree of the Fair Transactions in Franchise Business Act, Article 5-3
  • Enforcement Decree of the Fair Transactions in Franchise Business Act, Article 5-5
  • Enforcement Decree of the Fair Transactions in Franchise Business Act, Annex 1-2

Checked against the statutes on

Statutes and public notices change, so each case needs to be checked individually. Statute titles are given in English for reference. The Korean statutes are the authoritative text.

Check these first

  • In principle, a franchisor may not receive franchise fees or sign a franchise agreement until 14 days have passed since delivering the registered disclosure document and the nearby franchise store list.
  • If the disclosure document or attachments contain false information, registration is refused, and if a registration made with false information is discovered, it is cancelled.

Frequently asked questions

Does a small franchisor with only a few franchisees have to register a disclosure document?
Yes. Even small franchisors exempt from parts of the Act because of low sales or franchise fees remain subject to the disclosure document registration and delivery rules, which apply to all franchise transactions.
Can we recruit franchisees right away without a directly operated store?
In principle, no. If there is no directly operated store under the same brand on the application date, or it has operated for less than 1 year, registration may be refused. Exceptions include holding a permit, license, report or registration under related laws, or having run the same type of business in Korea or abroad for at least 1 year.
Where do we register if our head office is in Incheon?
You apply to the Mayor of Incheon. The principal office location decides the authority: Seoul files with the Mayor of Seoul, Gyeonggi-do with the Governor of Gyeonggi-do, and regions without delegated registration file with the Fair Trade Commission.
When must a registered disclosure document be amended?
It must be amended within the deadline whenever an amendment item changes. Trade name and representative changes are due within 30 days, and financial information within 120 days after each fiscal year ends (180 days for individual businesses that prepare financial statements); amendment registration is processed within 20 days.
What does the administrative agent's office handle?
The franchisor prepares and files the disclosure document itself. Hwang Yunsang Administrative Agent Office explains the registration authority, the one-year directly operated store requirement and change-registration deadlines, and prepares and submits the business reports and permit applications needed to open franchise outlets.

Contact us

Hwang Yunsang Administrative Office in Songdo, Incheon prepares and submits administrative documents and explains the procedure. If your situation is similar, send us a message.

📍 2697, 26F POSCO Tower-Songdo, 165 Convensia-daero, Yeonsu-gu, Incheon, Republic of Korea · 📞 010-3374-2687 · 🌐 hwangadmin.com

This guide is general information based on public sources. Requirements, documents and deadlines differ by case and by the competent agency, so please confirm them before you proceed.