§ 523H.8 — Nonrenewal of a franchise

Iowa § 523H.8

• Jurisdiction: Iowa
• Title XIII: COMMERCE
• Ch. 523H: FRANCHISES

Text

1. A franchisor shall not refuse to renew a franchise unless both of the following apply:
a. The franchisee has been notified of the franchisor’s intent not to renew at least six
months prior to the expiration date or any extension of the franchise agreement.
b. Any of the following circumstances exist:
(1) Good cause exists, provided that the refusal of the franchisor to renew is not arbitrary
or capricious. For purposes of this section, “good cause” means cause based on a legitimate
business reason.
(2) The franchisor and franchisee agree not to renew the franchise.
(3) The franchisor completely withdraws from directly or indirectly distributing its
products or services in the geographic market served by the franchisee, provided that upon
expiration of the franchise, the franchisor agrees not to seek to enforce any covenant of the
nonrenewed franchisee not to compete with the franchisor or franchisees of the franchisor.
2. As a condition of renewal of the franchise, a franchise agreement may require that the
franchisee meet the then current requirements for franchises and that the franchisee execute
a new agreement incorporating the then current terms and fees for new franchises.