,i  #aacth ,,congress  #b;d ,session    
,h4 ,r4 #efjj  ,,in ,,the ,,house ,,of  
,,representatives  ,september #ah1 #bjad
 ,mr4 ,graves of ,missouri introduced   
the following bill2 which was referred  
to the ,committee on ,small ,business   
,a ,,bill  ,to amend the ,small         
,business ,act to establish rules for   
franchisee eligibility for financial    
assistance under certain small business 
programs4  #a4 ,short title ,this ,act  
may be cited as the ,franchise          
,financing ,improvement ,act of #bjad4  
#b4 ,eligibility for financial          
assistance ,section #b of the ,small    
,business ,act 7#ae ,u4,s4,c4 #fca7 is  
amended by adding at the end the        
following new subsection3  7k7 ,the     
,administrator shall make financial     
assistance available to franchisees     
under this ,act or titles ,,iii and ,v  
of the ,small ,business ,investment ,act
 of #aieh if the franchisee is not      
affiliated with the franchisor pursuant 
to section #c of this ,act4  4  #c4     

,affiliation rules for franchisees      
,section #c7;a77#e7 of the ,small       
,business ,act 7#ae ,u4,s4,c4           
#fcb7;a77#e77 is amended by adding at   
the end the following new subparagraphs3
  7,c7 ,eligibility of franchisees ,for 
purposes of determining eligibility of  
franchisees for financial assistance    
under this ,act or titles ,,iii and ,v  
of the ,small ,business ,act1 a         
franchisee shall not be considered      
affiliated with the franchisor if--  7i7
 the franchisor has filed a disclosure  
document pursuant to--  7,i7 part #dcf  
of title #af1 ,code of ,federal         
,regulations 7or any successor          
regulation72 or  7,,ii7 any law or      
regulation of a ,state or territory that
 mandates disclosure of information to a
 franchisee2 and  7ii7 the franchisee1  
upon default on a loan 7whether         
guaranteed by the ,administrator or not7
 has no ability to obtain financial     
assistance from the franchisor to repay 
such loan4 ,for purposes of this clause1

 a franchisor's authority to repurchase 
the franchise for failure to comply with
 the terms and conditions of the        
franchise agreement or have the right of
 first refusal to purchase the franchise
 from the franchisee shall not be       
considered financial assistance to repay
 loans issued to the franchisee4  7,d7  
,definitions ,for the purposes of       
subparagraph 7,c71 the terms franchisor 
and franchisee have the meaning given   
those terms in section #dcf4a of title  
#af1 ,code of ,federal ,regulations as  
of ,january #a1 #bjad1 or any successor 
regulation4  4  #d4 ,issuance of        
regulations  7a7 ,the ,administrator1   
after the opportunity for notice and    
comment1 shall issue regulations to     
implement this ,act within #abj days of 
enactment4  7b7 ,if the ,administrator  
fails to promulgate such regulations1   
the ,administrator shall1 unless there  
is clear and convincing evidence of     
fraud1 honor the terms and conditions of
 any guarantee issued by the            

,administrator pursuant to the ,small   
,business ,act 7#ae ,u4,s4,c4 #fca et   
seq47 or titles ,,iii and ,v of the     
,small ,business ,investment ,act of    
#aieh 7#ae ,u4,s4,c4 #ffa et seq47      
without regard to whether the entity    
complied with any ,standard ,operating  
,procedure issued by the ,administrator 
until such time as the ,administrator   
issues regulations under subsection 7a74
  7c7 ,for purposes of subsection 7b71  
the term ,standard ,operating ,procedure
 shall have the meaning given the term  
,s,o,ps in section #abj4aj of title #ac1
 ,code of ,federal ,regulations as in   
effect on ,january #a1 #bjad1 or any    
successor regulation4