What FTC's Franchise Rule Update Means for E-Commerce Sellers

The Federal Trade Commission has revised the monetary thresholds tied to three exemptions from its Franchise Rule. Published as 89 FR 57077 and effective July 12, 2024, the rule does not rewrite the disclosure requirements at 16 CFR Part 436 — it moves the dollar-denominated lines that decide whether certain franchise-like arrangements fall inside or outside three specific exemptions. For e-commerce businesses that license a brand, a storefront system, or a reseller program to other online sellers, that line is worth re-checking, because a threshold recalibration can quietly change which side of it an existing arrangement sits on.

This guide explains, in plain English, what the rule actually changed, who it reaches in e-commerce, what to check now that the effective date has already passed, and how a growing seller can keep the underlying monitoring current instead of re-reading the Federal Register by hand every time the FTC revisits these numbers. It leads with the obligation and the primary source, not with any product.

Key Takeaways

• The FTC revised the monetary thresholds for three exemptions from its Franchise Rule, in a rule cited as 89 FR 57077 and effective July 12, 2024.

• The rule sits at 16 CFR Part 436 and carries no Regulatory Information Number (RIN).

• Per the rule's own abstract, the change is limited to the dollar thresholds for three existing exemptions — it does not describe any change to what counts as a franchise.

• The FTC is required to adjust the size of these thresholds every fourth year, based on changes in the Consumer Price Index for All Urban Consumers (CPI-U) published by the Department of Labor.

• Because the effective date has already passed, e-commerce businesses with franchise-like licensing or reseller arrangements should confirm now whether they still land inside — or now fall outside — an exemption, rather than treat this as a future deadline.

• This post is informational only and is not legal or tax advice; consult a qualified attorney before acting on any specific arrangement.

What this rule actually does

Under the FTC's Franchise Rule, codified at 16 CFR Part 436, certain relationships are measured against specific dollar figures — depending on the payment or investment amounts involved, an arrangement can fall inside or outside particular exemptions from the rule's requirements. Those dollar figures are not meant to stay fixed indefinitely: per the rule's own abstract, the FTC is required to adjust the size of the monetary thresholds every fourth year based on changes in the CPI-U. 89 FR 57077, effective July 12, 2024, is that periodic recalibration for three of those exemptions.

It is worth being precise about what changed and what did not. The rulemaking does not create a new category of exemption, and its own abstract does not describe any change to what counts as a franchise in the first place. What it does is move the monetary lines that three existing exemptions are measured against. A business that checked its numbers against the prior thresholds and concluded it was — or was not — exempt should not assume that conclusion still holds; the inputs to that calculation changed on July 12, 2024, as stated in 89 FR 57077.

Because this is a scheduled inflation-style adjustment rather than a new substantive rule, the obligation to periodically re-index the thresholds is already built into 16 CFR Part 436 itself — this document is simply the FTC carrying that requirement out on schedule.

Who is affected

The reach of this update follows the reach of the underlying Franchise Rule itself: any party evaluating whether a relationship is — or is exempt from being treated as — a franchise under 16 CFR Part 436 is affected by a change to the exemption thresholds. In e-commerce specifically, franchise-like structures show up in several forms: a licensed storefront concept, a branded reseller network, a subscription-commerce system sold to other operators, or a private-label program that bundles a trademark with ongoing support and a required payment. None of those labels is decisive by itself; what matters is how the arrangement is actually structured and how its dollar figures compare to the thresholds as adjusted in 89 FR 57077.

Sellers confident that their business is a straightforward retail operation — buying and reselling goods under their own name, with no licensing arrangement to other operators — are generally outside the reach of the Franchise Rule altogether. The update matters most to e-commerce companies on the licensing, franchising, or business-opportunity side of the table, not to a typical direct-to-consumer storefront with no sub-sellers. E-commerce companies that already have counsel review their reseller or licensing agreements for other reasons — intellectual-property terms, payment-processor requirements, marketplace policies — have a natural checkpoint at which to add this threshold check, rather than treating it as a stand-alone project.

What e-commerce sellers should do now

Because 89 FR 57077 has been in effect since July 12, 2024, this is not a countdown to a future date — it is a check that should already have happened, and one worth repeating whenever a business's fee structure or investment terms change. The rule requires that the current thresholds, not the ones in place before July 12, 2024, are what determine which of the three exemptions apply. A business that has not revisited this since the effective date is, in effect, still relying on figures the FTC has already superseded — a different and more urgent problem than a deadline that simply has not arrived yet.

A sensible path looks like this. First, identify every e-commerce arrangement in which the company licenses a name, system, or ongoing support to another operator in exchange for a required payment — these are the arrangements the Franchise Rule potentially reaches. Second, for each one, have counsel re-run the applicable dollar figures against the thresholds as adjusted in 89 FR 57077, rather than relying on a prior year's analysis. Third, where an arrangement newly falls outside an exemption, confirm whether a franchise disclosure document is required and whether the company's existing one, if any, is current under 16 CFR Part 436. Fourth, keep a record of when each arrangement was last checked, since the FTC is required to revisit these thresholds again on its four-year cadence, and the next adjustment will move the numbers a second time.

Throughout, the operative framing is that the rule requires the current thresholds to govern going forward; it is not a personalized instruction to any one business, and it does not substitute for advice from qualified counsel who can look at the specific payment and investment terms involved.

Operationalizing exemption monitoring at volume

The practical difficulty for a growing e-commerce company is rarely reading this one document — it is remembering to re-run the math the next time the FTC adjusts these thresholds, and catching it early when a specific licensing or reseller agreement's terms drift close to a boundary. That is where US Tech Automations fits: configured against the Federal Register feed, agentic workflows can watch for new documents tied to this rulemaking and to 16 CFR Part 436 generally, flag them, and route a summary to a named compliance reviewer rather than letting a quiet four-year-interval update sit unread in a shared inbox. The point is not to replace counsel's judgment; it is to make sure a threshold-only update like this one doesn't slip past — which is exactly the gap US Tech Automations is built to close.

How this fits the broader regulatory window

This threshold update does not exist in a vacuum. It is one of 259 U.S. federal rules sealed in our point-in-time index of rules published July 1, 2024 – July 5, 2026 by 10 agencies governing our covered industries. A single recalibration like this one is easy to miss precisely because nothing about its title signals a numbers-only change — an e-commerce company scanning Federal Register headlines for "new disclosure rules" can walk right past a rule that only moves existing thresholds. That is the structural case for treating Federal Register monitoring, across every rule that touches a business, as an ongoing function rather than a one-time review of the rules a company already knows about. For an e-commerce business layering new licensing or reseller programs onto its own storefront as it grows, that ongoing review is also the moment new arrangements get checked against current thresholds before they launch, not after.

Businesses that want a structured way to keep pace with updates like this one can see current plans on the US Tech Automations pricing page.

Frequently asked questions

What is the effective date of this FTC rule?

The rule is effective July 12, 2024, as stated in 89 FR 57077. It was also published on July 12, 2024.

Which part of the Code of Federal Regulations does this rule affect?

The rule affects 16 CFR Part 436, the FTC's Franchise Rule. Current text is available via eCFR under the Commercial Practices title.

Does this rule change what counts as a franchise?

Per the rule's own abstract, no. The FTC describes this rulemaking as revising the monetary thresholds for three exemptions from the Franchise Rule at 16 CFR Part 436; it does not describe any change to the underlying definition of a franchise relationship. A business that was not a franchise before this update is not turned into one by it.

Why does the FTC adjust these thresholds at all?

The FTC is required to adjust the size of the monetary thresholds every fourth year, based on changes in the Consumer Price Index for All Urban Consumers (CPI-U) published by the Department of Labor, as stated in 89 FR 57077.

Does this rulemaking carry a RIN?

No. The Federal Register record for 89 FR 57077 does not list a Regulatory Information Number for this document.

How does an e-commerce business figure out if it is affected?

Any e-commerce company that licenses a brand, storefront system, or ongoing support to other operators in exchange for a required payment should have counsel re-check its arrangement against the thresholds in 89 FR 57077, since that is the fact pattern the Franchise Rule at 16 CFR Part 436 is designed to reach. A straightforward retailer with no licensees or sub-sellers of its own generally has nothing to check.

Related guidance

For related e-commerce compliance coverage, see our notes on the revision and withdrawal of the negative option rule, premerger notification requirements, and ophthalmic practice rules for online sellers.

Disclaimer

This article is provided for informational purposes only and does not constitute legal or tax advice. Reading it does not create an attorney-client relationship. Regulatory requirements are fact-specific, and you should consult a qualified attorney or tax advisor before acting on any matter discussed here. Every date, citation, RIN, CFR reference, and figure in this post is copied verbatim from the Federal Register and eCFR as of the snapshot date. Nothing is estimated, modeled, or extrapolated. This is not legal or tax advice.

Last reviewed: July 5, 2026.

Source: U.S. Federal Register (89 FR 57077); current text via eCFR, Commercial Practices title, 16 CFR Part 436.