The Deceptive Franchise Practices Act aims to protect franchisees in New Mexico by prohibiting certain unfair practices and provisions in franchise agreements. Key provisions of the bill include the definition of a franchise, the identification of unlawful provisions in franchise agreements, and the establishment of unlawful acts and practices by franchisors. For instance, the Act makes it illegal for franchisors to require franchisees to purchase goods exclusively from them when alternatives are available, to unilaterally modify agreements without consent, or to terminate agreements without good cause. Additionally, it prohibits coercive practices, such as forcing franchisees to order unnecessary goods or participate in costly advertising campaigns.

The Act also outlines the process for terminating or not renewing a franchise, requiring a minimum of ninety days' notice unless otherwise specified in the agreement. Franchisees who are affected by violations of the Act can seek damages or reform their agreements, provided the agreements were entered into or renewed after July 1, 2025. Furthermore, any legal action for violations must be initiated within five years of the occurrence. The provisions of the Deceptive Franchise Practices Act will take effect on July 1, 2025, ensuring that franchisees have a legal framework to address deceptive practices in their agreements.