Ark. Code Ann. » Title 4 Chapter 72
Arkansas Code Annotated

Ark. Code Ann. § 4-72-204 (2026)

Termination, cancellation, or failure to renew

✓ current as of May 2026
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  1. It shall be a violation of this subchapter for a franchisor to:
    1. Terminate or cancel a franchise without good cause; or
    2. Fail to renew a franchise except for good cause or except in accordance with the current policies, practices, and standards established by the franchisor which in their establishment, operation, or application are not arbitrary or capricious.
  2. No franchisor shall directly or indirectly terminate, cancel, or fail to renew a franchise without first giving written notice to the franchisee at least ninety (90) days in advance of such action, setting forth the reasons for the termination, cancellation, or intention not to renew, and, in the case of terminations, shall provide the franchisee with thirty (30) days in which to rectify any claimed deficiency.
  3. The notice provisions of this section shall not apply where the reason for termination or cancellation is good cause under § 4-72-202(7)(C)-(H).
  4. If the reason for termination, cancellation, or failure to renew is for repeated deficiencies within a twelve-month period giving rise to good cause under § 4-72-202 (7)(A) or (B), the franchisee shall have ten (10) days to rectify the repeated deficiencies and thereby void the notice.

History. Acts 1977, No. 355, §§ 4, 5; A.S.A. 1947, §§ 70-810, 70-811.

Case Notes

Constructive Termination.

Summary judgment was inappropriate on claims brought under the Arkansas Franchise Practices Act, §§ 4-72-204(a)(1), 4-72-206(6), and 4-72-207(a)(3); significant issues remained as to the damages available to the franchisee and to the defenses the franchisor might be able to raise. Capital Equip., Inc. v. CNH America, LLC, 471 F. Supp. 2d 951 (E.D. Ark. 2006).

Good Cause.

Where there was evidence from which the jury could readily have found that termination of distributorship was attributable to franchisor having acquired a competing bottling company, rather than from the actions of the franchisee, the issue was one for the jury. Dr. Pepper Bottling Co. v. Frantz, 311 Ark. 136, 842 S.W.2d 37 (1992).

Arkansas Franchise Practices Act, § 4-72-201 et seq., applied to protect a beverage distributor from the wrongful termination of its agreement by the manufacturer since the parties clearly contemplated that there would be a “place of business” in Arkansas and the distributor's planned satellite warehouse would have qualified as one under § 4-72-202(6) as it would have had a telephone, forklift, the beverages for distribution, and personnel to run operations; further, the distributor already had an outlet for the beverages in Arkansas with a different beverage manufacturer. S. Beach Bev. Co. v. Harris Brands, Inc., 355 Ark. 347, 138 S.W.3d 102 (2003).

Franchisee was entitled to relief in its action against a franchisor for violation of the Arkansas Franchise Practices Act because under subdivision (a)(1) of this section, neither the market withdrawal of a product nor the withdrawal of a trademark or trade name for a product constituted “good cause” to terminate a franchise. Larry Hobbs Farm Equip., Inc. v. CNH Am., LLC, 375 Ark. 379, 291 S.W.3d 190 (2009).

Cited: Kent Jenkins Sales, Inc. v. Angelo Bros. Co., 804 F.2d 482 (8th Cir. 1986).

Notes of Decisions
Cited in 5 cases, 1993–2009 · leading case: Larry Hobbs Farm Equip., Inc. v. CNH Am., LLC, 291 S.W.3d 190 (Ark. 2009).
Sort: Relevance Newest Treatment
Larry Hobbs Farm Equip., Inc. v. CNH Am., LLC, 291 S.W.3d 190 (Ark. 2009). · cites it 5× “Arkansas Code Annotated section 4-72-204(a)(1) provides that “[i]t shall be a violation of [the AFPA] to terminate or cancel a franchise without good cause.”
Larry Hobbs Farm Equip., Inc. v. Cnh Am., LLC, 287 S.W.3d 550 (Ark. 2008). · cites it 3× “The questions involve Arkansas Code Annotated sections 4-72-204(a)(l), 4-72-310(B)(4), and 4-72-309.”
Instructional Sys., Inc. v. Comput. Curriculum Corp., 826 F. Supp. 831 (D.N.J. 1993). “815, 11705, § 19 & II710, § 9; Ind.Code Ann. § 23-2-2.7-1; Mich.Comp.Laws Ann.”
Mary Kay, Inc. v. Isbell, 999 S.W.2d 669 (Ark. 1999). · cites it 2× “1 Isbell asserted, among other things, that Mary Kay’s letter of termination failed to comply with § 4-72-204 of the Act because the letter did not give her ninety days’ notice or set forth the reasons for her termination.”
Capital Equip., Inc. v. Cnh Am., LLC, 471 F. Supp. 2d 951 (E.D. Ark. 2006). · cites it 2× “§ 4-72-206(6) by acting in a manner that is commercially unreasonable; and such actions resulted in a de facto termination, in violation of Ark.Code Ann. § 4-72-204(a)(l); (2) NHC violated the fraud provisions of the AFPA, Ark.”
Ark. Code Ann. § 4-72-204(a)(1): 1 case
Larry Hobbs Farm Equip., Inc. v. CNH Am., LLC, 291 S.W.3d 190 (Ark. 2009). “Arkansas Code Annotated section 4-72-204(a)(1) provides that “[i]t shall be a violation of [the AFPA] to terminate or cancel a franchise without good cause.”
Ark. Code Ann. § 4-72-204(a)(l): 3 cases
Larry Hobbs Farm Equip., Inc. v. CNH Am., LLC, 291 S.W.3d 190 (Ark. 2009). “Arkansas Code Annotated section 4-72-204(a)(1) provides that “[i]t shall be a violation of [the AFPA] to terminate or cancel a franchise without good cause.”
Larry Hobbs Farm Equip., Inc. v. Cnh Am., LLC, 287 S.W.3d 550 (Ark. 2008). “The questions involve Arkansas Code Annotated sections 4-72-204(a)(l), 4-72-310(B)(4), and 4-72-309.”
Capital Equip., Inc. v. Cnh Am., LLC, 471 F. Supp. 2d 951 (E.D. Ark. 2006). “§ 4-72-206(6) by acting in a manner that is commercially unreasonable; and such actions resulted in a de facto termination, in violation of Ark.Code Ann. § 4-72-204(a)(l); (2) NHC violated the fraud provisions of the AFPA, Ark.”
Ark. Code Ann. § 4-72-204(b): 1 case
Mary Kay, Inc. v. Isbell, 999 S.W.2d 669 (Ark. 1999). “1 Isbell asserted, among other things, that Mary Kay’s letter of termination failed to comply with § 4-72-204 of the Act because the letter did not give her ninety days’ notice or set forth the reasons for her termination.”
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