typically interpreted as the franchisee's failure to comply
with the franchise agreement (Shane 2005). In contrast to
the emphasis registration law places on addressing the ex
ante adverse selection problem, relationship law focuses on
minimizing the potential for ex post franchisor moral hazard
(see Figure 1). Full disclosure (registration law) and
good cause termination (relationship law) are designed to
safeguard the interests of franchisees within the state where
the particular regulation is in effect.