McDonald's Facing Anti-Trust Claims In Europe

06-Apr-2017 - Germany

Three Italian consumer groups have filed an antitrust complaint with the European Union against fast-food chain McDonald's alleging that it imposes illegal terms on its franchisees.

If found guilty, the company could face severe penalties of up to 2.5 billion euros.

The three complaints raised concerns about McDonald's franchising terms and conditions, including prices set for products sold at franchises. According to the complaints, McDonald's force its franchisees to charged customers more than at McDonald's own stores.

Franchising is an important business model for McDonald's, as over 80 percent of its outlets worldwide not company-owned.

The complaint filing comes just weeks after the European Commission launched a formal state-aid investigation into McDonald's tax arrangements with Luxembourg based on an assessment that its Luxembourg-based subsidiary McDonald's Europe Franchising has paid virtually no corporate tax either in Luxembourg or in the US since 2009. (dpa)

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