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ARTICLE · 18 JANUARY 2016

Real Deal? EU Antitrust Complaint Against Mcdonald's

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Three Italian consumer bodies, supported by a number of unions, yesterday lodged a formal antitrust complaint against McDonald's with the European Commission.

European UnionAntitrust/Competition Law
John Cassels
John Cassels
Jessica Burns
Jessica Burns
Gordon Drakes
Gordon Drakes

Three Italian consumer bodies, supported by a number of unions, yesterday lodged a formal antitrust complaint against McDonald's with the European Commission.  The complaint alleges that the way in which McDonald's operates its franchise network, infringes the EU antitrust rules.

The main allegations made against McDonald's are:

  • that it abuses its position as a landlord by charging excessive rents to franchisees, with prices alleged to be up to 10 times market rates;
  • that its contract terms unlawfully restrict the ability of franchisees to switch to other fast food brands; and
  • the contracts are excessively long (20 years on average), include non-compete provisions that are too long, and mandate the location of the franchised outlets.

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