Hejun files complaint against sale of McDonald’s franchises
February 20, 2017 Category Retail, Weekly
Beijing-based Hejun Vanguard Group has filed a complaint against McDonald’s with the Ministry of Commerce’s Anti-monopoly Bureau and its franchise office, alleging that the sale of many McDonald’s franchises to CITIC and Carlyle Group may hurt Chinese workers and consumers. The complaint could delay regulatory approval of the deal. While Hejun has stopped short of asking the Ministry to block the deal, it has called on the regulator to closely scrutinize the transaction and take measures to prevent McDonald’s “abusing” what it claims is the company’s dominant position in the fast-food burger market in China. It has also called for the Ministry to investigate alleged violations of China’s franchise law by McDonald’s, which it claims has failed to properly register all of its outlets in China. The Service Employees International Union, a U.S. labor body, in January raised concerns over McDonald’s China deal, saying previous such transactions in markets including Brazil and Puerto Rico had put enormous pressure on franchisees, making it harder for them to provide adequate pay and conditions for their workers, the Shanghai Daily reports.
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