McDonald's Slammed for Super-Sized Grip on European Economy

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McDonald's Slammed for Super-Sized Grip on European Economy

Already known for questionable business practices, multinational corporation challenged for harming food quality across Europe

"McDonald's—the only fast-food company that requires franchisees to lease property owned by the franchisor— abuses its position as a landlord by charging excessive rents to franchisees with prices up to 10 times above market rates," say consumer groups. (Photo: Mike Blake/Reuters)

"McDonald's—the only fast-food company that requires franchisees to lease property owned by the franchisor— abuses its position as a landlord by charging excessive rents to franchisees with prices up to 10 times above market rates," say consumer groups. (Photo: Mike Blake/Reuters)

From poverty wages to poor working conditions, the business practices of McDonald's are facing mounting protests world-wide.

Now the iconic brand is facing another powerful challenge, this time from three Italian consumer organizations that are demanding an anti-trust investigation from the European Union (EU).

The groups—Codacons, Movimento Difesa del Cittadino, and Cittadinanzattiva—filed a complaint on Monday to the European Commission—the executive wing of the EU. They are backed by unions on both sides of the Atlantic, including the international SEIU.

"This complaint is an important step in recognizing how anti-competitive practices and bad corporate citizenship harm consumers," the coalition wrote in a statement. "We urge the Commission to examine McDonald's franchising system in detail, and take all appropriate action to ensure that the unfair burdens on the company's franchisees end, and can no longer harm consumers."

The groups charge that the multinational food company "abuses its dominant fast-food market position in Europe, restricting consumer choice and leading to higher prices and poorer quality of service and food," according to a summary of the complaint by the low-wage worker campaign Fight for $15.

For example, the food giant is accused of being an exploitative landlord—charging exorbitant rents to franchisees at up to 10 times the market rate.

The complaint follows a separate Commission investigation, launched last month, into whether the multinational corporation is unfairly dodging taxes in Luxembourg.

According to the Wall Street Journal, the Commission confirmed receiving the complaint. If found guilty of breaking EU anti-trust law, the multinational could fined "up to 10 percent of their global revenue," the paper reported.

"To coincide with the filing of the antitrust complaint and the petition on working conditions, two-dozen U.S. McDonald’s workers are traveling to Europe this week to meet with politicians in six countries," Fight for $15 wrote. "They plan to discuss their involvement in the Fight for $15 as well as the importance of holding McDonald’s, the world’s No. 2 private employer, accountable to workers, consumers, and taxpayers."

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