David Shear, RBI’s president, said in March 2022 that Burger King’s main operator in Russia had “refused” to shut the outlets following the first attacks on Ukraine.
Steven Tian, part of a team of researchers at Yale University who track what companies have done in response to the Ukraine war, argued using franchise agreements as an “excuse” was a “convenient smokescreen”.
Mark Dixon, founder of the Moral Rating Agency, which campaigns against firms doing business in Russia, called for RBI to disclose what specific actions it had taken in its attempts to leave.
David Bond, partner at law firm Fieldfisher, said RBI’s 15% stake meant it could not simply “dictate terms” to its fellow shareholders to require them to close Burger King branches.
He also suggested companies that franchise out their brands would be reluctant to simply walk away from deals as it could lead to “dire consequences”, including being sued for breach of contract, as well as reputational damage.
But he said consequences aside, there was nothing stopping RBI from terminating the franchise arrangement if it was adamant it wanted to do so, though added it might not result in the Burger King brand ceasing to exist in Russia.
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