His burger chain Brands International Restaurant(QSR), has a joint venture partnership with businessman Alexander Kolobov in Russia. The RBI controls only 15% of Burger King’s Russian business, and Kolobov is responsible for the “day-to-day operations and oversight” of its sites in the country.
This means that Burger King can’t pick up his fingers and close the shop.
“We have started the disposal process [of] David Sher, head of international operations for the Reserve Bank of India, said in a statement: open letter. “While we would like to do this immediately, it will obviously take some time to do so based on the terms of our existing joint venture agreement.”
Scheer said the RBI “demanded” that the joint venture close Burger Kings immediately, but Kolobov “refused to do so.”
Burger King entered Russia about a decade ago, running a joint venture with Kolobov, Investment Capital Ukraine, and VTB Capital, a Russian bank that has been sanctioned.
Scheer explained that a “complex legal process” prevented her from closing the partnership and companies.
“There are no legal provisions that allow us to unilaterally change the contract or allow any of the partners to abandon or void the entire agreement,” Scheer said. “No serious investor in any industry in the world would agree to a long-term business relationship with flimsy termination terms.”
This issue highlights the problems some Western companies and banks face in withdrawing from Russia, complicated by joint ventures or partnerships over which they do not have complete control. For example, a Papa John’s(PZZA) Franchise in Russia refused Close about 200 sites Even after the pizzeria chain suspended its corporate support.