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September 24, 2018

Subway refutes charges of mistreating Korean franchisee

PUBLISHED : September 13, 2018 - 16:08

UPDATED : September 13, 2018 - 16:13

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[THE INVESTOR] US-based sandwich franchise operator Subway on Sept. 13 refuted allegations that it mistreated a franchisee in Korea by making unreasonable demands.

According to the Fair Trade Commission, a franchisee, who operated a store near Seoul for about five years, has filed a civil complaint for being mistreated by Subway. The antitrust agency said it will start reviewing the case. 




The owner alleged that Subway unilaterally ordered him to shut down his store. Moreover, he was also told to visit the New York headquarters and defend his position in English to avoid closing down the store permanently -- which he termed unfair and nearly impossible as he is not a fluent English-speaker.

After his complaint was reported, the company immediately sent out an official statement to refute the charges.

“In any case, we do not unilaterally inform our franchise owners to shut down their store without informing them in advance and giving some time to resolve the problems,” a company official said.

The firm explained that the problematic store was warned nine times for violating 26 regulations during January-September last year. The owner was repeatedly informed about the violations but did not make any improvements. As a result, the headquarters decided to order the store to be shut down for the safety of customers.

While admitting that the owner was asked to visit the headquarters to defend himself, Subway noted that the process can also be done through phone and the owner could have hired a translator.

Subway started operating in Korea in 1991 and currently has over 300 stores here.

By Song Seung-hyun (ssh@heraldcorp.com)

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