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McDonald's Hit With Antitrust Complaint In Europe

Backed by a powerful American union, three Italian consumer groups have asked EU regulators to open a second investigation into the burger giant.

Posted on January 12, 2016, at 1:36 p.m. ET

Saul Loeb / AFP / Getty Images

Three Italian consumer organizations, with support from the Service Employees International Union (SEIU), filed a complaint Monday in Brussels asking antitrust regulators to investigate McDonald's real estate practices in Europe, alleging they're anti-competitive.

Codacons, Movimento Difesa del Cittadino and Cittadinanzattiva said in the complaint to the European Commission that the fast-food company uses its market dominance to charge above-market rates to franchisees who lease property from the corporation. If the Commission finds McDonald's has violated EU antitrust law, it may fine the burger giant up to 10% of its global revenue — in this case, $9 billion, based on 2014 sales.

A McDonald's spokeswoman said in a statement that the company is "proud" of its franchisees and "committed to working closely together so that they have the support they need to operate their restaurants and their businesses."

"This approach, with the principle of sharing risk and reward, has been successful for many years and has helped create the best business opportunities for our franchisees and the best overall experience for our customers," the spokesperson said.

The complaint is another example of the SEIU working with international allies in its multi-front battle with McDonald's. The union, which backs the Fight for 15 movement to raise pay for low-wage workers to $15 an hour, has supported a number of overseas complaints against the fast food giant and its business practices.

In August, SEIU organizers and workers testified against McDonald's in front of the Brazilian Federal Senate, which subsequently opened a Parliamentary Commission of Inquiry to investigate financial practices and working conditions at the company. And last month, European Union regulators began investigating McDonald's tax practices in Luxembourg, in part thanks to a report partially funded by unions that said the company illegally avoided $1.09 billion in taxes.

Other U.S. unions, such as the Communications Workers of America (CWA) have also been using international tactics in recent months. A coalition of workers, including major German union ver.di, called on the German government in July to improve international labor conditions at the telecom giant T-Mobile, in part because the government owns a share of T-Mobile's parent company.

Timothy A. Clary / AFP / Getty Images

Scott Courtney, Organizing Director at SEIU said in a statement that “McDonald’s abuse of its dominant market position hurts everyone: franchisees, consumers, and workers." Courtney also testified on behalf of the Fight for 15 in Brazil.

The European Commission will now decide whether or not to open a second investigation into McDonald's, on top of the ongoing investigation into the company's tax arrangements, which also applies to other multinationals in the EU.

A BuzzFeed News investigation, in partnership with the International Consortium of Investigative Journalists, based on thousands of documents the government didn't want you to see.