McDonald’s Corporation (NYSE:MCD) has sustained a blow from the worsening relationship between the U.S. and Russia. Russia’s state consumer regulatory agency has been inspecting and shutting down McDonald’s restaurants across the country.
McDonald’s targeted by Russian authorities
The Wall Street Journal reports that as of today, Russian officials had shut down 12 of the fast food chain’s locations there, alleging sanitary violations. On Thursday, they had only closed eight. Last week, the agency had been inspecting several McDonald’s locations, but now 100 of the company’s locations in Russia are being inspected, according to a statement issued by the fast food chain.
A McDonald’s spokesperson said they are “studying the essence of claims” and determining what the best actions are to get the restaurants back open as soon as possible. A Russian court upheld the closing of some of the chain’s restaurants on Wednesday.
McDonald’s withdraws from Crimea
Although McDonald’s was one of the sponsors for the 2014 Winter Olympics held in Sochi earlier this year. However, Moscow has begun scrutinizing the fast food chain since it decided to close all of its locations in Crimea, the contested part of Ukraine where tensions between Moscow and Kiev keep rising.
After that withdrawal, Russia suddenly started dropping in on the company’s restaurants all across the country to conduct unscheduled inspections. However, officials there denied plans to launch a widespread investigation of McDonald’s locations. Also the chief of the regulatory agency denied that the inspections are politically motivated.
In addition to the restaurant closures and inspections, Russian officials have sued McDonald’s in an attempt to get some of the fast food chain’s most popular shakes and burgers banned. Regulators accuse the fast chain of food safety violations in two of its branches.
Russia responding to sanctions?
However, analysts say it isn’t uncommon for Russia to use pressure from its regulatory agencies when there are ongoing tensions with other countries. The U.S. and other countries in the West have sanctioned Russia for its actions in Ukraine. More sanctions could be ahead after the Ukrainian president accused Moscow of invading his country. The Ukrainian prime minister asked the West to freeze Russia’s assets until Russia withdraws from the Crimea region.
Russia continues to deny the allegations of assisting separatists in Ukraine. Officials also say that any Russians who are fighting in Ukraine are only volunteering.
