Ukraine designates Subway as 'international sponsor of war'
American fast food chain Subway has been added to Ukraine's list of "international sponsors of war" for its continued presence in the Russian market, the National Agency on Corruption Prevention (NACP) announced on Jan. 10.
The "international sponsor of war" list is designed to be "a powerful reputational tool" to encourage the exit of international business from Russia and reduce Moscow's financial ability to continue its war against Ukraine, the NACP explains on its website.
Over 500 Subway franchises continue to operate in the Russian market, which pay "hundreds of thousands of dollars in taxes to the budget of the Russian Federation," the NACP said.
Since the start of the full-scale invasion in February 2022, the company has not reported any reduction in its operations in the Russian Federation
Unlike other American fast food chains, Subway made no announcement to scale down or close operations in Russia, and "there were no attempts by the company's management to condemn Russia's war," the NACP said.
Fast food chain McDonald's, for example, temporarily suspended all operations in the country in March, and announced in May that McDonald's restaurants in Russia would be sold.
The same month, Subway found out that Russian banks had begun to block the payment of franchisee royalty fees to Subway's headquarters in the U.S., which had been designated an "unfriendly country" by the Russian government.
A solution was found with the help of a Russian law firm, which determined Subway could legally collect royalties from the franchisees through a holding company.
Subway joins alcohol company Bacardi, multinational food giant Nestle, and multinational snack and beverage companies like Mars and PepsiCo on the "international sponsors of war" list. Nearly 50 companies are currently included on the list in total.
