Embargo on McDonalds Mesoamerica

Failure to pay $24 million in compensation to Servipronto has led to an embargo of the brands McDonald's, Quarter Pounder, Big Mac and Ronald McDonald's.

Wednesday, August 29, 2012

An article in Elmundo.com.sv reports that "The executing judge is setting an embargo on the royalties paid by McDonalds Mesoamerica to McDonald's Corp. The judge has spoken to McDonald's CFO to determine how much this would amount to. Auction of the McDonald's brands would be the next step in the foreclosure process. It has been made known, preliminarily, that McDonald's Mesoamerica, the operator of the franchise, will not talk about the embargo. "

In October 2011 the Constitutional Chamber of the Supreme Court of Justice ruled against an appeal by McDonald's against the decision of the Second Civil Chamber of San Salvador, after a trial that lasted 14 years, in 2005 which condemned the multinational to pay $23.9 million in payment of damages, and breach of contract against the company Servipronto of El Salvador.

"The transnational filed an appeal before the Constitutional Chamber, where it argued that the sanction was illegal because it had been tried twice for the same cause. In October 2011, the Constitutional Chamber of the Supreme Court empowered Servipronto to collect the fine. "

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