McDonald’s has recently filed a lawsuit against Florence, Italy worth $20 million for blocking plans in opening a restaurant in one of the most iconic places in Europe, the Piazza del Duomo.
Florence is located in the Tuscany region of Italy and is known for Renaissance art and architecture, as well as fashion and wealthy residents. It’s not the kind of place you would expect to find McDonald’s Corp. (MCD). However, there are already nine McDonald’s locations in Florence, and due to millions of visitors to the city per year, McDonald’s considers Florence a prime location, especially Piazza Del Duomo, where McDonald’s wanted to open a new restaurant. Request denied. (See also, 10 Countries with the Most McDonald’s Locations)
After being rejected, McDonald’s is now suing the city of Florence for $20 million. The rejected application related to changes in the city’s licensing laws, which now protects the city from tourist-based businesses and protects historic sites. The mayor of Florence, Dario Nardella, said, “McDonald’s has the right to submit an application because this is permitted under the law, but we also have the right to say no.”
Florence’s deputy head of tourism and economic development, Giovanni Bettarini, said, “It’s a not a blanket rejection of McDonald’s. It’s just a rejection of that specific project.”
McDonald’s stated that it put forward a plan to “Operate respectfully towards the local policies, even accepting to introduce typical local products in our offer, as requested from the local commerce regulation.”
McDonald’s added: “We completely agree that the cultural and artistic heritage and the Italian historical town centers have to be protected. But we cannot accept discriminatory regulations that damage the freedom of private initiative without helping anyone.”
McDonald’s is suing for $20 million because that’s the amount it estimates it will lose over the next 18 years after being discriminated against. It’s good to see that McDonald’s fights for what it wants, but there are cultural boundaries, and this is borderline disrespectful. You should never go where you’re not wanted.
MCD has depreciated 0.10% over the past 12 months and currently offers a dividend yield of 3.35%.