Dear Sir,
India is a multifaceted country with diverse laws and the path to success is rarely smooth. To operate and survive in India requires compliance with a complex legal framework while seizing opportunities for growth.
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Yum! Restaurants (India) and its franchisees operate 133 Pizza Hut and 27 KFC outlets in 35 cities.
One of the biggest challenges is avoiding or minimizing cumbersome and time-consuming litigation. With innumerable cases pending, it takes an average of eight years for a dispute to make its way through the courts.
What’s more, each state has its own laws, rules and regulations, as well as separate requirements for licences, approvals and consents. Obtaining certain licences may take a considerable amount of time and delay openings.
Religious sentiments also play a major role and have to be kept in mind. Western fast food outlets are popular but consumer-centric laws encourage the public to act on virtually any grievance.
Outlets are generally taken on lease or collaborative arrangements. Here too, compliance is an issue. Property laws are also complex, not to mention rising rental costs.
Compliance with labour laws, foreign exchange regulations, food laws, advertising standards and taxation laws are other challenging areas. Nonetheless, Yum! is bullish about its business in India and is working to bring in its third brand, Taco Bell, in 2008.
Vinod V Mahboobani
Vice President – Legal
Yum! Restaurants International
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