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McDonalds675Three Italian consumer organizations have urged EU antitrust regulators to investigate McDonald's franchise system in Europe, a month after the opening of an EU inquiry into the U.S. fast food company's tax deals with Luxembourg.

Codacons, Movimento Difesa del Cittadino and Cittadinanzattiva filed their complaint with the European Commission on Monday, urging the EU competition enforcer to step in over what a system they said was anti-competitive.

"The system construed by McDonald's raises strong concerns under antitrust laws," the group said in its 46-page complaint. Franchising is a key business model for the world's largest fast food chain.

At issue are 20-year contracts which are twice as long as most other franchises, a requirement that licensees lease premises from McDonald's at above-market rates and conditions hindering them from switching to competitors, the group says.

"McDonald's exercises an excessive and disproportionate control on its franchisees by implementing conditions that exceed without justification what is required for the protection of its system, its know-how and reputation," the group said.

It said the restrictions hinder competition and lead to consumers paying higher prices in franchised restaurants.

McDonald's had no immediate comment. The Commission did not immediately reply to a request for comment.

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Franchisees operate about 75 percent of McDonald's outlets in Europe. The company made $9.27 billion in revenues from its franchised restaurants worldwide last year, accounting for about a third of overall turnover.

The Italian consumer groups are backed by the Service Employees International Union (SEIU) and European trade unions, whose complaint about suspected tax avoidance by McDonald's prompted the European Commission to open an investigation into its tax arrangements with Luxembourg in December.

"McDonald's abuse of its dominant market position hurts everyone: franchisees, consumers, and workers. We strongly urge the European Commission to investigate the charges and to use all of its powers to hold McDonald's accountable," SEIU organizing director Scott Courtney said.

The president of Codacons, Carlo Rienzi commented: "In a period of history already difficult because of the economical crisis it's unacceptable that corporations exploit tax avoidance systems that cause damages to State treasury, [damages] that afterwards consumers are called to repair".

It is far from certain that the Commission will open a second investigation into the firm. Complaints are usually followed by questionnaires sent to companies, after which the regulator determines whether there is cause for further action.

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