The National Agency for Prevention of Corruption (NAPC) has added the American multinational fast-food restaurant franchise Subway to the list of international sponsors of the war. Over 500 company restaurants continue to operate in the aggressor's market, contributing hundreds of thousands of dollars in taxes to the Russian budget. Subway actively promotes its activities through sanctioned Russian social networks and delivers food through "Yandex" services, which collaborate with state and law enforcement agencies of the aggressor country.
Subway, one of the world's largest fast-food chains known for its sandwiches, salads, and rolls, positions itself as a "healthy alternative to traditional fast food." Despite claiming to care about consumer health, the company continues to operate in Russia, financing the killing of Ukrainians. The Russian Subway network is now the third-largest in Europe, after the UK and Germany.
The company has been operating in Russia for over 20 years, creating around 6,000 jobs and establishing 550 restaurants in 122 cities. Since the start of the full-scale invasion, the company has not reported any reduction in its activities in Russia. In addition to paying taxes to the terrorist state's budget, the company provides jobs to Russians, supporting the Russian economy and employment rate.
Subway's business model operates through a franchise system, where a large network of legally separate entities operates under the Subway brand, generating income and paying taxes. In Russia, the Subway Russia Service Company, headquartered in St. Petersburg, owns the franchise. Subway claims that all restaurants in the country are owned and operated by local and main franchisees, thus remaining open in Russia. This statement regarding the inability to influence its franchisees is misleading.
In May 2022, Russian banks began blocking royalties (payments for using the franchise) because they were not prepared to take responsibility for processing payments to the franchisee from an "unfriendly" country (the US). Customers were unable to obtain ownership rights from Russian franchisees and send payments to the US.
In response, the Russian legal company Nevsky IP LAW, commissioned by Subway, conducted necessary analyses of contracts and Russia's sanction legislation, identifying legal mechanisms to lawfully collect royalties from the franchise and direct them to the holding company's address. As a result, the company assisted the client (Subway) in resuming the receipt of royalties from Russian franchises. Banks resumed processing payments, and franchisees returned to fulfilling their royalty payment obligations.
Subway in Russia actively conducts advertising campaigns through the social networks VK and Odnoklassniki, owned by the sanctioned legal entity LLC "Kompaniya VK." Subway also utilizes food delivery services through "Yandex.Eda." It's worth noting that this service is controlled by the Yandex group of companies, which collaborates with state and law enforcement agencies of the aggressor country, including the FSB. Yandex services have previously been candidates for sanctions by the National Agency for Prevention of Corruption.
The company's leadership has not made any attempts to condemn Russia's war against Ukraine.
