FamilyMart, the most successful Japanese convenience store chain in China, is embroiled in a royalty payments fight between its Japanese and Chinese joint-venture partners that could change how much money each side makes or scuttle the partnership entirely.
FamilyMart UNY Holdings Co. is suing to end its Chinese FamilyMart partnership with Ting Hsin International Group, saying the Taipei-based conglomerate hasn't fairly shared the gains from the chain's rapid expansion, according to people familiar with the matter and legal documents seen by Bloomberg.
Under the terms of the partnership, Ting Hsin effectively operates more than 2,500 FamilyMart stores in China, sharing profits and paying royalties to the Japanese company. Although Ting Hsin's founders are Taiwanese, the company has had a presence in China since the late 1980s before the country's economy opened up, and is considered a local entity. It also controls other food and beverage brands, including China's leading instant noodle maker.
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