Burger King 2013 Annual Report Download - page 23

Table of Contents
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In the United States, each of our Company and franchise restaurants is subject to licensing and regulation by health, sanitation, safety and other
agencies in the state and/or municipality in which the restaurant is located. State and local government authorities may enact laws, rules or regulations that
impact restaurant operations and the cost of conducting those operations. In many of our markets, including the United States and Europe, we and our
franchisees are subject to increasing regulation regarding our operations, which may significantly increase the cost of doing business. In developing markets,
we face the risks associated with new and untested laws and judicial systems. Among the more important regulatory risks regarding our operations we face are
the following:
• the impact of the Fair Labor Standards Act, which governs such matters as minimum wage, overtime and other working conditions, family leave
mandates and a variety of other laws enacted by states that govern these and other employment matters;
• the impact of immigration and other local and foreign laws and regulations on our business;
• disruptions in our operations or price volatility in a market that can result from governmental actions, including price controls, currency and
repatriation controls, limitations on the import or export of commodities we use or government-mandated closure of our or our vendors’ operations;
• the impact of the United States federal menu labeling law which requires the listing of specified nutritional information on menus and menu
boards on consumer demand for our products;
• the risks of operating in foreign markets in which there are significant uncertainties, including with respect to the application of legal requirements
and the enforceability of laws and contractual obligations;
• the impact of the Patient Protection and Affordable Care Act on the businesses of our U.S franchisees, many of whom are small business owners
who may have significant difficulty absorbing the increased costs or may need to revise the ways in which they conduct their business; and
• the impact of costs of compliance with privacy, consumer protection and other laws, the impact of costs resulting from consumer fraud and the
impact on our margins as the use of cashless payments increases.
We are also subject to a Federal Trade Commission rule and to various state and foreign laws that govern the offer and sale of franchises. Various state
and foreign laws regulate certain aspects of the franchise relationship, including terminations and the refusal to renew franchises. The failure to comply with
these laws and regulations in any jurisdiction or to obtain required government approvals could result in a ban or temporary suspension on future franchise
sales, fines, other penalties or require us to make offers of rescission or restitution, any of which could adversely affect our business and operating results. We
could also face lawsuits by our franchisees based upon alleged violations of these laws.
The Americans with Disabilities Act (“ADA”), prohibits discrimination on the basis of disability in public accommodations and employment. We have,
in the past, been required to make certain modifications to our restaurants pursuant to the ADA. In addition, future mandated modifications to our facilities to
make different accommodations for disabled persons and modifications required under the ADA could result in material unanticipated expense to us and our
franchisees.
If we fail to comply with existing or future laws and regulations, we may be subject to governmental or judicial fines or sanctions. In addition, our and
our franchisees’ capital expenditures could increase due to remediation measures that may be required if we are found to be noncompliant with any of these
laws or regulations.
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In the ordinary course of our business, we collect, process, transmit and retain personal information regarding our employees and their families,
franchisees, vendors and consumers, including social security numbers, banking and tax ID information, health care information and credit card
information. Some of this personal information is held and managed by certain of our vendors. Although we use security and business controls to limit access
and use of personal information, a third party may be able to circumvent those security and business controls, which could result in a breach of employee,
consumer or franchisee privacy. A major breach, theft or loss of personal information regarding our employees and their families, our franchisees, vendors or
consumers that is held by us or
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Source: Burger King Worldwide, Inc., 10-K, February 21, 2014 Powered by Morningstar® Document Research℠
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