Dispute over KFC and Pizza Hut restaurants in Türkiye heads to court

Turkish franchise operator of renowned fast-food brands KFC and Pizza Hut, Is Gida, has sued its U.S.-based partner Yum! Brands over a decision to terminate their franchise agreement.

While the move has raised concerns about the fate of 537 restaurants across Türkiye, Pizza Hut outlets continue to operate, and the limited activity of KFC restaurants—restricted to shopping mall locations—indicates that the legal process is still ongoing, according to Turkish media reports.

With the court yet to issue an injunction to halt the termination, KFC and Pizza Hut branches in malls remain open. However, if a decision is made to enforce the agreement’s termination, these outlets may also be forced to cease operations.

Closures begin for KFC and Pizza Hut in Türkiye

As the dispute unfolds, Pizza Hut restaurants still remain operational, but KFC’s online delivery services have been suspended. According to employees, management has stated that only street-side KFC restaurants have been temporarily closed, noting that the continued operation of mall-based outlets stems from rental agreements and higher sales volumes, as reported by Turkish media outlet hurriyet.com.tr.

Over the past 12 years, the franchise rights for KFC and Pizza Hut in Türkiye have changed hands four times. Is Gida, the latest franchisor, operates 537 restaurants, generates an annual revenue of ₺6 billion ($168.4 million), and employs approximately 7,000 people.

Yum! Brands, the U.S.-based owner of KFC and Pizza Hut, announced on Jan. 8 that it had terminated its franchise agreement with Is Gida, citing the franchisee’s failure to meet required quality standards. The decision is expected to impact 283 KFC and 254 Pizza Hut restaurants, with many anticipated to close, at least temporarily.

In response, Is Gida issued a statement emphasizing that the termination was unilateral and asserting that its operations were continuing without interruption.