OldTown White Coffee Café China franchiser under criminal investigation

PETALING JAYA: OldTown Bhd’s indirect wholly-owned unit Shenzhen Kopitiam Asia Pacific Ltd (SZKAP) is currently under criminal investigation by the Chinese Public Security Bureau for suspected contract fraud.

In May 2016, SZKAP granted the right to Jiangsu G&L Food & Beverage Management Co Ltd (G&L) to operate OldTown White Coffee within Jiangsu province, to use the trademark “OldTown” and to develop it into franchising business.

“We felt quite shocked when we were reported by Ai Chang Investment Limited in April 2018 for the issue of trademark infringement. Ai Chang reported to the local AIC (Administration for Industry and Commerce) that they are the actual trademark owner in mainland China,” said G&L COO Tao Yu Chen

“In view of that, we have been forced to close all of our OldTown White Coffee outlets and this has caused tremendous damage to our company.”

Franchising rights were also given to Xiamen Kuaike Investment Management Co Ltd, another Chinese company in FuJian in March 2017.

To-date, all OldTown White Coffee outlets in mainland China have been shut down.

OldTown was delisted from Bursa Malaysia on April 4, 2018 after Dutch coffee company JDE gained control of OldTown via its indirect unit Jacobs Douwe Egberts Holdings Asia NL BV. It was listed for less than seven years on the local bourse.