PETALING JAYA: OldTown White Coffee today denied claims of contract fraud by a firm granted licence to operate the popular coffee chain in China, about a week after reports that it had been forced to shut down all its stores in the mainland.

In a statement, it said the issue remained “a contractual matter only”.

On Dec 17, Jiangsu G&L Food & Beverage Management Co Ltd, which was licensed by Shenzhen Kopitiam Asia Pacific Ltd to operate the OldTown franchise in the Jiangsu province, said it had found itself the subject of a complaint filed by Ai Chang Investment Ltd in April last year.

It said it had been forced to close all its outlets, and that another Chinese company in Fujian, Xiamen Kuaike Investment Management Co Ltd, was granted rights as well in March 2017.

“To date, all OldTown White Coffee outlets in mainland China have been shut down,” it said.

However, OldTown said several of the outlets in Jiangsu were already closed due to poor management before any allegation of trademark dispute.

“We would like to clarify that in December 2018, Ai Chang, through a declaration and power of attorney, began the process of assigning their trademark for the operations of cafe outlets to Kopitiam Asia Pacific Sdn Bhd, a wholly-owned subsidiary of OldTown.”

It added that it has been in constant communication with the authorities in Malaysia and China to resolve the disputes in accordance with the law.

The OldTown franchise operates about 200 cafe outlets throughout Asia.

The company is also involved in the production, marketing and sale of coffee and other beverages, including instant coffee mix, instant milk tea mix, instant chocolate mix and roasted coffee powder.