Regulatory, Licensing, and Financial Requirements
Expanding your restaurant internationally is more than a growth strategy—it’s a major leap that tests every part of your business. From operations and supply chains to culture, finance, and law, every element will create new challenges.
It’s easy to get swept up in the excitement of new markets and emerging culinary scenes. But international expansion isn’t just about translating your brand or replicating your menu abroad.
Success requires understanding and complying with an entirely new legal ecosystem. You need to manage risk, structure your business intelligently, and ensure your intellectual property survives the journey intact.
We have seen too many promising overseas ventures grind to a halt because of seemingly minor zoning issues that were overlooked in the initial planning.
In this blog series, we take you beyond the checklists and into the legal substance of what international expansion really requires, while also weaving in operational and strategic considerations that align with your legal framework.
Whether you’re taking your first steps abroad or looking to solidify a presence already in motion, this six-part series will equip you with the legal insight to move with confidence and foresight, by covering:
Part 1: Legal Considerations for Structuring Your Restaurant Abroad
Part 2: Navigating Regulatory, Licensing, and Financial Requirements
Part 3: Employment, Data Privacy and Consumer Protection
Part 4: Intellectual Property Considerations
Part 5: Real World Nuances in Law and Application
Part 6: How to Use Legal Counsel When Expanding Internationally
Regulatory compliance is not just about obtaining a food service license—it’s about understanding the full legal infrastructure governing food safety, alcohol sales, building codes, signage, employment, waste disposal, and beyond.
Licensing and Permits
At a minimum, you will need to secure a business license and a food establishment permit. However, this is only the beginning. If you plan to serve alcohol, you will almost certainly need a liquor license, which in some jurisdictions is quota-based, expensive, or tied to specific locations. You may also require music licenses, fire safety inspections, outdoor seating permits, and signage approvals.
You need to distinguish between national-level licenses and local municipal requirements. In some cities, zoning restrictions or community board input can derail your licensing entirely.
Zoning laws are often overlooked by first-time international operators. A space that appears perfect may turn out to be zoned in a way that prohibits restaurant use or imposes noise restrictions incompatible with your concept. We once advised a client whose ideal location was rejected due to an obscure local ordinance prohibiting late-night retail in that specific district, a detail that was only uncovered deep into their lease negotiations (and that is when they first called us). We also worked with a major restaurant chain whose Moscow opening was delayed by nearly two years due to prolonged efforts to secure noise variance approvals.
Food Safety and Health Inspections
Local health codes vary dramatically. Some countries require HACCP (Hazard Analysis Critical Control Point) certification, while others impose unique sanitation or record-keeping obligations. Failure to comply can lead to fines, reputational damage and even criminal liability in certain jurisdictions
Restaurants must also navigate allergen labeling and ingredient disclosure rules. These requirements vary dramatically by country and can significantly impact your menu.
While navigating permits and health codes presents immediate operational challenges, the financial and regulatory requirements create a parallel layer of complexity that demands equal attention.
Financial Considerations
International expansion introduces a wide range of financial mechanics that can significantly impact your restaurant’s profitability. Success depends not only on adapting your business model to local economic conditions, but also on implementing a financial strategy that reduces exposure to regulatory risks, tax inefficiencies, and currency volatility.
To navigate these complexities, you should focus on several key areas:
Financial Reporting Standards
Accounting frameworks vary by jurisdiction. Many countries use International Financial Reporting Standards (IFRS). Others require domestic standards that may conflict with your existing systems.
You should evaluate whether your internal financial infrastructure and accounting teams can accommodate these differences and ensure timely, accurate reporting to local tax and regulatory authorities.
Compliance with Anti-Money Laundering (AML) Obligations
Many countries enforce stringent AML requirements, including customer due diligence, transaction monitoring, and suspicious activity reporting. These rules are especially relevant for restaurants that process high volumes of cash or frequent transactions.
Failing to implement adequate AML protocols may expose your business to investigations, penalties, or reputational harm.
Managing Currency Fluctuations
Foreign exchange volatility can have a direct impact on revenues, cost of goods sold, and overall profitability. Consider implementing hedging strategies—such as forward contracts or natural hedging through local sourcing—to stabilize performance and protect margins.
Understanding Local Banking and Payment Systems
Every country has its own banking practices, payment infrastructure, and settlement cycles. In some markets, cash remains dominant; in others, digital wallets and QR code-based payments are standard.
You must ensure that your systems are compatible with local preferences and comply with applicable licensing or reporting requirements for merchant services.
Repatriation of Profits
Moving profits from a foreign subsidiary or branch to your parent company may not be straightforward. Foreign exchange controls, dividend withholding taxes, or capital repatriation restrictions can all affect how and when funds can be transferred.
You should set up your repatriation strategies during the planning phase—not after profits begin to accumulate—to avoid unwelcome surprises.
Navigating Taxation
In addition to standard corporate income tax, businesses must account for indirect taxes such as value-added tax (VAT), goods and services tax (GST), or sales tax, depending on the jurisdiction.
Cross-border payments—including royalties, management fees, and interest—may also be subject to withholding taxes. For companies operating under multi-entity structures, transfer pricing rules are critical. Proper documentation and arm’s-length pricing of intercompany transactions will help ensure compliance and reduce audit risks.
Conclusion
A single overlooked licensing requirement can delay your launch by months. A misunderstood tax obligation can quietly erode your margins for years. But when you get these fundamentals right, you’re not just avoiding costly pitfalls—you’re building competitive advantages that many international operators never reach.
Working with legal counsel who understands both the domestic and international dimensions of your business is not optional—it is essential. The cost of expertise upfront pales in comparison to the price of mistakes discovered too late.
In Part 3 of this six-part series, we’ll explore the legal and strategic challenges around employment, data privacy, and consumer protection—three areas that are as complex as they are critical. Please stay tuned.
