Up to 22 Irish franchisees are believed to have stopped paying royalties and rents to O'Brien's Sandwich Bars.

Franchisees are nervous about the fate of the Irish business following the announcement on Friday that the British arm is going into administration. Many said they feared the group is facing the same plight here, although founder and chairman Brody Sweeney denied this.

"A few franchisees are a little bit upset. It's happened before and it will happen again," Sweeney told the Sunday Tribune.

Brody has written to franchisees warning them that the withholding of funds could actually push the Irish business into administration, in a letter seen by the Sunday Tribune.

A source said Sweeney had also telephoned franchisees two weeks ago in an attempt to petition their support in the event of the Irish business going into examinership.

The O'Brien's group, like all franchised businesses, is exposed to major rent liabilities where franchisees go under, as it holds the head leases on all franchise premises.

A number of the sandwich franchises closed down this year and simply posted back the keys of their premises to O'Brien's head office.

Trading conditions here "are if anything worse than the UK", Sweeney said in a statement announcing the administration move on Friday. "This is the worst downturn since the sandwich group began trading," he stated.

The sandwich empire franchisees pay royalties of up to 9% of turnover, with some paying €90 in every €1,000 to the O'Brien's group, regardless of whether they are making a profit. Franchisees reportedly sought a fee reduction of 3% in February of this year from the group, but without success.

Sources said that some O'Brien's outlets that closed down were reopened and rented out at reduced royalties and rents.

Some franchisees have paid €200,000 to €500,000 in 'key money' for their premises, an investment that would disappear in the event of their business collapsing.