PepsiCo, has turned to a Stockholm-based arbitration body to help it try and end one of its Chinese joint ventures.

The US soft drink and snack company, has been in a long-running battle with its Sichaun partner and PepsiCo is now demanding a termination to the partnership and damages for breach of contract.

PepsiCo claims that "for years" its partner in Sichuan had "ravaged" co-operation with the US company, and in doing so had broken contracts and agreements in the venture.

Pepsi set up the venture in January 1994, investing US$3m for a 27% share. The remainder is held by Sichuan Broadcasting Industrial Development. Each company could name three people to the board and Pepsi could appoint the deputy general manager and the deputy chief accountant.
 
But PepsiCo now says it cannot exercise its rights over the company and there have been reports that PepsiCo personnel have been barred from the factory in Chengdu, the capital of Sichuan, and refused access to the venture's financial statements.

Pepsico claims that money has been skimmed from the joint venture to spend on inflated advertising and in a statement the soft drink giant said: "Despite prolonged efforts and co-ordination to address the problems, their infringement acts have never stopped to date."

However PepsiCo announced that the dispute would not put it off investing in China. It said it wanted to find a new partnership in the area, which it dominates over rival Coca-Cola.