Note 1  Description of the Business Yum China Holdings, Inc. (Yum China and, together with its subsidiaries, the Company, we, us and our) was incorporated in Delaware on April 1, 2016. The Company separated from Yum! Brands, Inc. (YUM or the Parent) on October 31, 2016 (the separation), becoming an independent publicly traded company as a result of a pro rata distribution (the distribution) of all outstanding shares of Yum China common stock to shareholders of YUM. On October 31, 2016, YUMs shareholders of record as of 5:00 p.m. Eastern Time on October 19, 2016 received one share of Yum China common stock for every one share of YUM common stock held as of the record date. Yum Chinas common stock began trading regular way under the ticker symbol YUMC on the New York Stock Exchange on November 1, 2016. The Company owns, franchises or has an ownership in entities that own and operate restaurants under the KFC, Pizza Hut, East Dawning, Little Sheep, Taco Bell and COFFii &amp; JOY concepts (collectively, the Concepts). In connection with the separation of the Company from YUM, Yum! Restaurants Asia Pte. Ltd., a wholly-owned indirect subsidiary of YUM, and Yum Restaurants Consulting (Shanghai) Company Limited (YCCL), a wholly-owned indirect subsidiary of Yum China, entered into a 50-year master license agreement with automatic renewals for additional consecutive renewal terms of 50 years each, subject only to YCCL being in good standing and unless YCCL gives notice of its intent not to renew, for the exclusive right to use and sub-license the use of intellectual property owned by YUM and its subsidiaries for the development and operation of the KFC, Pizza Hut and, subject to achieving certain agreed-upon milestones, Taco Bell brands and their related marks and other intellectual property rights for restaurant services in the Peoples Republic of China (the PRC or China), excluding Hong Kong, Taiwan and Macau. In exchange, we pay a license fee to YUM equal to 3% of net system sales from both our Company and franchise restaurants. We own the intellectual property of East Dawning, Little Sheep and COFFii &amp; JOY and pay no license fee related to these Concepts. The Company also owns a controlling interest in the holding company of DAOJIA.com.cn (Daojia), an established online food delivery service provider in China. In addition, the Company started a new e-commerce business in 2017, offering a wide selection of products including electronics, home and kitchen accessories, and other general merchandise to customers directly through the Companys e-commerce platform.