UK: Government aims to stop pub company "abuses"

By | 9 January 2013

The UK Government is looking to intervene in the pub industry

The UK Government is looking to intervene in the pub industry

Plans for a new statutory code to stop “abuses” by large pub groups have been unveiled by the UK Government.  

The code will be overseen by an independent adjudicator to tackle “unfair practices” in the industry, the Department for Business, Innovation and Skills (BIS) said yesterday (8 January). The Government hopes it will stem the number of pub closures in the UK, with 18 a week still shutting. 

Under the UK's beer tie system, publicans pay a rent to pub companies, known as pubcos, and have to buy their beer through the company. The new code will "prevent abuses of the beer tie", BIS said.

UK Business Secretary Vince Cable said many pubs are closing as publicans are "struggling to survive on tiny margins". 

“Some of this is due to pubcos exploiting and squeezing their publicans by unfair practices and a focus on short-term profits,” he added.

Jonathan Neame, the British Beer & Pub Association's chairman, which represents the pubcos, said: “We will be urging the Government to ensure that any statutory process is light-touch and cost-effective, to protect consumers from bearing the brunt of unreasonable additional costs.”

A consultation on the measures will be launched this Spring, BIS said.

Expert analysis

UK Beer Market Insights 2012

A detailed market research report on the UK beer industry. The report covers total market (on- and off-premise) and includes valuable insight and analysis on beer market trends, brands, brewers, packaging, distribution channels, market valuation and pricing.

Sectors: Legislation, The on-trade

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