Business and Enterprise Committee

25 June 2008 (PN 46)


Committee to revisit the role of pubcos

The Business and Enterprise Committee is today announcing a follow up inquiry into pub companies (pubcos).

In 2004 the Trade and Industry Committee published a report on pubcos in which, most notably, it concluded that:

• No one pubco holds a dominant position within the market;
• Small brewers may be disadvantaged by the requirements set by pubcos;
• The cost of ‘beer ties’ are usually balanced by the benefits available to tenants;
• Splitting the wholesaling and property functions of the pubcos, by removing the beer tie, could lead to the national brewers having a virtual monopoly on the wholesaling of beer, as before the Beer Orders;

and recommended that:

• The British Beer and Pub Association code of practice should be urgently updated to cover: rent reviews; the role of business development managers; complaints and dispute procedures; disclosure and the availability of information; and the taking of legal and professional advice by prospective tenants. 

In response to the report, the British Beer and Pub Association revised its “Codes of Practice Framework on the Granting and Operation of Tied Tenancies and Leases” which forms the basis for individual companies’ own codes of practice.

The Business and Enterprise Committee, in re-visiting this subject, is interested in whether the conclusions of their predecessor still stand and how its recommendations have been applied.  The key questions are:

• Has the Licensing Act 2003 had an effect on competition within the market?
• To what extent have revisions to the framework codes of practice met the Committee’s concerns?
• To what extent are the codes applied by the pubcos?
• Is there a need for further regulation of the industry?

The Chairman of the Committee, Peter Luff MP, said:

“In December 2004 the Trade and Industry Committee concluded that “if the industry does not show signs of accepting and complying with an adequate voluntary code then the Government should not hesitate to impose a statutory code on it.”  We are aware that some progress has been made.  This brief inquiry is intended to find out whether the developments have been adequate.”

The Committee invites written memoranda, on the above points and any other related matters on which those submitting evidence may wish to respond. These should be sent, as an MS Word document, of no more than six pages, by e-mail to [email protected] with a single hard copy sent to the Clerk of the Committee at the address above by 29 September 2008.

Once submitted evidence is the property of the Committee and should not be published without the Committee’s consent. The Committee will usually publish evidence it receives, both in printed form and on the Internet. If you wish your evidence to remain confidential, please contact the Committee staff. Before submitting evidence, please read the guide to submission of written evidence at:

Further Information:

Committee membership is as follows:

Chairman: Peter Luff MP (Con) (Mid Worcestershire)
Mr Adrian Bailey (Lab) (West Bromwich West)
Roger Berry (Lab) (Kingswood)
Mr Brian Binley (Con) (Northampton South)
Mr Michael Clapham (Lab) (Barnsley West and Pen.)
Mr Lindsay Hoyle (Lab) (Chorley)
Mark Oaten (Lib Dem) (Winchester & the Meon Valley)
Miss Julie Kirkbride (Con) (Bromsgrove)
Anne Moffat (Lab) (East Lothian)
Mr Mike Weir (SNP) (Angus)
Mr Anthony Wright (Lab) (Great Yarmouth)

Media Enquiries: Laura Humble, Tel 0207 219 2003/ 07917 488 489, email: [email protected]
Specific Committee Information: Tel 020 7219 5777, email: [email protected]