GMB slams BBPA's new code

13-Oct-2009 - Last updated on 27-Aug-2011 at 06:33 GMT

GMB: calls for BBPA to talk about money

Trade union GMB has slammed the British Beer & Pub Association's new code for tenancies for failing to address the issue of unfair pricing to...

Trade union GMB has slammed the British Beer & Pub Association's new code for tenancies for failing to address the issue of unfair pricing to tenants.

GMB national organiser Martin Smith said: "The BBPA and the BII and others seem anxious to promote the view that what is at issue with the "tie" is a lack of transparency rather than an old fashioned economic dispute.

"While this new code may help to explain to new tenants the wholesale prices they will be charged it will do nothing to enable them to make a decent living.

"Wholesale prices to tied tenants need to come down. Until they do there will be no peace in this sector. If the BBPA code had stipulated that wholesale prices must allow tenants to be able to make a groo profit (GP) of somewhere around 66% at average local prices that would have been a step forward.

"However the code is silent on this central issues and is not much use to GMB members struggling as tied tenants to make a living with uneconomic GPs.

"We will be making this point to the OFT and the EU officials when we meet them soon. Sooner or later the BBPA and BII will have to talk about money."

But Mark Hastings, director of communications at the BBPA hit back: "What GMB are asking for is against the law. They should know better. Any industry wide agreement on margin protection is a clear breach of competition law."

The new BBPA Framework Code of Practice on the Granting of Tenancies and Leases will be mandatory for all BBPA members from 1 January 2010. Member companies will have until 30 June 2010 to incoporae the new code in their own code of practice and seek BII accreditation.

The BBPA code calls for members to:

• Establish standards of competence for BDMs

• Describe the rental and purchase obligations

• Demonstrate transparency over beer prices

• Clarify rent setting and review policies

• Provide shadow P&Ls

• Draw attention to the availability of ALMR and other benchmarking report.

• Ensure Upward Only Rent Review clauses are not included in new leases

• Remove AWP machine tie

• Supply lessees with full details about insurance cover

• Set out a clear policy on Brulines

• Clarify restrictive covenants