Pubco codes are legally binding

By Ewan Turney

- Last updated on GMT

Related tags Bbpa Renting

Pubcos: will have to abide by new codes of practice by 30 June 2010
Pubcos: will have to abide by new codes of practice by 30 June 2010
New pubco codes of practice will be legally binding and can be used as evidence in any court proceedings, says the BBPA.

New pubco codes of practice will be legally binding and can be used as evidence in any court proceedings.

That's the news from the British Beer & Pub Association (BBPA) as it publishes its long-awaited Framework Code of Practice.

The code, agreed with the Federation of Licensed Victuallers Associations and the BII, will be mandatory for all BBPA members from this month onwards, and pubcos have until 30 June to implement the changes and have their codes accredited by the BII.

The BBPA said that as the new codes would be signed by both tenant and pubco, they were legally binding. However, critics say the only sanction for breaches is exclusion from BBPA membership.

The code sets minimum requirements for the information made available to tenants and lessees. For the first time, it ensures that people who purchase assigned leases receive the same level of information.

Key points of the code:

• Ban on upwards-only rent​ clauses

• Increase transparency​ with regard to prices charged for beer and eligibility for discounts

• Explain policy on rent setting

• Provide shadow profit & loss accounts​ and volume details for past three years

• Remove AWP machine income​ from the divisible balance on rent setting

• Price match on insurance

• Set out clear policy on beer-flow monitoring

• Follow RICS rent guidance​ and implement any changes

• PIRRS rent arbitration​ available for all tenants.

Code breaches

The code stresses that complaints should be dealt with at an "appropriately high level of management".

If a resolution is not found, then a complaint should be made to the Federation of Licensed Victuallers Associations or BII, who will attempt to broker a deal.

Pubcos are committed to adopting any changes to the pub rental valuation system by the Royal Institution of Chartered Surveyors. Upwards-only rent clauses are banned.

Codes must also include the option for tenants to make use of the Pub Independent Rent Review Scheme (PIRRS).

The BBPA hopes the code will persuade the Business, Innovation & Skills Committee and the Government that no further intervention is needed (Luff: I don't feel we can trust pubcos​).

BBPA chief executive Brigid Simmonds said: "With these reforms well underway, this will help the industry to work together to tackle other challenges."

Lack of sanctions

But Fair Pint claims the BBPA has "offered nothing" with its new code. "The BBPA has offered nothing but a codification of things it should be expected that good companies would have done anyway," said spokesman Steve Corbett.

"Pubcos have a record of ignoring existing codes of practice. A lack of real sanctions for this code means they will be free to ignore this one as well.

"The weakness of the code shows that the BBPA believes that despite the criticism of members, it is business as usual and their only interest is the financial health of their big pubco members."

• Download the pubco code here​.

What do you think of the new pubco code of practice? Will it make a difference? Have your say in our forums by hitting Post a comment​ below.

Related topics Legislation

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