CAMRA urges restrictive covenants ban

Related tags Restrictive covenants Contract law Restrictive covenant Public house

CAMRA: clear stance on restrictive covenants
CAMRA: clear stance on restrictive covenants
The Campaign for Real Ale (CAMRA) has called on the Government to ban the practice of selling pubs with restrictive covenants that force change of use.

The group says a nationwide ban is “the only way to ensure that the practice of imposing restrictive covenants is permanently stopped”, in response to a Government consultation on the measure.

CAMRA said giving authorities the right to implement local bans would lead to inconsistencies between different councils, and said more self regulation “simply will not work”, arguing that sanctions would not be meaningful.

CAMRA pointed out that 12 companies that operate tenanted and leased pub estates, with 5,078 sites between them, have declined to rule out the use of restrictive covenants in their updated codes of practice.

The group also feared that Punch and Enterprise, the two biggest pubcos, would not stick to their commitment not to apply restrictive covenant on pub sales.

CAMRA dismissed the argument put forward by some pub companies that forcing some pubs to close via restrictive covenants will make others nearby viable, labelling this “a cynical attempt to boost profits for the remaining pubs in the area, to the detriment of consumers and the local community”.

The group also called on the Government to ban “restrictive covenants by the back door”. For example, by refusing to let it for use as a pub, and instead seeking planning permission to change it to housing.

CAMRA also fears that new Community Right to Buy legislation will not work if covenants are attached to pub sales.

Meanwhile, CAMRA highlights cases of pubs being sold with restrictive covenants that are billed as being “capable of generating high income” or in a “popular tourist destination in a scenic area” - “strongly implying that the pub is not being sold because it is unviable”.

The consultation closed on Tuesday (25 October).

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