Single pubco accounts for more than half of PCA arbitrations, data shows

By Helen Gilbert

- Last updated on GMT

Dotted line: arbitrations can help both parties reach an agreement
Dotted line: arbitrations can help both parties reach an agreement

Related tags: Pca, Arbitration, Mro, Pubco, Ei Group

EI Group, previously known as Enterprise Inns, has topped the list of arbitrations to go through the office of the Pub Code Adjudicator (PCA) since it was established, PCA data has revealed.

EI accounted for more than 120 of the 216 arbitration cases accepted by the PCA, while none involved Admiral, according to the adjudicator’s findings. 

Greene King, Punch Taverns and Star Pubs & Bars each made up between 21 and 30 of the accepted cases, while referrals involving Marston’s stood at between 11 and 20.
Of the 192 MRO (market-rent-only) option cases accepted by the PCA, 111-120 related to EI Group, 21-30 were about Greene King and Punch Taverns, 11-20 concerned Star Pubs & Bars, and  1-10 involved Marston’s. 

MRO triggers

According to the PCA, the right to request an MRO (free of tie) option only applies if one of four specific MRO events occur:

• at tenancy renewal

• following receipt of a rent assessment proposal as part of a rent review process

• where there has been a significant increase in price in a tied product or service

• where an event has occurred that significantly impacts on trade

The PCA said it publishes arbitration statistics in the form of narrow bands, rather than specific figures, to be transparent without providing information from which an individual case may be identifiable.

Most common referrals 

Under the pubs code, which came into force in the summer of 2016, tied tenants of pubcos owning more than 500 pubs have the legal right to take the MRO option - the PCA data showed the most common referrals concerned MRO, business development managers and rent assessment proposals.

Quarterly figures also revealed that number of arbitration referrals increased to 36 between January and March 2018 - up from 16 in the previous three months with 31 cases accepted compared to 16 previously.

Rise in MRO referrals 

MRO-related referrals also rose from 13 during the three months to December 2017 to 33 for the first quarter of 2018, with 28 cases accepted by the PCA compared to 14 previously.

Brigid Simmonds, chief executive of the British Beer & Pub Association, said: “The BBPA has been working closely with the pubs code adjudicator and deputy adjudicator in recent months through the Compliance Officer Forum and it is important that cases are now progressed at a quicker pace.  It is in no one’s interests to have a backlog of cases due for arbitration.

“Given the lack of a transitional period for the pubs code coming into effect it was inevitable that it would take some time for the system to begin functioning smoothly. We will continue to work with industry stakeholders to ensure that the code is operating as intended.”

Related topics: Legislation

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