Pubs code to be examined by business committee

06-Jul-2022 - Last updated on 06-Jul-2022 at 08:03 GMT

Evidence session: the Government's Business, Energy and Industrial Strategy committee will be examining the pubs code and assess how it is working

The Business, Energy and Industrial Strategy (BEIS) committee will question a number of people from the industry on how the pubs code is working later this month (Tuesday 12 July).

When the code was introduced in 2016, its aim was to govern the relationship between pub tenants and large pubco landlords when the two have a tied lease.

Pubs code adjudicator (PCA) Fiona Dickie is in charge of enforcing the code and she will be one of the witnesses questioned by the cross-party committee.

They will be looking to find out how provisions in the code have worked in practice compared to how they were envisaged by BEIS department ministers.

This will include the market-rent-only (MRO) option and according to BEIS, the committee has heard claims the code allows landlords to demand an arbitration process that can take two years, at added expense to the tenant, instead of of the result being provided within 90 days.

Witnesses will also be asked about criticisms the industry has continued to be dominated by large pubcos.

Code criticisms

It will also include claims pubcos are continuing to use the tied model to make prohibitive demands on tenants, which the code was supposed to prevent, such as demanding higher shares of revenue for sales of beer sourced from smaller brewers.

The committee has also heard of cases where tenants who request MRO have been threatened with detrimental changes to their terms such as rent payments becoming quarterly with an advance payment.

The aim of the examination of the code is to understand the validity of the criticisms and to look at whether improvements could be made to how it is administered.

The evidence session comes after the BEIS department launched an ongoing public consultation into how the pubs code and PCA are working.

Witnesses called

The committee will provide a submission to the Government’s consultation after hearing the evidence.

Witnesses for the session will include British Pub Confederation chair Greg Mulholland, Campaign for Pubs chair Paul Crossman as well as Forum of Private Business and licensee Ian Cass.

It will also hear from Star Pubs & Bars operations director for the north Mick Howard, Stonegate managing director Nick Light, Punch Pubs CEO Clive Chesser and Marston’s group operations director and group property director Ed Hancock.

PCA Fiona Dickie and BEIS deputy director of competition policy Alesha De Freitas will also give evidence.