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Industry cautious on government proposals for revised Pubs Code

Published:  29 October, 2015

Government plans announced today to redraw the relationship between tied pub tenants and their landlords have received a cautious welcome from the industry.

Business minister Anna Soubry launched the first part of a two-part consultation on a new Pubs Code this morning.

The revised code is designed to ensure fair dealing for tied tenants while minimising as far as possible burdens on business.

It aims to enshrine the principle that a tenant tied to a business owning 500 or more tied pubs should be no worse off than a free-of-tie tenant.

Up to 13,000 tied tenants in England and Wales will be protected by the code.

It will not reduce the protections available to tenants under the industry's existing but voluntary code of practice.

Soubry said: "Pubs are the lifeblood of so many of our towns, villages and high-streets, playing a vital role supporting our local economies. It's not right that some tied pub tenants are unfairly overcharged by their landlords and the Pubs Code will help ensure they get a fair deal.

"I'm looking forward to hearing from pub companies and tenants on these important proposals to put the industry on the strongest possible footing."

The government is seeking views from pub-owning businesses, tied tenants and their representatives.

Brigid Simmonds, chief executive of the BBPA, said: "There is a large amount of detail to be studied in these proposals, but I do welcome that the government appears not to be proceeding with parallel rent assessments, which we always argued strongly would be too costly and complex to operate.

"We also welcome proposals to allow for an MRO waiver in return for a significant capital investment. Over £200 million is invested by BBPA members in their leased and tenanted pub estates, each year. It is essential that this investment continues.

"We will be responding in detail as we do need to work very closely with Department of Business, Innovation & Skills, and tenants' representatives to make the legislation work in practice."

Steve Kemp, responding on behalf of the GMB, which represents tied-pub tenants, said: "It is nearly a year since Parliament voted for legislation to give tied-pub tenants a market-only rent option with freedom to buy drinks wholesale on the open market.

"The GMB hopea that the intention of the consultation is to implement that principle and not to water it down.

The GMB will study the proposals and members will respond to the BIS request for views."

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