Move to address lack of competition welcomed

January 14, 2010: A Government decision to revoke an order that could address a lack of competition in the pub sector has been welcomed by the Campaign for Real Ale (CAMRA) and the Fair Pint group.

The revocation of the Land Agreements Exclusion Order 2004 is something CAMRA has been campaigning for since last summer as part of its campaign to reform the beer tie and deliver a fair deal to the pubgoer.

Large pub operating companies — principally those with 500 or more premises — will now need to work to prove that their beer tie agreements are fully compliant with competition law.

Currently tied landlords are unable to buy beer from brewers of their own choice and, says CAMRA, are forced to pay prices inflated by around 50 pence a pint. The Government says the revocation of the order will promote fairer and more open markets and a better deal for consumers through improved prices, wider choice, greater investment and higher standards of customer service.

‘This is very positive news for pubgoers, small brewers and struggling lessees," said CAMRA chief executive, Mike Benner. "The Order is an anomaly which has for too long given legal cover to companies which are party to potentially anti-competitive agreements.

"The large pub-owning companies will now have to review their existing beer tie arrangements in the full knowledge that they will be liable to severe penalties if it is subsequently proven that they have breached competition law."

He added: "CAMRA remains supportive of the beer tie model provided that it offers a fair share of benefits to consumers through greater choice, price competition and quality.

"We now urge the large pub-owning companies to publicly commit to delivering on the basic principle that a tied tenant should be no worse off than they would be if free of tie."

Steve Corbett, from Fair Pint, which has worked with CAMRA and other interested parties on this matter, said: “The Government’s decision to revoke the order is a small bit of good news for the pub sector.

“On its own the effects of the removal of this order will be small, but it does lift a significant barrier to future regulatory intervention in the sector.”