An investigation has been launched by the Pubs Code Adjudicator into the suspected use of “unreasonable stocking terms” by Star Pubs and Bars in proposed market rent only (MRO) tenancies.
The adjudicator wants to hear from any Star tenants who have been offered terms which include a requirement for all or virtually all keg beer stocked to be produced by Heineken.
The investigation relates to MRO tenancies, which is the right of a tied-pub tenant to request to go free of the beer tie.
Other lines of inquiry include MRO tenants being required to stock an unreasonably high proportion of Heineken brands or brands in which Heineken has a commercial interest, or terms that seeks to influence the retail selling price of Heineken brands or brands in which Heineken has a commercial interest.
It is the first investigation from pubs code adjudicator Paul Newby and deputy Fiona Dickie into a breach of the pubs code since the body was launched.
The investigation will cover the period between 21 July 2016 – when the pubs code became law – to 10 July 2019.
Dickie said: “Where tenants of a brewer business regulated by the pubs code exercise their right to ask to go free-of-tie they may still be required to stock that brewer’s beer or cider within limits set out under the pubs code.
“This investigation concerns whether Star has been going beyond those limits by offering non-compliant terms.
“It is important that Star tenants and other interested parties provide us with information to support this investigation.
“Their information will help us to determine whether the pubs code has been broken and, if so, what further action should be taken.
“Any tenants and other interested parties who provide information for the purposes of the investigation will not be identified in the investigation report without their consent.”
A Star Pubs & Bars spokesperson said: “This investigation applies to a very small proportion of our total pub estate - fewer than 5% of our 2,700 pubs.
“The legislation is clear that as a brewer we have the right to ensure that the pubs we own sell our beer and cider.
“This reflects the significant ongoing investment we make and the jobs we support in our UK breweries, cideries and supply chain.
“While the principle of the brewers stocking requirement is clear, this part of the new legislation is complex and not clearly defined in the pubs code.
“We therefore hope that this investigation will provide the certainty and clarity that we have sought repeatedly over the past three years.
“We will of course cooperate fully with the PCA whilst robustly defending our position.”