Publicans are being warned not to offer taxi services to their customers which could land them in court.
Paul and Penny Layburn, who run the Pleasure Boat Inn in Hickling, Norfolk, have been offering free taxis to their regulars in a bid to stop drink-driving and encourage drinkers to visit their local pub.
But North Norfolk District Council told the couple that this was illegal because it breaches taxi licensing rules.
Mr Layburn said: "We feel we are being unfairly penalised. People find it difficult enough to come out to their local pub because of drink-drive laws and it is difficult to get taxis in rural areas."
But Tony Gent, licensing officer for North Norfolk District Council, said they had to make sure businesses obeyed the law and that offering a taxi service - even if it was free - was illegal.
He warned other licensees: "They can provide the service but they have to be registered as a taxi or private hire vehicle.
"If people are being taken to and from the pub they are not going anywhere else so there is a pecuniary advantage."