The office’s first investigation comes as pubs code adjudicator Paul Newby and his deputy Fiona Dickie claimed to have reasonable grounds to suspect the operator of near 3,000 pubs has used “unreasonable stocking terms” in proposed free-of-tie Market-Rent-Only (MRO) option tenancies, which is deemed a breach of the pubs code.
“Fiona Dickie and I have decided to launch this investigation to understand the extent to which the pubs code may have been breached and the potential impact on Star tenants,” said Newby in a statement.
The investigation will cover the period between 21 July 2016 – when the pubs code became law – to 10 July 2019.
Non-compliant terms
After the announcement today (10 July), the PCA will seek evidence from Star tenants who have been offered tenancy terms believed to be in breach of the pubs code, following service of an MRO notice.
These include a requirement for all, or virtually all, keg beer stocked to be produced by Heineken; a requirement to stock brands not produced by Star or group undertakings of Star; any requirement to stock an unreasonably high proportion of Heineken brands or brands in which Heineken has a commercial interest; or a term that seeks to influence the retail selling price of Heineken brands or brands in which Heineken has a commercial interest.
“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,” deputy pubs code adjudicator Dickie added.
“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.”
Evidence should be sent to investigations@pubscodeadjudicator.gov.uk before 5pm on 7 August 2019.
Full co-operation
In response to the launch of the investigation, a Star Pubs & Bars spokesperson said: “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, co-operate fully with the PCA while robustly defending our position.”
