The Heineken-owned pub company was fined £2m by Dickie, following her office’s first investigation into suspected breaches by Star Pubs & Bars for offering unreasonable stocking terms to tenants seeking to go free-of-tie.
Dickie concluded the nature and seriousness of the 12 breaches uncovered had “frustrated the principles of the pubs code” and merited the financial penalty. She said she hoped the decision would act as a deterrent to all the regulated pub companies.
Repeated regulatory interventions
At the time, she said: “My message is that if anyone previously had any doubts about my resolution to act when I find breaches, they can have no doubt now.
“Star had persisted in forcing its tenants to sell unreasonable levels of Heineken beers and ciders when they requested to go free-of-tie.
“This was despite repeated regulatory interventions and clear arbitration rulings from the PCA.”
On top of that, she also highlighted what the PCA described as systemic corporate failures in Star’s approach to compliance.
However, Star has now announced plans to appeal the decision.
In response to Star's forthcoming appeal, Dickie said: “I stand by the penalty issued following a detailed and thorough investigation in which I found multiple code breaches by Star.
"I am committed to ensuring pub companies deliver on their code duties and that the code achieves the cultural change that Parliament intended.”
Deeply disappointed
Lawson Mountstevens, managing director, Star Pubs & Bars, said: “We are deeply disappointed and frustrated at the outcome of the PCA’s investigation. There are many aspects of the report that we fundamentally disagree with and we have lodged an appeal with the High Court.
“This penalty is unwarranted and disproportionate, and comes at a time when the entire sector is in serious financial crisis as we work around the clock to support our pubs and licensees to keep their businesses afloat.
“We are a responsible business that takes its regulatory obligations extremely seriously and strives to achieve the highest levels of professionalism.
"From the outset we have been transparent and repeatedly sought guidance from the regulator on the terms we were offering those licensees looking to take up the market-rent-only (MRO) option, but the PCA consistently declined to respond to those requests. Instead it chose to launch a long, costly and unnecessary investigation.
“We are dedicated to the pubs code in both word and spirit, and do not believe the investigation accurately reflects the culture of our business or the good working relationship we have with the vast majority of our licensees.”
