Update on the Pubs Code Adjudicator inquiry

Pursuant to its inquiry into the operation of the Pubs Code and the performance of the Pubs Code Adjudicator (“PCA”), on 26 June 2018 the House of Commons Business, Energy and Industrial Strategy (“BEIS”) Committee received oral evidence (a transcript of which can be downloaded below) from the PCA, Paul Newby, and his deputy, Fiona Dickie. The oral evidence session can be viewed on Parliamentlive.tv here.

As we have previously reported, the Committee was looking at whether the existing statutory framework is working as it was intended to and whether disputes between tied tenants and pub owning companies are being resolved satisfactorily, with particular regard to the following questions:

  • Is the Pubs Code providing clarity and fairness in the relationship between pub owning companies and tied tenants?
  • If not, what changes are required?
  • How effectively has the office of the Pubs Code Adjudicator ensured compliance with the Code and arbitrated in cases of dispute?

Particular points arising from the oral evidence include:

  • Admiral Taverns and Star Pubs & Bars (Heineken UK) have shown the “most willingness” to waive confidentiality in arbitration rulings, whilst Ei Group and Greene King have been “intransigent”
  • the PCA believes that keeping awards confidential is “plainly not right”
  • a “deadlock” exists over market rent only (“MRO”) option issues
  • on the question of the current judicial review challenge by Greene King to the PCA’s MRO advice note, published at the beginning of March 2018, Paul Newby said: “We are at a point where the law is far from settled and we are still being challenged. We have issued our advice note and that is not accepted and the advice note itself is the subject of a legal challenge. A key part of our role is to get to a point where there is clarity about what this code actually means in legal terms”
  • on the question of the length of time it is taking to resolve disputes via the PCA process, Fiona Dickie said: “There is a significant caseload and neither of us have a magic wand. The number of cases that have been outstanding for more than six months is coming down”

Written evidence received in advance by the BEIS Committee from the following interested parties can be accessed here:

  1. the PCA
  2. Admiral Taverns
  3. UK Hospitality
  4. the Forum of Private Business
  5. Star Pubs & Bars
  6. Punch Taverns

UPDATE: It has been reported on 29 June 2018 by Propel’s Morning Briefing that: “the six companies subject to the Pubs Code have written to Business, Energy and Industrial Strategy minister Richard Harrington agreeing to waive their right to confidentiality in arbitration decisions made by the Pubs Code adjudicator. Under the Arbitration Act decisions must remain confidential unless all parties to a decision agree to publication. The move by pub companies to waive their rights in this respect will help in providing clarity and transparency for the whole sector”. BBPA chief executive Brigid Simmonds is quoted as saying: “The decision of the pub companies to waive their rights in this respect aims to reassure the whole sector about their commitment to clarity and transparency. It is something that has been under discussion for some time but clearly there are detailed legal hurdles that need to be overcome. The proactive agreement of the six companies to agree to this approach is an important step. It highlights the fact we remain committed to working with tenants and the Pubs Code adjudicator to ensure the code is delivered as Parliament intended. We have also suggested each company’s Market Rent Only option agreement is accredited by the Pubs Code adjudicator to ensure the system is more open, transparent and provides clear guidance to licensees.”