CAMRA disappointed by OFT pub decision

Date: 23rd October 2009

The Office of Fair Trading (OFT) has signalled support for the concept of the "tied pub", in a decision that could have big repercussions for the UK hospitality industry.

According to the report, Pubcos neither harm industry competition for publicans, nor lead to higher beer prices and less consumer choice.

The OFT was responding to an original super-complaint on the issue from the Campaign for Real Ale (CAMRA).

It had been claimed that tied pubs damage the sector - and are even contributing to pub closures in the recession.

Simon Williams, senior director of the OFT's Goods group, said: "Any strategy by a pub-owning company which compromises the competitive position of its tied pubs would not be sustainable, as this would result in a loss of sales.

"Pub-owning companies are not therefore protected from competition by virtue of the supply ties agreed with their lessees."

Meanwhile, a representative of CAMRA expressed disappointment at the decision and called on the government to overrule the OFT.

"We do not accept that there is sufficient competition between pubs or adequate consumer benefit from competition and choice within this sector," Mike Benner, CAMRA's chief executive, said.

"It is difficult to see how the OFT can argue that competition is working well in the pubs sector when demand is falling, yet prices are rising."