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Withdraw from EC renewed block exemption re UK beer tie

Comment 7th July 2010

On 20th April 2010 the European Commission (EC) agreed to continue its "block exemption" on certain "vertical agreements" which could pose competition issues, including the "beer tie", until 2022. Effectively the UK's compliance with this EC regulation will ensure the survival until at least 2022 of the national disgrace "beer tie" inflicted on UK public houses by UK pubcos and national and regional brewers. The UK "beer tie" is a major cause of the alarming closure of UK pubs (currently an average of six pub closures per day) and inflates the retail price of a pint of beer to the consumer by almost £1 per pint.

I cannot recommend strongly enough that the UK government urgently legislate to exempt the UK from compliance with the aforementioned EC directive in relation to the "beer tie" and thereby create a competitive business environment for UK pub tenants whilst also benefitting UK consumers. Whilst the "beer tie" may in the distant past have been a mutually beneficial arrangement for pub tenants, consumers and pubcos alike, it is very apparent that the pubcos and brewers have distorted it so much over the years that it now clearly pernicious, inflationery and anti-competitive – quite apart from being a restrictive practice otherwise illegal elsewhere in UK business. Both the EC and OFT have failed to appreciate this drastic change (despite the BISC's recent highly critical review of the "beer tie") although the OFT are now having to consider an appeal from CAMRA who I hope will ultimately refer the "beer tie" to the Competition Commission. However by the time these quangos wake up how many more UK pubs will have closed and thereby whole communities lost? The disappearance of sociable places of enjoyment (already suffering from the removal of the "two in a bar" live entertainment licence – which should be reinstated asap) will doubtless add further to the social problems in the UK in enforcing yet greater insularity by the population in becoming a nation of "couch potatoes".

FYI I am not employed in the UK pub trade but I am an independent accountant, concerned consumer and very worried UK citizen.

Why does this matter?

The unique pub culture in this country is in danger of extinction – and what will it be replaced by?

I sadly foresee greater social unrest, further absence of community spirit and neighbourliness if the destruction of our pub culture is allowed to continue apace through dominance of the UK by the European Commission (EC) in relation to the "beer tie".

I just hope that this government can halt the decline by extricating the UK from this penal EC directive as I do not want to be around when there are no pubs to go to in this country!


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