Ministers Signal More Flexibility for Tied Pub Tenants After Pubs Code Review

The Government has indicated it is willing to reform the rules governing tied pub tenancies, potentially giving licensees more control over what they pay for beer, cider and other supplies. The move follows a review of the pubs code and the role of the Pubs Code Adjudicator (PCA), the independent regulator that oversees relations between tied tenants and Britain’s largest pub-owning companies. Ministers have confirmed the regulatory framework will continue, but say it could be tightened up to create additional options for both tenants and pub companies.

Background to the code

Introduced in 2016, the pubs code governs dealings between tied licensees and the six biggest pub-owning businesses in England and Wales. Its core aim is to guarantee tenants fair treatment, and it includes the market rent only (MRO) option — a mechanism allowing qualifying tenants to break free of tie arrangements so they can source drinks from suppliers of their choosing.
In practice, take-up of that option has been limited. Government figures show fewer than 400 tenants applied to go free of tie between April 2022 and March 2025. Officials say tenants have pointed to the cost and complexity of the process as key reasons for not pursuing it.

What could change

The Department for Business and Trade (DBT) has said it will now consult publicans and industry figures on ways to widen tenants’ options, including the possibility of fairer lease terms and improved pricing on beer supplies.Separately, ministers are weighing up reforms that would let pub companies and their tenants strike longer-term agreements. The department argues that the added security such deals could bring may encourage both sides to invest more readily in their premises, protect jobs and keep pubs functioning as focal points for their local communities.
Kate Dearden, Minister for the Future of Work, said the review was intended to give tenants a fairer deal while also giving pub companies the confidence to invest, adding that thriving pubs bring benefits to the wider community, from skills development to reviving high streets.

Adjudicator asked to review its own practices

Alongside the wider policy review, ministers have asked the PCA to examine six specific areas where it could operate more effectively. These include producing clearer guidance for tenants and ensuring that requests for information made to pub companies are proportionate and reasonable.
The review followed a broader assessment of whether the adjudicator role should continue in its current form, be reformed, or be folded into another public body. It arrives shortly after the PCA marked ten years of regulating the tied pub sector.

Sector Response

Sector spokespersons have welcomed the news, Greg Mulholland, Campaign Director for the Campaign for Pubs said: “The Government has rightly retained the Pubs Code, which is still needed more than ever. We are very relieved that Minister did not fall for the transparently cynical nonsense spun by the big pubcos that it wasn’t needed any more. The truth is that abuse of the tie and abuse of the so-called ‘self-employed manager’ model is still rife as former licensees and communities all over the country will confirm. It continues to be a very significant factor in pub closures, both temporary and permanent.

“We welcome the fact that the Government will consult on making it easier for tied tenants to go free-of-tie, because the current weak process makes it far to risky and costly for most tenants to consider it. As the person who led the campaign and introduced the Market Rent Only (MRO) right to Parliament, I can confirm that the current Market Rent Only option is not what the House of Commons voted for and is weak and flawed and often out of reach for tenants. It is time for the genuine MRO that was promised to tenants, as well as looking at reform of the beer tie itself. There is no excuse at all for huge offshore property companies that don’t brew beer to be allowed to force pub landlords to buy beer and other products at hugely inflated prices, sometimes as much as double the cost. It is bad for publicans, bad for small brewers and bad for pub customers.

Paul Crossman, Chair of the Campaign for Pubs & a publican in York said: “Andy Burnham has promised to support pubs and one easy and obvious way to do this is through meaningful reform to stop abuse of the beer tie, to finally allow pubco tenants to take a fair share of the pubs’ profits. This costs the Treasury and the taxpayer nothing and would enable many more publicans to actually make a living. It is also high time that the Treasury commissioned a proper study of how much money is lost to the UK economy every year, through the fact that offshore and foreign owned pubcos take far too much money from pub tenants, which goes to service their debts, pay off bondholders and pay shareholders and excessive bosses salaries and bonuses.

“It is also time for a proper investigation into whether some of the ‘self-employed manager’ models are actually legal, both in terms of some of these people getting less than minimum wage, but also because some appear to be bogus self-employment, something the Government has pledged to crack down on”.

“We look forward to working with the Government and we hope they will look at the evidence and strengthen the Pubs Code, so that it can at last ensure that pubco tenants can take a fair share of their pubs’ profit, something they were promised in 2015 but that still hasn’t happened”.

CAMRA Chairman Ash Corbett-Collins said: “We’re glad that the Pubs Code will be kept in place, as it’s needed more than ever. Ordinary drinkers are being denied choice and value by the global brewers that dominate the UK beer market, including how beer is sold to pubs. We’re looking forward to seeing the details of how more tied pub tenants might be able to challenge the beer tie.

“However, we still have a supply-led beer market that is dominated by global brewers, which means that licensees, independent brewers, and ordinary drinkers lose out.

“We need to see bolder reforms like guest beer rights for tied tenants, and the Department for Business must stop dragging their feet and publish the outcome of the review of access to the beer market for independent brewers.”