April 22 (Bloomberg) -- The U.K. proposed a new regulator for companies that own more than 500 pubs, aiming to ease what officials called abuses by the owners, who may see annual income from their tenants cut by 100 million pounds ($152 million).
The pub companies affected would be Enterprise Inns Plc, Punch Taverns Plc, Greene King Plc, Admiral Taverns Group Holdings Ltd, Heineken NV, Marston’s Plc, Wellington Pub Co Plc, Trust Inns Ltd and Spirit Pub Co. Plc, according to a statement today by the Department for Business.
Of the U.K.’s 50,000 pubs, almost half are required to buy beer from their owner under their lease, rather than on the open market, according to the statement. The new rules would prevent pub companies from requiring tenants to sell certain types of beers often at high prices. The proposed Pub Code Adjudicator will decide on complaints of unfair rents or high prices.
“We gave pub companies every chance to get their house in order,” Business Secretary Vince Cable said in a statement. “It is clear the voluntary approach isn’t working. Pubs play a valuable role at the heart of our communities and we urgently need a change to help them survive and become profitable.”
Punch Taverns fell 1.5 percent to 9.75 pence at 11 a.m. in London trading. Spirit Pub dropped 1.7 percent. Enterprise Inns rose 0.5 percent, Greene King advanced 1.4 percent and Marston’s climbed 0.5 percent.
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