Heineken-owned pub group Star Pubs has been fined £2 million for allegedly forcing tenants to sell “unreasonable levels” of its own alcohol.
Investigators discovered that Star had continued to impose its own Heineken beers and ciders on pub managers when they asked to go free of their ties with the brewer, despite repeated interventions by regulators.
Officials found Star guilty of serious and repeated breaches of the Pubs Code over three years. A total of 12 violations were identified.
The Pubs Code is a legally enforced document regulating the relationship between individual tenants and pub companies which have commercial links to brewers and own more than 500 pubs in England and Wales.
Pubs Code adjudicator Fiona Dickie said: “The report of my investigation is a game changer. It demonstrates that the regulator can and will act robustly to protect the rights that Parliament has given to tied tenants.
“I will be holding discussions with all the companies I regulate following my findings about how they will ensure they are code compliant.
“My message is that if anyone previously had any doubts about my resolution to act when I find breaches, they can have no doubt now.”
Star, which leases 1,900 pubs across England and Wales, has said that it is considering an appeal against the fine in the High Court.
Lawson Mountstevens, Star Pubs managing director, said: “We are deeply disappointed and frustrated at the outcome of this investigation. There are many aspects of the report that we fundamentally disagree with.
“This penalty is unwarranted and disproportionate and comes at a time when the entire sector is in serious financial crisis as we work around the clock to support our pubs and licensees to keep their businesses afloat.”
The probe was the first of its kind after the Pubs Code became law in 2019. The new rules give pub managers the right to pay market rent instead of agreeing to buy a certain amount of beer from their landlords.
However, the adjudication panel reported that between July 2016 and August 2018, 96 tenants who requested the market rate lease were told that 100% of the keg beer they sold had to be Heineken brands.