Scottish Government can now implement Tied Pubs (Scotland) Act

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The Scottish Government can now go ahead and implement the Tied Pubs (Scotland) Act after four years of legal wrangling following the UK Supreme Court decision to refuse permission to hear an appeal from pub companies who had challenged the bill.

Campaigners have been fighting for the bill since 2020 when The Tied Pubs (Scotland) Bill, (TIPSA) was first introduced by MSP Neil Bibby. By May 2021, after several stages, the Scottish Parliament approved the Tied Pubs (Scotland) Act, which obliged the government to establish an adjudicator to settle disputes and a code of practice managing the relationship between pub companies and their tenants.

Since then, the Tied Pubs Act has been the focus of a legal dispute between three pub companies, Punch Taverns, Greene King, and Hawthorn Leisure Ltd, who challenged the Scottish Governments legislation in the Court of Session arguing that tied pub contracts were a reserved matter because they involved the regulation of anti-competitive practices, and that the Act infringed their rights under Article 1 Protocol 1 of the ECHR.

A judicial review was held in July last year when the Lord President, Lord Carloway upheld the opinion of the previous judge with the Judiciary of Scotland explaining, “It was accepted that tied-pub leases were anti-competitive but that they were exempt from challenge on that ground.  The 2021 Act did not alter that. Its purposes did not include preventing a landlord from entering into a tied pub lease with a tenant; nor do they terminate such leases.  The introduction of a code which will grant the tenant certain rights in relation to altering the lease into a market rent only one, or to permit the sale of a guest beer are not per se anti-competitive measures; rather the opposite.  Therefore the challenge, in so far as it is based on reserved matter was rejected”.

Following this ruling, the pub companies sought an interim order to prevent ministers going ahead with statutory orders which included the Scottish Pubs Code and the role and appointment of the Scottish Pubs Code Adjudicator.

By February 2023, although Ministers opposed the motion, Lord Malcolm granted an interim interdict – preventing the Scottish Government from progressing with the legislation until the appeal process was concluded.

It was then that the process took its last step ending up in the UK Supreme Court an they refuse the appeal which means that the Act can now be implemented.

The Pubs Advisory Service, which revealed the news on social media,  has welcomed the news, however a spokesperson for the Scottish Beer and Pub Association told the Dram, It’s a disappointing decision for the sector, we remain of the view that there is no evidence for the policy and has ended up costing Scottish pubs much-needed investment. What’s important now however is ensuring the new statutory code works for all parties and doesn’t negatively impact investment any further. We’re keen to work with the Scottish Government to achieve this and will be meeting with them shortly to discuss.

“The code will also come with added costs and further red tape at a really bad time for Scotland’s pubs. This must be factored into the implementation period to ensure both compliance and to protect against further closures.”

The Act aimed to ensure that Scottish tied pub tenants had, at least, the same protections and opportunities as those covered by the 2015 Act in England and Wales which established a statutory Pubs Code, and the role of a Pubs Code Adjudicator (PCA) who oversees the code in England and Wales for tenants who hold tenancies with pub companies that own 500 or more tied pubs.