10th June 2009
Commenting on reports of the ALMR ‘s attempts to establish an agreement amongst key players in the industry through a process of arbitration, the Fair Pint campaign and the Federation of Small Business (FSB) have said that a negotiated agreement within the industry should not be seen as an alternative to an investigation by the Competition Commission.
Both organisations argue that a full investigation by the Competition Commission offers the best hope of reform which will see material changes in the interests of tied tenants and that any process of negotiation within the industry should run parallel to a Competition Commission probe with any agreement reached within the industry then forming part of an binding undertaking to the Competition Commission.
Steve Corbett a tied tenant and a member of the Fair Pint campaign said:
"A Competition Commission investigation is the best hope of seeing changes to the industry which will lead to material improvements to the interests of tenants.
"Whilst we welcome the ALMR genuine attempts to agree to a solution to the problems identified by the Business and Enterprise Select Committee we are concerned that some of the potential participants in the arbitration scheme are motivated by an attempt to delay a Competition Commission inquiry rather than a genuine desire to agree to a compromise which would secure the long term future of the industry.
"We disagree with Mr Bish’s argument that a Competition Commission investigation would take two years and be damaging to the industry. What is clear is that the status quo is leading to tremendous damage to the long-term future of the sector. A Competition Commission inquiry is the best chance that the industry has to see the changes which are required to rebalance the relationship between tenants and the companies who own their pubs.
"We believe that an investigation could be carried out quite quickly and be complete in time to feed into the European Commission’s review of the block exemption, which is due next year.
"It is in the interests of the industry to see a Competition Commission inquiry to start as soon as possible. Efforts to find an industry solution could run parallel to a Competition Commission probe and any agreement which is forged amongst the industry could then form part of an undertaking to the Commission about how the industry intends to avoid anti-competitive behavior."
Clive Davenport the Trade and Industry Chairman for the FSB said:
"The initial very negative reaction of the pubcos to the Business and Enterprise Select Committee shows that that their main interest is securing the profits they make by overcharging tenants rather than accepting that major changes need to be made to their business model if we are going to secure the long-term future of the pub sector.
"The FSB and Fair Pint agree that a Competition Commission investigation is clearly in the long term interests of tied tenants and the whole sector. The danger to the industry doesn’t come from a proper review of its structures from the competition authorities, but from those forces who wish to defend the status quo.
"The pitiful response of the industry to the concerns which were raised in the 2004 Trade and Industry Select Committee report means that we have serious doubts about the willingness of big players in the industry to volunteer to put their own house in order."
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