socialmedian: OFT rejects complaint over beer tie

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Source: The Guardian

Oct 22, 2009

Summary

• Forcing landlords to buy beer from their owners is not anticompetitive, watchdog rules
• Investigation was sparked by super-complaint by the Campaign for Real Ale

An attempt to stop pub landlords being forced to buy beer from the companies which own their pubs has been rejected by the Office of Fair Trading.

The OFT told the City this morning that it had examined the issue of 'tied pubs', and ruled that they did not restrict competition.

The move is a blow to the Campaign for Real Ale, which says that the tie forces landlords to pay up to 50p per pint more than they would be charged by another brewer. But it will come as a relief to Punch Taverns and Enterprise Inns, the UK's biggest 'pubcos'.

According to Simon Williams, senior director of the OFT's Goods group, pub ties cannot be uncompetitive because it simply wouldn't be in the landlord's interest to overcharge their pub estate:

"Any strategy by a pub-owning company which compromises the competitive position of its tied pubs would not be sustainable, as this would result in a loss of sales. Pub-owning compani

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