Scottish Pubs Code and Scottish Pubs Code Adjudicator review: consultation

Background - Scottish Pubs Code

Scotland has an estimated 550 tied pubs^[2], representing approximately 12.8% of all licensed establishments.

A tied pub is owned by a pub-owning business and leased to a tenant. Tenants must buy some or all of their products and services ("the tie") from the pub-owning business (their landlord) or someone nominated by the pub-owning business. Ties can include, for example, beer and these products and services are often charged at a higher cost than on the open market. In return, tenants sometimes pay lower rent and may receive other support from the pub-owning business.

The Act introduced a Scottish Pubs Code to govern the relationship between pub-owning businesses (the tied pub landlords) and their tied tenants. The details of the Code are set out in The Scottish Pubs Code Regulations 2024^[3] which create rights and protections for tied pub tenants and place requirements on pub-owning businesses. The Scottish Government consulted widely^[4] on the development of the Scottish Pubs Code and the associated legislation.

The Code is aligned to the three regulatory principles set out in the Act which are:

(a) the principle of fair and lawful dealing by pub-owning businesses in relation to their tied-pub tenants,

(b) the principle that tied-pub tenants should not be worse off than they would be if they were subject to neither a product tie nor a service tie,

(c) the principle that any agreement between a pub-owning business and a tied-pub tenant should fairly share the risks and rewards amongst the parties.

The Code includes provisions enabling tied pub tenants to stock a wider range of beers beyond those supplied through the pub-owning business, providing more choice for customers and supporting local independent breweries.