Scotlands Tied Pubs Get a Fairer Deal: Key Amendments in 2025

In an effort to level the playing field for Scotland's tied pub tenants, the Scottish Government has introduced key amendments to the Scottish Pubs Code through the Tied Pubs (Miscellaneous Amendment) (Scotland) Regulations 2025. These changes aim to ensure fairness and transparency between pub-owning businesses and their tenants, as outlined in the Tied Pubs (Scotland) Act 2021.

Understanding the Scottish Pubs Code

The Scottish Pubs Code, established in 2024, governs the relationship between pub-owning companies and their tied pub tenants. Tied pubs are leased from pub-owning businesses, with tenants often required to buy certain products exclusively from their landlords. While this can lead to higher prices, tenants may benefit from reduced rents and other supports.

What's New in 2025?

1. Market Rent Only (MRO) Leases: Tenants can now request a Market Rent Only lease, free of product ties, earlier in their lease term. The process can begin six months before the lease's midpoint, giving tenants more flexibility and potentially better financial terms.

2. Appeal Rights: A new right to appeal independent rent assessments has been introduced. Tenants and landlords have 14 days to appeal any perceived errors, ensuring a fairer rent determination process.

3. Transparency for Prospective Tenants: Pub-owning businesses must now provide potential tenants with comprehensive reports on trading costs and a Schedule of Condition for the property, enhancing informed decision-making.

4. Guest Beer Agreements: Tenants can choose to offer a guest beer, expanding their product offerings. While this must be from smaller breweries, it gives tenants more control over pricing and selection.

5. Resolving Disputes: The code outlines clear processes for resolving disputes, with specific cases reserved for the Scottish Pubs Code Adjudicator’s oversight.

Why These Changes Matter

These amendments aim to rebalance the risk and reward dynamics between tied pub tenants and their landlords. By introducing more transparency, earlier MRO applications, and appeal mechanisms, the Scottish Government seeks to protect tenant rights while allowing pub-owning businesses to maintain viable operations.

Consultation and Impact

These changes follow extensive consultations with stakeholders, including the Scottish Licensed Trade Association and the Scottish Beer and Pub Association. The amendments reflect a diverse range of views and aim to address key concerns from both tenants and landlords.

While these changes promise financial benefits for tenants, the long-term impacts on the pub-owning businesses and the wider market will continue to evolve. The Scottish Government anticipates a shift in financial dynamics, largely benefiting tenants, but acknowledges potential market adjustments over time.

In summary, the 2025 amendments to the Scottish Pubs Code signal a significant step towards fairer and more equitable treatment for Scotland's tied pub tenants, ensuring they have greater autonomy and protection under the law.