Heineken fined for forcing pubs to stock ‘unreasonable’ amounts of beer
Heineken’s pubs division has been slapped with a £2m fine for forcing its tenants to stock “unreasonable levels” of its own beers and ciders.
The Pubs Code Adjudicator (PCA) ruled that Star Pubs & Bars, which operates the pub estate business of Heineken in the UK, had “seriously and repeatedly” breached the pubs code over the last three years.
The investigation found that pub tenants who asked to stock competitor brands were told that 100 per cent of the keg beer they sold had to be Heineken brands.
After several interventions by the PCA, Star changed its policy to specify ‘must-stock’ brands.
But this still required many tenants who stocked little or no Heineken products to stock 60 per cent Heineken keg beer within a year.
The watchdog branded Star a “repeat offender”, saying the company had been given opportunities to change its conduct but had “intentionally or negligently failed to do so”.
“It did not engage frankly and transparently with its tenants or meet the standards required of a regulated business when engaging with the PCA,” said Pubs Code adjudicator Fiona Dickie.
“Where it did change its approach, the efforts it made to comply were for the most part inadequate and not credible.”
Investigation
The investigation also found that the job description for Star’s code compliance officer included a responsibility “to ensure the code is interpreted to the commercial benefit of Heineken UK”.
This was in breach of requirements to appoint an officer whose role is to verify compliance.
The watchdog said Heineken’s behaviour had acted as a barrier to tenants pursuing a free-of-tie option, allowing them to sell competitor brands.
“The company must change its mindset and become proactive in its approach to compliance,” Dickie said.
“I have decided this can best be achieved by the imposition of a sanction that will serve as a deterrent to future non-compliant conduct by Star and other pub-owning businesses.”