The Supply of Beer (Tied Estate) Order 1989 and the Supply of Beer (Loan Ties, Licensed Premises and Wholesale Prices) Order 1989, commonly known as the Beer Orders, were statutory instruments made by the United Kingdom

Secretary of State for Trade and Industry The secretary of state for business and trade (business secretary), is a Secretary of State (United Kingdom), secretary of state in the Government of the United Kingdom, with responsibility for the Department for Business and Trade. The incumb ...

in December 1989.

Background

At the end of the 1980s, six national brewers dominated the market for

beer Beer is an alcoholic beverage produced by the brewing and fermentation of starches from cereal grain—most commonly malted barley, although wheat, maize (corn), rice, and oats are also used. The grain is mashed to convert starch in the ...

sold in

pubs A pub (short for public house) is in several countries a drinking establishment licensed to serve alcoholic drinks for consumption Licensing laws of the United Kingdom#On-licence, on the premises. The term first appeared in England in the ...

in the UK. These were Allied,

Bass Bass or Basses may refer to: Fish * Bass (fish), various saltwater and freshwater species Wood * Bass or basswood, the wood of the tilia americana tree Music * Bass (sound), describing low-frequency sound or one of several instruments in th ...

Courage Courage (also called bravery, valour ( British and Commonwealth English), or valor (American English)) is the choice and willingness to confront agony, pain, danger, uncertainty, or intimidation. Valor is courage or bravery, especially in ...

, Grand Metropolitan,

Scottish & Newcastle Scottish & Newcastle plc was a brewing company headquartered in Edinburgh, Scotland, which expanded from its home base to become an international business with beer volumes growing almost tenfold. The company was listed on the London Stock Exc ...

and

Whitbread Whitbread is a British multinational hotel and restaurant company headquartered in Houghton Regis, England. The business was founded as a brewery in 1742 by Samuel Whitbread in partnership with Godfrey and Thomas Shewell, with premises in L ...

. This prompted concerns about lack of competition for consumers. In 1989, a report titled "The Supply of Beer: A report on the supply of beer for retail sale in the United Kingdom" was published by the

Competition Commission The Competition Commission was a non-departmental public body responsible for investigating mergers, markets and other enquiries related to regulated industries under competition law in the United Kingdom. It was a competition regulator under t ...

. The Report contained a number of adverse findings related to the

vertical integration In microeconomics, management and international political economy, vertical integration, also referred to as vertical consolidation, is an arrangement in which the supply chain of a company is integrated and owned by that company. Usually each ...

between brewing and pub retailing, and made recommendations aimed at loosening the tie between pub retailing and brewing to facilitate easier entry by, and increasing competition between, brewers, wholesalers and pub retailers.

The orders

The orders restricted the number of tied pubs that could be owned by large breweries in the United Kingdom to 2,000, and required large brewer landlords to allow a

guest beer In 1989, licensing legislation passed by Margaret Thatcher's Conservative government made it possible for a tied pub to stock at least one guest beer from a different brewery. The Monopolies and Mergers Commission was concerned that the market ...

to be sourced by tenants from someone other than their landlord. The industry responded by spinning off purely pub-owning companies ("pubcos"), such as Punch Taverns, Enterprise Inns, and Admiral Taverns, from the older brewing-and-owning companies (notably Allied Lyons,

, and

). Other companies were established such as Pub Estates Group to purchase some of the pubs for sale. By the end of 1992,

had sold almost 2,500 pubs, as a result of the orders.

Revocation

The Beer Orders were revoked in January 2003, by which time the industry had been transformed from the position in the 1980s. A

House of Commons The House of Commons is the name for the elected lower house of the Bicameralism, bicameral parliaments of the United Kingdom and Canada. In both of these countries, the Commons holds much more legislative power than the nominally upper house of ...

report in 2004 found that "Under any of the market definitions we have chosen, no one company, be it pubco, brewer or retail pub chain, holds a dominant position in the total market for beer".House of Commons Select Committee on Trade and Industry, https://publications.parliament.uk/pa/cm200405/cmselect/cmtrdind/128/12805.htm

References

External links

History of Punch Taverns
{{DEFAULTSORT:Beer Orders Statutory instruments of the United Kingdom 1989 in British law Beer culture Alcohol in the United Kingdom