Pubs Code & MRO
The new legislation came into being in July 2016. The will of Parliament was that matters were intended to be simple. If you wanted to be free of tie you could make an application through the Pubs Code in a simple, straight forward and supposedly cost-effective manner. It did not work out that way at all. "Due process" as it is known is slow, tortuous, strictly time-controlled and complicated.
The log jam created by the PCA during 2016/2017 is now easing significantly with more cases coming through the system. The Draconian opposition at every turn by certain Pubcos has eased somewhat although the co-called ‘Mode of Delivery' is still contentious.
Chris Wright and Simon Clarke, two of our team members, were involved in the consultation and formulation of the Code on behalf of tenants and both readily accept that it is far from perfect. However, attempting to change the rules is still ongoing with representations being made to the Legislators. Slow but sure.
We know MRO for all of its positives and negatives and have a constant stream of cases going through the system. Chris Wright, director of the Pubs Advisory Service (PAS) is our subject expert and handles all of our Pubs Code focused matters and cases, with Morgan & Clarke handling all rent and valuation matters. PAS has been involved since the inception of legislation and has represented many dozens of pub tenants and lessees at arbitration.
The Pubs Advisory Service has a track record in raising referrals and navigating through the Pubs Code legislation to tenant and lessees advantage. No one is better able to fight for tenants when it comes to the Pubs Code.
Our consultant, Nigel Wakefield, offers a further list of helpful checks and balances which can be accessed through his own dedicated website here -
Here are a few of our frequently asked MRO questions below.
What is the MRO option?
Upon tenant request, the granting of a free-of-tie rent and an ending of all product and service ties (with the exception of insurance) and Pub Co direct involvement in the trading operations of your property.
Do all Pub Co's and brewers have to offer MRO?
No. Only Pub Cos and brewers, otherwise known as POBs under the code, with 500+ tied pubs in their total ownership will have to offer the MRO option. This currently includes Enterprise Inns, Punch Taverns, Admiral Taverns, Greene King, Star Pubs & Bars and Marston's.
Is MRO mandatory?
MRO can be taken up at the election of the tenant either at rent review or at lease renewal. The option is not retrospective.
To be a 'trigger', an event would need to be beyond the control of the tied pub tenant that was not reasonably foreseeable, has a significant impact on the level of trade that could reasonably be expected to be achieved at the tied pub, and is of a description specified in the Pubs' Code, yet to be agreed.
If you would like to see more answered MRO questions, visit our Market Rent Only frequently asked questions page for further information.
To read more Pubs Code related happenings, see here;