Pub industry cleared by OFT over 'beer ties'

BRITAIN'S pub industry was again cleared by the competition watchdog yesterday after a reopened investigation into controversial "beer ties".

The Office of Fair Trading (OFT) stuck by its initial findings last October that there was no evidence that "tied prices" - where pub companies compel tenants to buy drinks from them - damaged competition.

It revisited the inquiry after an appeal from the Campaign for Real Ale (Camra), which lodged the original super- complaint in July 2009 over fears that high rents and beer ties were forcing landlords out of business and leading to higher prices for consumers.

But the OFT said yesterday the UK pub sector was "competitive overall" and that there were "insufficient grounds to justify further OFT action".

Mike Benner, Camra chief executive, said the OFT's decision was "based on a blinkered and selective consideration of the evidence". Camra said tied pub landlords pay about 20,000 more for their beer a year as they cannot buy on the open market, which "inevitably" means higher drinks prices.

Britain's large pub companies have denied any wrong-doing, but business secretary Vince Cable said they were "on probation" and promised legislative action if they failed to bring in changes by June 2011.