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Morning Briefing Strap Line
Fri 20th May 2016 - Friday Opinion
Subjects: An open letter to the Pubs Code adjudicator, and promoting the vegetable 
Authors: Peter Holden and Glynn Davis

An open letter to the Pubs Code adjudicator by Peter Holden

It has to be said the Pubs Code etc regulations 2016 have had an unhappy start. Starting with the consultation over the winter, resulting in many changes and leading to the news on 6 May the latest draft was being suspended while some errors are being addressed. All of this has not helped build confidence in the regulations themselves.

In fact, the last draft of the regulations contains many curious features and what appear to be multiple drafting errors. Some of the provisions contain a logic that is difficult to follow and others seem to have been drawn up by someone not well versed in the workings of the sector.

The regulations are made under the Small Business, Enterprise and Employment Act 2015, which says advice and guidance may be given by the adjudicator in a whole range of circumstances and to different groups. Obviously, you cannot change the legislation but it would help us all if you were to give us guidance on a number of issues.

These are for starters:

1. Can you tell us what a pub is? The government spokeswoman in the House of Lords accepted that “increasing food consumption in pubs, gastro-pubs and so on” has made a legal definition more “complex”. Although she said there is power to exempt certain types of premises so only pub premises are in “scope”, this does not appear to have happened. It would help if you could define what are, and what are not pubs.

2. What is a tied pub? The act contains a very surprising definition of a tie. Trade ties can take various forms, and both before and after the Beer Orders, various mechanisms were developed in order to achieve the same economic effect. These included certain types of unilateral contracts that, in some cases, fell foul of the Orders. Those same contracts would not necessarily fall foul of the act or the regulations – in fact the wording of the regulations appears to be drawn so as to positively encourage them. The secretary of state has power to make regulations about terms that are “inconsistent” with the Pubs Code. What is your view of these types of mechanisms? Is it inconsistent with the act to use mechanisms that can produce the same economic effects as a tie even if the outlet is not “tied” within the meaning of the act?

3. The regulations draw some odd distinctions between tenants who have the protection of the Landlord and Tenant Act 1954 and those who do not. It may be this is one of the points that have resulted in the suspension of the regulations. There are a number of examples of this, but the first I noticed was only tenants protected by the 1954 act on a renewal would be entitled to the appropriate pubs entry training. Why are contracted out tenants excluded from this?

4. One of the events that gives rise to the Market Rent Only (MRO) option is a significant increase in product prices. Is there any reason why this should be so, bearing in mind the pub-owning business may only be passing a price increase on? Isn’t the prospect of price increases beyond the stated increase, which are being passed on, reasonably foreseeable at the start of the tenancy? Why is this apparently catered for in the definition of “trigger event” (that also gives rise to MRO), which expressly refers to “extrinsic increases”? Your view on this would be interesting.

5. If there is a significant increase in tied product prices, is that really an event that could lead to the MRO for all products? Is it foreseeable at the time of the grant of the tenancy a tenant could manipulate his buying patterns to achieve this?

6. Do you know why is there no exemption from the liability to have a sustainable business plan for a person who does not have to undergo pre-entry awareness training? Is there a reason why a long-serving tenant who has taken a succession of contracted-out tenancies (possibly a lifestyle tenant) or a multiple operator has to undergo this process?

7. If a tenant is granted a rent concession does this trigger a rent proposal or a rent assessment?

8. Could you explain exactly what is meant by regulation 47, which says the pub-owning business must not require a tied pub tenant to purchase or rent gaming machines? Most tied pub tenancy agreements contain a restriction on bringing such machines on to the premises. Did the draftsman in fact mean the pub-owning business could not make it a condition of its consent the tenant could only bring on to the premises such machines it had bought or rented from a landlord-approved supplier? 

9. The regulations say an MRO compliant tenancy should not contain terms and conditions that are not common terms in free-of-tie (FOT) tenancies. There might be a difference in this respect, in tenancies granted FOT by pub companies, and tenancies granted by landlords who are not pub companies. With whom should comparison be made? As an example, is a recharge for gas and electrical certification common terms in both those cases?

10. The issue of void or unenforceable terms is looming large in everyone’s mind – particularly in the light of regulation 57. Does “void” mean void forever? It seems a bit odd a clause that owes its invalidity to the size of the pub-owning business’ tied estate should also be void between successors in title.

Whilst appreciating there are a lot of questions to answer here, and you clearly have a lot to deal with, these are in fact just some of the concerns the industry needs to see addressed.
Peter Holden is a partner at Freeths, legal specialists in the drinks, hospitality and leisure industry

Promoting the vegetable by Glynn Davis

When attending a work function a couple of years ago involving a buffet I was suddenly aware of how badly we so often treat vegetables in this country. A vegetarian French woman (yes they do exist) asked when the vegetable dishes were going to appear and was informed they were already on the table. They were absolutely indistinguishable from the Scotch eggs, sausage rolls, spring rolls, samosas, deep fried Camembert and prawns in tempura. Nothing veered away from being brown, fried, and heavy. It was a procession of deep fried vegetables whose colour, life and nutrients had been completely sucked out of them. 

For something that should add crunch, colour and vitality to a meal it is a crime vegetables are given such a lowly ranking in the food chain. Maybe this is because we don’t really like the things? We’ve all seen how the salad garnish included with many starters is left completely untouched. This proves the point surely. Actually no, at a simple level it is left uneaten because it is too frequently limp and served without any dressing. I guess the thinking is why waste a good dressing on something nobody is going to eat anyway. It is no doubt one of the perennial chicken and egg situations.

As a sympathiser of the much-maligned vegetable I recently visited the high altar of cooking with vegetables – L’Arpège restaurant in Paris – to gain a sense of what could really be done with this secondary component of any plate of food. In 2001 its owner/chef Alain Passard took meat off his menu and decided to concentrate on la cuisine végétale so he could commit more time and effort to releasing the myriad flavours and textures he knew existed within the humble vegetable. 

This was a pretty radical departure for a French restaurant – especially one where diners are paying decent amounts of money and expect plenty of high cost raw materials to be served on their multi-course tasting menus. On my visit, what came out of the kitchen on the “Spring in the Garden” menu was a tour de force in freshness, seasonality, and clever light-touch cooking that opens your eyes to the potential of vegetables. But as much as I enjoyed the L’Arpège experience (it was undoubtedly one of the best and most interesting meals I’ve ever had) I recognise this is cooking at the extremity. Most of the dishes served would be beyond even well above average cooks.

But I’d argue some aspects stood out as simple elements that could be replicated by mere mortals in the kitchen. Using rocks of sugar as well as salt to enhance flavour – especially on dressings – seemed so obvious I’m not sure why it felt so new to me. Very surprising “flavour hits” – from the likes of the punchy coriander, rocket, fennel and celeriac – came unexpectedly in many of the dishes and highlighted how this is a simple but rather clever jolting technique that can easily be deployed by any amateur to enhance specific lighter-flavoured dishes.

Another interesting aspect of the meal was the continuous serving of bread. Without any proteins or carbohydrates packing out the meal, as well as your stomach, it has been recognised at L’Arpège bread has a much greater role to play than in any meat, fish, and carbohydrate-based dining experience. There was also a recommendation by the sommelier white wines should be chosen in order to complement the meal as reds would all too easily drown out the subtlety Passard is working hard at bringing to the table.

Although we seem to still be in the middle of a burger, steak house and US barbecue explosion with meat the be-all-and-end-all of British dining, there have been some interesting activities on the periphery that attempt to promote vegetables out of the Conference league and maybe on the cusp of the Championship. Pret A Manger is to trial a vegetarian-only store that will seek to encourage meat-eaters to try more plant-based options. Although management expects sales to be less than at a regular store it should be applauded for pushing vegetables up the agenda.

Most notable among vegetable promoters has been Grain Store in London. Meats and fish do play a part but in more of a supporting role. Chef Bruno Loubet has for many years cooked meat-based French dishes and gained the plaudits but with this latest restaurant he is cooking from the heart rather than pan-frying the organ.

While Grain Store is an undoubted success, we are a long way from vegetables being of genuine real importance to non-vegetarians when eating out. Even Passard with his three Michelin stars recognises the realities of customers’ expectations and rather reluctantly offers a separate tasting menu that includes some meat and fish. According to the waiter he’d much prefer his customers choose the pure vegetable menu. 

And so would I because in the right hands vegetables can clearly be at least the equal of any other foodstuff and should no longer be lazily relegated to being coated in batter or breadcrumbs and submerged in boiling oil.
Glynn Davis is a leading commentator on retail trends

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