Pub Owners Set Tenant Standards for Short Leases
The 6 regulated pub-owning businesses have worked together with the PCA to agree minimum standards in dealing with tied tenants on short agreements over and above what the Pubs Code requires.
A tenancy at will or short agreement is often used by pub companies to enable a tenant to begin operating a pub while a longer-term agreement is finalised. Such an agreement can provide an opportunity for both parties to understand whether the business relationship will work, and it can be a good introduction to the trade for a new operator.
If the business relationship is going to develop well, it is vital that the operator on a short agreement gets off to the right start. These transparent minimum standards for dealing fairly with tenants on short agreements can support them in their businesses.
Most rights in the Pubs Code do not apply to tenants on short agreements. However, those entering into such an agreement do have the right to certain information from their pub company and must be advised to complete pubs entry training unless they have certain business experience. A short agreement under the Pubs Code is a tied agreement which is either a tenancy at will or a tied tenancy which (when considered together with any other agreements) entitles the tenant to occupy the pub for under 12 months.
Using the relevant Pubs Code rights of tenants on substantive agreements as a guide, the pub companies regulated under the Pubs Code have worked together with the PCA to agree minimum standards. While largely reflecting existing business practices, these standards provide clarity to those entering into a short agreement on what they can expect from their pub company in addition to what the Pubs Code requires.
Fiona Dickie said:
“Everyone wants tied tenants to do well, and getting off to a strong start is essential. Those on tenancies at will and other short agreements are entitled to be treated fairly. It is particularly important that they should be advised not to invest their own money in the pub when on agreements which can be terminated at short notice. I’m pleased that the regulated pub companies have agreed to a consistent set of minimum standards to reflect their business practices over and above what the Pubs Code requires them to do. This should help tied tenants to understand what they can expect from their relationship with them”.
The short agreements minimum standards document can be found here: Short agreements – minimum standards (March 2025) – GOV.UK
https://www.gov.uk/government/news/pub-owning-businesses-agree-minimum-standards-for-tenants-on-short-agreements