Thinking of taking on a tied pub

The Pubs Code is there to support tied tenants' businesses to thrive. 

If you are thinking of taking on a tied pub from one of the pub companies covered by the Pubs Code, it is important you know what your Code rights are from the very beginning. 

The Pubs Code places obligations on the pub company when it is dealing with a prospective tied tenant. 

These obligations relate to the information the pub company must provide such as:

• If you are negotiating to take on a tied pub, the pub company must give the prospective tenant a range of information set out in the Pubs Code so you are fully aware of what the agreement involves and what your obligations would be if you decide to sign up.  
• The pub company must advise the prospective tenant to take independent professional advice on this information before preparing their business plan. The pub company must be satisfied that the business plan is sustainable before the tenancy agreement can be signed. Find out more about getting professional advice.
• The pub company must advise prospective tenants who do not have prior experience to complete pubs entry training, which raises awareness of the matters involved in operating a pub and entering into a tied agreement. Pub companies offer their own training, and the British Institute of Innkeeping (BII) offers a Pre-Entry Awareness Training (PEAT) course.  
• When the pub company makes its rental offer for the new agreement, it must provide a rent proposal which meets the requirements of the Pubs Code, including a profit forecast which is reasonable and evidenced, and advise the tenant to take professional advice on the rent proposal. Find out more about negotiating your rent. 
• All new and prospective tied tenants will also receive a letter from the PCA, via their pub company introducing them to their Pubs Code rights.  

Deposits 

Before you take on your tenancy (and before you renew a protected tenancy if there is a proposal to change the rent or deposit), your pub company must provide you with information about the payment of rent and deposits. This information includes the amount of any deposit, any arrangements to pay interest on it, and when and how it will be repaid to you.  

Fixtures and fittings  

Before you sign your agreement, your pub company must inform you whether you must purchase the fixtures and fittings. If you do have to purchase them, they must also tell you the arrangements for payment. Before your pub company consents to an assignment, it must be satisfied that the assignee has been given this same information. This applies whether the requirement is to purchase the fixtures and fittings from the pub company or from the outgoing tenant.  

If you are assigning your agreement to someone else, the pub company must explain to you and the assignee the implications of the assignment for both, and this may include arrangements in respect of sale and purchase of fixtures and fittings.  

Getting the right independent professional advice is key to success in running your own pub business. This is particularly important when you are negotiating to take on a tied pub. 

An independent professional with experience in the tied pub trade can help you make the right business decisions. They can also help you to understand and access your Pubs Code rights. 

The Pubs Code emphasises the importance of getting the right professional advice at the right time. It places obligations on a pub company to ensure that you take independent professional advice (such as business, legal, property and rental valuation advice) before preparing your sustainable business plan and taking on the agreement. The pub company must also advise you to take the advice of a qualified surveyor experienced in tied pubs - this can be particularly important when you are taking on responsibility for repairs at the pub. 

Expert advice can also help you negotiate the right rent for the pub. The pub company must advise you to obtain independent professional advice on the rent for your new pub before you agree to it. 

If you are taking on a longer agreement and are considering a pub company investment, which will exempt you for a period of time from the right to request a Market Rent Only option (known as the investment exception), the pub company must obtain confirmation that you have taken independent professional advice on that agreement.