The Court of Session has rejected a petition for judicial review of a Bill designed to ensure tenants are not locked into unfair deals in brewery-owned pubs.
The Tied Pubs (Scotland) Bill was passed unanimously by the Scottish Parliament more than two years ago, after being proposed by Scottish Labour MSP Neil Bibby.
The legislation will appoint an independent adjudicator for the sector and mandate the creation of a statutory pubs code.
Currently, there are 750 tied pubs in Scotland, with some tenants forced as part of their deal to only buy beer and other goods from their landlord, although some tenants are able to pay less than market value in rent for the premises they run.
But three pub-owning companies: Greene King, Punch Taverns and Hawthorn Leisure Limited; sought a judicial review at the Court of Session, claiming it was outwith the legislative competence of Holyrood.
The petitioners claimed the Bill infringed on their property rights under the European Convention on Human Rights and that tied pub contracts were a reserved matter.
A decision in December rejected the petition and an appeal – the decision on which was announced on Friday – upheld the initial decision.
Responding to the decision, small business minister Richard Lochhead said: “I welcome the Court of Session’s decision to uphold Lord Harrower’s judgment refusing the petition for judicial review of the Act.
“We remain fully committed to implementing the Act as soon as possible to ensure a fair and balanced relationship between pub companies and tenants.
“Work on implementation is well underway.”
A spokesperson for the participating pub companies said: “We are extremely disappointed with this decision and maintain there remains no evidence to support the introduction of this wholly unnecessary legislation, with the proposed pubs code legislation seeking to fix a problem that doesn’t exist in the midst of a profound economic crisis.
“Our decision to appeal was based on receiving further legal opinion that highlighted potential issues in the original ruling.
“We will now fully consider our response to this outcome whilst aiming to work constructively with the Scottish Government in a number of areas to try to mitigate the acute cost pressures facing all pubs at this time.”
Scottish Labour MSP Neil Bibby said: “I welcome this judgment. The Tied Pubs Act will support Scottish pubs and give customers greater choice.
“These discredited pubcos (pub companies) have tried and failed to use their financial might to preserve an unbalanced relationship with their tenants. They should accept the game is up and a fairer system for Scottish pub tenants is going to be introduced.
“Hospitality has been through a difficult time. These pubcos should be supporting Scottish pubs, not using their money, made by these pubs, to stop them getting greater rights (that) the Parliament has voted to give them.
“The Scottish Government should now get on with implementing this important legislation without delay.”