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  • Cited by 1
  • Print publication year: 2009
  • Online publication date: June 2012

10 - Beer – the ties that bind

Summary

‘You're walkin’ tough baby, but you're walkin' blind to the ties that bind'

Bruce Springsteen

Introduction

It started with the Beer Orders (1989). A watershed decision was made by the Law Lords in July 2006. For one man, Bernie Crehan, this was the culmination of a fifteen-year episode in the pub trade, in which he has made legal history as the first UK case of damages for breach of competition law being awarded by a court. Possibly hundreds of other cases hung on their Lordships' decision and Nomura, the Japanese bank that took over the chain called Inntrepreneur, had a total potential liability of £100 million. And it all concerns Article 81, vertical agreements and the price of a pint of beer.

In 1989, the UK Monopolies and Mergers Commission (MMC) published its lengthy and long-awaited report on beer. The Commission ‘… recommended measures that eventually led brewers to divest themselves of 14,000 public houses. The MMC claimed that their recommendations would lower retail prices and increase consumer choice. There is considerable doubt, however, that their objectives were achieved’ (Slade, 1998, 565). In its report, the MMC noted rising real prices of beer and seized upon the power of the then big six brewers exercised through their considerable tied estates as being a prime motor. Consequently, it recommended that the ties be substantially cut.

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