Tied pub tenants in Jersey demand urgent change to alcohol pricing structure so they can survive
Colin Foster, who owns The Daily Globe in St Helier, is closing the pub in December.
He says the company he rents from, Randalls Jersey, is charging full commercial rent and makes him pay more for the alcohol he sells when compared to traders who are not tied to a brewery.
Colin, who claims to be one of Randalls' longest-serving tenants, told ITV News that the company used to offer him discounts on alcohol but that benefit was removed in his current lease agreement.
Some tied tenants in the UK can buy guest ales to sell, something Colin cannot do in Jersey.
Colin said: "The pricing structure for tenants is way outdated. They [Randalls Jersey] know it and they should have done something about it years ago.
"If you're free trade, you're going to get all your products at a massively reduced price compared to what we pay."
He added: "We're not happy about it, none of the tenants are happy about it but I think I'm one of the few people who will talk about it."
Colin adds that he knows of tenants who have "lost everything" as a result of the increased cost of running their businesses.
ITV News has spoken to a number of pubs in Jersey, both free houses and tenanted pubs, and found differences in the prices being charged, per keg for the same products by Randalls Jersey and the other island pub company Liberation.
For example, for a keg of well-known Irish stout beer, tenanted pubs in Jersey told us they are paying between £280 and £290. But free houses said they are paying between £165 to £170.
Despite these price discrepancies, it is not unusual for breweries, like Randalls Jersey and Liberation, to charge tenants more for their products.
Often tied tenants are given reduced rent and support with running their business.
However, there have been concerns over the perceived power imbalance between breweries and tenants, something which led to the introduction of the UK's Pubs Code in 2016.
The code aims to give tied tenants more power in business negotiations as well as giving them more transparent information and allow them the right to purchase from other breweries at certain points in their tenancy.
Both Jersey's government and its Licensing Assembly declined to comment on whether a similar scheme could be introduced in the island.
In response to concerns raised by tied tenants, like Colin, both Randalls Jersey and Liberation sent us statements.
Randalls said: "With regards to your request for a statement or interview relating to Randalls structure and pricing with relation to their tenancies. Please note that this information is commercially sensitive and therefore the company will not comment."
While Liberation said: "Our valued tenants are incredibly important to us and we're rightly proud of what they and their teams deliver, adding essential vibrancy to Jersey's hospitality sector and the island's economy day in, day out.
"Since the well-documented changes to Jersey's licensing laws, we have been reviewing what we offer tenants and are in the final stages of agreeing plans regarding product pricing, business support and an ongoing programme of site investment."
Jersey's Competition Regulatory Authority (JCRA) told ITV News that reviewing alcohol pricing was considered in 2022.
In a statement, it said: "This is an issue that was considered by the JCRA as part of its review of the Guidance on Alcohol Pricing and Promotions published in 2022.
"One of the recommendations that fell out of that review was that the Authority would continue to monitor the position with tied pubs in the on-licence sector.
"It wasn't feasible to investigate the issue with the Guidance in place. The Guidance was updated this year but there needs to be more time to assess the impact that change has on the sector from a competition perspective; it is something that the Authority will continue to keep an eye on and, if further action is needed, the Authority will consider that at the appropriate time.'
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