The Scottish pub landscape is undergoing a significant transformation. The new Pubs Code Scotland, which came into force in stages throughout 2025, marks a new era of fairness and opportunity for tied pub tenants. This legislation is designed to rebalance the relationship between tenants and pub-owning businesses, fostering a more transparent and equitable environment. A key component of this change is the introduction of guest beer rights, which provides tangible benefits for operators and the wider craft beer industry.
Understanding the 2025 Pubs Code Scotland and Guest Beer Rights
The Pubs Code Scotland applies to all tied pubs in Scotland, regardless of the size of the pub-owning business. This is a crucial distinction from the Pubs Code in England and Wales, which only applies to large companies. The code is built on core principles of fair and lawful dealing, ensuring that tenants are not worse off than they would be if they were free of tie. A major new right for tied tenants is the ability to request a guest beer agreement. This allows a tenant to sell at least one beer of their choice, at a price they set, alongside the products they are tied to.
Eligibility Criteria Included in Guest Beer Rights
- The guest beer must be from a producer brewing fewer than 5,000 hectolitres annually (to support small, independent, and local craft breweries).
- It can be sold in any format: cask, keg, bottle, or can.
For Pub Operators, This Right Offers
- Increased Profits: By selling a popular guest beer, you can increase your profit margins, as you are not bound by the tied pricing structure for that specific product.
- Customer Choice: It allows you to diversify your offerings, attract new customers seeking unique or local options, and cater to the growing demand for craft beer.
- Strategic Flexibility: Having a free-of-tie beer line provides a competitive edge and allows you to respond to market trends more quickly.
- Support & Enforcement from SPAC: The Scottish Pubs Code Adjudicator (SPAC) is responsible for overseeing and enforcing the guest beer rights under the Pubs Code Scotland. This means tenants have a dedicated regulator to ensure landlords comply, disputes are fairly resolved, and operators can fully exercise their rights without fear of retaliation.
Unlocking Your Potential with Market Rent Only Lease Option
Beyond the guest beer right, the new Pubs Code Scotland provides other significant protections for tenants. The most notable is the Market Rent Only (MRO) lease option, which became available from 30 June 2025. An MRO lease allows eligible tenants to become entirely free of tie and instead pay a market-assessed rent. However, MRO eligibility isn’t automatic, it depends on having a qualifying tenancy, meeting statutory notice periods, and applying at the halfway point of the lease term. Key areas to focus on include:
- Pub Business Strategic Planning: Carefully assess the financial benefits of breaking your pub tie and transitioning to a free-of-tie lease. This requires a detailed analysis of your current costs and potential new profit margins.
- Pub Sector Risk Management: The MRO process can be complex. Understanding the specific conditions under which your landlord can refuse an MRO request, such as a substantial investment exemption, is crucial for effective pub sector risk management.
- Legal Advice on Pub Leases: The Pubs Code is a legal framework. Before making any formal request, it is essential to seek pub business legal advice from a specialist. This ensures your request is valid and that you follow the correct procedures.
☞ Check out our Step-by-Step Guide for Tied Pub Tenants
At MDE Pub Consultants, We’re Your Partner For Growth
The new Pubs Code Scotland presents both opportunities and challenges. At MDE Pub Consultants, we specialise in helping Scottish pub operators navigate this new landscape. We offer a range of services tailored to your specific needs, providing the expertise to unlock your pub’s full potential. Our services include:
- Pubs Code Consultancy: We provide in-depth analysis of your situation, advising on your eligibility for MRO and guest beer rights. We guide you through every step of the process, ensuring compliance with the code.
- Pub Business Legal Contracts: We help you understand and negotiate pub business legal contracts, ensuring the terms of your lease, rent reviews, and MRO agreements are fair.
- Free-of-Tie Lease Negotiation: If you decide to pursue a free-of-tie pub lease, we can manage the entire negotiation process, from the initial MRO notice to the final agreement, helping you secure a fair rent and profitable terms.
- Business Planning: Our consultants assist with pub business strategic planning, helping you model the financial impact of breaking the pub tie and developing a robust plan to succeed with a free-of-tie beer line.
Ready to unlock higher profits, more choice, and greater independence for your pub? Act now to secure A Better Deal with MDE Pub Consultants and harness the full power of the new Pubs Code Scotland today!
Email: info@mdepc.co.uk
Phone: 0330 088 3133
