Government snubs EC on guest ale rule

The Government yesterday dismissed the European Commission's claim that the guest beer rules, which allow pub tenants of national brewers to buy a cask-conditioned ale from any supplier, was anti-competitive.

John Taylor, Corporate and Consumer Affairs Minister, said that the Government intends to hold a tripartite meeting with the European Brewers Federation and EC officials to try to resolve the dispute, which could end up in the European Court of Justice.

The EC argued last week that the guest beer provision was discriminatory because cask ales were typically a British product, and therefore excluded draught beers produced by other member states using different fermentation methods.

In response to a letter of concern from the Whitbread brewing company, the minister said it considered that the guest ale arrangements were compatible with the Treaty of Rome.

Whitbread and Camra, the pressure group, welcomed the Government's stance. Whitbread said: "The DTI's comment shows an underlying confidence in the market conditions within which guest beers are sold in the UK."

Camra believes that the guest ale provision has been a liberalising measure since it was introduced four years ago. Ben Wardle of Camra said: "This statement [DTI] gives great hope to Britain's beer drinkers." He said 50 new breweries are opened in Britain every year, most of which sell their beer as guest ales. "There has been an explosion of choice and quality for the drinker," he added.

The Government believes that the tie between national brewers, those that own more than 2,000 pubs, and tenants would be undermined by relaxing the guest ale rules. He also dismissed recent speculation that the Commission's action could lead to the extension of the guest beer provision to include lagers.