80 % of all pubs and restaurants in Belgium are tied to a brewery. This means that these houses are obliged to buy their beer exclusively from that brewery. In most cases, the brewery owns the real estate of the pub. In other cases the pub-owners agree to such a contract because the brewery pays for the installation and upgrade of the whole pub, furniture included. Tied pubs pay an average price of about 20 % more for their beer than the free houses. The largest brewer has the most pubs, so it is no surprise that in Belgium you see so many pubs with signs on the outside for Stella, Hoegaarden and Leffe, beers brewed by the second largest brewer in the world: Interbrew.

Peter Vanvelthoven, Federal representative for the Socialist party, has entered a bill that would free most tied houses. This measure would at the same time upgrade the Belgian legislation to what the European Community is asking for. It would allow the quality of the beer, brewed by smaller independent breweries, to have a better chance in competition with the mass-produced beer of the world’s largest brewers. Peter’s bill says that only breweries with a market share less than 10 % have the right to tie pubs, breweries with a market share up to 30 % can only tie a pub for five years. Breweries with more than 30 % market share are not allowed to tie anybody. The only brewery in Belgium in this last case is Interbrew.

The bill is no law yet, but Interbrew is already defending its near monopoly: they are shifting the pub contracts to their beer-distributors, who are tied firmly to Interbrew.
Newsletter April, 2001