What does the ACCC "beer taps investigation" mean for beer drinkers?

THE Australian Competition and Consumer Commission has just finished its beer taps investigation.

A lot of Australians love having a beer at their local but what will the findings of this investigation affect what they get at the bar?

Read our “beer taps investigation explainer” and have your say in our survey below.

What is the ACCC beer taps investigation?

On the back of a number of complaints from independent breweries, the Australian Competition and Consumer Commission put together a three-year investigation into the contracts of Carlton United Breweries and Lion Pty Limited.

Allegations from independent breweries claims the major brewers were locking them out of beer taps in venues around Australia because of the exclusivity of the contracts.

If major brewers are seen to be locking small brewers out of taps in pubs and clubs, it makes it hard for independent brewers to establish themselves and grow. 

One of the main complaints from independent brewers was that Lion and CUB’s contracts required pubs and clubs to dedicate 80 per cent of beer taps to big name brands in exchange for rebates, infrastructure investment and refurbishment loans.

So who did the ACCC investigate over the last three years?

In three years the ACCC looked at contracts and practices at 36 venues in Victoria and New South Wales. 

Most of the venues were in metropolitan areas such as Sydney and Melbourne but venues in regional areas including Bendigo and Ballarat were also investigated.

The ACCC also considered 33 contracts from small brewers and 140 from Lion and CUB.

What did the investigation find?

While the ACCC was able to uncover some contracts that included minimum volume requirements that could make it harder for craft brewers to gain access to taps in these venues, the overall conclusion was that venues were responding to consumer demand rather than being restricted by big name beer contracts.

The investigation also concluded that a number of small brewers were about to get their products on venue taps alongside a major brewer.

Independent brewers have predictably been upset with the ACCC’s findings.

Brookes Beer owner Doug Brooke said one problem with the investigation was the ACCC’s resources. He cited that only 36 out of the 40,000 licensed venues in Australia, had been investigated over three years.

Bendigo Beer chairman Trevor Birks with Brookes Beer owner Doug Brooke.

Bendigo Beer chairman Trevor Birks with Brookes Beer owner Doug Brooke.

Will this affect what beers are available at my pub?

In the short term no, but Dr Schaper said the ACCC will revisit the industry in two to three years . He said over time investigators will be monitoring whether the complaints and problems in the beer industry grow or die away.

“If they grow it is a red flag to us,” he said. “There is a reliance of people continuing to raise the issue with us. Some might think ‘is there a real value in this? The answer is yes.”

In Bendigo, Bendigo Beer chairman Trevor Birks said it was important to educate venues about independent breweries.

“On our agenda for the next couple years is to be better at education and be a champion for the beer drinkers while supporting (small brewers),” he said.

“From a Bendigo Beer view, pub owners need more education. They need to know that they don't need those contracts to run a successful business.”

Why won’t the ACCC act on anti-competitive contracts?

ACCC Deputy Chair Michael Schaper said unlike other countries, the ACCC is not “judge, jury and executioner.” If they believe a law has been broken or a market is anti-competitive, they have to take companies to court.

In investigations like this, the legal test used is “exclusive dealings” where a big organisation offers a small company a product in exchange for not buying from anyone else. To prove that most venues are tied in an exclusive or highly limiting contract, the ACCC would have to show a pattern of that behaviour across the whole industry.

Dr Schaper said the ACCC had such a mixed bag of evidence from the “beer taps investigation” that it was unable to show a pattern and that they wouldn’t be able to convince a court that a whole market was “locked up”.