The Competition Authority has begun formal proceedings against the two organisations representing Irish publicans, a spokesman said yesterday. The authority has been investigating allegations of price-fixing in the trade. The action is being taken as the price of a pint of beer rose by 5p yesterday.
The spokesman said the Licensed Vintners' Association (LVA), which represents mainly Dublin publicans, and the Vintners' Federation of Ireland (VFI), which represents publicans outside Dublin, had been formally notified that proceedings were being issued.
The authority began an inquiry last year to examine how restrictive licensing laws might be influencing practices in the licensed trade. The former minister of State, Mr Pat Rabbitte, was anxious that the inquiry would look into allegations that some publicans were colluding in fixing prices or operating cartels.
The authority's report was due to be published last November. Mr Rabbitte said yesterday he understood its publication was being blocked "by threatened litigation". The authority spokesman confirmed that, in the light of the proceedings now being taken against the LVA and the VFI, it had received legal advice that the results of the inquiry should not be published for the time being.
The authority raided the offices of the LVA in January as part of its investigation into price-fixing allegations. Officials photocopied 119 documents which they found on the premises and took away the copies. Mr Frank Fell, the LVA's chief executive, said on that occasion the authority's tactics were more appropriate to "hardened criminals" than "a law-abiding trade association".
Mr Fell said the LVA had consistently co-operated with the Government in all matters relating to the pricing of drinks in pubs.
Guinness notified its customers last week that it was adding 2p to the cost of the pint. Publicans added a further 2p and these increases trigger a VAT increase of 1p. The 5p increase came into force yesterday, although individual publicans have discretion as to when they will introduce it or whether they will introduce it in full.
The Competition Authority can investigate allegations of anti-competitive behaviour such as price fixing or cartels.