The Department for Business said the aim was to tackle unfair practices, such as high rents and the prices publicans have to pay for beer, reports The BBC.
Campaigners have complained for years of being exploited by “pubcos”.
Pubcos are the large firms that own thousands of pubs and bars and decide where tied landlords can buy beer from and at what price.
About half of all pubs in the UK are owned by pubcos.
Business Secretary Vince Cable said he also wanted to establish a new statutory code to look at the relationship between pubcos and publicans, and which would be enforced by the adjudicator.
The British Beer and Pub Association (BBPA) said it was disappointed that self-regulation had not been given a proper chance.
“Whilst the Association believes that statutory underpinning of recent industry reforms will result in unnecessary red tape and bureaucracy, it does however, welcome the endorsement of the tied house model and the clear distinction drawn between leases and traditional brewery tenancies,” it said.
BBPA chairman Jonathan Neame added: “In the consultation, we will be urging the government to ensure that any statutory process is light-touch and cost-effective, to protect consumers from bearing the brunt of unreasonable additional costs.”
The Fair Pint campaign, which aims to help publicans get a fair deal, welcomed the announcement.
“For far too long, tied pub tenants have been abused by big pub owning companies. Many have lost their livelihoods, savings and have lived in fear of losing their home,” said publican and Fair Pint campaigner Simon Clark.
“Today’s announcement comes after many years of highlighting this unfairness.
“There is work to be done on the detail and we believe that a free of tie option would be the best way of guaranteeing fairness in tied deals, but this represents genuine progress which will give a boost to publicans and consumers by increasing the viability of local pubs.”
The Campaign for Real Ale (Camra) has been calling for urgent action to help landlords against the financial pressures they face.
Camra said in a report in November that 18 pubs a week were closing in the UK, up from 12 a week a year earlier.
The government’s proposals come a day before a scheduled House of Commons debate on a statutory code of practice for pub companies. The debate was forced by Labour, who have long been pushing for action to save pubs from closing.
