Chapter 1 of Part 2 of the Finance Act 2003 is amended by inserting the following section after section 78:

"78. Relief for small breweries.

(1) A relief of half the amount of alcohol products tax paid on beer shall, subject to subsection (3) and to such conditions as the Commissioners may prescribe or otherwise impose, be granted on a quantity of beer, not exceeding 20,000 hectolitres in a calendar year, brewed in the European Community in a brewery -

(a) in which the quantity of beer brewed in the previous year has not exceeded 20,000 hectolitres,

(b) which is legally and economically independent of any other brewery,

(c) the premises of which are situated physically apart from those of any other brewery, and

(d) in which less than 50 per cent of the beer brewed in the previous calendar year has been brewed under a licence, franchise or contract arrangement for another brewery.

(2) The relief under subsection (1) shall be granted by the Commissioners by means of repayment.

(3)

(a) Subject to paragraph (b), relief under subsection (1) does not apply to any beer brewed for another brewery under a licence, franchise or contract arrangement.

(b) Notwithstanding paragraph (a), where beer is brewed in a brewery under a licence, franchise, contract or other cooperation arrangement with one or more other breweries, and where -