JD Wetherspoon's has lost an appeal to extend its opening hours at a Lloyds No 1 pub in Guildford, Surrey.
Under last November's new licensing laws, the 655-strong pub group failed to get a three-hour extension every night of the week at the Bridge Street site in the town centre.
But, in what is seen as a test case for the industry, Guildford Council turned down its appeal after police raised fears that the area was already "demanding" and "acted as a magnet for drunk people".
Wetherspoon's argued that the council was enforcing the old 11pm cut-off by the back-door by only granting extensions in Bridge Street under exceptional circumstances.
A spokesman for the group played down suggestions that the case may set a precedent.
"The problem is specific to Guildford and won't stop us applying for extensions in the future. We already have them in place at 95% of our pubs," he said.
By Tom Bill