Can a liquor licence be transferred?
In WA most liquor licences are capable of transfer from the current licensee to a new licensee. However, approval to the proposed transfer must first be obtained from the WA licensing authority (being the Racing, Gaming and Liquor Division of the Department of Local Government, Sport and Cultural Industries).
This is because although a licence is commonly regarded as personal property, it is not. It is a statutory right that exists pursuant to, and is governed by, the Liquor Control Act 1988 (WA). Under the Act, a liquor licence is held by a “licensee”, the legal person. who is authorised by the licensing authority to hold the licence. While generally this is the person who owns and operates the business conducted under the licence, it can also be a person who has the right to carry on the business of the licence under an interim authorisation (such as an administrator or liquidator in the event of bankruptcy or insolvency or the existing licensee, or the executor of an estate where the existing licensee has died) or a protection order.
The Act allows for the transfer of liquor licence in the following circumstances:
- Pursuant to a contract of sale or assignment of the business of the licence. Generally this arises when the business operated under the licence is sold, but can also be when there is a corporate restructure.
- Where an entity has the right to carry on the business under an interim authorisation or a protection order.
- Where a licence is held by one or more parties and one or more of these no longer wants to be involved in the business.
- With the leave of the Director of Liquor Licensing. That is, in circumstances where none of the above applies. The most common situation is where the current licensee no longer occupies the business premises and has lost its interest in the licence.
There are two liquor licences which are not capable of transfer, being an occasional liquor licence and a club liquor licence. Also, the transfer of a casino liquor licence requires the consent of the Gaming and Wagering Commission in addition to the approval of the WA licensing authority.
What application is needed?
To apply for the transfer of a liquor licence a formal application must be lodged at the WA licensing authority.
The licensing authority prescribes what must be lodged for an application. This includes a Notice of Application, payment of the application fee and supporting documents. The documents required will depend on the circumstances of the transfer.
What are the essential requirements?
There are some essential requirements for an application to transfer a liquor licence. These are set out below.
- Where the transfer relates to the sale or transfer of a business, the offer and acceptance or business sale agreement must include a condition that the sale or transfer is conditional upon, and subject to, the Director of Liquor Licensing’s prior approval to the transfer of the licence.
- The transfer application must be made by the person wanting to hold the licence (the proposed incoming licensee) after the transfer has occurred.
- The proposed incoming licensee must have exclusive possession of the licensed premises on and from the date the licence is transferred. That is, it must have a lease or other right of exclusive possession.
What other things are required?
- Other important requirements for an application to transfer a liquor licence are:
- Where the proposed incoming licensee is a company:
- All persons who hold a “position of authority” in the company (this includes a director or shareholder in any shareholding company or a beneficiary of a trust with an interest in the business of the licence) have to be approved by the licensing authority. This is done as part of the application.
- At least one director of the company must have successfully completed the Course in Management of Licensed Premises.
- A House Management Policy, a Code of Conduct and Management Plan for the licensed premises in the name of the proposed incoming licensee must be prepared that complies with the licensing authority’s requirements. These documents set out details on how the proposed incoming licensee will operate the premises and ensure the responsible service of alcohol.
- If the licence to be transferred is a producer’s licence the proposed incoming licensee must complete a questionnaire to demonstrate that it will be a genuine producer.
What is the application process?
Once an application has been lodged at the licensing authority, the licensing authority will complete a preliminary assessment of the application. It will then advise if further information or documents are required. Once all the licensing authority’s requirements have been satisfied the application will be determined (i.e. a decision made).
Generally a decision can generally be expected within 4 to 6 weeks from the date of lodgement of the application. If approved the licensing authority will issue an approval letter with the transfer effective on the relevant date, such as the date of settlement.
For further information on an application to transfer a liquor licence or liquor licensing law in WA, please contact Susan Nicholson by email at email@example.com or by telephone on (08) 9389 3999.