Sorry sir, no wine tonight!

Ever been to your favourite restaurant and ordered a beer or a glass of wine, only to be told “Sorry, unfortunately we cannot serve alcohol at this time as we are still awaiting renewal of our liquor license!” Unfortunately, this scenario happens quite often, leaving patrons dry-mouthed and wondering why the restaurant has not renewed their liquor license. The application for or renewal of a liquor license can however be a complex process and one that should be undertaken timeously to avoid situations such as these.

Herewith some basic information for existing or prospective restaurateurs, pub, club or tavern owners.

Anyone who wishes to trade in liquor by manufacturing, selling or serving liquor, is required by the Liquor Act, 59 of 2003 (the “Act”) to have a proper liquor license in place, with contraventions attracting various types of penalties. Licenses differ depending on the type of establishment being opened or operated.

It is important to bear in mind that each liquor license application is unique. This makes it difficult to estimate how long an application and the approval thereof may take. Manufacturing and distribution licenses are regulated at a national level while micro manufacturing and retailing continue to be regulated at provincial level – with applications being made to your relevant Provincial Liquor Board. Applications are carefully considered with all relevant factors being taken into account. Most provinces have a Provincial Liquor Act and requirements, formalities and procedures may accordingly vary from province to province.

The first step is to establish which type of license it is you will be applying for. If you are opening a restaurant for example, you will apply for an On Consumption Liquor License which will permit the sale and consumption of liquor on the restaurant premises (liquor may not be removed from the premises). If you wish to open a liquor store, you will need to apply for an Off Consumption Liquor License, which allows the sale of liquor (but no consumption on the premises). If you want to go into the manufacturing or distribution of liquor, a manufacturer or distributor liquor license will be required.

The main reason for applications being delayed, is application forms which have not been properly completed and lodged with the required substantiating evidence. It’s essential that all the required documentation is carefully and correctly completed, and it is highly recommended that a specialist be used to assist in compiling the relevant application.

The following aspects often carry substantial weight in the consideration of each application (these may vary from province to province):

  • It must be shown that the granting of the liquor license is in the public interest.
  • The applicant must be of good character.
  • The premises for which the license is to be obtained must be suitable for use by the applicant for the purpose of the license. Land use rights and the zoning of your property (whether or not you are prohibited from carrying on certain business etc.) are crucial. 
  • The applicant must also show that the granting of the license does not prejudice –
    • residents of a residential area;
    • older persons or the frail;
    • school children under the age of 18; and
    • congregants of a religious institution located in the vicinity of the proposed premises.

The relevant Liquor Board will consider all of the above, together with a report by a police officer assigned to your case, as well as any public objections lodged whilst the application lay for comment.

The Liquor Board may approve or reject the application, postpone it for further investigation or call a hearing to make a determination on whether or not objections are valid. If your application is approved, one must remember to renew it annually on or before the anniversary date thereof. Should the Liquor Board reject your application, written reasons for the rejection should be supplied so as to enable the applicant to either rectify the application, or to re-apply with their proposed amendments incorporated.

Applying for a new licence or the transfer or renewal of a licence can become a time-consuming and costly exercise if potential business is lost, and it is therefore advisable to ensure that your application is compiled and submitted correctly in line with the relevant provincial or national formalities with the help of professionals that will ensure that your patrons are not left dry-mouthed at your table!

Disclaimer:

Please note that this article provides only an indicative outline for information purposes of the process to apply for or renew a liquor licence and should not be relied on as legal opinion. The processes, procedures, requirements and formalities for each form of license and per province may vary and appropriate legal advice should be obtained as relevant to your situation.

September 11, 2014
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