When a liquor licence is granted, it is granted to a specific entity known as “the licensee”. The licence allows only the licensee to sell or supply liquor at the licensed premises.
If the licensee wishes to sell the business (operated under the licence) to another entity, then the applicant who wishes to purchase or be assigned the rights to the business (including the rights to operate under the licence) must apply to the department to take over the business. This is done by lodging a transfer of licence application. It is important to note that settlement cannot take place until prior approval of the transfer application has been granted by the department.
During the Transfer of Licence application the existing licensee must not vacate the premises and the applicant must not sell or supply liquor until approval has been given by the licensing authority. If the licensee has vacated the premises prior to the transfer application being lodged then consent for the transfer may be given with ‘leave of the Director’.
How a transfer is made
There are three situations where a Transfer of Licence can be made:
- Contract for the sale or assignment of business.
- Entity has the right to carry on business or may be granted a Protection Order.
- With leave of the Director.
Contract for sale or assignment
A contract must be provided that will give the rights of the licensee to the applicant to carry on business under the licence (section 84(1)(a)).
The contract must be made between the applicant and the current licensee for it to be considered valid.
The contract must be subject to a condition precedent requiring the prior approval of the licensing authority before settlement can occur.
Right to carry on business or Protection Order
An application can be made by a person who has the right to carry on the business of the licensee or by a person who may be granted a Protection Order (section 84(1)(b)).
Right to Carry on Business (Section 86)
Circumstances where the licensee has become bankrupt, disabled or other events as indicated under section 86 apply to the right to carry on business. Examples of persons who can apply are liquidators, administrators or an executor of the estate.
Protection Order (Section 87)
Where the licensee is suddenly unable to operate their business an application for a Protection Order can be made by the freehold owner or another person mentioned above, to allow the continuation of the business to prevent a loss of income/profit. If approved, the applicant can then apply for a Transfer of Licence to ensure the continuation of the business.
With Leave of the Director
In situations where the licensee is no longer able to give consent for the transfer to occur the applicant must also provide a submission with the application seeking leave of the Director outlining the reasons (section 84(1)(c) and section 84(3)).
This includes situations where the licensee has been evicted, has vacated the premises or has become deceased and a Protection Order is not applicable.You will need to show evidence that you have attempted to contact the licensee to advise them of your application (for instance registered post slip).
Please ensure your submission outlines why there is no contract for the sale or assignment of business and provides justification as to why the Director should exercise discretion.