Update: Liquor Licensing and Compliance

Since the de-merger of liquor and gaming regulation, the new Victorian liquor regulatory body, Liquor Control Victoria (LCV), have published statements regarding their current approaches to compliance, leading to a regulatory environment where licensees are increasingly being held to account for failures to comply with the Liquor Control Reform Act 1998 (LCRA). These failures include those of an administrative nature, which the previous regulators have historically been more forgiving of when non-compliance arises.

For new entrants to the liquor industry, it is essential to take steps to ensure compliance with the LCRA from the outset of obtaining a liquor licence, so that this flows through into continued compliance during the operation of the venue. For existing licensees it is equally important to ensure that your licensing structures are up to standard with the LCRA – as the LCV are also auditing existing operators for administrative compliance.

Applicants for new liquor licences and existing licensees should carefully note the following key pitfalls that have been subject of regulatory action recently:

1. Correct trading entity

Under the LCRA, it is the entity listed as the licensee on the liquor licence that has the right to supply liquor under that licence. Licensees should ensure that the application for a liquor licence is made in the name of the same entity that is buying and selling the liquor (the licence is not to be held by an individual person connected to the business, nor a related entity, or holding company) – which should also be the same entity that holds a lease/right to occupy the land.   

In some cases, approval may also be given by LCV for a third-party to conduct the licensed business by way of a management agreement or other profit share structure – however this is also a procedure that requires pre-approval of the LCV prior to implementation. 

If any changes are proposed to the trading entity at a later date, once the liquor licence has already been granted, then depending on those changes you may need to notify the LCV, or seek a formal approval to change the liquor licence.

An entity purchasing a new business with an existing licence must also wait until the transfer application is approved and the transfer is made effective before trading. Trading under the new entity prior to the transfer application being approved is a serious offence.

2. Notification of changes to company structure

Once a company holds a liquor licence, it must ensure that no new company directors are appointed prior to LCV formally approving the individuals as directors.

Licensed venues that also operate a gaming offering should be mindful that separate and additional approvals apply to other changes in corporate structure – even to your registered address or senior staff.

3. Correct completion of application material

It is essential that when applying for a liquor licence, applicants are fully transparent with LCV in completing application material. In particular, police questionnaires and declarations of associates must be accurate.

Making a false or misleading declaration is a serious criminal offence – and can also have detrimental impact on the application, which may lead to an application being refused and the applicant may be deemed unsuitable to hold a liquor licence.

4. Online sellers

Recent legislative amendments introduced a change to categories of licence for online supply of liquor, including the introduction of a new remote seller’s packaged liquor licence. The LCV has also changed it’s approach as to the relevant location which is to be ‘licensed’ for the purposes of these activities.

Any licensees in this position should review the licensed premises address on their licence. This should now be the address where liquor is ‘picked and packed’ – meaning the location where liquor is appropriated from the licensee’s stock and set aside for delivery to fill an order.

Licensees must also ensure that they do not move the location of the picking and packing activities of their online business without first relocating the liquor licence.  

If you are looking to establish a new business, purchase an existing business or review your existing structure and you would like specific advice to your circumstances then please contact our office for a consultation.

This update does not constitute legal advice and should not be relied upon as such. It is intended only to provide a summary and general overview on matters of interest and it is not intended to be comprehensive. You should seek legal or other professional advice before acting or relying on any of the content