Alcohol Reform Bill Implications: Tavern On-licences

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1 Alcohol Reform Bill Implications: Tavern On-licences Parliament is currently considering the Alcohol Reform Bill in response to the Law Commission s review of alcohol sale and supply laws. The Bill will replace the Sale of Liquor Act 1989 with new legislation that introduces a shift toward a tighter system of control over the sale and supply of alcohol. The purpose of this paper is to summarise the implications for your business. Purchase Age Proposes an age of purchase of alcohol for on-licences of 18 years and 20 years for off premise purchase to commence 12 months after the new Act comes into force with no change to the parent or guardian provisions regarding minors on licence premises. The final vote on the age of purchase for alcohol will however be a conscience vote with either the split age, the status quo or an across the board increase to 20. Could provide some trading advantage over off premise consumption. Trading Hours All licences will be required to include conditions on trading hours. The Act will provide for default maximum national trading hours for the sale of alcohol for consumption on premises between the hours of 8 am and 4 am. However, more or less restrictive trading hours may be imposed by conditions on issue of a licence or under a Local Alcohol Policy. Trading hours could also be restricted further where there is a one way door imposed either as part of a Local Alcohol Policy or as a licence condition. Generally members of the public will not be able to be on premises prior to 6am and from 6am it will only be possible to sell food and non-alcoholic beverages unless authorised to sell alcohol by a licence condition. Special Day Trading As currently on-licences will not be able to sell or supply alcohol on Good Friday, Easter Sunday, Christmas Day or before 1 pm on Anzac Day, unless a special licence has been obtained for a particular event or the buyer lives on the premises or is on the premises to dine. A definition of what it means to dine is introduced to mean a person on premises no more than one hour before or after eating a meal that effectively confirms current case law. Little change from current law. The Licensing Process Existing licences continue in force but on expiry will be subject to renewal under the new criteria for the issue of on-licences from 6 months after the new Act comes into force meaning that licences could face greater costs and restrictions on renewal. Licence Categories The Bill makes no change to the current types of licences and designations. June 2012

2 Applications 12 months after the new Act comes into force DLAs become District Licensing Committees (DLCs). Applications for all liquor licences will be made to District Licensing Committees (DLCs) of the local territorial authority for the district in which the premises are situated. Each DLC will consist of three members appointed by the territorial authority. Persons with any interest in the alcohol industry, police officers, licensing inspectors and medical officers of health are disqualified from appointment. The functions of DLCs will be to: Consider and determine applications and renewals for licences and manager's certificates, Consider and determine applications for temporary authorities, Consider and determine applications for variation, suspension or cancellation of special licences, Consider and determine applications for variation of licences (other than special licences), With the leave of the chairperson of the Alcohol Regulatory Licensing Authority (ARLA), refer applications to the ARLA, and Any other functions conferred on it. Licensing Criteria In considering issuing a licence the DLC or the ARLA must have regard to: The object of the Act, The suitability of the applicant, Any relevant local alcohol policy, The days and hours during which alcohol is proposed to be sold, The design and layout of the premises, Whether the applicant will be engaged in the sale of goods other than alcohol, low alcohol refreshments, non-alcoholic refreshments and food: Whether the applicant will be engaged in the provision of services other than those directly related to the sale of alcohol, Whether the amenity and good order of the locality (including factors such as noise, nuisance, vandalism and number of other licences) would be likely to be reduced by more than a minor extent by the effects of the issue of the licence: Whether the applicant has appropriate systems, staff and training to comply with the law: The availability of low-alcohol refreshments, non-alcoholic refreshments and food: Any matters dealt with in any report from the Police, a Licensing Inspector or a Medical Officer of Health. After considering the above criteria, the ARLA or DLC will be able to refuse to issue a licence, even if no objection was filed against the application for it and no report was filed opposing it. The ARLA or DLC may also refuse to issue a licence if inconsistent with a local alcohol policy, although conditions may be imposed to ensure consistency with any local alcohol policy. An applicant will have a right of appeal to the ARLA from the DLC or the High Court from the ARLA June 2012

3 Alcohol Regulatory and Licensing Authority The Liquor Licensing Authority will be replaced by the Alcohol Regulatory and Licensing Authority (ARLA). It would appear that the ARLA is intended to operate primarily in an appeal role although some matters are referred directly to it. For example, the practice of applications that attract objections being automatically referred to the Authority is discontinued. The ARLA will have the following functions: To consider and determine applications for licences, renewals, variations, manager's certificates (including renewals) when those matters are referred to it by DLCs, To consider and determine appeals from decisions of DLCs, To consider and determine appeals against elements of draft local alcohol policies, To consider and determine applications for variation, suspension and cancellation of licences and manager's certificates, and Any other functions conferred on it. The ARLA will be comprised of 3 District Court Judges and any number of other members. It can refer matters to the DLCs for investigation and may give statements to DLCs setting out its views on matters such as the general administration of the Act. It would seem that the ARLA is intended to operate at a higher level than the current LLA. It is tasked solely with determining applications for variation, suspension and cancellation of licences and manager's certificates. All other applications opposed or otherwise, are to be considered and determined by the DLCs. Licence Conditions The Bill provides that the following conditions must be imposed on all on-licences: A range of low and non alcoholic drinks to be available at all times that alcohol is sold and supplied. Low alcohol drinks are defined as those containing less than 2.5% alcohol by volume, A reasonable range of food available when the premises are open for the sale and supply of alcohol within a reasonable time of being ordered, Drinking water available free of charge at all times that liquor is sold and supplied, and Free comprehensive and accurate information about the forms of transport available from the premises. Provides for discretionary conditions that can be imposed on on-licences, including Conditions relating to the days and hours that alcohol may be sold, Conditions prescribing steps to be taken to ensure that alcohol is not sold to prohibited persons, Conditions prescribing steps relating to the management of the premises, Conditions imposing one-way door restrictions, and Any other reasonable condition not inconsistent with the Act. Different conditions may apply to different parts of the same premises. The effect of these provisions is likely to be in more compliance costs and conditions restricting operation of business. Examples could include requirements to have a number of managers on duty, door security, CCTV and directions on staff training June 2012

4 Renewals and Licence Variations No significant change is proposed in relation to the current process except the fees payable and the conditions that may be imposed. Objections Interested persons will be able to object on a wider range of grounds including consistency with local alcohol policies. Fees The Bill provides for regulations to be made in respect of: Prescribing fees that, so far as practicable, recover the costs of the licensing process, Different fees on the basis of factors such as the kind of premises, the capacity and likely patronage of the premises, trading hours, the conduct and performance of the licensee or anyone involved and any actual or proposed activities, arrangements or systems that may reduce the risk of alcohol-related harm arising from the operation of the premises, Full or partial refunds of fees in some circumstances, Annual fees, and automatic suspension of licence for non payment until such time as payment is made, Penalty fees for the late payment of annual fees, and Authorising territorial authorities to prescribe fees. Likely to result in higher and more frequent fees including annual fees in some cases. Special Licences Applications will need to be lodged with the DLC at least 20 working days before the event, unless this is not reasonably foreseeable. The application process largely parallels the process as for other licences, including the ability for applications to be refused even if no objection was filed against the application and no adverse report was filed or if inconsistent with a local alcohol policy, although conditions may be imposed to ensure consistency with any local alcohol policy. If an application relates to a large-scale event, the DLC may require the applicant to provide the DLC with a management plan describing how the applicant proposes to deal with matters such as security, monitoring, interaction with local residents and public health concerns and require the applicant to liaise with the Police and the territorial authority on planning for the event. There is also, as with other licences, a wider range of conditions that may be imposed. The new special licence provisions commence 12 months after the new Act comes into force except the new criteria (see licensing criteria above) which comes into force 6 months after the new Act commences. Likely to result in special licences being more difficult to get, to cost more and more conditions imposed June 2012

5 Local Alcohol Policies The Bill empowers, but does not require, territorial authorities to have policies relating to the sale and consumption of alcohol in one or more parts of their districts. Local alcohol policies may include any of the following: The location of licensed premises by reference to broad areas and proximity to other premises and particular facilities, Whether further licences (or licences of particular kinds) should be issued for premises in the district or part of the district, Maximum trading hours, One-way door restrictions, and Any other matter relevant to the licensing objects of the Act. Likely to result in more restrictions on business operation and higher costs. Management of Premises No significant changes are proposed for the application and issuing of General Manager s qualifications and certificates except that holders of General Manager s certificates will need to be aged at least 20 years for all applications from 12 months after the new Act comes into force. Much the same procedures as currently except records of all temporary and acting manager appointments will be required to be kept. Enforcement and Offences Increases penalties for a range of licence breaches and offences, including allowing intoxication on premises, allowing violent and disorderly behaviour on premises, running irresponsible promotions and being on or allowing people on licensed premises outside licensing hours, Strengthens the existing offence of promotion of excessive consumption of alcohol by making it apply to anyone not just licensees or managers and changing the offence to irresponsible promotion of alcohol and setting out examples of unacceptable promotions, such as free alcohol (other than in on premise promotions that cannot be seen or heard outside the premises), offering (or the opportunity to obtain) any goods or services or prizes on the condition that alcohol be purchased, and discounting alcohol by more than 25% of the normal retail price. Amends the current offence of sale or supply to minors and permitting minors in restricted or supervised areas and restricts the defences. In order to successfully defend a charge a person will need to prove that they were presented with a document that appeared to be an evidence of age document and that he or she believed on reasonable grounds that the document was an evidence of age document that related to the customer and indicated that the customer was at an age where the customer could lawfully buy alcohol and the defendant must reasonably believe that the customer was not under the lawful age of purchase. Creates new offences for managers or employees intoxicated while on duty. Creates offences relating to presenting, selling, hiring, lending or giving evidence of age documents (both genuine and false) June 2012

6 Infringement offences Creates and extends the infringement offence regime for certain offences including: Buying alcohol by people under the purchase age, Minors in restricted or supervised areas, Permitting minors to be in restricted or supervised areas, Manager or employee intoxicated while on duty, Sales of spirits otherwise than in a vessel exceeding 500ml, Offences relating to evidence of age documents, and Offences relating to breaches of licence conditions. A constable will be able to issue an infringement notice for any infringement offence but licensing inspectors will only be able to issue infringement notices in respect of offences relating to licensees and managers and breaches of discretionary licence conditions. Means greater risk to licences and of fines. Other Provisions Retains and extends the ability to seek a court order to close premises for up to 24 hours if rioting is occurring or it is reasonably believed rioting may occur. However, the circumstances in which the Police can close licensed premises are widened to include (as well as rioting or serious disorder or a threat of rioting or serious disorder) if there is a significant threat to public health or safety or if the conduct on premises amounts to a substantial public nuisance or if there are reasonable grounds for believing offences have been committed on the premises that carry a maximum penalty of 5 years or more and there is a significant risk of further such offences being committed on the premises if the premises remain open. Carries over provisions relating to Police powers of entry onto premises and extends the powers to licensing inspectors meaning more intrusive licensing enforcement. Creates a new enforcement regime to deal with licensees and managers who frequently commit certain specified offences or have findings made against them by the ARLA in respect of certain conduct including irresponsible promotion of alcohol, sale or supply to minors, unauthorised sale or supply and sale or supply to intoxicated people meaning greater risks to licences and managers. Gives the ARLA express power to cancel a licence or manager s certificate if the licensee or manager has, on 3 separate occasions within a period of 3 years, had 3 holdings in respect of the same premises and must not grant an application for a licence or manager s certificate in respect of any premises to which the holdings relate for a period of 5 years meaning greater risks to licences and managers. Provides for the making of regulations requiring licensees to display at points of sale information relating to alcohol content of alcohol products and the potential harmful effects of alcohol. Provides for the making of regulations banning and restricting alcohol products June 2012