Licensing an expansion in business

Many publicans operating through these difficult conditions have had to diversify their business models, improve their food offerings, extend their range of off-sales products and minimise costs. In our Expert View column Niki Andrews sheds some legal light on the various options – and their repercussions – open to publicans aspiring to increase profits.

Over the last few years there has been a continued decline in on-sales due to the economic downturn and increased off-sales. The dramatic hike in the costs of Special Exemption Orders has resulted in many public houses having to abandon late-night trading beyond permitted trading hours.

Prior to the Intoxicating Liquor Act 2000 coming into force, a licensed premises could only trade beyond the permitted trading hours if there was a Restaurant Certificate in force in respect of the premises or it was a hotel. Since holding a Restaurant Certificate is no longer required in order to apply for a Special Exemption Order many publicans stopped renewing their Restaurant Certificates at the Annual Licensing Court.

Restaurant Certificate returns
However there are still benefits to a public house being certified as a restaurant as a public house so certified by the District Court may serve intoxicating liquor for one hour with meals after normal closing times. So a public house that has a Restaurant Certificate could trade until 1.30am Saturday and Sunday morning. The meal served must be substantial and have a value of €9.00.

In addition, a public house that’s certified as a restaurant by the District Court is considered a mixed trading premises. Until 2000, restrictions applied to the hours during which non-licensed business could be carried on at a licensed premises. Now, non-licensed business can be conducted on the licensed premises at any time.

When non-licensed trade is being carried on in a licensed premises outside of permitted trading hours persons are permitted to be on the licensed premises for non-licensed business and the licensee will not be guilty of the offence of permitting persons to be on the premises during prohibited hours.

To apply for a Restaurant Certificate, the holder of a Seven Day Publicans On-Licence (or the holder of a Wine Retailer’s On-Licence) must apply to the District Court and prove that the licensed premises are structurally adapted for use and bona fide and mainly used as a restaurant. The Restaurant Certificate must be renewed annually at the Annual Licensing Court. All restaurant premises must be registered as ‘food premises’ with the HSE and display the Food and Beverage Display and Price Orders.

Letting out the licensed premises
Public houses situated in residential areas can be extremely attractive to supermarkets as they usually come with ample parking and room for development. In addition, as the premises can be acquired with the benefit of a Seven Day Publicans On-Licence, that licence may be used to facilitate the grant of a new Off-Licence for the prospective supermarket operator. If the licence attaching to the public house has lapsed, depending on when the last licence attached to the premises, the prospective purchaser can give notice to the Court of their intention to apply for an Off-Licence on the basis that the premises was licensed within the last five years with a Seven Day Publicans On-Licence.

Any publican considering entering into such a transaction should be aware that their premises can never be licensed with a Seven Day Publicans On-Licence again once the licence is converted into an Off-Licence. And the conversion of the public house into a licensed supermarket may require a grant of planning permission, depending on the planning history of the unit.

Sub-dividing a licensed premises
Some public houses are split over two or more levels. Due to the drop in on-sales the upper floors may no longer be in use. It’s presumed that the licence attaches to the whole of the premises unless there are licensing maps to indicate otherwise. So it may be possible to separate the upper floors from the ground floor and create a separate unit that can be sold or leased to a third party. An application to Court for a new licence that does not include the new unit must then be made by the publican. The locus of the unit above a public house may be very attractive to a restaurant operator who can, in turn, licence the area with a Special Restaurant Licence or alternatively a Wine Retailer’s On-Licence and a Restaurant Certificate.

Alternatively, a public house may be operating from a ground floor premises that’s too large for the needs of the business. It may be possible to divide the premises into two units so that the public house may continue to operate from one of the units while the other unit is offered to another retailer, for example a convenience store operator or a bookmaker. Again, as in the previous scenario, an application to Court for a new licence for the public house that does not include the new unit would be required.

Any subdivision of a licensed premises may have legal implications under not only the Licensing Acts but the other regulatory codes of law such as the Planning Acts and the Building Control Acts so professional advice should always be sought before any works are undertaken.

Having attended UCD, Nicola-Jane Andrews BL specialises in intoxicating liquor licensing law and was called to the Bar in 2004. She has practised ever since and has co-authored Liquor Licensing Laws of Ireland (May 2011) with James V Woods.