Category: Liquor Licence South Africa

Strategies for combating illicit trade in the liquor industry

18 December 2023

The nature of the illegal sale of alcohol means it is difficult to quantify the precise scale of illicit trade in the liquor industry. But Tax Justice South Africa, an NGO set up to tackle the large-scale tax evasion that is depriving South Africans of vital services, estimates that 500 million litres of illegal alcohol is consumed in South Africa every year, costing the country R6 billion in taxes. Furthermore, because the manufacture of illegal alcohol is unregulated, it may contain fatal levels of alcohol or other toxic ingredients. What is being done to combat the illicit trade in liquor? 

Regulation

Illegal sale of alcohol in the Western Cape is currently regulated by SAPS. It is not regulated by the Western Cape Liquor Authority and therefore premises suspected of illegal trading are not inspected by Inspectors from the Western Cape Liquor Authority. This activity falls outside of the scope of the Western Cape Liquor Act 4 of 2008 (as amended).  

White paper

The Western Cape Liquor Authority drafted the Western Cape alcohol-related harm reduction policy which currently is currently available for comment. The White Paper states:  

“Unlicensed liquor outlets and the illicit liquor trade identifies the concern of a lack of regulation leading to increased harm and the loss of tax and licence revenue that can be used to mitigate harms. 

The policy proposes taking steps to bring responsible unlicensed liquor outlets into the regulated space in a sustainable and responsible manner, identifying mechanisms and criteria that will enable the re-zoning of outlets for liquor sales in appropriate residential areas and prioritising upstream interventions targeting suppliers to the unlicensed liquor industry and the illicit liquor trade. 

Awareness of alternative economic opportunities should be provided to currently unlicensed outlet owners. Liquor enforcement units are to be capacitated and strengthened through increased resources and an integrated liquor enforcement approach, among other proposals.”

According to the Western Cape Liquor Authority, the number of licensed liquor outlets in the Western Cape in December 2015 was 9,296, comprising 8,888 liquor licences issued by the Western Cape Liquor Authority and 408 issued by the National Liquor Authority. In a 2015 survey, the number of unlicensed liquor outlets in the Western Cape was estimated at 3,483, equal to 37% of licensed outlets.

The White Paper proposes the following policy interventions:  

  • Take steps to bring some responsible unlicensed liquor outlets into the regulated space in a sustainable and responsible manner to facilitate compliance with minimum requirements.

The regulated space must be attractive for both traders and their customers. Incentives for becoming a licensed outlet should be clearly identified and communicated to current illegal outlets as well as the consequences of not becoming licensed. The application process for liquor licences must be simplified and streamlined.

  • Identify mechanisms and criteria, working with municipalities, that will enable the re-zoning of outlets for liquor sales in appropriate residential areas.

The importance of this is to ensure there is a clear basis for re-zoning. Zoning is a municipal competence. The issuing of liquor licences is a provincial competence and the proposal is to ensure collaboration between the two spheres of government in order to reduce harm, while bringing a predictable and regulated environment, particularly for outlets in residential areas. 

  • Prioritise upstream interventions targeting suppliers to the unlicensed liquor industry and the illicit liquor trade. 

A key strategy to combat the unlicensed liquor industry and the illicit liquor trade is to cut off the supply at the source. Obtaining information from community structures and enforcement officials of the licensed traders supplying the liquor, targeting enforcement operations on these licensed traders and lobbying for the prioritisation of the prosecution of them is recommended as a focus area. 

  • Place evidence before the justice system to argue for the prioritisation of liquor law transgressions and to be considered in the sentencing process for tougher sanctions. 

Unlicensed liquor outlets that cannot be brought into the regulated space and those that do not comply must face the consequences of the justice system, be prosecuted and closed down. Alcohol’s mind-altering effects are drivers of various and extensive harms, including violence (especially gender-based violence) and criminal activities such as robbery, murder and assault. The courts need to be cognisant of this and prosecutors need to be assisted with evidence, such as academic studies and statistics, placed before the courts. Consistent prosecution and heavier sentences will also act as an incentive to become licensed. 

  • Create awareness of alternative economic opportunities to currently unlicensed outlet owners who cannot be accommodated within the applicable zoning scheme.

A clear strategy benefiting and empowering individuals regarding economic alternatives must be developed and shared with the affected parties, including information on relevant business support programmes. 

This White Paper was drafted and has been in circulation since 2015, so whether these amendments and proposals are ever implemented remains to be seen.  

Help with your liquor licence

If your liquor licence application renewal is outstanding we can help you with submission and the correct documentation. We can handle objections and manage any compliance issues. Get legal help with your liquor licence application here.  

The role of a liquor law consultant

20 June 2023

How can a liquor law consultant smooth your licensing process?

If you are applying for your first liquor licence, or renewing an existing licence, you may decide to enlist help. Or you may prefer to go it alone. Do you need professional assistance? What are some of the benefits of using a liquor law consultant? As the legislation stands, there is no requirement to engage an attorney to submit an application to the Western Cape Liquor Authority and/or the National Liquor Authority. Anyone who wishes to obtain a liquor licence can submit the application on their own behalf. The costs of the various licences are published on the WCLA’s website and there is now an eLicence portal which allows licence holders to manage their licences online. Currently it is only possible to renew an existing licence online and not apply for an initial licence.

Why use a liquor law consultant?

If you can manage your own licence, why would you choose to use a consultant? There are obviously cost savings to be found in the DIY approach. But there are also false economies – “actions that save money at the beginning but, over a longer period of time, result in more money being wasted than being saved”. Generally a consultant who assists with your liquor licence is an attorney who specialises in liquor legislation. As with most areas of the law, liquor legislation has become a very specialised field. An attorney will know, for instance, how applications are being considered and viewed by the authorities at different times. An attorney will also know what information and documentation the authorities require, where the information is not stated in the Act or in the information provided by the different authorities.

Critically, an attorney has relationships with people at the various licensing boards, built up through time and experience, and enjoys direct access to the key role players. This might be particularly helpful if there are any irregularities with your licence application or if you have specific questions.

Freedom from the administrative burden

Applying for a liquor licence can be tedious and carries with it a considerable administrative burden. If you appoint an attorney to handle your licence application for you, that burden falls on the attorney. It is your responsibility to provide the requisite information and documentation to your attorney. It is not their job to produce documents. But it is their job to ensure the documentation complies with the legislative requirements and turn your information and documentation into a valid application. And because they are an expert in the field, they are almost certain to complete the process much more rapidly than you could. If you consider all the other tasks on your plate as the owner or manager of licensed premises, and the time you can save by outsourcing your liquor licence application, the cost of engaging a liquor licence attorney becomes extremely good value.

Other stakeholders

A liquor licence application is submitted not only to the liquor licensing authorities. There are various third parties that may have a stake in an application. Your attorney can deal with these on your behalf. Stakeholders may include the local SAPS office, the applicable municipal office and, in some instances, the Department of Agriculture, Fisheries and Forestry. It may also be necessary for the attorney to liaise with the Western Cape Educational Department and/or town planners.

Handling objections and compliance issues

From time to time, objections are lodged against an application. This is not uncommon in suburban neighbourhoods, particularly where licensed premises already operate. Community groups often want to limit the number of outlets, motivated by concerns over noise, crime, antisocial behaviour, or proximity to schools or churches. An experienced attorney knows how to deal with these objections and provide representations on behalf of the applicant.

An attorney who specialises in liquor legislation deals with more than just licence applications. Sometimes compliance notices are issued which could lead to fines or the suspension of the liquor licence. In serious instances, the liquor licence could be revoked. If you as the licence holder are not familiar with liquor legislation, administrative law, or the law of evidence, you could put your liquor licence at serious risk if you don’t appoint an attorney to handle the case.

An attorney does more than submit licence applications. They also assist with the portfolio of existing licenced premises to ensure you are in compliance with ever-changing liquor legislation.

Changes to liquor legislation are being proposed for discussion and public participation. Whether you are a first-time applicant or an existing liquor licence holder, it is in your best interests to work with an expert who is aware of all the risks and responsibilities that come with being the a liquor licence holder.

Help with your liquor licence

As a liquor law consultant we will ensure your liquor licence application or renewal is submitted on time and with the correct documentation. We will also handle objections and manage any compliance issues. Get legal help with your liquor licence application here.

Event liquor licence

7 June 2023

What you need to know about temporary and event liquor licences

“Pop-ups” are becoming common in all walks of life. There are pop-up restaurants, pop-up second-hand clothing shops, and pop-up cocktail bars. Regardless of the duration or the reach of the pop-up, if alcohol is sold, the outlet must have a liquor licence. Even a small function with only, for example, 20 people, hosted in a private home, requires a liquor licence if liquor is sold and not offered freely to guests. Furthermore, it doesn’t matter if the host owns a bar or restaurant and holds a liquor licence in their professional capacity. If they are selling liquor in another place, they require a liquor licence for those premises. The golden rule to keep in mind is: where liquor is sold, a liquor licence must be in evidence. There are two types of licence that may apply to the scenarios described above: a temporary liquor licence and an event liquor licence. Let’s look at the difference.

Temporary liquor licence vs. event liquor licence

When the new Western Cape Liquor Act 4 of 2008 (“the Act”) was drafted, the industry had hopes that applying for a temporary or event liquor licence would be a fairly quick and hassle-free administrative process. Unfortunately, the reality turned out to be somewhat different. When the Act came into operation on 1 April 2012, applying for a temporary or special event liquor licence became a daunting procedure.

The two types of licence are virtually the same. The distinction is that only holders of a permanent liquor licence can apply for a temporary liquor licence. A private individual or organisation wishing to sell alcohol at a one-off event must apply for an event liquor licence if they are not liquor licence holders in any other capacity.

The application process

The documentation and information that must be provided for an application for a temporary or event liquor licence is the same as an application for a permanent liquor licence, except that no zoning certificate is required. See the Western Cape Liquor Authority website for the documentation required for a permanent licence. Or find out how to renew your liquor licence.

Fee structure

An application for a temporary or event liquor licence must be submitted 40 days before the first day of the event. An application can still be submitted after the 40-day cut-off, but a penalty fee for late submission will be levied. The applicant must also apply for condonation for the late filing of the application. An unintended consequence of this regulation (or perhaps it was intended!) was that temporary and event licences became quite costly. Not all events are planned 40 days in advance. An opportunity might arise, for example, for a wine or craft beer producer to exhibit their wares less than 40 days in advance at a farmer’s market, perhaps as a late participant or substitute for a cancellation. In order to do so legally, with the proper licence, they will be subject to the penalty fees.

The penalty fee is a fee per each day the application is submitted late and currently the fee is R475 per day. Therefore, if the application is submitted on day 30 prior to the event, the application is 10 days late and the penalty fee would be R4,750!

Mobile liquor licence (spoiler alert – it doesn’t exist)

There is a misconception that the Act makes provision for a “mobile liquor licence”.  However, there is no such thing. A liquor licence is linked to a specific premises. Someone who holds a liquor licence on premises A is not authorised to sell liquor on premises B. If the premises A licence holder wants to sell liquor on premises B, they must submit the necessary application to the Western Cape Liquor Authority. This is the case even if someone else holds a licence to sell alcohol on premises B.

To illustrate this, consider the following scenario:

Premises B, with an existing liquor licence, invites a local wine producer to host a tasting of its wines on the premises. The producer holds a liquor licence at its premises (call them premises A), and premises B holds a liquor licence. Everyone is covered, right? Wrong! Only the holder of a liquor licence is allowed to sell liquor on the licensed premises. In this example, the wine producer must apply for a temporary liquor licence (assuming it is a permanent licence holder at premises A) or an event liquor licence (if the producer is, for example, a “garagiste winemaker” with no public premises), to host the tasting at premises B.

Help with your event liquor licence

Don’t fall foul of the Act. We will ensure you have the right licence for every circumstance and your application is submitted within the requisite time frames (or as quickly as possible if your event is less than 40 days away). Get legal help with your liquor licence application here.

Responsible alcohol service and management

30 May 2023

Protect your liquor licence – serve alcohol responsibly

If you’re a liquor licence holder, your licence is probably a critical business tool for you. If your liquor licence is taken away, your business would probably fold, unless alcohol sales makes up a very small proportion of your turnover. What do you need to do to ensure you carry out responsible alcohol service  and never put your licence in jeopardy?

The responsibility for the liquor licence does not rest solely with the business owner. All members of staff within licensed premises need to understand their role in the responsible service and management of alcohol. However, the buck stops with the licence holder, so it’s important that they ensure all staff are trained and aware of their duties, and have the right attitude to support the business owner in upholding the licensing criteria. This applies whether the outlet is an on-consumption licensed business (e.g., a restaurant), or an off-consumption licensed business (e.g., a liquor store). 

Legal responsibilities

What must a licence holder do to comply with national and provincial laws surrounding sale of alcohol? In serving and managing the sale of alcohol, a licence holder plays a number of roles. They are:  

  • A “police officer”, ensuring no one breaks any laws
  • A salesperson, knowledgeable about the products they sell
  • A cleaner, keeping premises clean and tidy (not always an easy job when customers consume alcohol!)
  • A good host, creating a friendly and welcoming atmosphere
  • A safety officer, always concerned about the wellbeing of customers and reducing any risks

Alcohol can cause harm if misused. Therefore, it must be sold in a way that minimises any potential abuse. The licence holder must be aware of the nature of the customer, the quantity of alcohol being purchased, and ultimately the wellbeing of the customer.

Liquor licensing legislation governs the sale of alcohol. It defines who can sell alcohol, when, where and to whom. The purpose of the legislation is to protect the general public from disruption to public order or risk to public health. 

Trading hours

There are often restrictions on the days and hours when alcohol can be sold. It is illegal to sell alcohol outside the time specified by legislation. The Western Cape Liquor Act 4 of 2008 states that the authority to regulate the trading days and hours for the sale of liquor falls under the jurisdiction of the municipality where the premises are located. The hours may differ depending on the type of licence, so the licence holder must ensure compliance with the time during which the business is allowed to sell alcohol. 

Age and other restrictions

In South Africa it is forbidden to sell alcohol to any person under the age of 18 years. The licence holder is responsible for confirming the age of the person being served. Breaking this law may result in a fine and/or a prison sentence. It is also likely to result in the loss of the liquor licence.

However, responsible alcohol management extends beyond checking the age of the customer. Serving alcohol to a person who is already intoxicated is an offence. Once drinkers have consumed sufficient alcohol to display signs of intoxication, their normal judgement is impaired. Therefore, it is up to the server, not the customer, to decide whether or not more alcohol should be served. Breaking this law could result in fines, warnings, loss of the liquor licence, or imprisonment.

In summary

To ensure responsible alcohol service and management, the licence holder should always:  

  • Be familiar with the applicable liquor legislation for their business 
  • Be familiar with the applicable trading days and hours for their business 
  • Refuse to sell alcohol to any person under the age of 18 years, checking valid identification if in doubt 
  • Be familiar with the applicable conditions pertaining to the sale of alcohol to intoxicated persons 
  • Be familiar with the penalties that apply to the liquor legislation relevant to their business
  • Display information or other materials to discourage drinking and driving

Get legal help with your liquor licence application here.  

How to renew your liquor licence

11 May 2023

Liquor licence renewal – the process to follow

Liquor licence renewal is required on an annual basis.  

The renewal date will depend on the type of liquor licence.  

In the Western Cape, there are two forms of liquor licence: a provincial liquor licence, which is issued by the Western Cape Liquor Authority, and national registration as a manufacturer and/or distributor, which is issued by the National Liquor Authority.  

Western Cape Liquor Authority

There are four types of provincial liquor licences issued by the Western Cape Liquor Authority:

  1. Micro-manufacture on- and off-consumption 
  2. On-consumption
  3. Off-consumption
  4. On- & Off-consumption  

These four licences must be renewed annually on or before 31 December.  

Under normal circumstances the liquor licence is automatically renewed by paying the renewal fee on or before 31 December annually.  

The Western Cape Liquor Authority sends out renewal notices annually from October onwards, but the onus to renew the liquor licence remains with the licence holder, whether a renewal notice was received or not.  

The renewal notice together with proof of payment of the renewal fee must be displayed on the premises, in terms of the Western Cape Liquor Act 4 of 2008 (as amended).  

Renewal fees increase annually on 1 December and the licence holder must obtain a copy of the renewal notice to ensure the correct renewal fee is paid.  If the renewal fee is not paid in full, the liquor licence will lapse on 1 January.  

Late payment of liquor licence renewal

It is possible to renew a liquor licence during the months of January and February, subject to a 50% or 100% penalty fee (depending on when the licence is renewed) on top of the renewal fee.  

In the event of late payment, a liquor licence holder will be required to submit an application in March for condonation of the late renewal and, upon approval of the application for condonation, a 150% penalty fee will have to be paid on top of the renewal fee.  

Complaints

In 2022 the Western Cape Liquor Authority implemented the Section 64 renewal process.  

If the liquor licence holder has received any complaints, Section 20 applications and/or negative reports from either SAPS or the municipality in the months between June (of the previous year) and end of June (of the current year), the liquor licence holder will receive a Section 64 Notice.  

The liquor licence will then not automatically renew through payment of the renewal fee. The liquor licence holder will be required to submit an application requesting the licence to be renewed for the following year. The licence holder will need to provide proof of a balance of probability that the renewal of the liquor licence will be in the interest of the public.    

Should the application in terms of Section 64 be submitted late, penalty fees will be applicable if the renewal application is approved.  

After renewal of the liquor licence, the Western Cape Liquor Authority will issue a renewal certificate, which the licence holder can download from its website.  

National Liquor Authority

National registration as a manufacturer and/or distributor must be renewed annually on the date of issue of the registration certificate. For example, if the registration certificate was issued on 10 May, renewal will fall due annually on or before 10 May.  

The renewal of a national registration entails more htan the payment of the renewal fee. Specific documentation is required, including, but not limited to, a tax clearance certificate, BEE certificate, proof of annual turnover, membership of certificate from Aware.org, etc.  

The renewal fee depends on the annual turnover of distribution activities.  There are various scales of fee calculation. After approval of the renewal of the registration the NLA provides the registrant with a renewal certificate.  

Get legal help with your liquor licence application here.

WC Community Safety MEC says liquor law changes not biased

29 August 2022

Reprinted from enca.com – 2022-08-25

CAPE TOWN – The Western Cape Government is not targeting black and coloured liquor traders, according to Western Cape Community Safety MEC, Reagen Allen.

Traders have accused officials of bias in proposed changes to liquor licence laws.

Permits will no longer be renewed automatically and traders will have to reapply.

“It is 37 communities where these 116 outlets are situated. It’s not in your predominantly coloured or black areas,” he said.

“Politics is often brought in but here the facts are clears, details are listed on the website so that we can obtain public comment as well.”

Watch the video here.

Get legal help with your liquor licence application here.

Western Cape liquor traders decry licence fee increases

13 June 2022

Reprinted from iol.com, by Mthuthuzeli Ntseku – 2022-06-10

Cape Town – With the liquor industry still recovering from the effects of lockdown and with massive increases in food prices and fuel, local shebeen owners have described as disingenuous the increase in the already high fees of liquor licences.

The provincial government has published a draft amendment to the Western Cape Liquor Regulations in the Provincial Gazette, including proposed amendments to liquor licensing fees with public comment open until July 4.

These tariff increases are part of the provincial government’s proposed amendments to the Western Cape Liquor Act and will come into effect on July 22.

Western Cape Liquor Traders Organisation (WCLTO) chairperson Allan Samuels said the fee increases were a ploy by the government to put black and coloured business owners out of business.

“These exorbitant and ever-increasing fees will have business owners who can’t afford them out of business – something we have been saying is what the government wants.

“When the due dates pass and other owners fail to pay, a penalty will be added on top of the amount they couldn’t afford for renewal which will further drive them towards closure.”

Samuels said they were not consulted about fee increases or decisions affecting them.

“In Cape Town shebeen owners in informal settlements operate without a licence and make huge profits. We have been fighting with the government and the City to implement the permits to bring these people into a regulated space so that they also contribute to the economy.

“We are already sitting with competition from the big chain stores, which have entered our township, and are paying the same fees as us but are making billions a day, which is not fair.

The Western Cape Liquor Authority said the proposed increases would mean less public funds were spent on the regulation of liquor.

Get legal help with your liquor licence application here.

Restaurants endure ‘punishing’ wait for liquor licences, RASA claims

23 November 2021

The Restaurant Association of South Africa (RASA) says many business owners are having to endure a punishing wait for liquor licence approvals and renewals from the relevant authorities.

Reprinted from East Coast Radio News, by Steve Benghu – 2021-11-19

The Restaurant Association of South Africa (RASA) says many business owners are having to endure a punishing wait for liquor licence approvals and renewals from the relevant authorities.

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Alcohol bottles - liquor licence South Africa

Cape Town plans to introduce new alcohol laws in two phases

22 October 2021

The Western Cape government is working on updating its laws around the sale of alcohol, with alcohol abuse closely tied to violent crimes in the province.

“One of the driving forces behind the staggering homicide or murder statistics in the Western Cape is the availability and consumption of alcohol, says Wade Seale, spokesperson for the Western Cape’s Department of Community Safety.

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CITY OF CAPE TOWN CLAMPS DOWN ON ILLEGAL EVENTS

City of Cape Town clamps down on illegal events

23 September 2021

Reposted from News24

  • The City of Cape Town has ramped up its operations in clamping down on illegal events.
  • In recent months, 49 illegally planned events were identified.
  • A number of warning letters had also been issued, and organisers arrested or fined.

The City of Cape Town has ramped up its operations in clamping down on illegal events, with 49 illegally planned events identified in recent months.

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