Ongoing compliance with the Western Cape Liquor Act

License holders must comply with the conditions of their liquor license and the Western Cape Liquor Act at all times. Importantly, this duty is ongoing. Therefore, they should monitor key compliance areas regularly. In doing so, they reduce the risk of penalties and disruption.

Renovations and alterations to the licensed premises

Before making any structural changes, license holders must obtain approval from the Western Cape Liquor Authority. For example, this includes adding buildings, extending outdoor areas, or changing the layout.

In addition, license holders should always check the original approved floor plan. The Liquor Authority approved this plan when it issued the license, and it remains the primary reference point.

Previously, some wineries operated under producer’s licenses issued under the 1989 Act. When the current Act came into effect, authorities converted these into micro-manufacturer licenses. Under the old law, license holders only needed approval for sales areas such as tasting rooms. However, they did not need approval for cellars or production areas.

As a result, many micro-manufacturer licenses do not reflect cellars or storage areas. Under the current Act, by contrast, license holders must include all cellars and storage areas in the licensed premises. Accordingly, wine farms, distilleries, and breweries should confirm that their approved floor plans reflect all facilities.

Restaurants operated by a lessee

A license holder may not allow another person or entity to operate on the premises without approval. In other words, the license holder remains responsible for compliance.

If a landlord holds an on-consumption license but leases the restaurant, the parties must either lease or transfer the liquor license to the operator. In this case, the Liquor Act sets out the required process. Furthermore, the lease agreement should deal clearly with the transfer and any future re-transfer of the license.

Sale of a business

When parties sell a licensed business, they must address the liquor license. In particular, they must consider who will operate the business after the transaction.

If a new entity will operate the business, the parties must give the required notice. In addition, the sale agreement must provide for the transfer of the liquor license. Ultimately, the new entity must hold the license before it begins trading.

Change in shareholding

The Liquor Authority vets shareholders when it considers a liquor license application. Thereafter, if ownership changes, the company must notify the Authority.

To do so, the company must submit an application that discloses the new shareholders. The Authority will then assess whether they meet the suitability requirements.

Changes to the appointed manager

During compliance inspections, inspectors check the responsible person or manager. Typically, they ask for proof of appointment, such as an appointment of manager certificate.

If the appointed manager leaves the business, the license holder must appoint a new responsible person within 30 days. Otherwise, the business may face compliance issues.

Liquor products permitted to be sold

A license holder may only manufacture or sell the liquor types approved under the license. Therefore, the business must align its product offering with its license conditions.

If the business wants to introduce new products, it must first obtain approval. This is especially important if the business also changes the premises. In some circumstances, the license holder must apply to amend the license conditions.

Record-keeping requirements

License holders must keep accurate records of sales, invoices, and deliveries. In addition, they must ensure that these records remain accessible.

The Liquor Authority conducts spot inspections to check compliance. During these inspections, officials may request copies of invoices and supporting documents.

An off-consumption license holder may not sell more than 150 litres of liquor to one person in one day. Moreover, license holders should monitor repeated or high-volume orders to the same person or address. In this way, they reduce the risk of unlawful resale.

Compliance inspections

During inspections, officials usually ask for a copy of the original liquor license. In addition, license holders must display the license and its conditions on the premises. Importantly, they should not confuse this with the annual renewal notice.

Licenses issued before 1 April 2012 refer to Form 4. By comparison, licenses issued after that date refer to Form 11.

If the original license is unavailable, the license holder can request a duplicate from the Liquor Authority.

Signage requirements

License holders must display specific details at the entrance. For example, these include the premises name, license type, trading hours, and liquor license number.

The premises name must match the name on the renewal notice. Likewise, the trading hours must comply with the municipal by-law. Finally, the liquor license number begins with WCP and appears on the license or renewal notice.

Our services include conducting due diligence on licensed businesses and their operations. Where there is uncertainty regarding compliance, assistance can be requested by contacting danie@daniecronje.com or lizanne@daniecronje.com.