By Liquid Courage Consultants
If you’re a South African business or person wishing to start operating a Restaurant, Hotel, Nightclub, Club or Pub that is going to sell liquor to the public, one of the most important business operating requirements that you need to take into consideration is the application for a Retail liquor license.
Ensuring that this license is granted before you begin operating is vital to the success of your business.
A retail liquor license is essential for any of the following types of South African businesses:
– Restaurants
– Pubs
– Hotels
– Guest houses
– Club houses
– Casinos
– Night clubs
All of these types of businesses are expensive to operate and often all of them also rely on the sale of liquor to ensure a steady flow of foot traffic through the door and generation of a loyal clientele.
Make the sober choice and put your trust in us. You can get on with the business of running a successful and growing accommodation business.
- SAPS POLICE CLEARANCE
You need a SAPS clearance certificate confirming that you do not have a criminal record. This step can take up to six (6) weeks, so start with this before you do the rest.
- Take a copy of your South African ID document to your local SAPS during office hours.
- Ask them to do your fingerprints for the purpose of an application for a Liquor License.
- Request a SAPS Clearance Certificate.
2. LOCAL AUTHORITY APPROVAL AND PROOF OF LAWFUL OCCUPATION
Next, you need to ensure your premises are suitable before you can even apply for a Liquor License. The public area must not be less than 50m2. Ensure that your premises align with the floor plan/ sketch plan of your premises (you will need to submit this as well). The smoking zone must be clearly outlined in the floor plan if the applicant intends on having a smoking zone. It is ideal is that your premises be +500m or more away from a church, school or similar business. However, since this is not always possible, do not start spending money on renovating the existing building or start building a new building or sign a lease contract on the building before you have cleared the following:
- Visit your local Municipality’s Town Planning or Land Use department and confirm with them that the premises or stand that you want to use are suitable for a Liquor Store. (You need the ERF number of your premises).
- Request a Zoning certificate from the Municipality on the stand that you intend to use. Your Liquor License Consultant must be convinced that the zoning is correct. In Gauteng you need a Local Authority Approval (A letter confirming you may apply) for a Liquor Store in addition to the zoning certificate.
- Negotiate a Lease Contract. If you are not the owner of the property, then you require a lease contract between you and the landlord. Be careful when signing the lease contract. Read the conditions very careful, especially with regards to the following:
- Escalation clause. This means the amount the rent will increase after every year. An annual escalation of up to 8% is acceptable in today’s economy. (Do not accept a 12% escalation clause for this is too high in today’s terms.)
- Right to renew. The renewal clause gives you the right to renew the lease contract after the expiry of the lease. There should be a % increase or a rand figure of the first year’s renewal increase in rent with an escalation clause for every year thereafter until the end of the renewed contract. The applicant is welcome to contact the writer for more information. (Do not accept a clause stating “The lessee has the right to renew the lease contract, without a clear stipulation of the cost of the lease after renewal.)
If you own the premises, a Title deed is need. In the case of you renting the premises, you will have to attach a lease agreement. The lease agreement must allow for business use.
3. SARS TAX CLEARANCE
Apply for your Tax PIN certificate at SARS. If the applicant is a juristic person such as a Company, the Tax Clearance must be in the name of the company otherwise the tax clearance certificate must be in the name of the applicant(s).
SARS verification certificate can be obtained from your nearest SARS office or online via e-filing. The SARS needs to be in the name of either the company or the person applying.
4. APPLY
Apply as soon as possible because a Liquor License Application can take a long time. (4-6 months or longer) You can apply on an existing premises or on a stand on which there is no building yet.
Your Liquor License Consultant will give you a list of requirements for a Liquor License Application.
Don’t attempt to do a DIY job on your Liquor License application unless you are fully familiar with all aspects of the Liquor Act. Section 23(3) of the Gauteng Liquor act reads: “Where an application for a license has been refused by the Board, no new application may be made in respect of the same premises within a period of one (one) year from date of refusal,……..” If it takes six months before you receive a refusal from the board it means that you have wasted 18 months before you can apply again and then you might wait another 6 months before your application can be approved. That could mean 24 months which you might pay rent on an empty shop.
Our experienced consultants will draft all the necessary documentation in preparation of your application. We will then compile the application in the prescribed manner and continue to lodge it with the relevant liquor authority.
Once the new liquor license application is lodged and checked by the liquor authorities, and if it complies returned for public participation. At this stage the application must be advertised with local newspapers and government gazette, and a copy of the application attached on the premises to give general public the opportunity to raise an objection.
Application will be available to the public, for a twenty-one-day (21) period to allow for inspection.
Provided no objections were lodged, you now sit back and wait for the compliance inspector to inspect the premise after which application goes to the local committee for their recommendation.
CONCLUSION
Once the new liquor license application reaches this point, it is time for the liquor authorities to prepare and consider the application. Once your application has been approved you will get a notice, with a reference number to pay for the activation fee.
Your new liquor license certificate must be printed, signed and in your possession before you can start trading.
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