What happens to the liquor licence when I buy a restaurant property?

Buying the building a restaurant operates from and buying the restaurant are two separate deals, and the liquor licence follows the second. The AGCO treats the licence as something a licensee holds to run a business, and it moves to another person only through the regulator’s own process. What that means for you depends on whether the operator stays or you plan to run the restaurant yourself.

If the operator stays as your tenant

The licence stays with the operator, which remains the licensee. On the AGCO’s published list, a change in who owns the building is not among the prescribed ownership changes that require a transfer. Read the lease before you close, though. The AGCO does list a person other than the licensee becoming entitled to any of the profits from the sale of liquor, so a rent clause tied to liquor sales deserves a lawyer’s attention.

If you plan to run the restaurant yourself

Then you are buying or starting the business as well as the property, and the buyer’s steps apply: a transfer from the current licensee or a new application, with the regulator checking that you are eligible. Owning the building does not shorten that process. Our page on buying a bar or restaurant sets those steps out.

If a landlord or lender takes possession

The AGCO lists a mortgagee, franchisor or landlord taking possession of the licensed premises among the changes that require a transfer. It also says the Registrar may transfer a liquor consumption premises licence to such a party for a limited period. That is a temporary arrangement for the party that took possession, not a permanent right to the licence.

What to ask before you close

Ask who holds the licence, its class and its conditions, and whether the tenant or the seller of the property is the licensee. Confirm the answers with the regulator. In British Columbia, the Liquor and Cannabis Regulation Branch says a liquor licence must be transferred when a business changes ownership, so the same line between property and business applies there. Other provinces have their own regulators and rules.