Transferring a liquor licence on a business sale in British Columbia

British Columbia treats a liquor licence differently from Alberta and Manitoba. The Liquor and Cannabis Regulation Branch (LCRB) says that liquor licences can be transferred to an eligible new licensee, and that when a business changes ownership the liquor licence must be transferred. The transfer is a formal application decided by the general manager under the Liquor Control and Licensing Act, not an automatic consequence of the sale. A buyer of a licensed restaurant, pub or liquor store in British Columbia should treat the transfer as a track that runs beside the purchase agreement, with its own forms, its own eligibility tests and its own risk of refusal. This guide follows that track in the order the parties meet it. Other provinces run their own regimes and reach different answers. For the wider picture of permits in a British Columbia sale, see licences and permits in a BC business sale.

Who starts it, and what the buyer needs first

The LCRB says the current licensee must initiate the transfer in the liquor and cannabis licensing portal by submitting the proposed licensee’s business name and email address. The buyer is then notified to proceed. The proposed licensee must have a Canada Revenue Agency business number registered to the new applicant, needs a Business BCeID to use the portal, and does not have to be a citizen or resident of British Columbia or Canada. The CRA says that a new owner of a sold sole proprietorship cannot continue using the old business number, and the LCRB wants a number registered to the new applicant, so a buyer should register its own number before the seller starts the process. A licence that has expired is not eligible for transfer.

What the buyer submits

The proposed licensee submits the required forms and documents with the application fee. The LCRB says these depend on the buyer’s business type and include a Personal History Summary form and the other documents that form lists, such as a Canadian criminal record check, a statutory declaration and a driver’s abstract. The application also includes a sample sign for the establishment. Ask the LCRB for the checklist that matches the buyer’s structure, whether a sole proprietor, a partnership or a corporation, and gather the personal documents for each person the form covers before the seller starts the portal step, so the file is not held up by one missing record.

The tests the general manager applies

Section 19 of the Act bars the general manager from transferring a licence if, in the general manager’s opinion, it would be contrary to the public interest. It also bars a transfer where the applicant or an affiliate of the applicant is a minor, where, for a licence other than one of a prescribed class, the applicant does not own the business, where the applicant does not meet the ownership or control requirements for the premises, where the place or equipment does not comply with the Act, regulations or licence terms, or where the applicant does not meet prescribed criteria, and it contains further bars and exemptions of its own, so read section 19 in full. The general manager may also decide whether the applicant, an affiliate or a prescribed person is fit and proper, and must not transfer the licence if, in the general manager’s opinion, one is not. For the premises, the applicant must own them or have an arrangement that gives enough control and is of satisfactory duration, so the buyer’s lease terms matter to the licence. Section 20 lets the general manager refuse a transfer if the applicant fails to disclose a material fact required by the application or makes a false or misleading statement in it, and, in respect of a licence, for a fine or monetary penalty that has not been fully paid or a suspension that has not been fully served, or for a prescribed circumstance.

Who may serve alcohol while the application is open

The LCRB says an establishment can remain open during a licence transfer application, and that the seller is responsible for maintaining the licence until the LCRB tells the seller and purchaser that the application is administratively complete. The purchaser then becomes the deemed licensee and may operate the licence and make changes to it. Section 22 of the Act separately lets a proposed transferee use the licence while the general manager’s section 19 determinations are pending, and deems that transferee the licensee from the date the application is received until the licence is transferred or refused. The page and the Act describe the starting point differently, so ask the LCRB which date applies to your file. Section 21 says a licensee must not purport to transfer or deal in a licence before the general manager transfers it.

If the transfer is refused

Section 21 requires written reasons when the general manager refuses a transfer. Under section 22, after a refusal the general manager may do one or more of the following: suspend the licence, authorize a transfer within a specified period to a person at arm’s length from the proposed transferee, or cancel it. A purchase agreement should say what happens to the price, the deposit and the closing date if that occurs. Cannabis retail stores are handled on separate LCRB pages, which include a transfer page of their own, so a business that holds both kinds of licence needs both tracks.

• Register the buyer’s business number and Business BCeID before the seller starts the portal step.
• Confirm that the seller’s licence has not expired and that no fine, penalty or suspension is outstanding on it.
• Check that the buyer’s lease or ownership of the premises gives the control and duration the Act requires.
• Ask the LCRB when the buyer becomes the deemed licensee on your file, and who answers for the licence until then.
• Write the refusal outcome into the purchase agreement: price adjustment, deposit and any right to walk away.