Offering customers alcoholic refreshments? take note!

The experts at Leathes Prior discuss the rules around offering clients complimentary alcohol..

Complimentary alcoholic drinks are often offered by businesses to incentivise customers.  For example, businesses may offer a complimentary glass of champagne whilst customers browse their products or use their services. However, unbeknown to most business owners, this could be a criminal offence.  It is vital that any business that offers such a service to their clients, obtains the appropriate authorisation to ensure they do not expose themselves to potential criminal liability.

This article provides information in respect of the approvals that are essential for the sale of alcohol, the process for obtaining the required authorisations and the potential offences that a business owner can face when undertaking licensable activities without the required permissions.

Authorisations required to supply alcohol

A premises licence is required in order that business premises can supply and sell alcohol.  When drinks are complimentary (free of charge), a premises licence would still be required.   In these circumstances, any person over the age of 18 may apply for a premises licence, as long as they hold a relevant licensing qualification, declare any relevant convictions and have not had a personal licence forfeited in the five years preceding the date of their application.  This  licence may be applied for on either a permanent basis or for a time-limited period. “A person” in this context includes a corporate entity, for example, a company or a partnership.

In the premises licence, a designated premises supervisor must be named who holds a personal licence. A personal licence is a licence granted by a licensing authority to an individual, which authorises them to supply alcohol or authorise alcohol in accordance with a premises licence.

Alternatively a person may acquire a temporary event notice (“TEN”) to authorise licensable activity on a temporary basis. A person may apply for a TEN to the relevant licensing authority at least ten working days before the event.

A number of statutory limitations are imposed on the use of temporary event notices:

• the number of times a premises user may give a TEN is a maximum of 50 times in a calendar year for a personal licence holder and five times in a calendar year for other persons
• the number of times a TEN may be given for any particular premises is a maximum of 12 times in a calendar year
• the maximum duration of an event authorised by a TEN is 168 hours (seven days);
  the maximum total duration of the events authorised by TENs in relation to individual premises is 21 days in a calendar year
• the maximum number of people attending at any one time must be fewer than 500; and
  the minimum period between events authorised under separate TENs in relation to the same premises (not including withdrawn TENs) by the same premises user is 24 hours

TENs are therefore more suitable for one off events than as a permanent means by which to authorise licensable activities on a premises.

Offence

It is a criminal offence for a person to either carry on, or attempt to carry on, a licensable activity on any premises otherwise than in accordance with a premises licence or temporary event notice. It is also a criminal offence for a person to knowingly allow a licensable activity to be carried on otherwise than in accordance with a premises licence or temporary event notice.

A person charged with the offence of carrying out a licensable activity other than in accordance with an authorisation may rely on the statutory defence of due diligence, if the following criteria can be applied:

• the act was due to a mistake, or to reliance on information given to him/her, or to an act or omission by another person, or to some other cause beyond his control, and he/she took all reasonable precautions and exercised all due diligence to avoid committing the offence.

If a  person relies on the defence of due diligence, the burden is on them to prove on the balance of probabilities that they had done all that could reasonably have been expected of them.

The Court has provided guidance on what behaviour and acts are required by an employer in order for the defence of due diligence to apply. An employer must go further than simply instituting a preventative regime. It must also exercise all due diligence to ensure that the measures put in place are maintained, adhered to by employees and continue to be adequate in the circumstances. This means that an employer will need to demonstrate that steps were taken to implement a regime and that this regime was actively monitored by the employer.

For such offences, a person is liable upon summary conviction in a Magistrates Court to an unlimited fine or to imprisonment for a term not exceeding six months or both.  Given the stringent penalties which may be imposed, it is crucial for business owners to ensure that they do not inadvertently commit a criminal offence.

If you would like to take advice on anything covered in this article, please contact the expert team at Leathes Prior on 01603 610911.