Liquor licensing changes in Western Australia

In 2007 major liquor licensing reforms were made to address the “Dullsville” tag in Western Australia (WA).  The reforms were aimed at striking a “balance in determining what is in the best interests of the community in terms of services, harm minimisation and policing, while promoting a more competitive, responsible and dynamic liquor environment”.

Whilst the liquor licence reforms were meant to encourage entrepreneurs to “explore ways to appeal to locals and visitors alike” and for small business to be given a “chance to provide new and different services to their customers”, they were not meant to lead to a “proliferation of liquor outlets”.

Between 2007 and 2009 liquor licence applications were relatively easy to obtain approval.  In May 2010¹ the Liquor Commission handed down a watershed decision when it found that:

…mere opinions expressed by an applicant as to the perceived benefits of the grant of their application, in the absence of supporting evidence, falls well short of the level of evidence required to substantiate such a claim.  In addition, letters of support from business people purporting to speak on behalf of consumers simply does not go far enough to satisfy the Commission that the general public has a requirement for liquor and related services…

This decision was quickly followed by a similar finding by the Liquor Commission in Shallcross Investments Pty Ltd² where it was found that “the private interests of an applicant should not be confused with the public interest.  Simply because an applicant wishes to establish a liquor outlet in a particular locality does not mean that a licence should automatically be granted.”

These two precedent decisions of the Liquor Commission highlighted the need for applicants to provide relevant, objective and independent evidence from a representative sample of the public to demonstrate that there is both a need and demand for the proposed licensed premise.  This led to a number of applications being refused by the Director throughout 2010 and 2011 on the basis that applications were:

…based on assertions not supported by an appropriate level of evidence, I am not satisfied with the veracity of those assertions and find that the application is not sufficiently made out to satisfy me that, on the balance of probabilities, the grant of this application is in the public interest.³

The applications refused throughout 2010 and 2011 on reasoning described above, tended to be licences considered to be of the more complex variety, such as hotels, taverns, liquor stores and nightclubs.  However, this trend began to change towards the end of 2011 when numerous small bar applications, which are supposedly of a less complex nature according to the Director’s Public Interest Assessment Policy, were refused.  These decisions were highlighted in our March Snapshots.

Most of the applications that have been refused by the Department of Racing, Gaming and Liquor or the Commission have been prepared without professional assistance.  However, despite this fact, the Director continues to maintain, in his recently amended Public Interest Assessment (PIA) Policy, that “…there is no requirement in the Act for PIA’s to be prepared by legal counsel or industry consultants…” and that applicants “…can complete their own PIA by … taking a common-sense approach to their submission…”  In addition to these comments, numerous disappointed applicants who have been refused licences have commented that they were actively encouraged by Departmental staff not to seek professional assistance on the basis that obtaining a licence was a simple process and that the Department would assist applicants throughout the application process.

As a result of recent adverse comment in this area, the Director of Liquor Licensing defended the licensing authority’s position by issuing a press release with an opening sentence stating that “Disappointed applicants and commentators on liquor licensing decisions often do not understand why an apparent good idea for a “bar” is not approved by the liquor licensing authority.”  This comment has led some within the industry to question the decision making process of the Department.  It is concerning for those within the industry that some applicants are unable to understand, even after analysing the Director’s decision, why their applications were refused.

Of those decisions published between January and April 2012, the following applications for licences have been refused:

• The Precinct Bar and Restaurant (Small Bar);
  
• Club Mansion (Nightclub);
  
• The Stables IGA (Liquor Store);
  
• Forrest Road Liquor (Liquor Store);
  
• VHT Perth Pty Ltd (Liquor Store);
  
• Cranbrook IGA (Liquor Store);
  
• Par 3 Indoor Golf (Small Bar); and
  
• Café Royal (Small Bar).

The Department’s consistent promotion that applicants can complete a PIA, lodge an application for a liquor licence and succeed appears to be at odds with the recent spate of refusals.  This is something that potential applicants should take into account when applying.  There are serious consequences for failing in the first instance.  Although an unsuccessful applicant can take the decision on review to the Liquor Commission, the Commission may only have regard to the material that was before the Director when making the original decision.  This means in essence, an applicant is stuck with the same deficient application that it submitted to the Director.

Another adverse consequence of being refused is that an application for the grant of a licence in respect of the same premises cannot be made within three years after the licensing authority’s decision unless the Director certifies that the proposed application is of a kind sufficiently different from the application that was not granted.  An unpublished decision of the Director would indicate that this provision of the Act will be strictly adhered to.  In that decision, an applicant failed to obtain a tavern licence and attempted to reapply for a small bar in respect of the same premises.  The Director refused to certify that the application was sufficiently different from the previous application.  The Director even went so far as to amend the Small Bar Policy to categorically state that a small bar licence was not sufficiently different from a tavern licence so as to allow an applicant to re-apply for another licence.

These consequences need to be taken into account by potential applicants when considering whether or not to obtain professional assistance to handle their liquor licence applications.

If you require assistance preparing your application or have any other liquor licensing query please do not hesitate to contact: