Massachusetts Regulations that Affect Liquor License Holders

liquorMassachusetts liquor regulations require that the local licensing authorities be notified in a timely fashion of any changes to the name on a restaurant, bar, club, or hotel’s liquor license.  The license holders are also required to petition the board immediately and appear before the local licensing board.   This hearing gives the local licensing authority the opportunity to ask any questions of the license holder and to ensure that the new manager of record is aware of all the liquor regulations of the city they are located in and the regulations of the Massachusetts Alcoholic Beverages Control Commission.  Such hearings are also required if there are any changes in the name of the establishment, it’s stockholders, or of any parties the liquor license has been pledged to as collateral in a loan situation.

Failure to notify the local licensing board of changes in the holder of liquor license holder can have serious consequences, even resulting in the termination/revocation of the said license.  The law office of John P. Connell explains on its blog how transferring control of your business without the approval of the local licensing authorities can have serious consequences

When licensed businesses transfer managerial duties or other privileges of a license to individuals not approved by the local licensing authority and the ABCC, however, they are in violation of M.G.L. c. 138, § 23, which prohibits a licensee from allowing another individual from operating the license “for his own account.”Griffin’s Brant Rock Package Store, Inc. v. Alcoholic Beverages Control Comm’n, 12 Mass. App. Ct. 768, 771 (1981). “Control,” of the business operation, therefore, is the touchstone in determining whether such a transfer has occurred.  Such undisclosed transfers of a licensed establishment’s “control” are actively investigated by the ABCC and the licensee is subject to significant sanctions should the ABCC determine that the privileges of an alcoholic beverage license were in fact transferred to another for their benefit.

The Connell Law post goes on to examine how this provision directly affected the closure of large Boston restaurant/club and an establishment in Revere.  What may seem like a trivial, largely administrative procedure can have a major impact on your business.



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