New licensing laws come into effect next week and, as D-day approaches, Rod Addy looks at the implications for retailers

Now that the second appointed deadline for retailers’ alcohol licence applications is upon us, the situation is far from the doomsday scenario predicted by the press a few months ago. Yet retailers still have major concerns that they claim the government is not addressing.

According to The Grocer’s findings in July, just days before the August 6 deadline for applications to renew licences, 27% of independents had still not sent them off. Now, Sean Carter, manager of the Rural Shops Alliance, says the situation has improved. “Only one or two of our members did not apply. The vast majority did and will be able to sell alcohol by November 24.”

The 2003 Licensing Act, which will permit 24-hour sales of alcohol, will come into force next Thursday (November 24) after a last-minute Conservative-led attempt this week to block its implementation was scuppered.

Many retailers admit that they sent their applications off just weeks before the deadline. As such, while most retailers applied in time and have been granted licences, many have not received their licences yet.

Thresher Group says that, of the premises and personal licence applications for its 1,659 stores, only 20% have been granted. Philip Loring, head of the off-licence chain’s central operations, says he fears that if the rest are returned at the last minute, it will not be able to get them to stores in time.

Unwins says 41% of the personal licences it has been granted and a fifth of premises licences have not been returned. “The law was about harmonising licensing standards,” says sales and marketing director Ian McLernon. “But different local authorities are interpreting the law differently.”

Alex Tottenham, policy adviser at the Wine and Spirit Trade Association says: “Most supermarkets have had their licences back. It’s the smaller businesses that have left it until the last minute that will have problems.”

However, he says, some councils have been more efficient at processing applications than others. “I know retailers who applied for licences in April and May who still haven’t received them.”

Meanwhile, applications for 24-hour licences have not been a big focus, except for major supermarkets and some forecourt operators. Tesco, for example, has applied for 340 24-hour licences. “As many people do their shopping in our 24-hour stores, we support changes that give customers greater flexibility,” says a spokeswoman.

The question is: what happens if retailers haven’t received their licences by the time the new laws take effect? Until recently, the government was talking tough. It indicated that any retailer not displaying a premises licence in hard copy would be prosecuted. That could have meant losing the ability to sell alcohol for three months.

Last week, the stance softened. Lacors, the Local Government Association and the Association of Chief Police Officers advised “a proportionate, risk-based and targeted approach to premises without a licence”. And the statement said local authorities and police should take into account the steps a business had taken to remain licensed.

Some councils say that as long as shops display a letter from them showing their application is under way, police will be lenient. But attitudes to the new rules have varied so much that retailers are uncertain what will happen.

With the November 24 deadline now confirmed, grey areas remain for retailers. Those who have filled in licence applications properly have little to fear. That is especially true for those with existing licences who applied before August 6, as their grandfather rights guarantee them a licence even if it has not yet been updated. But those who applied incorrectly might find themselves in trouble. Retailers have reported having applications returned for several reasons, including that they used the wrong colour pen.

The application process is the tip of the iceberg. Another uncertainty for retailers has been application costs, with councils threatening to charge extra administration fees in addition to the official expenses. Fortunately, indications are that this is not going to happen until late 2006 at the earliest, if at all, says Carter, who sits on the Licensing Fees Review Panel. Even existing costs have forced some to let their licences go. But the numbers doing so are unlikely to be as high as some claim, he says.

Worries about forms and costs aside, retailers are concerned that their applications could be challenged by rival retailers. One Costcutter store in Ringwood Highway, Potters Green, near Coventry, has just won a battle to sell alcohol after opposition from local residents and off-licences. The owners have held a licence for 15 years, but locals objected to its renewal on the grounds that the stock would attract troublesome gangs. Similar cases continue, but the government claims opposition to a licence must conform to strict criteria supported with concrete evidence. It says it is unlikely that retailers will use the law to gang up on rivals.

Of course, the new laws are not only about reapplying for licences. The government also plans to introduce tougher penalties for irresponsible retailers. Broadly speaking, retailers support a no-nonsense approach, but some believe a ‘three strikes and you’re out’ rule for the sale of alcohol to minors is harsh. And the new rules even raise the possibility that retailers could have their personal licences suspended after just one offence. Retailers want the government to acknowledge that problems surrounding the consumption of alcohol are not just the responsibility of retailers. And they want more support from law enforcers to prevent staff being intimidated by underage yobs.

The government met the major supermarkets earlier this month to develop a co-ordinated approach to selling alcohol to minors. And members of the British Retail Consortium have formed an Alcohol Retailing Standards Group, due to meet later this year, to firm up retail policy. Retailers say they want greater support and clearer communication on where to go from here.

What the new licensing laws will do

>>the terms of the 2003 Licensing Act, with effect from November 24

nExpand police powers to close down disorderly or noisy licensed premises. In future, this will also apply to night cafes and takeaways

nEmpower the police, residents and others to seek a review of licences, backed by an extended range of measures that could impact on businesses and their profits

nIncrease fines - as well as the potential suspension for up to six months or forfeiture of personal licences - following conviction for offences of allowing disorderly conduct or sales of alcohol to people who are drunk

nIncrease penalties for breach of licence conditions - a person faces a maximum fine of £20,000 or imprisonment for up to six months or both

nIncrease penalities for selling alcohol to children (up to £5,000) and make it possible for courts to suspend or forfeit personal licences at first offence - and not only on second conviction as it is now

nEnable licensing officers to prosecute for breach of licensing conditions and other licensing offences

The case so far

Asda says it applied for 137 licences for either extended hours or 24 hours. All except one were granted. 101 applications for straightforward conversions were lodged and all have been granted. It says it is still awaiting the majority of its licences.

Unwins has applied for 394 personal licences and 235 have so far been granted, but 41% have yet to be returned. Of the 384 premises licences it has applied for, three quarters have been granted, but only 20% have been returned.

Tesco has applied for 340 24-hour licences. It says it has not experienced any significant delay in the process of applications, but says it is ongoing. It is confident that all stores will have received their extended licences by the deadline.

Thresher Group has applied for standard premises licences, rather than 24-hour licences, for its 1,659 stores in England and Wales and has made 2,400 personal licence applications, but only 20% of its applications have been granted so far.