Guide. Application for an Authorization to Sell Beer in a Grocery Store 1577 (2015/07)
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1 Guide Application for an Authorization to Sell Beer in a Grocery Store 1577 (2015/07)
2 Alcohol and Gaming Commission of Ontario 90 SHEPPARD AVE E - SUITE 200 TORONTO ON M2N 0A4 Fax: Tel: or toll free in Ontario Queens Printer of Ontario, 2015 Disponible en Français
3 BEER SALES IN GROCERY STORES As announced in the Government s 2015 Budget, Ontario intends to expand the sale of beer to up to 450 grocery stores across the province over the next 10 years. During this period, the Alcohol and Gaming Commission of Ontario ( AGCO ) will be responsible for authorizing grocers to sell beer and ensuring that beer is sold responsibly and in accordance with Ontario s regulatory framework. The AGCO is an agency of the provincial government that is responsible for regulating Ontario s beverage alcohol industry. The AGCO s mandate includes ensuring that the sale of beverage alcohol is conducted in a safe and responsible manner. The AGCO s powers are primarily derived from the Liquor Licence Act ( LLA ), the Alcohol and Gaming Regulation and Public Protection Act, and certain provisions of the Liquor Control Act ( LCA ). Grocery store operators in Ontario will require the following: 1. An Authorization to Sell Beer in a Grocery Store ( Authorization ) from the AGCO to be legally permitted to sell beer through each grocery retail location in which they intend to sell beer, subject to the terms and conditions outlined by the Registrar of Alcohol and Gaming ( Registrar ), and the LLA, the LCA and their respective regulations. 2. A supply agreement with the Liquor Control Board of Ontario ( LCBO ) to be able to legally purchase beer from the LCBO for resale to the public. There will be a three-phase process to obtain the AGCO Authorization and LCBO supply agreement, as follows: 1. A grocer must apply to the AGCO for a Letter of Eligibility. The AGCO will conduct an eligibility assessment focusing on the honesty, integrity and financial responsibility of the applicant to determine its eligibility for an Authorization to sell beer. This assessment will include background checks on sole proprietors, all partners in a partnership, and all officers, directors and shareholders who hold 10% or more of the outstanding shares of a corporation. These individuals must complete and sign the appropriate form, consenting to the AGCO s collection of information and background checks. 2. Once a grocer has obtained a Letter of Eligibility from the AGCO, it will be eligible to participate in the LCBO s competitive allocation process for supply agreements. The LCBO will invite eligible grocers to participate in competitive allocation processes from time to time as these are held. 3. Successful participants in the LCBO s allocation process will then be required to apply to the AGCO for an Authorization for each store location at which beer is intended to be sold (a separate Authorization will be required for each location). 1577E (2015/07) Page 3 of 8
4 AUTHORIZATION TO SELL BEER IN A GROCERY STORE This guide is intended to provide detailed information about obtaining an Authorization from the AGCO, and your responsibilities and obligations to the AGCO once an Authorization is obtained. Please note that this Guide may not cover all of the requirements for your particular application. Please consult the LLA, the LCA and their respective regulations to ensure that you understand all of the responsibilities and obligations that come with an Authorization. You may also wish to consult with a legal advisor. THE APPLICATION PROCESS Phase I AGCO Letter of Eligibility If you are interested in selling beer in your grocery store(s), you must apply to the AGCO for a Letter of Eligibility from the Registrar prior to entering into the LCBO s competitive allocation process for supply agreements. You must complete and submit an Application for Eligibility to Participate in LCBO Supply Agreement Process, along with all necessary supporting documents which may include: 1. Corporate Structure Form (only if the applicant is a corporation) for the applicant and corporation that directly or indirectly holds 10% or more of the outstanding shares of the applicant corporation. 2. Personal History Report for each owner (sole proprietor, all officers, directors and shareholders holding 10% or more of the outstanding shares of a corporation and all partners). The eligibility assessment process may take several weeks. The length of this process will depend on a number of factors, including whether all required documents are submitted in a timely manner, whether items are complete and correct, or if risks are identified that warrant further investigation by the AGCO. Once the AGCO has reviewed and processed the application, you will be notified in writing with respect to your eligibility. Upon receipt of a Letter of Eligibility from the Registrar, you may then enter into the competitive allocation process for a supply agreement with the LCBO as these are held periodically. Note: A Letter of Eligibility does not guarantee an applicant s success during the LCBO s allocation process for a supply agreement or the store level Authorization process (please see Phase 2 and Phase 3 below). 1577E (2015/07) Page 4 of 8
5 Phase II - The LCBO s allocation process for Supply Agreements Prior to the issuance of an Authorization, you must enter into a competitive allocation process to procure a supply agreement from the LCBO. The Registrar cannot issue an Authorization in the absence of a supply agreement with the LCBO. Phase III AGCO Authorization Application: Once you, or your business, have entered into a supply agreement with the LCBO, you are eligible to apply for an Authorization(s) by submitting an Application for an Authorization to Sell Beer in a Grocery Store to the AGCO for each location along with all necessary supporting documents, including: 1. Application fee; 2. Personal History Report for on-site manager(s); and 3. Floor plans of the premises with all areas and retail space outlined and labelled (e.g. grocery retail space, pharmacy), including dimensions of each area. During this stage, you may be required to disclose additional personal and financial information. You will be required to confirm that the location meets store specific eligibility criteria. Pre-authorization Inspection Before the issuance of an Authorization, your premises must undergo an inspection conducted by an AGCO Inspector. The Inspector will attend your premises to ensure that all eligibility criteria are met and that areas match those listed in your application and shown on your floor plans. Significant inconsistencies noted by the Inspector must be corrected. The pre-authorization inspection is also an opportunity to address any operational questions and/or concerns you may have related to the sale of beer in your grocery store. Conditions Authorizations may be subject to one or more conditions to address a specific risk(s) that has been identified in the application review process. 1577E (2015/07) Page 5 of 8
6 SELLING BEER AT A GROCERY STORE MAINTAINING YOUR AUTHORIZATION Once you have been issued an Authorization, it is your responsibility to operate your store and sell alcohol responsibly in accordance with the LLA, the LCA, their respective regulations and any conditions attached to your Authorization. Failure to do so may result in regulatory action such as a warning, monetary penalty, or revocation of your Authorization by the AGCO. In addition to the above, the following requirements apply to Authorizations for the Sale of Beer in a Grocery Store: 1. The store operator must enter into a supply agreement with the LCBO and must comply with the agreement. 2. The store operator must not acquire beer for resale in any manner other than in accordance with the supply agreement. 3. The store must be operated in compliance with all applicable laws and any terms and conditions of the authorization. Examples include prohibitions against selling beer to individuals under nineteen years of age or individuals who are, or appear to be, intoxicated, and selling beer outside of the prescribed hours. Sampling and advertising must also be conducted in accordance with guidelines established by the Registrar. As well, the Registrar will outline social responsibility training requirements. 4. The store must maintain compliance with the eligibility criteria for an Authorization. Consistent with all licences and authorizations administered by the AGCO, eligibility for an Authorization is expected to be contingent on your business being conducted in accordance with the law and with honesty, integrity, and financial responsibility. Renewal of your Authorization An Authorization is valid for four years from the date it was first issued. An Application to Renew/ Reinstate an Authorization to Sell Beer in a Grocery Store form and the appropriate fee must be submitted to the AGCO prior to your Authorization expiry date to ensure that there is no lapse in your Authorization to sell beer at your business. Expired Authorizations cannot be renewed. If your Authorization has expired, you must apply to reinstate your Authorization and you will not be permitted to sell beer until the reinstated Authorization is issued. Keeping the AGCO Informed You are required to notify the AGCO of any changes to the ownership and/or management of your business. Applications may be required, depending on the situation. Examples include, but are not limited to: 1577E (2015/07) Page 6 of 8
7 If the location of your store/business is moving, you are required to submit an Application for an Authorization to Sell Beer in a Grocery Store with the appropriate sections completed. If a new individual(s) is/are added to an existing ownership structure, you are required to notify the AGCO in writing of the change in ownership structure (corporations must submit an updated Corporate Structure Form), and new individuals must submit a Personal History Report. If a new manager is hired whose responsibilities include overseeing the day-to-day operations of the sale of beer, he or she is required to submit a Personal History Report. If there are any planned renovations to existing authorized grocery store(s), you must notify the AGCO in writing and submit updated floor plans of the premises with all areas and retail space outlined and labelled, including dimensions of each area. Surrendering your Authorization / Closing or Selling your Business If you decide to close your business, if you sell your business or if you no longer want to sell beer at your business, you must surrender your Authorization to the AGCO. COMPLIANCE ASSURANCE AGCO Inspections All premises are inspected by AGCO Inspectors and police. You are required to allow AGCO Inspectors and/or police officers unobstructed access to your business and you must facilitate their inspections. The most serious infractions include: 1. Selling alcohol outside of prescribed hours; 2. Selling alcohol to individuals under the age of 19; and 3. Selling alcohol to anyone who is or appears to be intoxicated. Committing any of the above or other infractions of the LCA and/or LLA and regulations may result in a warning, monetary penalty, or revocation of your Authorization by the AGCO. In addition, local police may also lay charges. Orders of Monetary Penalty/Hearings Infractions of the LCA and/or LLA and their respective regulations may result in a monetary penalty. If you are issued an Order of Monetary (OMP) by the Registrar, you will have 15 days to request an appeal before the Licence Appeal Tribunal (LAT). If you choose not to request an appeal before LAT, you are required to pay the amount specified in the OMP. If you choose to request an appeal before LAT, LAT will inform you of the appeal date and location. LAT will render a decision that will either uphold or set aside the monetary penalty (LAT cannot change or adjust the amount of the penalty). 1577E (2015/07) Page 7 of 8
8 QUESTIONS / COMMENTS If you have any questions or comments, please contact AGCO Customer Service during regular business hours at (in the GTA) or (toll-free in Ontario). You can also find helpful information and all of our forms and guides on our website at E (2015/07) Page 8 of 8
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