In Ontario, fully transferring a commercial liquor licence through the AGCO typically takes 4 to 8 weeks. However, buyers can apply for a Temporary Transfer (Authorization to Contract Out) which takes only a few days, allowing you to serve alcohol and generate revenue immediately while the formal application is processed. The AGCO transfer fee is roughly $1,055 CAD.
When purchasing an existing hospitality business in Ontario—whether it is a bustling bar in Toronto or a cozy restaurant in Mississauga—transferring the liquor licence is a critical step. Without a valid licence, you cannot legally serve alcohol, which can severely impact your bottom line. The Alcohol and Gaming Commission of Ontario (AGCO) oversees all liquor licensing in the province. Many buyers worry about the timeline, fearing their new business will have to halt alcohol sales during the transition.
Fortunately, Ontario law provides a mechanism to keep the drinks flowing during an asset purchase. By understanding the AGCO timeline and the temporary transfer process, you can ensure a seamless transition. Below, we break down exactly how long the process takes, the steps involved, and the costs you can expect.
Step-by-Step Process to Transfer a Liquor Licence in Ontario
Whether you are operating in Ottawa, Hamilton, or anywhere else in Ontario, the AGCO follows a strict procedure for transferring a Liquor Sales Licence. It is highly recommended to consult a local commercial lawyer to ensure your asset purchase agreement contains the right clauses regarding the transfer.
Step 1: Obtain Consent from the Current Licensee
Before you can transfer a licence, the current owner (the seller) must officially consent to the transfer. This is usually handled within your asset purchase agreement. The seller must sign the required AGCO consent forms, verifying they are surrendering their rights to the licence in your favour.
Step 2: Apply for a Temporary Transfer
Because a full transfer takes time, most buyers apply for an Authorization to Contract Out (often called a Temporary Transfer). ⌚ This allows the buyer to operate the business and serve alcohol under the seller’s existing licence while the formal AGCO review takes place. Both the buyer and seller must sign this agreement, and the buyer assumes liability for any liquor infractions during this period.
Step 3: Submit the Full Transfer Application via iAGCO
Next, you must file the official transfer application through the iAGCO online portal. You will need to provide extensive documentation, including corporate records, details of the asset purchase, floor plans, and personal disclosure forms for all directors or major shareholders. Accuracy here is vital to avoid unnecessary delays.
Step 4: Pass Background Checks
The AGCO will conduct background checks on the new owners to ensure they are fit to hold a liquor licence in Ontario. This involves police record checks and a review of any past AGCO infractions. If you have previous summary convictions or regulatory issues, the review may take longer.
Step 5: Final Review and Issuance
Once the background checks clear and all documents are verified, the AGCO will finalize the transfer. The temporary authorization will end, and the Liquor Sales Licence will officially be issued in the name of your new corporation or business entity.
How Much Does It Cost in Ontario?
Budgeting for a liquor licence transfer involves both government fees and professional legal costs. Here is what you can generally expect to pay in Ontario:
- AGCO Transfer Fee: Approximately $1,055 CAD (subject to minor annual changes).
- Temporary Transfer Fee: Usually included or entails a nominal processing fee depending on the specific application type.
- Lawyer Fees: Most commercial law firms in Ontario charge between $1,500 and $3,500 CAD to manage the asset purchase and AGCO transfer process.
- Municipal Approvals: If you are changing the floor plan, you may need to pay local city fees for new health and fire inspections (varies by municipality).
How Long Does the Process Take?
The timeline depends entirely on how accurately your application is filled out and the current backlog at the AGCO. Generally, the timeline is as follows:
| Phase of Transfer | Estimated Timeline |
|---|---|
| Temporary Transfer Approval | 3 to 7 business days |
| AGCO Background Checks | 2 to 4 weeks |
| Full Licence Transfer Issued | 4 to 8 weeks (Total) |
Frequently Asked Questions (FAQ)
Can I serve alcohol while waiting for the full transfer?
Yes. By applying for an Authorization to Contract Out, you can legally operate and serve alcohol under the seller’s licence until the full transfer is approved by the AGCO.
What happens if the seller has past liquor infractions?
If the seller has outstanding AGCO suspensions or fines, it can complicate the temporary transfer. A lawyer will normally ensure these issues are resolved or accounted for before closing the asset purchase.
Do I need a lawyer to transfer an AGCO licence?
While not strictly legally required, using a local commercial lawyer is highly recommended. Mistakes on the iAGCO portal can lead to long delays, meaning your business might have to pause alcohol sales.
Are the rules different in Toronto versus other Ontario cities?
The AGCO rules are identical across the province. However, if you are altering the patio or capacity, you will need municipal approvals, and processing times at Toronto City Hall may differ from those in smaller municipalities.
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