QHA November 2017

LEGAL MATTERS with Curt Schatz
CORPORATE CHANGES – DON’T DELAY,
NOTIFY THE OLGR TODAY!
QHA REVIEW | 30
As we know, when buying or establishing a new
licensed premises, as part of the liquor and gaming
application process, the OLGR requires substantial
probity information in relation to your personal affairs
and financial circumstances to determine whether you
are a fit and proper person to hold a liquor licence.
As these requirements also apply to corporate
structures which can be much more complex, we
thought it timely to provide a refresher on your
notification requirements under the relevant legislation.
CHANGE IN CONTROLLING INTEREST –
FOR LICENSEES
Section 150 of the Liquor Act 1992 requires a
corporate licensee to give the OLGR written notice
within 14 days of every change in the controlling
interest of the corporation.
Typically, these changes include changes to the
executive officers of the company, such as the
appointment or retirement of directors, share transfers,
particularly where these are to an entity which has not
gone through the probity process, and in the case of
trust structures, changes to the beneficiaries under
these instruments.
These provisions are mirrored under the Gaming
Machine Act 1991, however it is important to note that
the OLGR must be notified with 7 days of these types
of changes to a gaming licensee.
It is critical to ensure that you comply with these
deadlines, as the penalty for non-compliance can be
up to 100 penalty units, or $12,615 for each offence.
In notifying the OLGR of these changes, you will need
to ensure that the new Form 5 - Personal Details
Schedules (Liquor) and Personal Probity Forms
(Gaming) are completed by any new executive officers
of the company, and should the OLGR be satisfied
with the information provided, they will simply approve
the changes.
In the event they are not satisfied, in a worst case
scenario, you may be required to change the
executive officers or vary the shareholding so they are
satisfied the new executive officers, shareholders, or
beneficiaries under a trust are fit and proper people to
be involved in a corporate entity, which holds a liquor
and gaming licence.
While the obligations to report your corporate changes
to the OLGR can seem onerous, we have worked
with a number of clients in recent times to keep
the OLGR appraised of these changes, and have
reaped the benefits of this ongoing disclosure for
future acquisitions, as the probity process for new
acquisitions can be much quicker if the OLGR is
already up to date on the Licensee’s corporate details.
TRANSFERS OF HOTEL LAND –
REQUIREMENTS FOR LANDOWNERS
In circumstances where you own the land on which
your hotel operates, particularly through a different
entity such as a trust, it is important to ensure that this
interest is registered with the OLGR, which is done by
completing a Form 6 – Registration of
Financial Interest.
It is an offence under the Liquor Act if you fail to notify
the OLGR within 28 days of acquiring an interest in a
licensed premises, even if this is only as a third party
landlord, and the penalty is $126.15. Although this is
only a small financial penalty, there are more important
commercial reasons to ensure that your interest is
registered, in particular in circumstances where you are
a landlord at a venue which is run by a third party, or if
you seek to sell the hotel business to a third party, and
retain the land only.
Registration of your interest protects you where a third
party hotel operator defaults or vacates the premises,
and if you are registered with the OLGR, you can apply
to transfer the licence into your own name to ensure
that revenue is not lost while you search for a new
lessee for the venue, and to avoid the licence
being cancelled.
These matters are often overlooked by licensees and
landowners, however as the consequences of noncompliance
can be severe, it is important to get on the
front foot with your disclosure to the OLGR, as this can
save a lot of time and heartache down the track.
If you would like to discuss these issues and the
structure of your business further, please do not
hesitate to contact me at Mullins Lawyers
on 07 3224 0230.