Published on September 12th, 2012 | by Dean Carr
Selling alcohol online and by mail order
Selling alcohol online and by mail order- a licensing guide to distance trading and delivery
At alcohollicence.org, we’ve received a growing number of enquiries about the licence requirements for a business selling alcohol over the internet or by mail order. This guide to distance trading and delivery focuses on the licence requirements of businesses selling alcohol online, by telephone order and by mail order.
Retail sale and wholesale:
Wholesale of alcohol is business to business sale, typically from a supplier to a retailer. To give an example, the supply of alcohol from a specialist online firm to a local shop would be classed as wholesale. Wholesale businesses do not require licensing (either premises licence or personal licence), although they must be certain not to engage in the retail sale of alcohol.
The retail of alcohol is a business to customer sale, over the counter or over distance. The retail of alcohol is a licensable activity, requiring a premises licence and personal licences.
Licence requirements for distance trading:
Two familiar licences are required for the distance retail sale of alcohol: a premises licence and a personal licence. Nevertheless, distance trading of alcohol is fundamentally different to traditional, over-the-counter sales, as the point of sale is separate to the handing over of the goods.
In a typical bar, the premises and the bar itself would be covered by a premises licence. For distance trading, by contrast, only the point of storage and dispatch needs to be covered under a premises licence. The point of sale, an office, does not need to be physically included in the premises licence. Nevertheless, the office space may be relevant to the operating schedule, and its activities will fall under the remit of the Designated Premises Supervisor (DPS), named on the premises licence.
Naming the Designated Premises Supervisor (DPS) on the premises licence brings us onto the second alcohol licence: the personal licence. The DPS must be a personal licence holder. Although they do not need to physically oversee sales activity in the office, the DPS must ensure that a responsible retail policy is put in place.
As mentioned, it is the point of storage and dispatch that must be covered by a premises licence. Although distance trading business can be run from home, alcohol cannot be stored for retail purposes in a domestic garage or shed. The items stored would be vulnerable to organised theft, contravening the prevention of crime and disorder licensing objective.
The protection of children from harm is one of the four licensing objectives that licensed traders must adhere to.
Online businesses should implement a tick box system (or similar), requiring the user to confirm that they are aged 18 or over during the order. Although age verification is impractical, the user is contractually responsible for providing an accurate response- it is a criminal offense for a person under the age of 18 to attempt to purchase alcohol from a licensed premises or business.
A child (person under the age of 18) can legally accept home delivery on behalf of the customer, and sign for the order. Nevertheless, the delivery driver retains the legal right to refuse to hand over alcohol to a child if he or she suspects that the customer is in fact a minor or the child intends to consume the alcohol. This is a policy reliant on judgement and common sense: if the child is already drinking alcohol or a predominantly under-18s house party is in full swing, common sense would dictate that the trust of the retailer is likely to have been abused.
A growing industry:
The success of microbreweries in recent decades has been well documented.
Around 50 new small brewers opening every year in the United Kingdom, with a growing interest in ethical, ‘green’ beers. Of course, distance trading is not synonymous with ‘green’ business; the internet has allowed companies to specialise in the export of wines and spirits by online order.
A similar trend has occurred in the USA and South Africa. The total number of breweries in the United Kingdom has increased four-fold over the past 30 years, to 767 and rising, despite a simultaneous decline in large UK breweries. Hand in hand with this increase has been the success of micro distilleries and specialist spirit merchants.