Alcohol in our lives - law commission's paper on liquor law reform
The Law Commission ("Commission") has recently released an Issues Paper titled "Alcohol in Our Lives" ("Issues Paper"), which suggests major changes to New Zealand's liquor laws including proposing an overhaul of liquor law in New Zealand and developing a new statute.
The Issues Paper has been produced as part of the Commission's wider reference from Government in August 2008 to review the alcohol laws in New Zealand.
A substantial part of the Issues Paper focuses on the harm that alcohol is doing to our communities and identifies a strong need for change in liquor regulation to help protect New Zealander's from the social and cultural impacts associated with alcohol use and abuse.
The second part of the paper focuses on the current liquor regulatory scheme and discusses possible solutions to New Zealand's alcohol related problems by focusing on three key areas: supply controls; demand reduction; and problem limitation measures. A summary of the key proposals are set out below. A full copy of the Issues Paper is available on the Commission's website: http://www.lawcom.govt.nz/ProjectIssuesPaper.aspx?ProjectID=154.
New Legislation
The Commission's view is that the current law is very complex (particularly considering it is commonly used by people who are not legally qualified, for example bar tenders and police officers) and does not offer sufficient protection from alcohol related issues. The recommendation therefore is to draft a new and comprehensive statute dealing with liquor regulation.
Objective of the Statute
The current legislation has a very broad objective - to contribute to the "reduction of liquor abuse." The Commission considers the objectives of the new statute should be more specific, particularly to::
- Minimise crime and disorder.
- Promote public safety.
- Minimise public nuisance.
- Protect and improve public health.
- Protect families and children from harm.
- Minimise the impact of harmful use of liquor on state agencies such as Police and the health system.
- Encourage responsible attitudes towards the promotion, sale, supply and consumption of liquor.
- Ensure that the liquor industry develops and operates in a way that is consistent with the needs and aspirations of the community.
- Ensure so far as practicable that the supply of liquor contributes to, and does not detract from, the amenity of community life.
According to the Commission, the strategies that minimise harm fall under three key categories:
- Supply controls.
- Demand reduction.
- Problem limitation.
Supply Controls
The Commission recommends retaining the current system with its four licence types (on-licences, off-licences, club licences and special licences), but favours removing the licence exemptions (for premises including Police canteens and Parliament).
The Commission considers that the existing Liquor Licensing Authority's ("LAA") powers should be bolstered:
- Types of licensed premises: The provisions that control which types of premises that can hold an off-licence are currently difficult to understand (for example the difference between a dairy, a grocery store and a convenience store is hard to discern). The Commission considers that licensing regime based on the floor size of premises would be arbitrary and that, instead, increased grounds to refuse a licence would provide the LAA with the necessary tools to sensibly control the types of premises that obtain licences.
- Wider grounds for refusal: While a return to the previous "necessary or desirable" test is considered unwarranted, the Commission does perceive a need to provide wider grounds for the LLA to refuse a licence application than are currently provided under the Sale of Liquor Act 1989 ("SLA"). Suggested additional grounds for refusal are:
- The overall social impact of the licence is likely to be detrimental to the well-being of the local or broader community, taking into account the proposed site and nature of the premises and the health and social characteristics of the local population and the risks applicable.
- Granting the licence would be inconsistent with the object of the Act.
- The amenity, quiet or good order of the locality would be lessened by the granting of the licence.
- The licence would be inconsistent with the relevant local alcohol policy.
- Wider grounds for cancellation: It is considered that the grounds upon which a licence can be cancelled by the LLA should be extended.
- Impose any reasonable condition: The Commission recommends that the LAA be empowered to impose any reasonable condition that it considers appropriate in order to reduce liquor-related harm (for example, controls on discounted alcohol promotions or ensuring free tap water).
- Proactive enforcement: The Commission also recommends that the LLA has the power to:
- Monitor and report on trends.
- Make rulings on aspects of sale of alcohol policy, such as promotions, without requesting a specific change in the law.
- Award costs.
- Impose fines on licences, managers and staff of licensed premises for breaches of any provisions of the Act.
- Enhance the flow of data and information to the LLA from inspectors, Police, District Licensing Authorities ("DLA"), and medical officers.
- Analyse the use of licences and require a regular and routine flow of information from DLAs.
- Impose quality control on DLA output compliance.
- District Court Judge to preside: The LLA would be presided over by a District Court Judge, though initial breaches would be heard by a liquor tribunal.
The Commission sees a revised role for the existing DLAs (the performances of which varies greatly at present), including developing a compulsory local alcohol policy which would be ultimately approved by the local district council.
The Commission considers that there is a good case for local authorities to set their own fees to reflect the actual cost of processing applications and monitoring existing licences. Alternatively, a supervision fee could be imposed reflecting the burden of the number of inspections required for a particular premise. Another suggestion to reduce costs is to allow low risk premises to be exempt from the renewal requirements.
The Commission accepts that liberal trading hours are necessary, however the preferred position is that all off-licences should be closed from 10pm to 8am. The Commission considers that on-licences should be restricted from selling liquor after 2am, but also be permitted a standing extension to sell liquor until 4am if, as a condition of its licence, the premises operates a 'one-way door' policy from 1am.
The Commission considered that the case for increasing the purchase age is strong and suggested that the minimum purchase age at on-licences be 18, and the minimum purchase age at off-licences be 20. The Commission also favoured an offence of supplying liquor to a young person.
The Commission considered the types of products available in supermarkets and grocery stores and following its investigations believes that removing alcohol from these places would not be acceptable to the public. It also considered the possibility of banning "ready-to-drink" drinks as they appear to be contributing to problems with young people, in particular young women, but the Commission is not in favour of a ban.
Demand Reduction
Demand reduction concerns two main topics:
- price; and
- advertising and promotions.
The Commission sees a case for increasing the excise tax on liquor, and intends to address the detail of this tax in its final report, including a possible recommendation to reduce excise tax on low-alcohol products.
In terms of advertising, the Commission favours leaving the bulk of the regulation to the Advertising Standards Authority. The Commission considers that irresponsible promotion practices could be a ground for the LLA to suspend or cancel a licence.
Problem limitation
A number of enforcement measures are recommended including:
- The ability for a Police inspector to be able to immediately close on-licence premises to prevent breaches of the Act.
- A review of penalties under the SLA, with a view to increasing them.
- Increasing the range of infringement notices for technical and minor breaches of the Act.
- SLA to provide for the development and recognition of alcohol accords.
In terms of liquor bans in public places, the Commission favours the current situation of liquor bans in certain areas, but sees the difficulty in determining whether there is a ban in place for any given area.
With respect to product labelling and serving sizes, the Commission considered that product labelling is only of marginal relevance to the problems being addressed. The Commission did not favour a regulatory power to restrict the alcohol content and size of packaged beverages. However, it did see a case for providing a regulatory power to require licensed premises to offer standard measures of wine, beer and spirits.
In terms of transport, the Commission has suggested that the blood alcohol limits for driving be reduced from 80 milligrams of alcohol per 100 millilitres of blood to 50 milligrams per 100 millilitres of blood. The Commission also favoured provision for an alcohol ignition locking device for all convicted drink drivers.
Resource Management Act 1991
The Commission discusses the potential of the Resource Management Act 1991 ("RMA") to provide some controls to advance the health goals of liquor legislation through its focus on enabling "people and communities to provide for their social, economic and cultural well-being and for their health and safety."
Whilst it is considered inappropriate for the RMA to place limits on the location of liquor licensed premises, it is acknowledged that the RMA could sensibly influence trading hours and amenity issues. The Commission considers that this can work alongside a new liquor law but is not the correct act to solely deal with liquor issues.
Submissions
Submissions are sought on the Issues Paper by 30 October 2009, and the Justice Minister has asked that the Law Commission release its final report in March 2010.
If you have questions about the issues discussed above, including how you can effectively engage on the issues that do affect you or the need to submit in support of positive recommendations by the Commission or in opposition, please contact us and we would be happy to assist.
Auckland City Liquor Licensing Policy
Mayor John Banks has pulled the controversial Draft Auckland City Liquor Licensing Policy ("Policy") following a strong reaction from Auckland's publicans. The Policy will now be put on hold until the Law Commission's review of the Sale of Liquor Act 1989 has been released, due in March next year.
The Policy was intended to support the safe and responsible enjoyment of liquor by providing a framework for consistent decision making regarding the sale and consumption of liquor within Auckland City. A full copy of the Draft Policy is available online at http://www.aucklandcity.govt.nz/council/documents/liquor/default.asp.
The Policy related to all on-licences, off-licences and club licences for the sale or supply of liquor in Auckland City and divided Auckland City into three categories:
- the CBD;
- specific entertainment precinct areas; and
- the rest of the isthmus/Hauraki Gulf Islands.
The proposed changes would have closed suburban premises at 11pm, or midnight if an extended licence was obtained, and this prospect was not received well by the hospitality industry:
The objectives of the Policy were to:
- Give effect to the SLA.
- Ensure transparency in liquor licence decision-making processes.
- Promote consistency across liquor licensing decisions.
- Reduce liquor-related harm in Auckland city and enhance community safety.
- Support the development of Auckland as a vibrant and attractive world-class city, both to visit and to live.
Submissions on the Policy were due by 7 October 2009, and the Alcohol Advisory Council has expressed surprise that the Policy was pulled during the consultation period.
It will be important to closely monitor Auckland City Council's response to the Law Commission report in March next year. We will continue to keep you updated on the progress of any liquor licensing policy released by the Council.
Two liquor bills before parliament
There are currently two bills before the House relating to the sale of liquor: the Sale of Liquor (Objections to Applications) Amendment Bill ("Objections and Applications Bill") before the Social Services Select Committee, and the Sale and Supply of Liquor and Liquor Enforcement Bill ("Enforcement Bill") before the Justice and Electoral Select Committee. Submissions on both Bills closed some months ago.
The Objections and Applications Bill seeks to broaden the scope of who can object to a new licence application, and requires social impact reports to be provided by applicants and taken into account by Licensing Authorities. The Objections and Applications Bill also requires the preparation of community impact statements when applying for a licence. (The Issues Paper specifically rejects this proposal because of the costs involved, and the questionable value of such reports.)
The Enforcement Bill prohibits all premises smaller than 150m² from being licensed. Licensing authorities will be required to take into account local authority Alcohol Plans when making licensing decisions. The Issues Paper does not support a specific restriction on the size of any given licensed premises, rather it considers that the size of a premises be one of a range of factors to be taken into consideration. The Issues Paper is equivocal about making compliance with local alcohol plans compulsory for licensing authorities, particularly in respect of the impact on already licensed businesses.
The Select Committee is expected to report back on the Enforcement Bill on 1 November 2009. A report is not due on the Objections and Applications Bill until June 2010. The Government may seek to avoid piecemeal legislative change and instead adopt wholesale reform, effectively by-passing both these bills with a new Act, but that is yet to be announced.
This publication is included in Russell McVeagh's website on the Internet:
www.russellmcveagh.com
The publication is intended only to provide a brief summary of the subjects covered. It does not constitute legal advice and should not be relied on as such without first obtaining specific professional advice based on your unique circumstances.
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