Ask the Experts: Special Events & Liquor Licenses
By: Kelly Allen | Allen, Akison, Need, & Rowe
Q: What steps does a liquor licensee need to follow to host a special event or contest?
A: Are you a bar, restaurant or hotel looking for an interesting way to make the fall season one for the memory books? How about a contest, or a tournament? Here’s what you need to do as a liquor licensee to make this happen!
If your licensed business has great ideas to invite customers for special events this season, you should consider making an application with the Michigan Liquor Control Commission(“MLCC”) in time to have a special event, whether it be a contest or a tournament. An excellent way to attract new or bring back existing customers is with a special event. It’s October, how about a Halloween costume contest? But what is a contest without a great prize?
Liquor licensees need to know that the MLCC requires on-premises licensees, such as bars, restaurants, and hotels, to obtain PRIOR approval of the MLCC to conduct a contest or other activity in which the licensee or any other person is awarding or giving away anything of value over $250 per day. The exception to this requirement is for golf and bowling tournaments. If you operate as a bar, restaurant, or hotel, the relevant MLCC statute requires that you have a valid Entertainment Permit from the MLCC for all contests regardless of the prize level. This means that if your establishment has an Entertainment Permit, and you are having a contest with an aggregate prize of less than $250,you do NOT need prior approval of the MLCC.
If you are an establishment that does not have an Entertainment Permit, but wants to have, for example, a Halloween costume contest, you may apply for a permanent or temporary Entertainment Permit by submitting a form to the MLCC. With MLCC approval for an Entertainment Permit, you may have a contest with prizes under $250.
A: Are you a bar, restaurant or hotel looking for an interesting way to make the fall season one for the memory books? How about a contest, or a tournament? Here’s what you need to do as a liquor licensee to make this happen!
If your licensed business has great ideas to invite customers for special events this season, you should consider making an application with the Michigan Liquor Control Commission(“MLCC”) in time to have a special event, whether it be a contest or a tournament. An excellent way to attract new or bring back existing customers is with a special event. It’s October, how about a Halloween costume contest? But what is a contest without a great prize?
Liquor licensees need to know that the MLCC requires on-premises licensees, such as bars, restaurants, and hotels, to obtain PRIOR approval of the MLCC to conduct a contest or other activity in which the licensee or any other person is awarding or giving away anything of value over $250 per day. The exception to this requirement is for golf and bowling tournaments. If you operate as a bar, restaurant, or hotel, the relevant MLCC statute requires that you have a valid Entertainment Permit from the MLCC for all contests regardless of the prize level. This means that if your establishment has an Entertainment Permit, and you are having a contest with an aggregate prize of less than $250,you do NOT need prior approval of the MLCC.
If you are an establishment that does not have an Entertainment Permit, but wants to have, for example, a Halloween costume contest, you may apply for a permanent or temporary Entertainment Permit by submitting a form to the MLCC. With MLCC approval for an Entertainment Permit, you may have a contest with prizes under $250.
Alcohol Cannot be an Inducement to Participate
While you want to have fun inviting folks to frolic for Halloween or another event, the MLCC does not allow a contest or tournament of any kind in which the sale, use, or consumption of alcohol is a necessary part of the contest or tournament. This means you can say “come in your best costume,” but you cannot say customers can only win if they buy or consume alcohol as part of the contest. Additionally, you may not advertise alcoholic liquor in connection with offering a prize or award on the completion of a contest except upon prior written approval of the MLCC. This means that you cannot advertise, for example, “Come to our place, dress up as Dracula, and if you are the best Dracula, you win $250.”But you can advertise if you apply to the MLCC properly.
While you want to have fun inviting folks to frolic for Halloween or another event, the MLCC does not allow a contest or tournament of any kind in which the sale, use, or consumption of alcohol is a necessary part of the contest or tournament. This means you can say “come in your best costume,” but you cannot say customers can only win if they buy or consume alcohol as part of the contest. Additionally, you may not advertise alcoholic liquor in connection with offering a prize or award on the completion of a contest except upon prior written approval of the MLCC. This means that you cannot advertise, for example, “Come to our place, dress up as Dracula, and if you are the best Dracula, you win $250.”But you can advertise if you apply to the MLCC properly.
Just When You were Ready for a Party, There are a Few Restrictions to Dampen the Mood Regarding the Prizes
- Cash prizes must be issued as checks which are not redeemable for cash or alcoholic beverages at the establishment.
- Prizes from the licensee issued as gift certificates shall include language that indicates that the gift certificate shall not be used to purchase alcoholic beverages.
- Prizes cannot include alcoholic beverages or alcoholic beverage brand logoed items unless the logoed items are purchased by the retailer from an acceptable barware retailer.
MLCC Application
To apply for a contest with prizes or giveaways more than $250 you must submit your application with the MLCC at least ten (10) days in advance of your event for your request to be considered by the MLCC. This is a very important requirement. The MLCC works endlessly to process and approve applications like this. If you do not apply within this time frame, you may not be approved. And, importantly, you may be denied by the MLCC, which is not a good look on your record. If you have questions about these types of events, you should call your friendly neighborhood liquor licensing attorney, yours truly, or contact the MLCC Enforcement Division at (866) 813-0011.
To apply for a contest with prizes or giveaways more than $250 you must submit your application with the MLCC at least ten (10) days in advance of your event for your request to be considered by the MLCC. This is a very important requirement. The MLCC works endlessly to process and approve applications like this. If you do not apply within this time frame, you may not be approved. And, importantly, you may be denied by the MLCC, which is not a good look on your record. If you have questions about these types of events, you should call your friendly neighborhood liquor licensing attorney, yours truly, or contact the MLCC Enforcement Division at (866) 813-0011.
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