Transferring a liquor license in Michigan is possible, but can be a complex process due to the state’s liquor license laws. There many details that must be followed and mistakes are easy to make if you don’t know exactly what you’re doing.
In the state of Michigan, there are three parties that must be involved in the transfer of a liquor license: the seller, the buyer, and the State. In Michigan, the State does not have ownership of the license in any way once a private party takes possession of it, but it plays an integral role in overseeing the purchase and transfer of liquor licenses. Here are the steps in the process:
To transfer a liquor license in Michigan, the first thing you need to do is fill out an application form called a License Interest Transfer Application (LCC-101). The person transferring the license is also required to submit a form called a Report of Stockholders, Members, or Partners. In addition to these forms, a fee of $70 must be paid as a non-refundable inspection fee. The fees and protocols vary depending upon the percentage of the liquor license that is being transferred. Because of the complex rules, it is really important to consult with an experienced attorney if you’re interested in transferring a liquor license.
In addition to the forms and the inspection fee, any applicants who are requesting to have a liquor license transferred to them but have never been licensed through the Michigan Liquor Control Commission must submit their fingerprints through the Livescan fingerprinting process.
Another document that is required when transferring a liquor license is a purchase agreement. This document must be signed by both parties, the party transferring the license and the one who the license is being transferred to. Additionally, the document must detail the transfer of the percentage interest of the liquor license. Specifically, the amount of interest being transferred must be indicated in this document.
Once all the documents and fingerprints have been submitted, the Licensing Division will review the application and all relevant documents that were submitted for the transfer. Once everything is received, the Licensing Division will submit the request to the Enforcement Division for investigation. The Enforcement Division will contact the applicant to set up an interview with the applicant and the party transferring the license. The investigator will review the purchase agreement, any financial documents, any property documents, and any other relevant items or papers involving the liquor license transfer.
Once the interview has concluded, the Enforcement Division will prepare a report. The Licensing Division then reviews this report and the request is prepared for the Commission. The Commission then schedules a license meeting, where they will decide if they are going to approve or deny the application. Once the Commission makes a decision, the file is returned to the Licensing Division for final processing.
Transferring a liquor license typically does not take that long, especially if you have legal representation to assist you. Once the buyer and seller have worked out all the details of the transaction, it typically doesn’t take longer than 30-120 days for the transfer to be approved by the Michigan Liquor Control Commission (MLCC). This is assuming that everything was filed correctly.
You need to make sure that all documents are drawn up and executed properly so that the transfer is valid in order to avoid delays. If there is an error in any of the paperwork, you may have to restart the entire process, which will obviously prolong everything. That is the reason you want a liquor license transfer lawyer in your corner. Once the transfer is approved by the MLCC, a closing occurs, which usually happens within a week to 10 days.
Oftentimes people try to transfer a liquor license themselves without hiring legal representation. While it is possible to do alone, there are a lot of places where someone who does not know the process could easily slip up. If you make a mistake, the transfer won’t go through, and it could be delayed significantly. In fact, if any errors are made, you will likely have to start the process over. Hence, having an attorney to assist you can be critical to moving forward with your business.
Also, an attorney can helpful because typically a liquor license is transferred along with the sale of a business. While that is not always the case, it is even more important to hire legal representation if you’re selling a business as well as transferring or selling a liquor license at the same time. Making sure that all parties agree to the terms of the deal and ensuring that all documents are properly drawn up and executed is crucial. Even if you think you don’t need help, consulting with a Michigan attorney for liquor license transfer is advisable.
Transferring a liquor license in Michigan is possible, but it can be difficult and quite confusing if you are not experienced in handling all of the rules and the documents required for the process. Hiring an experienced lawyer is always a good idea.
At Shinners & Cook, we have significant experience assisting clients with liquor license transfers. We can assist you with all aspects of the transfer, from dealing with the city to negotiating with the other party. Our goal is to make this process as easy and quick as possible for you. Contact Shinners & Cook today for a consultation.