Laying the groundwork for a more flexible, modern approach to liquor regulation

November 29, 2021 

Today, the Liquor Licence and Control Act, 2019 (LLCA) and the regulations under the LLCA come into effect, enabling the AGCO to modernize the way it regulates the sale, service and delivery of liquor, and importantly, lay the groundwork for a more flexible approach to regulation. 

The AGCO’s licence, permit and authorization holders do not need to take any action in iAGCO before their scheduled renewal date. All current licences, permits, authorizations and endorsements remain in effect and transition to the new LLCA framework.  

Highlights of the new LLCA framework  

As previously announced in the Information Bulletin: Approved Liquor Framework Lays the Groundwork for a More Flexible, Modern Approach to Liquor Regulation

  • Several new permissible activities for licence holders are now in effect. For information on what’s changing by licence type, see Annex A. 
  • Starting July 1, 2022, a new Smart Serve recertification requirement will be introduced for individuals involved in the sale, service or delivery of liquor.  
  • A new, more flexible liquor licence structure features six licence categories, associated licence classes and endorsements for additional activities. Licence holders do not need to take any action before their scheduled renewal date. 
  • Registrar’s Interim Standards and Requirements for Liquor are now in effect and apply to all licence and permit holders in the liquor sector. 

Patio Policy Extension for Eligible Liquor Sales  Licensees 

To continue to provide flexibility and support to businesses impacted by the COVID-19 pandemic, the AGCO Registrar has extended the policy to allow for the temporary physical extension of premises (i.e. patios), until January 1, 2023. Please see Annex B for the full policy. 

No Changes to Fees 

The AGCO’s existing licensing fees will not be changed. However, the schedule has been updated to reflect the new licence structure.  The list of liquor fees is available here.

New Schedule of Monetary Penalties 

A new schedule of monetary penalties for the LLCA and its regulations has been established by the AGCO Board and approved by the Attorney General. The new schedule of monetary penalties: 

  • aligns with the new LLCA framework and replaces the two previous schedules for liquor.  
  • maintains status quo monetary penalties for most existing infractions and establishes monetary penalties for new infractions under the LLCA.  
  • updates certain maximum penalty amounts to reflect new risks.  

Monetary penalties, a compliance tool used by the AGCO since 2009, act as a bridge between a warning and a revocation of a licence, authorization or registration. The penalty ranges are designed to address the specific risks posed by each infraction and by the different licensees and permit holders. 

All funds collected through monetary penalties are required to be used for education and training purposes for licensees and permit holders, or for public awareness campaigns. For more information about monetary penalties, see the AGCO’s Monetary Penalties web page. 

For More  Information 

The AGCO is committed to helping licence, permit and authorization holders and stakeholders understand what the new liquor framework means to them.  

Please consult the resources below to assist in navigating the new liquor framework. 

Information Bulletin: Approved Liquor Framework Lays the Groundwork for a More Flexible, Modern Approach to Liquor Regulation outlines highlights of the new framework for the AGCO’s licence and permit holders. 

Information Bulletin: Mandatory Smart Serve® Recertification Will Begin July 1, 2022 provides information on new recertification requirements for Smart Serve® certificate holders, starting July 1, 2022.    

The AGCO Guide to the New LLCA Framework is designed to assist licence, permit and authorization holders in understanding the new liquor framework and to support their transition to the LLCA

More details about standards are available on the Information on the Registrar’s Interim Standards and Requirements for Liquor page

Liquor licence, permit and authorization holders are also encouraged to review the: 

Annex A

What’s Changing by Licence Type

Examples of some of the changes in the new liquor framework, organized by licence type, are provided below. 

 Liquor Sales Licensees 

What’s New 

The Previous Rule 

Infused liquor to create drinks or change the flavour of liquor through practices such as barrel aging, as long as the customer is informed, will be permitted. 

The licence holder can add a substance to a drink when requested to do so by the customer, but they cannot store liquor in a container other than the container in which it was purchased.  

The ABV limits for wine and brew pubs will be removed.  

Wine pubs may not sell wine with greater than 14% ABV, and brew pubs may not sell beer with greater than 6.5% ABV.) 

Under “Take Home the Rest”, a bottle of commercially made wine removed from a licensed premise will need to be “securely closed”.  This will allow, for example, a screw top bottle to be re-closed with the original cap. 

The requirement is for the bottle to be “recorked”.   

Light meals will not be required in a licensed premise or at events under a Caterer’s Endorsement. 

Light meals must be made available by a Liquor Sales Licensee and at events held under a Caterer’s Endorsement. 

Licensed Manufacturers 

What’s New 

The Previous Rule 

A new Temporary Extension Endorsement will allow manufacturers with an on-site retail store to sell liquor products at industry promotional events, in addition to farmers’ markets. 

Manufacturers are able to apply for an authorization to sell at farmers’ markets. 

Manufacturers selling in farmers’ markets and industry promotional events will be required to have their temporary extension endorsement readily available for inspection. 

This rule does not currently exist. 

The time for returning unsold product from a farmers’ market or industry promotional event to the manufacturer’s retail store has been extended to 72 hours from the time the market closes. This will apply to new sales at industry promotional events. 

Unsold product from a farmers’ market must be returned within 72 hours from the time it leaves the manufacturer’s store. 

A new Delivery Endorsement will permit manufacturers to deliver the liquor products of other licensed manufacturers that have an on-site retail store to customers for consumption. 

Manufacturers are not permitted to deliver the products of other manufacturers. 

Manufacturers and third parties will no longer require a separate permission from the LCBO to distribute and warehouse manufacturer products. Oversight of distribution and off-site warehousing will be transferring from the LCBO to the AGCO

Oversight of these areas conducted by the LCBO and a separate permission is required. 

There will be enhanced flexibility for conducting retail sales anywhere on a production site, from the store at the production site. This could enable, for example, sales from the retail store to take place within a vineyard. 

Sales must be conducted within the physical store. 

Manufacturers will be able to sell products between their stores located at different production sites (for the same type of product), provided that each production site has a store, and the manufacturer complies with the required production steps that must take place at each location. 

The sale of products between a manufacturer’s retail stores is not explicitly permitted for all manufacturers. 

The sale of bulk wine, beer or spirits between manufacturers (used as an input to their production process) will be expressly permitted and is exempt from the requirement to have a licence, as long as the wine, beer or spirits inputs are sold to a licensed manufacturer. 

Only wineries are permitted to engage in this activity, under certain conditions. 

Licensed Grocery Stores 

What’s New 

The Previous Rule 

Grocery stores with a Beer and Cider or Beer and Wine Grocery Store Licence will be able to offer beer, wine and cider for online ordering and sale for pickup at the store. 

All aspects of sale, including ordering and payment, must take place in the store.  Online sales not permitted. 

Grocery stores will be permitted to display non-liquor products in the same area as liquor product types (i.e. beer and cider, wine) for the purposes of cross promotion.  Energy drinks and products that promote immoderate consumption may not be displayed for cross promotion with liquor products. 

Non-liquor products cannot be displayed within the liquor product area. 

Licensed Ferment on Premises Facilities 

What’s New 

The Previous Rule 

It will be permissible to combine multiple customers’ batches, allowing innovative practices, such as barrel aging, to enhance the flavour of the final product. 

Multiple customers’ batches cannot be combined. 

The 90-day limit on contracting out of Ferment on Premises licences will be removed.  

Licensees submit a 90-Day Contract Out Agreement with a transfer application. 

Licensed Manufacturer’s Representatives 

What’s New 

The Previous Rule 

A fee for delivery of liquor that has been purchased from a manufacturer or LCBO will be permitted. 

A fee for delivery cannot be charged. 

Representatives will be able to solicit orders at physical premises OR through a website, app or other similar online platform.  They must notify the Registrar within 5 business days after the platform begins to be used (there is already existing similar requirement for physical premises). 

All representatives are required to have a physical premises unless their business model is such that they take orders by “moving from place to place”. 

Licensed Delivery Services 

What’s New 

The Previous Rule 

The 90-day limit on contracting out of Liquor Delivery Service licences be removed.  

Licensees submit a 90-Day Contract Out Agreement with a transfer application. 

The minimum age for employees and contractors is reduced from 19 years to 18 years to bring consistency with rules for licensed premises.   

Individuals have to be 19 years old to deliver. 

Annex B 

Registrar’s 2021 — 2022 Policy for Temporary Patio Approvals for Liquor Sales Licensees including Boat Operators and Manufacturer’s with a By-the-Glass Endorsement  

November 29, 2021

Pursuant to section 153 of Regulation 746 made under the Liquor Licence and Control Act2019, filed on November 9, 2021, the Registrar of the Alcohol and Gaming Commission of Ontario, has approved a temporary physical extension of the premises, for the period beginning no earlier than November 29, 2021, until 3:00 a.m. on January 1, 2023, for those liquor sales licensees including premises that are boats and manufacturers with a by-the-glass endorsement that meet the following criteria, as applicable: 

  1. The physical extension of the premises is adjacent to: 
    1. the premises to which the licence to sell liquor applies; or 
    2. a dock to which the boat is attached and may include land adjacent to the dock; or 
    3. the licensed premises under the by-the-glass endorsement to a Manufacturer’s Licence. 
  2. The municipality in which the premises is situated has indicated it does not object to an extension; 
  1. The licensee is able to demonstrate sufficient control over the physical extension of the premises;  
  2. There is no condition on the licence or endorsement prohibiting a patio;  
  1. The capacity of any new patio, or extended patio space where the licensee has an existing licensed patio, allows for at least 1.11 square metres per person; and 
  1. In the case of a by-the-glass endorsement to a Manufacturer’s Licence, the sale and service of the wine, beer and/or spirits manufactured by the manufacturer within the physical extension of the premises is primarily aimed at promoting the manufacturer’s product and either providing an enhanced tourist experience or fulfilling an educational purpose. 

The licensee is not required to submit documents to the AGCO to demonstrate compliance with the above criteria, however, licensees are required to produce such documents should the AGCO request them. 

Licensees that do not meet the above criteria are required to follow the usual application process for a temporary extension of premises and apply through iAGCO

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