To begin the transfer process of a liquor license in the state of Michigan, Department of Licensing and Regulatory Affairs Liquor Control Commission (MLCC), the Seller (aka the transferor) and Buyer (aka transferee) must first enter into a Purchase Agreement.
Applicants requesting to transfer a license from another licensee must submit an executed purchase agreement signed by both the applicant and the current licensee, which details the sale of the liquor license(s).
• Purchase agreements must specifically indicate that the liquor license is being sold and provide the purchase price and terms of the sale.
• Purchasers of on-premises licenses must have at least 10% of the purchase price of the business, excluding real estate.
• Purchase agreements that are not for cash only sales and include real estate must list the personal property, including the licenses, and real estate with the terms and price for each.
• If the personal property and real estate are being purchased by separate people or entities, the purchase agreement must indicate those names and who is purchasing which items.
• If the applicant will not pay the full purchase price at closing, the balance due may be covered by a security agreement or promissory note. Alcoholic beverage inventory cannot be included on a security agreement or promissory note.
Every MLCC application is slightly different from the next, so it is difficult to specify a definite number of days, weeks, or months for an application to be completed. The MLCC attempts to process and review all applications in a timely manner.
Effective April 1, 1988, retail liquor licensees are required to file and maintain Proof of Financial Responsibility with the Michigan Liquor Control Commission (MLCC).
This filing requirement must be met before a new license can be issued or an existing license renewed. This requirement can be met by: (1) filing this form, or (2) filing a different Proof of Liquor Liability Insurance form which has been approved by the MLCC and is often available through insurance carriers: http://www.michigan.gov/documents/lara/LC95_485190_7.pdf
1. Documents requesting a new license or transfer of a license and inspection and licensing fees received by Michigan Liquor Control Commission.
2. The Licensing Division reviews documents for completeness and verifies the appropriate fees have been received. If additional documents, fees, or corrections to documents are needed, Licensing will notify the applicant. Once all the necessary documents have been received, Licensing will submit the request to the Enforcement Division for its investigation. If an applicant has applied for and meets the requirements for a conditional license, the request will be considered by the Commission.
3. The Enforcement Division will contact the applicant to schedule an interview with the applicant (and current licensee for license transfers). At this meeting an investigator will review the purchase agreement, financial documents, property documents, and other items with the applicant. After the interview, the investigator will prepare a report for the Commission regarding the investigation and submit the request back to Licensing for further processing.
4. Licensing reviews the report from Enforcement and any additional documents received during the interview process. The request is prepared for the Commission to consider and placed on a docket for an upcoming licensing meeting.
5. The Commission considers the request, including the liquor license operating history of the applicant (if a current or prior licensee), the arrest and conviction record of the applicant, whether the applicant meets the requirements for a license, the applicant’s financial information, and the opinions of the local legislative body or police department, if received. The Commission will approve or deny the request based on these factors. Occasionally, the Commission will request more information from the applicant before making a final decision.
6. After the Commission makes a decision on the request, the request goes back to Licensing for final processing. Approval orders are sent to the applicant requesting any final items before the issuance of the license. Denial orders are sent to the applicant and the applicant may appeal the decision.
7. Closing Form for New License or License Sale must be signed by the Buyer and Seller: http://bit.ly/2c06auc
8. When all the final items are received by Licensing, the completed request is forwarded to the Renewal Unit for the issuance of the physical license documents.
