Licenses

What type of license do I need?


What are you trying to do? The most common license types we help people with are: Type 47 - restaurant with beer, wine & distilled spirits ("substantial" food required) Type 41 - restaurant or cafe with beer & wine ("substantial" food required) Type 42 - beer and wine with no restaurant aka wine bar (no minors) Type 48 - a bar bar (no minors) Type 20 - beer and wine grocery store or wine shop Type 21 - beer, wine & distilled spirits grocery store or bottle shop Type 23 - a small-ish brewery Type 85 - internet wine sales to consumers Type 58 - Catering Permit add on license for catering and events Type 75 - brew pub (brewing some beer and selling beer/wine/distilled spirits with food) There are many more types for all layers of making, wholesaling, and retailing alcohol. There are licenses for bars on boats, spirits tastings and hotels, although nothing yet for mobile food trucks... If you want to collect revenue from alcohol beverage sales, you need a license. Reach out to see what license is best for you.




What can I do with a Type 41 license?


The Type 41 is an excellent, affordable restaurant license. It's also available at any time from Dept. of ABC, meaning you do not need to find one from a broker on the secondary market. There are some real benefits of getting an "Original" license-- no seller waiting for their money, no escrow, and no broker fee! You have to serve substantial meals from a kitchen, minors are allowed, and you can sell beer and wine "to go" in manufacturer-sealed bottles and cans (unless your city government or PD restricts this privilege). You cannot sell distilled spirits or use them in your drinks. Get the Type 58 add-on license to get your catering business going.





Buying & Selling

I have an ABC license and want to sell it. How much is it worth?


Essentially, what is someone willing to pay for it. It depends on a few factors: • What type of license is it? (ie. is it a "controlled" license, like a Type 47, 48, 75, 20 or 21 that is typically unavailable directly from Dept. of ABC) • What county is it in? • Is it the liquor license only or are you trying to sell the business? Do you have a good lease? • How long are you willing to wait to get paid? The secondary market fluctuates based on quantity of licenses in the market, whether or not a lottery is coming up, and how many people are trying to get a license at the time you're ready to sell. We have a database that lists all recent transactions including ABC licenses, so definitely reach out for specifics on your county and license type. State law requires that payment for an ABC license goes through an escrow, and the escrow requirements for liquor licenses are specific. So make sure you reach out before you accept any money from a potential buyer.




I need a Type 47, Type 48, Type 20, Type 21 or Type 75 license. How do I get one?


These "general" licenses are limited based on county census numbers. So if your county's population is growing, there's a chance new "General" licenses (47, 48, 21, 75) may be available in the annual Priority Drawing that happens in October. More info on that HERE. If your county doesn't have this, if you don't get lucky in the drawing, or if you need a license at a different time of year, we will get you a license on the secondary market, from someone who no longer is operating theirs. There are almost always licenses available if you can afford the market rate. We will coordinate with our broker and escrow partners to find you a license, open the legally required escrow, and manage the process on your behalf. Licenses purchased from another licensee require a recorded notice and forms signed by buyer and seller. Since a seller doesn't get their funds from escrow until your license issues, and licenses won't issue until your construction is nearing completion, we generally recommend starting the process ~5 months from your most reasonable (ie. not your most ambitious) timeline for opening. Sellers get cranky waiting for their money (wouldn't you?) so really best for all parties to start at the right time.




Where do I start if I want to buy a license?


Start here! You're in the right place. We have a client list hundreds long and often have a license to sell from someone we've worked with in the past. This is ideal because a transaction needs cooperation from sellers and buyers, and we maintain good relationships with everyone we work with to facilitate efficient, low-stress transactions. If we don't have one, we work with most of the state brokers and can find you a license 99% of the time. We also have records of the recent transactions by license and county and can help you negotiate a fair price for your new license.




I want to sell my license? Where do I start?


You're in the right place! We get inquiries from potential buyers all the time, and also know when our current clients may be ready to upgrade. We prefer to find buyers within our client base because when we manage the ABC application process, we have a bit more control about timing and trying to get you paid as quickly as possible (which usually can't happen until the license issues and escrow closes). Send us a note if you're considering selling so we can help you understand the process.





Process

How long does it take to get an ABC license?


The fastest applications we've handled were done in just over 2 months. The slowest have been several years. It depends on several factors: • When your construction is done (what your contractor told you is probably not going to happen) • What time of year you apply (ie. how busy is ABC and how staffed up are they?) • Who gets assigned your file at the ABC district office ( some license reps and supervisors are just faster than others) • Was your application protested by neighbors? (this will substantially slow down the process, although it will rarely stop you from getting a license) If you are buying a business, including the license, you CAN generally get a Temporary Permit that allows you to operate the license while the application is pending. These are processed for the day your application gets "on file" with ABC, or a later date of your choosing. More info on Temporary Permits to come.




How much does it cost?


When you hire us, we charge a flat fee to manage your project. We will collect our fee, ABC fees and mailing costs at the beginning of the process. If you're buying an existing license, typically 25% of the purchase price is collected up front as a deposit. The total will vary due to specifics of your project— are you buying a new license or an existing one and transferring it? Is an escrow required? What are license values in your county? How complicated is your ownership structure? How many people need to get fingerprinted? The fees are a little complicated (even ABC employees get it wrong sometimes) so reach out for an estimate.




What is the annual Priority Drawing? (Liquor License Lottery)


Each fall, Dept. of ABC assesses county populations and issues new "General" licenses to the counties that are growing. General licenses are the big daddy retail licenses that include distilled spirits: Type 47, Type 48, Type 21, and Type 75. They literally pull names out of a raffle drum like bingo. You need to have your ownership entities formed 90 days before the drawing (by July 1 is a good rule of thumb). Once notified of your success, you can submit the full application. It generally takes 3-5 months for ABC to process these apps, so think January - March of the following year. If you are not successful, don't panic, many people who apply don't end up applying and those licenses are then offered to the next peopel in line. The only restrictions with these licenses is you can't make any changes in ownership or premises address for 2 years and you can't sell it during that time either. We prepare these apps for you for a flat fee of $250. Start a chat or send us a note if you want more info.





Signs & Postings


Operating a License

I'm a restaurant or bar, can I buy alcohol from Costco or another retailer?


No. As a licensed retailer yourself, you must buy from a licensed wholesaler in California. The state has a quite strict rule called the "Three Tier System" that separates alcohol producers, wholesalers and retailers. Apart from some exceptions, you generally can only do ONE of the three.




We've changed some of the ownership on the license, do we need to tell ABC about it?


Yes. We know it's annoying to go through bureaucratic processes with ABC every time you change something. You're running a business, we get it. But it is required, and although ABC doesn't have a lot of resources to audit this type of thing, we've seen people run into problems when they don't do the updates and then want to sell or transfer or expand a license. Keeping ABC's records accurate is a best practice and we definitely recommend it. If the change is substantial, over 50% or controlling individuals are changing (ie. new LLC managers or new officers), it's a bit more involved of a process. This is a little complicated to put into a FAQ, but if you reach out to us, we can help you determine if/when/how a change is reported.




We want to expand our operations to a patio/next door/etc. Do I need to do anything with ABC?


Yes. ABC has (thankfully) streamlined their process for expanding so that it's relatively simple to do it.
One thing to note is that ABC is the state agency, but you also need permission for certain types of expansions from your local governing body, aka the city or county where your business is located. For example, if you're expanding to the public sidewalk in Oakland, you need a Department of Transportation "Encroachment Permit". These can sometimes be much more involved than the ABC piece. So you will want to check with the city before spending any substantial money on hiring an architect and builder and applying for the ABC expansion.




How do I know what I can and can't do?


Each ABC license comes with a not-very-obvious set of privileges and restrictions that even we can't remember, so totally understand that it's confusing for you to keep track of. We're compiling a list of basics for each license, but feel free to reach out if you have questions about your license privileges. One thing to be aware of, ABC often will restrict your specific license through "Operating Conditions". These are sometimes requested by the local police departments, city planning codes, neighbors, or will carry over from previous operators of your license (if you bought someone's business that included the license). If you don't know if/what your conditions are, we can help you find out. These Operating Conditions are a document ABC provides that you must sign and then post at your place of business, along with your physical current license. We can also request a "modification" to a set of conditions after you've been in place for a year. Let us know if you want help with that.




Do I have to comply with an ABC agent that comes to my business?


Yes. ABC has two arms– the licensing arm and the enforcement arm. If an agent is coming to your business after the license is issued, it is almost certainly an enforcment agent and they are peace officers with the power to make arrests, issue citations, conduct undercover investigations and more. It is in your best interest to cooperate with these officers at the time they come to your business. Once a violation is assessed, if possible, you will want to hire an attorney who specializes in these matters. We have an excellent network of ABC-focused attorneys we can refer you to depending on the issue. You want to be properly lawyered up to address any issues here.




Can we hire minors to serve alcohol?


It depends on your license type! Bars or tavern-type licenses CANNOT ever have minors employed to handle alcohol in any capacity. Restaurants CAN employ minors, but they cannot be primarily handling alcohol. They can be a food server but not a cocktail server or bartender, for example. A market or store that sells manufacturer-sealed alcohol may only allow minors to conduct sales of alcohol if someone over 21 is present to provide direction & assistance. So a minor can't be alone on a premises if alcohol is being sold. Any gas station selling alcohol between 10 pm and 2 am must be staffed by a person over 21. Violations of the minors rules can result in a misdemeanor, incurring a fine and/or jail time.




How long do I have to keep records of alcohol transactions?


The ABC Act requires you maintain records of alcohol transactions for 3 years. Peace officers can request these records without notice and examine books. They almost never will do this unless there have been complaints made to the department, they just don't have the resources to monitor every licensee. But a complaint can trigger an investigation and you want to be prepared for the worst.




What kind of meals do I have to offer?


Oh, the million dollar food question. ABC defines restaurants as offering "substantial meals". Especially in a culturally diverse place like California, this is not a simple thing to define. And ABC is relatively understanding about this reality. But they do take the food piece seriously because bars are more strictly controlled than restaurants and it's their job to make sure restaurants do not operate like bars. So a substantial meal is interpreted by the Department to include something generally prepared on site and hearty. Chips, fries, charcuterie and nuts will not satisfy the "substantial meal" requirement. Ditto to a pre-packaged sandwich or salad. But a sandwich made on site with a side salad will generally work. We always recommend adding something really hearty to the menu– a bowl of chili, a protein-heavy dish, pasta, noodles or rice. You don't need a 16 page diner menu or a steak, but it should include at least 1-2 dishes that could satiate the hungriest person you know if needed. And the meals need to be offered at typical meal times, especially lunch or dinner.





FAQs

Still have questions?

Chat with us right here on the site or send us an email.

ABC License Company

LOCATION & HOURS

337 17th Street #101

Oakland, CA 94612

 

Mon-Fri  9 am - 5 pm 

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