When you enter into a contract to buy a pub in Australia, the sale contract is generally subject to transfer of the liquor license as a pub has little value as a business without the license.

Either the owner, or a director on behalf of the company that will own the premises needs to apply for the liquor license, which allows you to sell liquor on site and a takeaway liquor license if you will be selling liquor through a bottle shop. Liquor licenses contain a 'fit and proper' person character test which can be confusing if someone is not experienced in the licensing process.

The following issues can be problematic when applying for a liquor license:

• If a shareholder has connections with a recognised organised crime groups, such as motorcycle gang
• If a shareholder has previous convictions related to selling alcohol or other drugs in a illegal manner (including to underage patrons)
• If a shareholder has previous convictions related to selling or use of weapons
• If a shareholder has previous convictions related to assault or violent crimes
• If a shareholder has previously lost or had multiple suspensions of a liquor license for failing to abide by the conditions of that license.

For applicants from another country the application will look both a police check from the original country of residence and results of a local test showing that the applicant understands the requirements of a liquor license holder under the Liquor Act relating to their state. All applicant also need to have completed a Responsible Service of Alcohol test and it is viewed positively when applicant have have previous bar or hospitality managing experience. 

Even if the application has one or more of these issues present, it may not prevent the transfer if the applicant can show that the issues are in the past and have been resolved. Equally the liquor license can be put in place with special conditions that restrict operation or help control the risks associated with the issues. All liquor licenses are issued with general conditions including opening hours, record keeping, compliance with fire safety regulations and place of business.

In some states including Western Australia applicants also need to submit character references from two nonrelated parties in additional to business referees. The licensing body also looks at the financial capacity of the license applicant and the business plan to ensure that business, if run as stated, has the potential to be profitable.

Learn more about what it takes to buy a pub and be able to get a liquor license by talking to resources such as John Parsons Hotels.