Why landlords with hospitality tenants should consider obtaining a ‘Shadow Licence’23rd April 2020 - Published by Kuits licensing team
What is a Shadow Licence?
Shadow Licences are the name given to premises licences that landlords hold in reserve, to provide them with a safety net should anything happen to a premises licence held by their tenant.
How is this different to my tenant’s Premises Licence?
There is no restriction on the number of licences that can be held for any particular space, so often a shadow licence will be an exact replica of the licence used by an operator tenant to trade. It will often licence the same areas and permit the same activities.
Why should I obtain a Shadow Licence?
The benefits of holding a shadow licence come in the event that a tenant’s licence is revoked or lapses. A licence may be revoked as the result of review proceedings brought by, for example, the police, following incidents of crime and disorder. In this instance, if a review results in a revocation, a landlord has a licence in reserve that they can immediately transfer to a new tenant to allow them to commence trading as soon as the existing tenant is removed from the premises.
More pertinently in relation to the current climate and its impact on the hospitality industry, a licence lapses in the event that the premise holder at any given time becomes insolvent (unless it is salvaged by way of a transfer within 28 days, but this would require the landlord to have immediate knowledge of that insolvency). As such, in the event that a tenant’s licence lapses, a landlord with a shadow licence again has a licence in reserve that can be immediately put to use to allow a new tenant to occupy and commence trading straight away.
To speak to a licensing expert about obtaining a Shadow Licence, please contact Rebecca Ingram on 0161 838 8161 or email email@example.com.