Client Alert: New York State Liquor Authority Proposed Advisory on 3rd Party Providers

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The September 19, 2019 – New York State Liquor Authority (the “SLA”) has issued a proposed Advisory relating to many types of agreements that often exist between an entity having a liquor license (a “licensee”) and an entity which provides services to a licensee (a “third party”) in exchange for the third party receiving a percentage of the licensee’s sales or profits. The SLA’s Advisory would apply to leases, management agreements, and any other type of agreement between a licensee and a third party. If adopted, this advisory would, among other things, place limits on the percentage of a licensee’s profits or sales that a third party may receive before requiring the third party to be considered a licensee. The proposed advisory is available here and the SLA is accepting written comments submitted on or before Friday, September 27. Separately, the State Liquor Authority will be holding a special Full Board meeting on October 7 at 10:00 a.m. to discuss and hear from anybody that would like to speak on the matter.

If you have any questions or would like additional information, please contact Alexander B. Victor at abv@dhclegal.com or (646) 428-3293.

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