Fit for the 21st century?

Adam Matthew, partner with Miller Hendry Solicitors, which has offices in Perth, Crieff and Dundee, says ‘Fit and proper’ raised thorny issues in the past and could cause uncertainty and concern if it returns.

Adam Matthew, partner Miller Hendry Solicitors.

IN May, the Scottish Government introduced its bill containing provisions for amendment of the 2005 Licensing Act. One of the main amendments is the reintroduction of the “fit and proper test” that existed under the old licensing regime. Concerns regarding the move to reintroduce have been brewing in the industry since.

Licenceholders who operated under the old licensing regime will easily recall that, when purchasing licensed premises, they would submit an application for transfer of the licence. The board could then refuse an application if it found that an applicant was not a “fit and proper” person. The police were entitled – and very much exercised their rights – to lodge objections to transfer applications, leading to a great many disputes and a whole range of case law with regards to testing what was deemed “fit and proper”.
In 2005 the “fit and proper test” was removed from the legislation.
Now, not even 10 years on from the test’s disappearance, the Air Weapons and Licensing (Scotland) Bill introduces a new, and very similar, form of wording: “… that the licensing board may refuse an application if they consider that, having regard to the licensing objectives, that the applicant is not a fit and proper person to be the holder of a premises licence.”
This wording also applies to a personal licence and the fit and proper test is also to be reintroduced in respect of licence reviews.
The bill goes on to say that if a holder is not found to be fit and proper then the board must revoke the licence. This has particularly pertinent implications for the licensed trade, as it would not be possible for the board to suspend the licence, allowing transfer to another individual. The consequences of this are potentially far-reaching for the many small businesses that make up the large part of the licensed trade.
Although the new provisions differ from those under the 1976 act in that they specifically refer to the licensing objectives, previous cases under the 1976 act may provide some guidance to resolving disputes, but any such cases will be of limited relevance given the changes.
If the bill gets passed, one thing that’s clear is that there is likely to be a period of uncertainty across the industry until the new fit and proper test is fully tested through the courts.
Concerns are likely to ripple through the licensed trade that Police Scotland will see the “fit and proper test” as a means to increase objections to licence applications and reviews, and that many premises licences – and by extension the livelihoods of many licenceholders – may be in danger.
At the moment the bill is, of course, just that – a bill. It does not yet have the force of law behind it. But the signs are there and the likelihood is that the bill will be passed and become an Act of the Scottish Parliament before the year is out.