Retail alcohol licence: categories A, B and C and the hundred metres

It is Rule 4.4.1 of Chapter 4.4 of Joint Regulation No. 9473, together with Rule 4.4.2 on limited-time licences. Retail alcoholic beverage trafficker licences are issued within the Permiso Único for each business, site or commercial establishment to which they apply, with the same validity as the Permiso Único, and may be conditioned at any time where the situation warrants it, to protect the health, welfare, safety and tranquillity of Puerto Rico’s inhabitants. The wholesale licences, the from-a-vehicle licence and the beer and wine manufacturers’ licences are in our companion guide.

Any trafficker selling exclusively for individual use and consumption must obtain a Retail Alcoholic Beverage Trafficker Licence. Category A, B and C licences are issued only for establishments in permanent buildings or structures; that limitation does not apply to sea vessels with a fixed itinerary under franchise carrying passengers through Puerto Rico’s ports, lakes and rivers. And no licences will be issued or authorised for dispensing alcoholic beverages, wholesale or retail, for establishments or premises used as dwellings or connected directly to a dwelling through any opening.

• Completing the corresponding application and meeting the requirements set in Rule 4.1.4, both to obtain and to renew.Verified against the official source
• That the establishment be in a permanent building or structure, except sea vessels with a fixed itinerary under franchise carrying passengers through Puerto Rico’s ports, lakes and rivers.Verified against the official source
• That the premises are not used as a dwelling nor connected directly to a dwelling through any opening.Verified against the official source
• Displaying to the public a sign stating that selling alcoholic beverages to people under eighteen (18) and employing such minors to sell them is prohibited by law.Verified against the official source
• Requiring from anyone who appears to be under twenty-seven (27) an identification card with photograph and date of birth, before sale, employment or use in dispensing.Verified against the official source
• Buying for resale only from a licensed wholesale trafficker, a wholesale importing trafficker, or a rectifier, distiller, beer manufacturer or wine manufacturer.Verified against the official source
• For the limited-time licence: holding the Permiso Único for a Temporary Activity and not exceeding fifteen (15) consecutive days.Verified against the official source

• Certification stating whether a previous licence was revoked and, if so, how long since that revocation became final and firm.
• Negative Room Occupancy Tax Certification from the Tourism Company, for applicants located in — or operating — hotels, condohotels, all-inclusive hotels, motels, paradores, short-term rentals, small inns, guest houses, apartment hotels and recreational facilities operated by Government agencies or instrumentalities.
• Recommendation from the Institute of Puerto Rican Culture where the property sits in a historic zone.
• Recommendation from the Tourism Company where the property sits in a tourist-interest zone.
• Recommendation from the Housing Department where the property sits on public housing property.
• For the limited-time licence: the Permiso Único for a Temporary Activity, certification of returns for the previous five (5) years, an IVU-returns certification current at filing, a Treasury debt certification current at filing, a temporary merchants registry, and the president’s or managing partner’s certification for corporations or partnerships.

1. 1

   Step 1: The three categories

   The category depends on where the drinking happens. A is issued to establishments dispensing alcoholic beverages to be consumed inside them, and under that category they may also sell capped and sealed for consumption outside the establishment or its immediate surroundings. B is issued exclusively to establishments selling alcoholic beverages in capped and sealed containers to be taken away and consumed outside the establishment and its immediate surroundings. And C is issued exclusively to establishments in Puerto Rico’s air and sea terminals devoted to selling tax-exempt alcoholic beverages to people travelling outside Puerto Rico’s jurisdictional limits. With B or C there is an express prohibition: no holder of those licences may allow alcoholic beverages to be consumed in their establishment or its immediate surroundings.

2. 2

   Step 2: Premixed drinks: five gallons, in a glass

   Every licence issued to Category A establishments contains an authorisation to keep premixed drinks with ingredients permitted by law, subject to four conditions. Up to a maximum of five gallons of a hand-prepared premixed drink may be kept on the premises. Up to a maximum of five gallons of a machine-prepared one may be kept. The premixed drink may not be bottled and sold. And it may only be consumed inside the establishment or premises, in glasses.

3. 3

   Step 3: Minors, ID and suppliers

   Three counter rules. No trafficker may sell or donate alcoholic beverages to anyone under eighteen, for their own or another’s use; none may employ under-eighteens in dispensing alcoholic beverages; and every trafficker, wholesale or retail, must require from anyone who appears to be under twenty-seven an identification card with photograph and date of birth, before selling to, employing or using that person in dispensing, selling or trafficking alcoholic beverages. In addition, every commercial establishment selling alcoholic beverages at retail must display to the public a sign stating that selling to under-eighteens and employing such minors to sell is prohibited by law. And buying has its rule: the retail trafficker may only buy for resale from a licensed wholesale trafficker, a wholesale importing trafficker, or a rectifier, distiller, beer manufacturer or wine manufacturer.

4. 4

   Step 4: The papers added to the general ones

   Besides the application and Rule 4.1.4’s requirements, this licence asks for five more things. A certification stating whether a previous licence was revoked and, if so, how long since that revocation became final and firm. A Negative Room Occupancy Tax Certification from the Tourism Company, if the applicant is located in or operates hotels, condohotels, all-inclusive hotels, motels, paradores, short-term rentals, small inns, guest houses, apartment hotels and recreational facilities operated by Government agencies or instrumentalities. The Institute of Puerto Rican Culture’s recommendation if the property is in a historic zone. The Tourism Company’s recommendation if it is in a tourist-interest zone. And the Housing Department’s recommendation if it is on public housing property.

5. 5

   Step 5: When it is denied or revoked

   There are four cases in which issuance or renewal is revoked or denied. Where the applicant or the business’s administrator has been convicted of any felony or misdemeanour involving moral turpitude, or declared addicted to narcotic drugs, and five years have not passed since the sentence was served or the addiction declared. Where the applicant or administrator is enjoying the benefits of a suspended sentence or parole. Where the applicant is not the legitimate owner of the business. And where a licence was previously revoked and five years have not passed since that revocation became final and firm. In addition, OGPe, the hierarchy municipalities and Authorised Professionals may refuse to issue it if any director or principal shareholder has been convicted of a felony in Puerto Rico, the United States or any foreign country; convicted of a misdemeanour for breaching Puerto Rico’s internal revenue laws; has falsely declared or concealed required information; has engaged in or continued businesses or occupations requiring a licence without paying the fees in the form and time established; or for any other just and reasonable cause. All of this applies both to individual applicants and to directors, shareholders or principal partners of corporations or partnerships. And anyone denied may seek review under Chapter 11.1.

6. 6

   Step 6: Conditioned licences: hours, noise and neighbours

   OGPe, hierarchy I-III autonomous municipalities and Authorised Professionals may condition the issuance of a licence subject to regulating the selling hours, require soundproofing of the structure, prohibit the use of sound-generating or amplifying equipment, or set any other reasonable and necessary condition. There are five circumstances: where an investigation shows the business adversely affects the health, safety, tranquillity and welfare of the area’s residents; where the establishment sits on property under the Housing Department’s jurisdiction or in any Government structure; where it sits less than a hundred metres from a school, church, religious centre or public or private rehabilitation facility — and in that case the institution itself may condition its authorisation on what it needs to carry out its activities; where the property sits within a municipality’s casco urbano and its recommendation certifying that is filed; and where the investigation shows the business adversely affects the normal operation of hospitals, health or rehabilitation centres, childcare centres or places where minors gather and hold activities. If your licence issues conditioned, the document itself must include the conditions imposed.

7. 7

   Step 7: The hundred metres, and where they are measured from

   This is the rule that stops most projects. OGPe, the hierarchy municipalities and Authorised Professionals will not issue new licences to businesses seeking to trade alcoholic beverages at retail from premises less than a hundred metres from a public or private school, church, religious centres or public or private rehabilitation facility for people addicted to controlled substances or alcohol. And the regulation says how it is measured: the distance is considered radial or linear as the case may be, and is counted from the fence, railing or any other demarcation sign of the school, church, religious centre or facility, to the structure where the retail trading will take place. There are two exits. One: if the institution within a hundred metres consents in writing to the granting of the licence, it may be granted with the conditions deemed necessary so both establishments can carry out their activities. The other: where the property sits within a municipality’s casco urbano, the licence may be issued inside the hundred metres provided the municipality’s recommendation certifying the casco urbano location is filed, and in those cases the licence may be conditioned.

8. 8

   Step 8: Falsely declaring the distance

   The regulation attaches an express consequence to lying on this point. Anyone seeking a new licence must state in the application whether, at the time of filing, the proposed premises is or is not located less than a hundred metres from a public or private school, church, religious centres or public or private rehabilitation facility. And if the applicant falsely declares that the establishment is not located within that distance, the licence will not be issued; and if it had already been issued, it will be left without effect.

9. 9

   Step 9: Premises connected to dwellings

   A whole section of a single sentence, and it is absolute: no licences will be issued or authorised for dispensing alcoholic beverages, wholesale or retail, for establishments or premises used as dwellings, or connected directly to a dwelling through any opening. Any opening. If the business and the house share an interior door, the licence does not issue.

10. 10

    Step 10: Category C: duty free in the terminals

    It applies to anyone leasing, or seeking to lease, premises from the Ports Authority for a shop in an air or sea terminal for tax-free sales. Those establishments must apply in writing to Treasury’s Consumption Tax Bureau for entry in the Registry of Tax-Free Entities or Transactions, and once entered the Bureau assigns a number to each establishment. There are five extra requirements: the Ports Authority Executive Director’s recommendation; the air or sea zone site where the shop is proposed; a sketch describing the premises to be used as a warehouse, with security conditions acceptable to the Secretary of the Treasury and OGPe’s Assistant Secretary; the Tourism Company’s recommendation; and the establishment’s number in that Registry. The beverages may be imported by the concessionaire or bought from local manufacturers or wholesale importing traffickers in Puerto Rico. Those sold tax-free are delivered to the buyer immediately and directly, duly packed and with an adhesive tape reading: "Por Ley esta Mercancía No Podrá Ser Abierta Ni Usada hasta Tanto Salga de los Límites Jurisdiccionales de Puerto Rico. De Así Hacerlo Estará Sujeto al Pago de Impuestos, Multas o Confiscación." And in the shop and adjacent areas notices must be installed stating that three acts violate the Internal Revenue Code: bringing untaxed beverages and other articles into non-sterile areas; consuming untaxed beverages in the terminals; and transferring exempt beverages and articles to persons not authorised by the Code. When the Ports Authority lease ends, its Executive Director informs the Secretary of the Treasury, OGPe’s Assistant Secretary and the hierarchy municipalities so renewal does not proceed, and notifies the concessionaire by certified mail with return receipt.

11. 11

    Step 11: The per-day licence and the fifteen-day one

    Limited-time Retail Alcoholic Beverage Trafficker Licences — per day — and limited-time Retail Cigarette and Alcoholic Beverage Trafficker Licences may be issued for temporary establishments, for a term not exceeding fifteen consecutive days. The premises or site applied for must hold the corresponding Permiso Único for a Temporary Activity. For the combined licence, the term "cigarettes and tobacco-derived products" includes cigarettes, cigars, loose tobacco, rolling paper, cigarette tubes, electronic cigarettes, nicotine cartridges and vaporisers. And its requirements are its own: the Permiso Único for a Temporary Activity; certification of income tax returns filed for the five years before the accreditation request issued by Treasury; a Treasury certification of IVU returns filed, current at the time of filing — and, for corporations or partnerships, the president’s or managing partner’s certification; a Treasury debt certification current at filing; a temporary merchants registry; the corporate certification; and, where the president or managing partner does not reside in Puerto Rico, the information is satisfied by the authorised representative in Puerto Rico.

Within the Permiso Único, through the SUI, before OGPe, a hierarchy I-III autonomous municipality or an Authorised Professional, because the regulation lists these licences among those filed and evaluated exclusively that way. The recommendations come from the agencies that apply given where the property sits: the Institute of Puerto Rican Culture in a historic zone, the Tourism Company in a tourist-interest zone, the Housing Department on public housing property, and the municipality where the casco urbano is invoked. For Category C, the Ports Authority and Treasury’s Consumption Tax Bureau. If the licence is denied, review is sought under Chapter 11.1.

• Measuring the hundred metres from the school building rather than from its fence, railing or demarcation sign.
• Falsely declaring the premises is not within a hundred metres, which leaves the licence without effect.
• Allowing consumption in the establishment or its surroundings while holding a Category B or C licence.
• Bottling and selling the premixed drink, or exceeding the five gallons of each type.
• Leasing premises connected to a dwelling through any opening.
• Applying for a non-permanent structure, except vessels with a fixed itinerary.
• Asking for ID only from those who look under eighteen, when the rule is anyone not appearing over twenty-seven.
• Buying for resale from someone who is not a wholesale trafficker, wholesale importer, rectifier, distiller or manufacturer.
• Forgetting the Culture, Tourism or Housing recommendation when the property requires it.

These are the government pages this guide is based on.

• Oficina de Gerencia de Permisos (OGPe)

  OGPe

  docs.pr.gov

• Permit Management Office

  ogpe

  ogpe.pr.gov