The forgotten effect of insolvencies on a premises licence

In recent weeks, the UK nightclub scene has made headlines after it was revealed that Pryzm owner is allegedly mulling restructuring options. But what happens to a licence when a late night operator goes insolvent? Sarah Taylor, licensing partner at Keystone Law, explains why it’s important for businesses to be proactive with their licences in case of an insolvency event

Can you explain how an insolvency event can cause a premises licence to lapse, and at what point in the process does this typically occur? 

Before there’s any sign of going into insolvency, I think it’s important for operators to consider not  just their wider business, but specifically their licences because a lot of operators and also a lot of  insolvency practitioners don’t realise that as soon as an insolvency event happens that licence lapses  immediately. And it’s important to be mindful of that trigger point because at that point, when the  licence has lapsed, it’s not in effect anymore and any licensed activities that are taking place are  technically unauthorised.  

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