Bustling street: People spending the night out in Changkat Bukit Bintang, Kuala Lumpur over the weekend. — SHAARI CHEMAT /The Star
OPERATORS of entertainment outlets, pubs and nightclubs in the Klang Valley are calling for clearer guidelines and transparency in liquor licensing procedures.
Restaurant and Bistro Owners Association (RBOA) vice-president Jeremy Lim said the whole process was in need of a revamp.
Lim: RBOA members are unhappy with the long and uncertain wait for licence approvals.
Lim is representing 500 members nationwide, of which 70% are from the Klang Valley.
A good 80% of RBOA’s members have liquor licences.
Have clearer timelines
Lim, who has 15 years of experience in the industry, said members were unhappy with the long and uncertain wait for licence approvals.
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Explaining the basics on how bars and clubs are run, Lim said a business owner was required to sign a tenancy agreement and engage professionals for interior designing and renovation in order to obtain a premises licence before applying for liquor and entertainment licences.
The second part of the process takes between one and four months depending on the design scope and size of premises.
“Only when the project is 90% complete, can you take photographs to start the application process.
“By this time, contractors will be asking for payments and you are already paying your landlord. So, before you can open for business, you are already in debt.
“This is a cash flow-exhaustive business. You will roughly need RM100,000 to RM200,000 in cash just to start.
“The sooner an establishment can begin operations, the better. Ideally, there should be a pre-approval process before the tenancy agreement is signed,” said Lim.
Trec Holdings general manager Kelvin Lam said it would usually take up to three months for a nightclub to obtain all the necessary licensing for its operations.
“This is too long. Imagine, your renovation is completed and the team is ready but you can’t open for business because the licence is not ready,” said Lam.
Trec Holdings is the landlord for TREC KL, a popular entertainment centre in Jalan Tun Razak, Kuala Lumpur.
Thirty-five of the outlets there serve alcoholic beverages.
Lam said most businessmen were left with no choice but to wait.
Lam: The time taken for liquor licences to be approved is too long.
Some, however, will operate under the acknowledgement of a “white card”.
The “white card” is a statement issued by a local authority to acknowledge that an operator’s application has been accepted.
In the document, it is indicated that it is not a valid licence.
In Lam’s 20 years of experience, he has observed that 70% of entertainment outlets in the Klang Valley were at one time or the other, using the white card to operate.
It would save the industry from much anxiety if the approval process could be facilitated in one month as long as all the required documents were in order and stipulated conditions fulfilled, said Lam.
Leveraging technology
Though licences for premises, signboards and entertainment outlets can be submitted and renewed online, users are constantly frustrated with slow page loads and hangs.
Application for liquor licences, however, must be submitted over the counter.
Lam, who logs into the eLesen website owned by Kuala Lumpur City Hall (DBKL) as frequently as three times a week, said there were times when the website was unable to print receipts and copies of licences after payment was made.
“There are also instances when while making online submission of our applications, the system will come up with an error code at the last step,” said Lam.
This means having to turn up at the counter so that the matter can be sorted out.
“Depending on the type of problem encountered at the back end, this can either take half a day or even a week to sort out,” said Lam.
This situation should be improved in lieu of the fees that licensees are paying.
“Yearly, a liquor licence is RM2,648.
“We should not forget that those who have permission to extend operation hours have to pay an additional RM60 per hour.
“An additional extension of two hours per day, that can come up to RM43,800 a year,” said Lam.
RBOA is suggesting for an inbuilt geographic coordinate system be included in the online licensing site run by local councils so that applicants can key in an address and verify if entertainment activities such as bars, karaokes and nightclubs are permitted at that location or premises type.
Ideally, this feature should also incorporate the types of entertainment categories, zoning details and revised draft plans for future planning purposes.
“This location feature will definitely be a great help as it will prevent investors from making the mistake of investing in a premises which is located in a zone where they cannot do business,” said Lim.
Keeping owners informed
Lim said members have also called for the various state Excise Licensing Boards to provide clearer indications on meeting dates and to have more frequent sittings.
Presided by the local council, Customs Department, the police, Health Department, fire and rescue department and land office, all liquor licensing must obtain the approval of the Excise Licensing Board, in accordance with Section 35 of the Excise Act 1976.
The board comes under the purview of the state government.
At present, no one knows when these meetings take place but it was believed that they take place every three months in March, June, September and December, said Lim.
A nightspot in Jalan Doraisamy, Kuala Lumpur. Many entertainment outlets are still struggling to recover from losses suffered during the MCO. — SHAARI CHEMAT /The Star
As such, it has been suggested that those who have either applied for new licences or awaiting renewals be kept informed when the state licensing boards will be meeting so that business owners can plan their document submissions to coincide with the sittings to avoid delays in approvals.
Lastly, now that entertainment outlets have been given the green light to reopen, following an ease in restriction due to the Covid-19 pandemic, many operators are still struggling to recover from losses suffered during the various movement control order restrictions.
As such, a measure of sensitivity is needed before coming up with blanket statements and decisions concerning the industry.
DBKL’s announcement of a freeze on the granting of new liquor licence applications on June 3, 2020 following drink-driving incidents was a case in point, said Lam.
Entertainment outlet operators are required to submit their application for liquor licence over the counter. — Filepic
“The freeze lasted for six months, affecting business on the retail and supply side. It is unfair to tar the whole industry with the same brush just because of an irresponsible few,” said Lam.
Instead, effort should have been channelled to awareness campaigns on responsible drinking as well as mechanisms to encourage private driver and e-hailing services, he said.
With regards to timelines, StarMetro upon checking DBKL’s website found that any application for a new licence, change of ownership or location has to be submitted not later than four weeks from the date of the Excise Licensing Board meeting and the application to renew the licence shall be not later than four weeks before the expiry date.
Applicants must also attend Customs and the police screening interview when required to do so or within 14 days after an application is submitted.
A query has also been sent to DBKL concerning the frequency and dates of its Excise Licensing Board to which the public relations team said that a reply would be forthcoming at a later date.
