Selling alcohol with takeout and delivery in Ontario: who is eligible and what the AGCO expects

A bottle of wine added to a Friday takeout order is one of the highest-margin items a restaurant can sell. Ontario made that permanent in December 2020, with conditions. Because the rules started life as emergency measures, a lot of the advice online is out of date. The Alcohol and Gaming Commission of Ontario (AGCO) publishes the current rules, and here is how they apply to your restaurant.

Who can sell liquor for takeout or delivery?

You need a liquor sales licence for on-premises sale, service and consumption. Convenience stores, grocery stores, department stores and big box stores, and premises inside one of those, are not eligible. The AGCO says a licence issued or transferred before 9 December 2020 is eligible if the other requirements are met. A licence issued or transferred after that date must also meet two tests: serving food and liquor for on-premises consumption must be the primary purpose of the premises, and the premises must not sit inside another commercial business, other than a shopping mall. A bar inside a hotel, or a restaurant inside a grocery store, would not qualify.

The AGCO describes its page as guidance, not a full list. The legal source is Ontario Regulation 746/21 under the Liquor Licence and Control Act, 2019, with the Registrar's standards.

What does the order have to include?

Liquor must be bought with food that you sell from the licensed premises. An order of alcohol alone is not allowed.

What are the hours?

The AGCO's December 2020 bulletin says the hours for takeout and delivery of liquor are 9 a.m. to 11 p.m. The sale and the delivery, including the customer accepting it, all need to fall inside those hours.

What must the container be like?

The bulletin replaced the early emergency wording, "sealed and unopened", with "securely closed". Read the current AGCO guidance before you start putting cocktails or draught beer into containers, because the earlier temporary rules did not allow them.

Who may deliver?

From 1 January 2021, the bulletin says delivery must be done by the licensee, an employee of the licensee or the holder of a Liquor Delivery Service Licence. Deliveries may go to a residence or other private place. The earlier temporary rules said liquor goes to the person who paid for it or another adult at the address who is at least 19, and that identification should be requested if the buyer may be under 19. Treat that as your standard.

What training is required?

Anyone who takes orders, sells, serves or delivers liquor must have completed Smart Serve. See Smart Serve for Ontario restaurant staff if your newer hires have not done it.

What records do you keep?

For orders placed directly with you, the AGCO says to keep the information for one year from the date of delivery of the liquor. Order forms and delivery receipts need specific details, and the bulletin lists them.

Can a delivery app do it?

The AGCO's emergency guidance allowed a third-party service acting on behalf of the licensee. The permanent rules require the delivery to be done by you, your employee or a licensed delivery service, so confirm with the AGCO before you put alcohol on a platform. The commission side is in Ontario delivery app commissions.

What if your licence changes hands?

The rules for takeout and delivery depend on when your licence was issued or transferred. The AGCO says a licence issued or transferred after 9 December 2020 must meet the primary purpose and no-other-business tests. So if you are buying an existing restaurant, ask the seller when the licence was issued and whether it moved after that date, and read the AGCO's eligibility page with your lawyer before you assume a takeout wine program comes with the keys.

What to do before you start

1. Confirm your licence type and issue date.
2. Read the current AGCO page and Regulation 746/21.
3. Set the cut-off at the last order that can be delivered before 11 p.m., and check your takeout packaging against the single-use plastics ban.
4. Train drivers and check age at the door.
5. Keep a one-year record, and put it where you can find it.

The wider licence picture is in Ontario liquor sales licences, and for outdoor service see serving alcohol on a patio.

More in the Canadian guides for food businesses.