Section 2: Regulatory requirements for licensees

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Please note that this guide does not replace the law. Please consult the LLCA, the regulations and the standards and requirements established by the AGCO Registrar to ensure understanding all responsibilities and obligations that come with holding a Convenience Store Licence .

The LLCA and its regulations set out the rules for liquor in a number of areas, including:

  • Rules regarding the purchase, sale, display, delivery and storage of liquor
  • Licences (including classes, sub-classes, and endorsements) and the conditions that licensees must follow
  • Regulatory oversight activities
  • Social responsibility measures
  • Transition of licensees into the new licensing regime

Licence holders should refer to the three regulations under the LLCA that are applicable to their licence:

Permitted Products and Packaging Requirements

Convenience store licensees must purchase all liquor from the LCBO.

If a convenience store licensee purchases containers of liquor that are packed together for consumer sale, the licensee must sell the liquor in that packaging. Convenience store licensees are permitted to sell beer, ready-to-drink beverages and cider with an alcohol content that is no greater than 7.1% by volume.

Convenience store licensees are permitted to sell wine, other than cider, with an alcohol content that is no greater than 18% by volume. Additionally, convenience store licensees are permitted to sell wine to which an alcoholic distillate (fortified wine) has been added, provided that the alcohol content is less than 18% by volume.

Beer, wine (including cider) and ready-to-drink beverages kept for sale, offered for sale, or sold must not be in a container with a volume of more than 5 litres. 

Permissible Retail Sale Hours

See Hours for Liquor Sale, Service and Delivery.

While convenience store licensees may choose to further limit the hours of beer, wine (including cider) and ready-to-drink beverage sales, store licensees must ensure that beer, wine (including cider) and ready-to-drink beverages are not made available to customers outside of the permissible hours. In addition to not selling outside of the permissible hours , store licensees may choose to lock the refrigerators in which the products are located, create a partition around the display aisles, or lock the point-of-sale system to disallow the sale of beer, wine (including cider) and ready-to-drink beverages outside of the permissible hours. Convenience store licensees have the flexibility to determine how best to meet this requirement in their store environments .

Some convenience stores may also have general hours of operation that are outside the permissible hours of sale (e.g. a 24-hour store), however they are only permitted to sell in-store, allow in-store pickup and perform deliveries of liquor within the permissible hours. 

Product Display and Storage Requirements

Ontario has established specific product display requirements, including requirements to display products made by small manufacturers. Criteria for these small manufacturers can be found in O. Reg. 746/21. The LCBO product catalogue is available to assist in selecting products that align with these requirements.

It is the convenience store licensee’s responsibility to properly display the beer, wine (including cider) and ready-to-drink beverages that are offered for sale. Energy drinks and products that would promote the immoderate consumption of liquor (e.g. beer pong kits) cannot be displayed immediately adjacent to liquor.

Regarding liquor product display, licensees must also ensure the following:

  • That at least 20% of the containers of beer on display are containers of beer produced by small breweries.
  • That at least 20% of the containers of cider on display are containers of cider produced by small cideries.
  • That at least 10% of the containers of wine, excluding cider, on display are containers of wine produced by small wineries.
  • That at least 20% of the containers of ready-to-drink beverages on display are containers of ready-to-drink beverages produced by small breweries, small distilleries or small wineries. 

Additionally, at least 40% of containers of wine, excluding cider, on display in convenience stores must be containers of wine that is produced using grapes from a single country and in respect of which at least one of the following criteria is met:

  1. The wine is quality assurance wine.
  2. The wine was produced by a small winery.
  3. The country where the grapes were grown produces, in the aggregate, less than 150 million litres of wine annually from grapes grown in that country.

Beer, wine (including cider), and ready-to-drink beverage inventory that is not on display for sale to customers must be stored in a secure storage area that is not accessible to the public. 

Dealing with Manufacturers or their Representatives

Convenience store licensees are prohibited from directly or indirectly requesting, demanding, or receiving a financial or non-monetary benefit in Ontario or any other jurisdiction from a liquor manufacturer or from a person acting on the manufacturer’s behalf, including a benefit requested, demanded or received in exchange for the provision of shelf space at the store or product listing of the manufacturer’s liquor or for any merchandising, marketing or promotional opportunities.

Convenience store licensees are also prohibited from entering into an agreement with a liquor manufacturer if the agreement restricts the manufacturer’s ability to sell its liquor in other stores. 

Convenience store licensees are also prohibited from entering into an agreement with a liquor manufacturer that guarantees the provision of shelf space at the convenience store for a product listing for the manufacturer’s liquor or that guarantees any merchandising, marketing, or promotional opportunities.

Prohibited Brands

A convenience store licensee must not offer a brand of liquor for sale at its store if the licensee or any of its affiliates has a direct or indirect financial interest in the brand or a trademark under which the brand of liquor is marketed.

Loyalty Points or Reward Programs

Convenience stores can offer loyalty or rewards points for the purchase of beer, wine (including cider), or ready-to-drink beverages, as long as the points are applied equally to all these products (i.e., no extra points for specific brands are allowed). The points should not be used to specifically encourage the purchase of alcohol.

Points must be applied equally to all alcohol products purchased (i.e., no extra points for specific brands are allowed) and rewards for the purchase of alcohol or the redemption of rewards cannot be subject to special offers or bonuses (i.e. extra points as an inducement for buying alcohol is not permissible). 

This requirement applies to all forms of points or rewards issued by a loyalty or rewards program, including coupons, tickets, points or other rewards.
 

Cross Promotions and Advertising

Convenience store licensees cannot offer free or discounted merchandise that requires the purchase of beer, wine (including cider) or ready-to-drink beverages. For example, a store cannot offer a promotion where a free or discounted snack item is available to customers who purchase beer, wine (including cider) or ready-to-drink beverages. 

Other products may be displayed within the contiguous product display areas if they are displayed by the licensee for the purpose of cross-promotion with liquor (beer, wine (including cider) or ready-to-drink beverages) . However, energy drinks or products that promote the immoderate consumption of liquor are not displayed immediately adjacent to liquor.

Convenience store licensees cannot advertise or promote liquor or its availability unless the advertising is conducted in accordance with Standard 2.1 of the Registrar’s Standards for Grocery and Convenience Stores. For more details on how to advertise or promote liquor, convenience store licensees should also consult the Guide for Grocery Store and Convenience Store Licensees: Advertising and Inducements. 

Sampling

Licensed convenience stores are not permitted to offer samples of beer, wine (including cider) or ready-to-drink beverages to customers. 

Conducting Delivery of Online Orders

Convenience store licensees can  deliver  their liquor products for a fee and any liquor ordered must be supplied from the licensee’s inventory that is stored at the convenience store. 

Posting Licence

Convenience store licensees must post their convenience store licence in a conspicuous place in the store. For example, posting the licence at a customer service counter or a selected checkout aisle that is in a conspicuous place are acceptable options.

Ontario Deposit Return Program (ODRP)

Convenience store licensees are not required to accept empty containers or provide refunds on those containers under the Ontario Deposit Return Program. However, beginning on October 31, 2024, convenience store licensees are required to post the nearest location or locations where empty containers can be returned.

Signage Requirement — Warning Sign for Consumption of Liquor During Pregnancy

Licensed convenience stores must display a sign warning that drinking alcohol during pregnancy can cause birth defects and brain damage to a baby. (also known as “Sandy’s Law” signs). The sign is required to be prominently displayed in a location where liquor is purchased (e.g., cash register). For more information and to download a copy of the sign, please see Signage Requirement – Warning Sign for Consumption of Liquor During Pregnancy

Remaining an eligible business

Even after you start selling liquor in your convenience store, you must continue operating as a convenience store, meeting all the regulatory requirements, including offering a range of food products for sale. The food products offered for retail sale must take up at least half of your retail floor space. This excludes prepared foods that can be eaten on site and liquor that is sold for retail.