Do I Need a New Business Licence After Buying a Business in BC?

You have bought a business, or you are about to, and the sign on the door and the licence on the wall still carry the seller's name. It is natural to ask whether you can simply keep operating or whether you need to apply for your own licence.

In British Columbia, municipal business licences are handled by each city or district, so the answer is not the same everywhere. This article explains how to approach the question, which related approvals do have set steps, and what to do before you open under new ownership.

This article covers the law of British Columbia.

Does the municipal business licence carry over?

Municipal business licensing is handled at the local level, and how it applies to your business depends on where you operate, so it is worth confirming with the municipality or a lawyer. Because the rules differ from one municipality to the next, there is no single answer for the whole province. Some places may treat a change of owner as a new application, while others may handle it differently. The licensing office can tell you which applies to you.

How you buy matters too. If you buy the business's assets, you are usually a different operator from the seller. If you buy the shares of the company that holds the licence, the licence holder may be the same company as before. Even so, a change in ownership or contact details is something a city may want to know about. Ask the licensing office to confirm rather than assuming.

How to apply or update in your city

Start with the website or counter of the city or district where the business is located. Most municipalities have a business licence or bylaw services department. Ask these questions before closing, not after:

• Does the existing licence transfer, or must the new owner apply fresh?
• What documents and fees are required, and how long does approval usually take?
• Does the premises need zoning, fire or health sign-off for a change of operator?
• Will the licence name, address or business name need to change?

Get the answers in writing where you can, and keep them with your closing documents.

What if you operate before the licence is issued?

The consequences of operating without a required municipal licence are set by each municipality's bylaw, and they can include fines or orders to stop operating. Because they vary, ask the licensing office what applies. If timing is tight, ask whether the city will confirm in writing that you may operate while your application is processed, and build that into your closing plan.

Other licences and registrations that do have set steps

A business licence is only one item. Some other approvals have defined rules for a purchase, and they are separate from the municipal licence.

• Liquor licence: the current licensee starts the transfer in the liquor and cannabis licensing portal by submitting the buyer's business name and email address, and the buyer is then notified to proceed.
• The buyer needs a 9-digit CRA Business Number registered to the new licence applicant and a Business BCeID to access the portal.
• The buyer submits the Personal History Summary form (LCRB004), a sample sign, any other documents required for the business type, and the $330 application fee.
• The establishment can stay open during the application, and the seller remains responsible for the licence until the LCRB tells both parties the application is administratively complete, at which point the buyer becomes the deemed licensee.
• An expired liquor licence cannot be transferred, so renewal must be kept current before closing.
• PST: a purchaser buying a business, or goods, software or an interest in a business in a bulk transaction, should obtain a PST clearance certificate, and if the purchaser does not, they are liable for an amount equal to any outstanding amount owed by the collector.

What to do next

• Find out which city or district licenses the premises and contact its business licence office.
• Ask whether the licence transfers, and what the application involves for a new owner.
• Confirm whether the deal is an asset purchase or a share purchase, since this can affect who the licence holder is.
• If the business holds a liquor licence, check that it is current and plan the transfer steps around closing.
• Have a lawyer review the purchase agreement so licensing conditions are built into closing.

Frequently asked questions