So, you’ve decided to take the plunge and are buying a restaurant. Congratulations! But the reality is that buying and setting up a restaurant is not always a simple task. Without a comprehensive understanding of the legal issues when buying a restaurant, it can be a costly exercise and one that ultimately ends up as a failed business venture. As a restaurant owner, you will mostly likely be involved in tasks such as designing a menu, choosing the décor, hiring and training staff, managing financial accounts and ensuring a high standard of customer service. But what are the legal issues you must account for when buying a restaurant? At the end of the day, you are running a business, which warrants certain legal requirements that must be met.
Licensing, Qualifications and Permits
It is important that you ensure you have obtained the appropriate business licensing requirements within the state you wish to buy your restaurant.
Food Business License
Firstly, you must get the correct business license from your local council. Depending on the category your food business falls into (E.g. Restaurant, Hotel, Bakery etc.) different rules and regulations apply. Each state dictates their own food business classifications so it is advised that you visit the appropriate website provided below to check which classifications apply to your restaurant:
- NSW – http://www.foodauthority.nsw.gov.au
- ACT – http://health.act.gov.au/c/health?a=sp&did=10192956
- VIC – https://www2.health.vic.gov.au/public-health/food-safety
- QLD – http://www.health.qld.gov.au/foodsafety/
- SA – http://www.health.sa.gov.au/pehs/food-index.htm
- WA – http://www.public.health.wa.gov.au/2/786/3/food_informatio.pm
- TAS – http://www.dhhs.tas.gov.au/peh/food_safety
Remember, each council implements different licence costs and processing times so it is best you check with your local council when applying.
Food, Health and Safety Regulations
Under the Australian New Zealand Food Standards Code (FSANZ) and Food Act 2003 (NSW), restaurant businesses must satisfy the food and safety regulations. For instance, a common storage requirement for restaurants is storing meat products like beef and chicken in a cold chamber storing unit. You must ensure that you meet these food, health and safety regulations in operating your restaurant.
Food Safety Supervision
It is also a legal requirement in many Australian states, namely NSW, VIC, ACT, SA and QLD, to have a Food Safety Supervisor available at all times. A Food Safety Supervisor is an individual who has the required training, qualification and registration to operate the restaurant. Such an individual could either be a current employee or an external contractor and is responsible for compliance with all food safety regulations during the operation of your restaurant.
Through the Registered Training Organisation (RTO), the Food Safety Supervisor must complete the online or classroom training provided. The training program must be specific to the restaurant business you are in (Retail & Hospitality, Food Processing, Transport & Distribution or Health & Community) and the relevant state.
If you want to enable customers to dine outside, you must provide appropriate tables and chairs on a footpath. Café owners may also be required to obtain an outdoor dining licence from the relevant local council.
Another legal issue is if your restaurant will be providing alcohol service to its customers. You must refer to the relevant Office of Liquor in your state. If your restaurant is in NSW, for example, you must submit your alcohol license application to the NSW Office of Liquor Gaming and Racing. It is also important for all the employees who will be serving alcohol to have the required Responsible Service of Alcohol certificate (RSA).
In relation to training your staff, you are legally required to provide proper training that covers both basic training and food safety, and food handling. Training programs come in many forms and it is up to you to decide in which method to train staff, i.e. online, classroom, manuals and in-house training.
Remember that buying and running a successful restaurant is not only for the love of food, but is first and foremost a business. It is crucial that you comply with all the legal requirements and regulations within the relevant state or territory. Various legal issues such as food, health and safety requirements and licenses/permits are vital when buying a restaurant. All these considerations can be extremely difficult without the proper business and legal experience and it is strongly recommended that you speak to a lawyer after considering the above factors.
A business lawyer at LegalVision will gladly assist you with buying a restaurant, so do not hesitate to call us 1300 544 755.