Scottish hospitality "circuit break" lockdown confirmed

Breaking news – our guidance note on the October Scottish hospitality lockdown has been updated constantly and takes into account publication of the new Regulations and updated Guidance from Scottish Government as of 12 October 2020. If you have any questions then please do get in touch with one of the team.

On Wednesday 7 October 2020 the First Minister announced significant and wide ranging restrictions on the hospitality industry in an effort to slow the spread of COVID-19. These restrictions, amounting to a hospitality lockdown for large swathes of Scotland and an almost complete alcohol ban for on sales premises, take effect from 6pm this Friday 9 October 2020 and will last until at least Sunday 25 October 2020 (inclusive).

You can read the First Minister’s speech here and view The Health Protection (Coronavirus) (Restrictions and Requirements) (Additional Temporary Measures) (Scotland) Regulations 2020 (“the Regulations”) here. 

The impact of these new restrictions were significant and devastating news for many hospitality businesses. In this briefing, we will try to unpick the key elements such as the issues around licensed cafes and hotel premises as well the ability to provide takeaway and home delivery facilities.

The Regulations which give legal effect to the new lockdown were fast-tracked through the Scottish Parliament in a matter of hours, having been first published around 12.15pm, and commenced as of 6pm on Friday 9 October 2020. The lockdown does not affect retail or off-sale premises and is focused on “hospitality” premises such as restaurants, cafes, bars, public houses, and hotels (referred to as “hospitality premises” in the Regulations) as well as snooker halls, bingo premises and so on.

The impact of the new hospitality lockdown depends on where the premises are situated in Scotland.

The Scottish Government has constantly updating its own Guidance in the days around the lockdown commencing – three variations were published in just over 24 hours, so please continue to visit our website to keep abreast of changes.

Central belt

The Central belt, broadly speaking, is the area from the west coast to east coast capturing the cities of Glasgow and Edinburgh and everywhere in between. The local authority areas affected are noted below. The First Minister provided an explanation that, owing to the significantly higher levels of infection in the central belt area, stricter restrictions are being applied. These are:

• All licensed premises (with the exception of licensed cafes albeit without alcohol service) must close to the public during this lockdown. From the First Minister’s comments, the Scottish Government has moved away from trying to categorise premises in this regard by offering definitions of what a pub might be in comparison to a restaurant, and instead the Regulations have regard to the presence of a premises licence or occcasional licence offering on-sales under the Licensing (Scotland) Act 2005.
• Only parts of a licensed premises where food and drink are served have to close. For example, a visitor attraction with a licensed restaurant could open albeit the restaurant would need to close.
• Unlicensed premises may remain open during this period from 6am to 6pm. We are unaware of how or why an unlicensed premises is deemed suitable to open while a licensed premises, such as a restaurant, with no alcohol sales is required to close. This means that fast food type premises (without a premises licence) will remain open during the lockdown.
• There is an exemption in relation to food and drink in cinema auditoriums – affected premises should contact us for specialist advice.
• Premises may continue to offer takeaways, home deliveries and off-sales in line with existing permissions. This provision appears not dissimilar to the position from March to mid-July when certain restaurants and bars were closed, but offered takeaway facilities or “click and collect” for customers at the front door. Bars, restaurants and so on may therefore offer a takeaway, click and collect, or home delivery service, including alcohol if their licence permits it, and following the existing licensing rules and Covid-19 regulations on social distancing and use of masks etc.
• There is a limited exemption for meals and non-alcoholic drinks for residents in hotels and other accommodation that may have a premises licence. Meals and non-alcoholic drinks may be served in the hospitality areas of the hotel between 6am and 10pm. Room service can take place at any time and room service can include alcohol. Residents can drink alcohol in their rooms.
• Wedding receptions and funeral purveys are exempt from these requirements and alcohol can be served, with the terminal hour being 10pm subject to any existing licensed permissions, and up to a maximum capacity of 20 persons at the event.  For the avoidance of doubt, snooker / pool halls, indoor bowling alleys, casinos, and bingo halls must close.
• Licensed cafes (with no sale or consumption of alcohol) may remain open. A café is defined as “an establishment whose primary business activity, in the ordinary course of its business, is the sale of non-alcoholic drinks, snacks or light meals, which may be consumed on the premises.”.  It has been made clear by the First Minister that the Scottish Government is of the view that a minority of licensed premises will benefit from this exemption. It is clear that the premises’ existing operation must conform with this definition. It has been suggested by the First Minister that where there is doubt then advice should be sought from local authority Environmental Health Officers.

The First Minister was adamant that it “is a definition based on what a cafe already does. It doesn’t allow a restaurant to now turn itself into a cafe.”

The Government Guidance states:

Q. How do I know if I can define my business as a café?
A. You should consider the following key questions: a) do you serve alcohol only without food to customers?; b) does your normal hours of operation extend to 20:00?; c) do you have a range of menus (an evening menu)?  If any of these apply then you are not a café within the definition set out in the regulations.

If you are unclear on whether your premises is allowed to open please contact us to discuss the matter.

Outwith the central belt 

Unlike the central belt, licensed premises can open, albeit subject to additional trading restrictions outlined below. A key message is that serving alcohol will be prohibited during this period inside hospitality premises so although premises in, for example, Aberdeen or Inverness, may be open up to 6pm, alcohol cannot be provided at all indoors. Alcohol may continue to be served outdoors in licensed areas until 10pm in accordance with licensing and covid legislation.

Local rules apply here – if your licence or street café permit has a condition for an external area restricting trade till 8pm (for example), then you must still observe that. As above, there will be exceptions to this prohibition on serving alcohol indoors for “significant life events” such as wedding receptions and funeral purveys.

A key element of the hospitality lockdown for premises outside the central belt is a uniform further restriction of trading hours allowed:

• All indoor hospitality must close between 6pm and 6am (hotels serving meals to residents will be exempt).
• Hospitality premises may therefore open between 6am and 6pm provided that no alcohol is served indoors.
• There is a special rule for food and drink in cinema auditoriums – affected premises should contact us for advice.
• The rule of six people from two households still applies.
• There is a limited exemption for meals and non-alcoholic drinks for residents in hotels and other accommodation that may have a premises licence. Meals and non-alcoholic drinks may be served in the hospitality areas of the hotel between 6am and 10pm. Room service can take place at any time and can include alcohol. 

Financial assistance for affected premises

This hospitality lockdown will undoubtedly have a significant adverse impact on the majority of hospitality premises. Even for premises outside the central belt, there will be questions over whether it is at all viable to attempt to trade without the ability to sell alcohol and until only 6pm. The First Minister confirmed that there will be financial assistance available to hospitality businesses, with a fund of £40million seemingly set aside for this purpose and it has been confirmed by the Scottish Wholesale Association that wholesale businesses, part of the supply chain so sorely affected by this, will be able to make a claim. Find out more about the funding.

The UK Government has also just revealed plans for a targeted furlough scheme for the hospitality industry but this will not start until the beginning of November 2020.

Evidence base

Many clients have asked us about the policy rationale and evidence base behind the hospitality lockdown. The Scottish Government released an “Evidence Paper” just prior to the First Minister’s announcement in Parliament.

A key element of the paper is to seek to justify the targeting of the hospitality sector. In answering questions, the First Minister pointed to the detail that approx. 1/5 of people who contracted Covid-19 told the Test and Protect system that they had been in some form of a hospitality premises. However, that group of people will also have been in other settings and contexts during the relevant period – shops, public places, family homes, workplaces, at the school gates and so on.

In addition, there appears to be no way of knowing what proportion of the 1/5 visited a licensed premises as the definition of hospitality premises includes unlicensed cafes. The popularity of high street coffee shops will inevitably contribute to the numbers recorded yet the restrictions announced today are more onerous on licensed premises.

What this means is that the Scottish Government cannot point to a causal link between hospitality and the transmission of the disease. Both the First Minister in her announcement, and the Deputy First Minister in subsequent press briefings, have confirmed this. The First Minister therefore sought to fortify the policy position by indicating that “good common sense” suggested that licensed premises were subject to prevailing features which would make transmission easier such as the fact they are spaces where people meet, which might have poor ventilation and she highlighted the impact of alcohol on decision making. The Evidence Paper says this: 

“The risks in hospitality are exacerbated by some behaviours. As people will generally visit with family or friends they will naturally be less concerned about distancing and this behaviour will also be influenced by the disinhibiting impact of alcohol.”

It is our view, however, that this position appears not to have taken into account the mitigating factors that hospitality have put in place both voluntarily and as required through law and guidance, and have gone to extreme lengths to put into place. Some reference to international evidence such as studies from the US appears to us to be capable of criticism as the measures in place in Scottish and UK venues were not in place at equivalent US premises when those studies were undertaken.

There is a general assumption in the Scottish Government Evidence Paper that social distancing is impaired as a result of alcohol consumption and therefore hospitality premises are risky. This assumption is not, it seems to us, balanced against numerous other factors which are at play now:

• Covid-secure risk assessments and protocols
• reduced capacities
• requirement for table service
• wearing of masks
• sanitation stations and regular deep-cleans;
• the reduced times currently in force over which people might enjoy themselves by having a drink or two,
• the general ability of experienced people in hospitality to manage their own customers sensibly.

The licensing solicitors here at TLT will keep you updated with developments once the full regulations are published, but until that time we have produced a list of FAQs in order to try to deal with some of the initial queries and concerns which are arising.

End note: local authorities within the central belt

City of Glasgow, Clackmannanshire, East Ayrshire, East Dunbartonshire, East Renfrewshire, East Lothian, Edinburgh City, Falkirk, Inverclyde, Midlothian, North Ayrshire, North Lanarkshire, Renfrewshire, South Ayrshire, South Lanarkshire, Stirling, West Dunbartonshire and West Lothian.