Caterers Beware: Advertising restrictions for special events

The holiday season is filled with special events – corporate parties, private celebrations, and the like. There are also a handful of public, reservation-required holiday parties, where a caterer is hired to provide the venue and the supply of food and beverage for these special events. The caterer, already possessing its own venue, may even see an opportunity to host its own holiday party open to the public.

A catering license issued by the State Liquor Authority authorizes the license holder to sell alcoholic beverages during a function. The alcohol must be consumed on the premises. (For example, the caterer cannot sell bottles of wine to be consumed off-premises.) The caterer benefits from more people attending the event, as greater attendance translates to more alcohol sales. The caterer, then, is directly invested in the event’s success. This might entice the caterer to help promote the event for its client, or even try to host an event on its own.

Beware of this thought trap! The SLA is very clear: The acceptance of holiday or special event reservations from the general public, or the advertising or solicitation by the caterer is not authorized by the Alcoholic Beverage Control Law. Hosting or promoting these events subjects the catering licensee to disciplinary proceedings, including civil penalties ($1,000-$10,000), license suspension, or even revocation. (Bulletin # 358, December 19, 1962).

A caterer can work the event it was hired to cater for a third party private party, but it cannot itself arrange and hold an event such as a charitable function or holiday event. It is important to keep this distinction in mind and adhere to it, especially during this season, when there are so many opportunities to take advantage of the celebratory spirit in the air.