Close encounters

Paddy Whur sets out what local authorities need to know when it comes to licensing sexual entertainment venues.

In September 2008, the then Home Secretary announced the government’s intention to give local people greater say over the number and location of lap dancing clubs in their area.

Establishments such as lap dancing clubs have, until now, been licensable under the Licensing Act 2003. Therefore, their licences have been determined against the four licensing objectives. Through section 27 of the Policing and Crime Act 2009, lap dancing clubs have been reclassified as Sexual Entertainment Venues giving local authorities the power to regulate such venues under Schedule 3 to the Local Government Miscellaneous Provisions Act 1982.

A Sexual Entertainment Venue is defined as: “Any premises at which relevant entertainment is provided before a live audience for the financial gain of the organiser or the entertainer”.

The key words to be taken from this are relevant entertainment, the meaning being: "any live performance or live display of nudity which is of such a nature that, ignoring financial gain, it must reasonably be assumed to be provided solely or principally for the purpose of sexually stimulating any member of an audience (whether by verbal or other means)".

Home Office guidance states that they would expect local authorities to judge each case on its merits but that the definition of relevant entertainment would apply to the following forms of entertainment as they are commonly understood: lap dancing; pole dancing; table dancing; strip shows; peep shows and live sex shows.

In summary, Schedule 3 of the 1982 Act will allow five major changes. It will:

1. allow local people to oppose an application for a sex establishment licence if they have legitimate concerns that a lap dancing club would be inappropriate given the character of an area because, for example, if the area was primarily a residential area;
2. require licences to be renewed at least annually, at which point local people will have the opportunity to raise objections with their local authority;
3. allow a local authority to reject a licence application if it believes that to grant a licence for a lap dancing club would be inappropriate given the character of a particular area;
4. allow a local authority to set a limit on the number of sex encounter venues that it thinks is appropriate for a particular area; and
5. allow a local authority to impose a wider range of conditions on the licences of lap dancing clubs than it is currently able to under the 2003 Act.

Local authorities have not been forced to adopt these new powers, they are not mandatory. However, if not adopted by 6 April 2011, local authorities will be obliged to have a consultation in order to decide if they should. Therefore should a local authority decide to adopt these powers, it will have to publish a notice that it has passed the resolution under section 2 of the 1982 Act. If the resolution is adopted it will take lap dancing clubs and the like outside the statutory regulation of the Licensing Act 2003. Lap dancing clubs will therefore require this additional sex establishment licence as well as their premises licence.

Paragraph 12 of Schedule 3 sets out the grounds for refusing an application for the grant, renewal or transfer of a licence. It creates mandatory and discretionary grounds for refusal with very narrow appeal provisions.

Examples include:

• a licence must not be granted to a person under the age of 18 or to a body corporate which is not incorporated in an EEA State
• a licence may be refused where the number of sex establishments, or sex establishments of a particular kind, in the relevant locality at the time the application is determined, is equal to or exceeds the number which the authority consider is appropriate for that locality
• or that the grant or renewal of the licence would be inappropriate having regard to: (1) the character of the relevant locality; or (2) the layout, character or condition of the premises, vehicle, vessel or stall in respect of which the application is made.

In respect of individual merits, the decision regarding what constitutes the relevant locality is a matter for the appropriate authority; although local authorities must be aware of the R v Peterborough City Council ex parte Quietlynn 85 L.G.R. 249 case. It was found in this case that the relevant locality does not have to be a clearly pre-defined area, nor are local authorities required to be able to define its precise boundaries.

Therefore, while a local authority is not prevented from defining the exact area of the relevant locality, it is equally free to conclude that it simply refers to the area which surrounds the premises specified in the application and does not require further definition. Case law also indicates that a relevant locality cannot be an entire local authority area or an entire town or city.

Therefore, it is reasonable and potentially useful to future applicants, for the local authority to decide in advance of receiving any applications that certain areas are, or are not, appropriate locations for a sex establishment or a particular number of sex establishments.

The Home Office guidance states that objections should not be based on moral grounds and values. What are moral objections? These could consist of those who seek to object because they find lap dancing distasteful, or others who object because it is sexist and degrades women. The key case law on this issue is R v Newcastle upon Tyne City Council ex parte The Christian Association Institute [2001] B.L.G.R. 165. This case makes it clear that it would be unlawful for a local authority to refuse a licence by giving weight to a view of its own, that sex establishments should not be allowed at all.

When determining a licence application, the local authority must have regard to any rights the applicant may have under Article 1, Protocol 1 of the European Convention on Human Rights, which entitles every person to the peaceful enjoyment of their possessions and also Article 10, which gives a right to freedom of expression.

The key case law is that of Belfast City Council v Miss Behavin' Ltd [2007] UKHL 19 where the House of Lords decided that if the local authority exercises its powers rationally and in accordance with the purposes of the statutory provisions, it would require very unusual facts for it to amount to a disproportionate restriction on Convention Rights.

Another important consideration is the Provision of Services Regulations 2008, which amended Schedule 3 to the 1982 Act to state that, if having considered an application for the grant, renewal or transfer of a licence, the appropriate authority decides to refuse it on one or more of the above grounds, it must provide the applicant with reasons for the decision in writing.

Representations were made to the Government by industry representatives to exclude existing operators from the new regime, or at least to give them preferential treatment when their sex establishment licences fall to be determined for the first time. Such provisions, often referred to as ‘grandfather rights’, were made when the 2003 Act and the Gambling Act 2005 were introduced.

Similar provisions were not made for the purposes of the Policing and Crime Act so that existing operators of lap dancing clubs who wish to continue to provide ‘relevant entertainment’ should be required to apply for a new sex establishment licence in the manner set out in Schedule 3 to the 1982 Act.

There is guidance for existing operators in relation to Transitional Provisions, which allows a 12-month ‘transitional period’ which begins the date that the local authority resolves that Schedule 3 should be adopted.

In that way existing operators will be allowed to continue to provide relevant entertainment until the transitional period ends or the determination of any application they have submitted before that time, including any appeal against the refusal to grant a licence.

An authority could consider no more than one sexual entertainment venue to be appropriate. If there are already a number of venues in operation pursuant to their licences under the Licensing Act 2003 and all venues then apply for a licence under the 1982 Act then the authority can legitimately refuse all but one application for no reason other than that they would represent too many premises in that one locality.

Thought should therefore be given to the scenario that local authorities could face if all applications were received simultaneously. Here there are difficulties as the local authority will have to determine how each application should be judged and if applicants are going to be in competition with each other. The local authority would have to be very careful in its determination. This in itself could lead to litigation and problems in the future. Only time will tell as to the effect that local authority policy will have on lap dancing as and when they are adopted.

Paddy Whur is a partner and joint head of the Licensing Group at law firm Walker Morris. He can be contacted on 0113 283 2500 or by email at This email address is being protected from spambots. You need JavaScript enabled to view it..