Possible methods in tobacco retail licencing
| Method | Explanation | Potential impact* |
| Increase the cost of selling tobacco | ||
| High price | A licence would be expensive for retailers. | A high price for a licence, a supervision fee and a renewal fee make selling tobacco less attractive and less affordable for retailers. Fewer retailers buy a licence which may decrease the total number of tobacco retail outlets. |
| A supervision fee | Retailers pay an additional fee to cover costs of monitoring for compliance. | |
| Renewal fee | Requirement of regular renewal of the licence, for which retailers have to pay a renewal fee. | |
| High fines for selling tobacco without a licence | Retailers pay a high fine for selling tobacco without a licence. | Fines discourage illegal tobacco sales and thereby support potential reductions in the number of tobacco retailers. |
| Criteria to purchase licence | ||
| Minimum distance to schools | Retailers are only allowed to buy a licence if they are located at a minimum distance from a school. | The average proximity of tobacco retail outlets to schools increases. This would decrease outlet density around schools. Retailers could relocate towards areas without schools, which would not reduce the total number of tobacco retail outlets. |
| Minimum distance to other retail outlets | Retailers are only allowed to buy a licence if they are located a minimum distance from an existing tobacco retail outlet. The distance may depend on the population. | Impact depends on the set distance. This may reduce the number of tobacco retail outlets in areas where the density was high (eg, city centres). In areas where density was low the impact may be minimal. Retailers could move towards lower density areas, which would not result in reducing the total number of tobacco retail outlets. |
| Licence only available for specific type of retailer | Tobacco licences are only sold to a specific type of retailer, for example, to tobacconists. | Restriction by retailer type may reduce the total number of tobacco retail outlets. There is a risk that shops will adapt their business to adhere to the definition of tobacconist. |
| Restricted number of licences based on population/area | Total number of available licences restricted to allow a maximum number of retailers per population and/or per surface area. | The total number of tobacco retail outlets reduces. |
| Methods of distributing restricted number of licences | ||
| First-come-first-serve | Licences are given out to the first N retailers annually on a set date. | Due to restricting the number of available licences, the total number of tobacco retail outlets reduces. If selection criteria are used (ie, not at random), there is a risk that criteria are not transparent or unfair. |
| Lottery | Licences are raffled to retailers that enter an annual state-organised lottery. After the first round, only licences of retailers that have stopped selling tobacco may be raffled. | |
| Auction | Licences are sold to the highest bidder in an annual state-organised auction. After the first round, only licences of retailers that have stopped selling tobacco may be auctioned. | |
| Criteria to retain licence | ||
| Regular renewal | Requirement of regular renewal of the licence, for example, annually. | Regular renewal would add to the retailer burden for sales of tobacco. |
| Compliance with point-of-sale tobacco control policies | Licence revoked when policies such as age-of-sale and display ban are violated, or after a set number of violations. | Compliance as a condition to retain the licence would improve compliance and may decrease the total number of tobacco outlets. |
*‘Potential impact’ describes the effect the licencing method may have on public health through a reduction in tobacco retail outlets.