Unfair Sex Shop Licences

A previously unknown group, Large Cause Ltd (Licensed Adult Retail Group Encourage Councils Abolish Unlicensed Sex Establishments) have been successful in their application before a district judge to issue a summons against Ann Summers Ltd for trading without a sex establishment licence under the Local Government (Miscellaneous Provisions) Act 1982 at their Brewer Street shop in London's Soho.

Large Cause was created as a fighting platform to try and encourage local councils to adopt a uniform approach to the licensed sex shop industry, and to encourage them to enforce the 1982 act.

Ann Summers now face a criminal prosecution and have to enter their plea on the 14 October at 2pm.

The move follows a number of complaints earlier this year to local councils across the country from a number of licensed sex establishments, who contended that Ann Summers were operating unlawfully across the country.

Licences are required where a significant degree of sex related articles are for sale – a term that has not yet been definitely defined by the courts.

Complaints to local authorities alleged that the majority of products on sale and for display within the Ann Summers shops consisted of sex related articles requiring a licence – an assertion rejected by all the local authorities who inspected their local outlets. Where there was any dispute, councils reported that the chain was happy to reduce the amount of merchandise on sale to an acceptable level.

The prosecution also follows calls for councils to reduce their sex establishment licence fees. Whilst councils have a wide discretion in setting their fees providing they do not profit from doing so, these range from a few hundred pound a year to more than £30,000 a year in some areas. Licensed operators have criticised chains such as Ann Summers for being able to operate without this additional administrative and financial burden.

A representative from Large exclusively told Licensing News that the group wanted to also see the Act used against retailers trading under council's radars by not attempting to be licensed: Ann Summers are our prime concern because they are the most visible, but there are many more. Almost every UK-based sex product website trades unlicensed and every party planner should have an individual licence as their income is derived from sex articles to a significant degree. We know councils have no real interest in any of this, but they are accountable and should act.

City centre sex shops claim Nottingham's Ann Summers store should be subject to licensing conditions.

There are no age restrictions on who can enter the shop in Smithy Row – which sells goods ranging from lingerie to sex toys and softcore 18 rated adult DVDs [Many high street shops sell lingerie and 18 rated DVDs. Some sell a few sex toys as well).

Yet similar stores such as The Adult Gift Shop in Goose Gate, Hockley, and The Private Shop, in Upper Parliament Street, have to apply for an expensive annual licence to trade, which includes a condition that they enforce a strict over 18 policy.

Licences are required where a significant degree of sex related articles are for sale – a term not yet defined by the courts. Each licensing authority determines its own interpretation.

Local sex stores claim Ann Summers is over what they would expect is the threshold. It comes as an Ann Summers store in Soho, London, faces private prosecution for trading without a sex establishment licence under the Local Government (Miscellaneous Provisions) Act 1982. They are due to enter a plea on October 14.

Marilyn Hawkes, owner of The Adult Gift Shop said: It is a gripe among a lot of stores. There are quite a few stores across the country involved in checking Ann Summers shops in their local area. We went out to check the Nottingham one. That's when we realised that they were selling a lot more sex items than they were two to three years ago. I don't think the council realise the level of teenagers and people who go in to Ann Summers with buggies. They don't necessarily see it as a problem. They don't look at it in the same way as they do with our store. But children could pick something off the shelf that they shouldn't be exposed to.

Mrs Hawkes said Ann Summers was also allowed to have a prime city centre location next to the Council House – yet licensed stores were not allowed in that area. Mrs Hawkes added that licences cost £6,500 a year, but Ann Summers did not have this administrative burden.

A spokesman for Nottingham's The Private Shop said: It is something I have never understood because it always appeared to us that no one ever seemed to be bothered about Ann Summers (not having a licence).

A spokesman for Nottingham City Council said: There would appear not to be widespread public concern about this issue as we have received only one complaint, in January 2009, from a company claiming that Ann Summers was illegally trading as a sex shop. We have been taking a view, on a case by case basis, on whether a significant degree of sex related articles are for sale. We visited the premises earlier this year and we are satisfied that the local branch does not need a sex establishment licence.

Bournemouth trading standards and licensing officers have taken part in a day of enforcement against four premises in the town to investigate whether they are selling sufficient sex articles to warrant a sex shop licence.

They visited Chez L'Amour at the Triangle, 18+ on Holdenhurst Road, Blue Bazaar on Christchurch Road and Ann Summers on Commercial Road, which all currently trade without sex establishment licences on the basis that they do not offer a significant degree of sex articles.

But licensed sex shop owners, who pay thousands of pounds for a licence, allege these shops are effectively unlicensed sex shops and have urged the council to investigate.

It comes at a time when a group called Large Cause Ltd (Licensed Adult Retail Group Encourage Councils to Abolish Unlicensed Sex Establishments) is taking legal action against Ann Summers Ltd on the same grounds.

In a statement, Ann Summers said they had had direct communication with Bournemouth council and been told they were not in breach of licensing laws. Chief executive Jacqueline Gold said: Allegations made against us are wholly unsubstantiated and we are confident the courts will find that there is no case to be answered.

And Jason Sherratt, owner of Chez L'Amour, said: My shop's a bit of both. I have a selection of normal DVDs and some other little novelties as well as some adult material. I wouldn't say I'm a full-on 'explicit' shop, so we just have a sign on the door warning people that there are adult things inside.

Senior licensing officer Sarah deBruin said the law was vague when it came to ascertaining exactly what was a sex shop. The definition of a significant degree of sex articles has never been tested in the courts but recent legal advice provided for Leeds City Council suggested the threshold could be placed at just 10 per cent.

Officers' findings from their visits will be reported to a private meeting of the council's licensing board on November 3. Councillors will then decide whether there is any evidence to prosecute any of the businesses and whether they want to pursue this.

A sex shop owner has been ordered to pay almost £11,000 after refusing to get a licence from the council.

Martin Hale was taken to court by Southampton City Council when he ignored warnings that he needed to renew a licence for his Adult Gift Shop in Howard Road.

Hale challenged whether his shop came within the definition of a sex shop, denying that he needed a sex establishment licence.

But District Judge Calloway, sitting at Southampton Magistrates' Court, ruled he had no doubt in his mind that the premises were a sex shop.

Hale admitted three offences of trading without a licence. He was sentenced to fines totalling £6,000 and ordered to pay £4,973 costs.

The council charges a £7,500 fee for sex shop licence applications.

Hale has now applied for a licence which is due for consideration at a meeting next month.

Pressure group, Large Cause, represents licensed sex shops who feel that expensive licenses are an unfair when competing with unlicensed shops selling similar lines. The group took legal action against Ann Summers suggesting that one representative Ann Summers store should be licensed too.

The claim by Large Cause that the Ann Summers store in Brewer Street, Soho, should be required to apply for a sex shop licence culminated in a two day hearing at the City of Westminster Magistrates Court, London, on February 11th.

Large Cause Ltd, which stands for Licensed Adult Retail Group Encourage Councils Abolish Unlicensed Sex Establishments, now faces legal costs of £100,000.

District Judge Michael Snow rejected the private prosecution on three separate points – but they were related to who was bringing the prosecution and their reasons for doing so, rather than the nature of the case.

He told the parties: The motivation behind this prosecution appeared to be profit rather than upholding the law. And to allow this matter to proceed would be an affront to justice.

An application for costs has been made by Ann Summers legal team and this will be heard on March 3rd.

Sex shop owners have won a High Court victory over licensing fees which could see them claw back an estimated £1 million.

A judge has ruled that Westminster City Council unlawfully used licence fee income to enforce against illegal sex shops. Mr Justice Keith declared that a recently introduced European directive did not permit the determination of a reasonable licence fee to include the costs of enforcement.

Tony Devenish, the council's Cabinet member for licensing and public health, spouted:

Naturally we are disappointed at this decision, which we intend to appeal.

Westminster City Council has always maintained that the use of licence fee income to enforce against illegal sex shops is a proper use of public money, protecting the quality of life for our residents and visitors, including the global reputation of London.

Enforcing against the illegal sex trade actually benefits those who are legitimate operators in the sex industry.

With millions of extra visitors about to descend on London to celebrate the Jubilee and Olympics, it is critical people see the best face of our city.

The landmark ruling was a victory for Simply Pleasure Ltd and six other long-standing licensees of 11 sex shops in London's Soho and two others in Covent Garden and the West End selling adult sex toys, DVDs, and books and magazines.

The judge said that in the past the cost of enforcing the licensing system was often reflected in the licence fee. But in 2009 new regulations were introduced to implement EU Directive 2006/123/EC, which was aimed at creating a free and competitive market for services within the European Union.

The judge said that whatever domestic law had permitted in the past, the directive did not allow the licence fee to exceed the administrative costs covering the steps which an applicant for a licence has to take if he wishes to be granted a licence or to have his licence renewed. The judge said:

The fact that the council has preferred over the years to use the licence fee to charge the operators of sex establishments for enforcing the system does not affect the proper interpretation of the 2009 regulations.

For all these reasons, therefore, I have concluded that since the year beginning February 1 2010 the council has not been permitted, when determining the reasonable licence fee for sex establishments, to reflect the fee which it determines the costs of enforcing the system.