The fees charged to licensed sex shops by Westminster City Council are set to drop and licensees could benefit from significant refunds following a landmark judgement in the High Court on 16th May. As reported in the February issue of ETO, earlier this year a group of licensed sex shop owners mounted a legal challenge against Westminster City Council and the annual licence fees it charges – £29,102 per year per outlet, the highest in the UK.
The fee had been set at £29,102 in 2005/6 but the council had failed to determine a fee for any subsequent years, contrary to the Local Government (Miscellaneous Provisions) Act 1982. The Council argued that the sum set was a rolling annual fee but Mr Justice Keith disagreed.
The store owners also claimed that Westminster City Council was using the licence fees for purposes other than administration – in effect profiting from the fees. The Council responded by claiming that the majority of the annual licence fee income was spent on prosecuting and closing unlicensed shops. But Mr Justice Keith said that licence fees should only reflect administrative costs, the costs of vetting the applicants and the costs of investigating their compliance – and that the costs of enforcement should come from general funds rather than licensing fees. Accordingly the claimants were entitled to be credited with the enforcement costs for the licensing years 2010-2011, 2011-2012 and 2012-2013.
Westminster City Council said it intends to appeal against the judgement.
More details on this case will be included in the June issue of ETO.