Thinking about buying a restaurant? Key legal considerations to make beforehand

28 August 2026

Have you been watching some Gordon Ramsey and felt that it is your time to open up your own restaurant?

Before you start buying your knives, forks and tablecloths, there are some key legal considerations that need to be addressed.

When beginning your dream as a chef, you don’t want to look like an ‘idiot sandwich’ because you didn’t get the legalities of the purchase correct.

The structure of the sale

You must first consider if you want to buy just the business assets (brand, equipment and inventory) or if you would like to buy the entire corporate entity (buying the company).

Each of these options possess their own pros and cons, so it is imperative that aspiring business owners carefully consider which structure will work best for them and their business.

There should also be clear contractual warranties and indemnities that include clear guarantees surrounding debt-free equipment ownership, settled taxes and clean legal records.

You may also want to add restrictive covenants to stop the seller from opening a competing restaurant nearby or poaching new staff.

Due diligence is essential when beginning any purchase of a business and buying a restaurant is no different.

Employment law considerations

In many restaurant acquisitions, the Transfer of Undertakings (Protection of Employment) Regulations 2006 (TUPE) will apply.

If this is the case, the employees’ jobs will remain intact when a business changes hands and their existing contract terms will transfer to the new buyer.

This happens automatically once the sale is completed, with the employees’ continuity of service remaining intact.

It is important to remember that both the buyer and seller have the duty to inform all affected employees within the required timeframes.

TUPE restrictions can be strict, so before you decide to make any changes to contracts, it is important to consult an employment solicitor first.

Licences and compliance that you will need in place before opening

In order to serve any food out of the kitchen, you will need to register the business with the local council at least 28 days prior to opening.

You will then need to complete all appropriate training, including allergen control and staff food hygiene, to ensure that you can get that five-star food hygiene rating.

If you are planning to serve alcohol within the restaurant, you will also need to acquire a valid alcohol licence and hire a Designated Premises Supervisor who must hold a personal licence.

Considerations surrounding music should also be considered. If you wish to play any music, you will typically need to hold a PRS and PPL licence.

Restaurants also need to hold contracts surrounding trade waste and grease. This is typically mandated by the lease or local by-laws.

Licensing and planning can often cause delays if not handled early. Often, timelines can be written into contracts so that completion is dependent on approvals.

How can we help?

We understand that this may sound like a lot to digest for somebody who is new to the hospitality industry.

Our commercial property team can help you through the whole process and, when it comes to staff, our employment law team can advise you on best practice.

Don’t have a sandwich of problems, get in touch with our team for support!