Item - 2026.EC30.6

The Executive Director, Municipal Licensing and Standards recommends that:

1. City Council amend the definition of an Entertainment Establishment/Nightclub in Toronto Municipal Code, Chapter 545, Licensing to add that, “Despite Subsections A and B, a premises with an occupant load of under 151 people shall not be deemed an Entertainment Establishment/Nightclub and will instead be licensed, based on its operations, as an Entertainment Place of Assembly, Eating or Drinking Establishment, or Expanded Activity Eating or Drinking Establishment for the purposes of this Chapter”.

2. City Council request the Chief Planner and Executive Director, City Planning work with the Executive Director, Municipal Licensing and Standards to strengthen alignment of business licensing and zoning regulations for Entertainment Establishment/Nightclubs and assess and consult on potential zoning changes to address implementation challenges.

3. City Council direct that Recommendation 1 come into effect on September 30, 2026.

In April 2026, as part of an update on the City’s Business Licence and Permit Applications Action Plan (2026.EC27.1), City Council directed Municipal Licensing and Standards (MLS) to report back to the June meeting of the Economic and Community Development Committee with any recommended changes to the definition of an Entertainment Establishment/Nightclub in Toronto Municipal Code, Chapter 545, Licensing (the Licensing Bylaw).

Nightclub regulations were last updated in 2023 during the City’s Night Economy Review (2023.EC8.13), with modernized licensing and zoning regulations for bars, restaurants, and entertainment venues coming into effect on January 1, 2025. Over the first year of implementation, staff identified opportunities to further refine and review regulations, including for nightclubs.

Staff have initiated a broader implementation review of licensing and zoning regulations for nightclubs to address implementation challenges and respond to stakeholder feedback. This work includes reviewing the specified criteria of a nightclub in the licensing definition, how nightclubs are differentiated from other licence categories, and zoning requirements. Staff plan to report back on outcomes of this work in 2027 as part of the next update on the City’s Business Licence and Permit Applications Action Plan (2025.EC22.7).The objectives of this implementation review are to support business growth and focus enforcement resources on operators that present with high nuisance and safety risks. The longer-term next step of the implementation review will be to consult with industry stakeholders on potential updated regulations.

While the implementation review progresses, staff are recommending an immediate amendment to the licensing definition of an Entertainment Establishment/Nightclub to reduce regulatory burden on small capacity entertainment venues that are currently captured under the nightclub licensing category. Enforcement data shows that these venues have demonstrated lower nuisance and safety impacts compared to larger capacity nightclubs.

This report recommends amending the definition of an Entertainment Establishment/ Nightclub in Toronto Municipal Code Chapter 545, Licensing to only apply to venues with an occupancy load of more than 150 people. Entertainment businesses with an occupant load of 150 or fewer will instead be licensed under a different existing entertainment category (likely Expanded Eating or Drinking Establishment or Entertainment Place of Assembly licence, depending on business operations). This change aligns with MLS’ activity-based licensing framework, introduced through the Night Economy Review. Under this framework, select establishments with higher potential safety or nuisance impacts determined by their activities (e.g. liquor service and late operating hours) must meet additional licensing requirements.

This report was prepared in collaboration with Economic Development and Culture, Toronto Fire Services, City Planning, and Toronto Building.

There are no current year or future year financial impacts resulting from the recommendations contained in this report.

The Chief Financial Officer and Treasurer has reviewed this report and agrees with the financial implications as identified in the Financial Impact Section.