What is the difference between a licensee and a permittee?

• A. A licensee holds the operating license; a permittee holds a permit for specific activities under the license.
• B. A permittee has a full license; a licensee has no license.
• C. They are the same thing.
• D. A licensee must always own the business; a permittee does not.

Answer: (A)

The main idea is that a license is the ongoing permission to operate and sell in general, while a permit is a more limited authorization for a specific activity under that license. A licensee is the person or entity that holds the operating license and is responsible for overall compliance and the business's authorization to conduct its activities. A permittee, on the other hand, is the person or entity that is granted permission to carry out a particular activity under that license—often tied to a specific location, event, or time frame.

For example, a restaurant might have a standing license to sell alcohol. If they host a private event in conjunction with that license, they may obtain a permit for that event to allow serving alcohol at that particular time and place. The permittee is the party authorized to conduct the event under the licensee’s umbrella, and must follow the terms of that permit, while the licensee remains the overall holder of the license and responsible for compliance.

This is why the other statements don’t fit: a permittee does not hold a full license, and they are not the same as the licensee; ownership of the business isn’t the defining factor—the license vs. permit relationship is.