Not every member of a Louisiana LLC is required to submit a Schedule A when the entity applies for an ATC liquor permit — and understanding exactly who is required to file is one of the most practically important questions in structuring a multi-investor restaurant group. Under Louisiana ATC regulations, members who own less than 5 percent of the LLC are not required to submit a Schedule A at all. Beyond that threshold, the ATC further limits the disclosure requirement to members who are actually involved in decision-making — and also retains the authority to designate any three members for Schedule A submission when it determines that is appropriate. These three distinct provisions, read together, give restaurant groups with multiple investors meaningful flexibility. Ignoring any one of them — or misapplying them — creates compliance exposure from the day the application is filed.

What the Schedule A Is and Why It Matters

Every Louisiana ATC permit application requires disclosure of who is behind the applying entity. For LLCs, this is done through the Schedule A — the form that identifies members, their ownership percentages, and who exercises control over the licensed premises. The ATC uses Schedule A submissions to conduct background investigations and fingerprinting, and to determine whether the individuals identified meet Louisiana's suitability requirements for holding an alcohol permit.

For a two-or-three member LLC, this process is straightforward. Every member files, every member is fingerprinted, and the ATC reviews everyone's background. For a restaurant group capitalized by a dozen or more investors — some active, most passive — the question of who must file and who is exempt becomes a deal-structuring question with real consequences.

The 5 Percent Ownership Threshold

The first and clearest exemption is based on ownership percentage. Members of the applying LLC who own less than 5 percent are not required to submit a Schedule A. This is not a discretionary waiver — it is a threshold built into the ATC's requirements. A passive investor who holds a 3 percent or 4 percent interest in the LLC does not file, does not get fingerprinted, and is not subject to the ATC's background investigation as part of the permit application.

For restaurant groups with many investors, this provision is significant. A venture capitalized by 20 individuals, most of whom hold small percentages, may have only a handful of members above the 5 percent threshold. Those sub-5 percent investors can be told honestly — and correctly — that the ATC permit application does not require them to submit to fingerprinting. That is a real and valuable selling point when raising capital for a new restaurant concept.

The Decision-Maker Designation: Above 5 Percent, But Not All Members

For members who own 5 percent or more, the analysis doesn't end with the ownership percentage. The Louisiana ATC further limits the Schedule A requirement to those members who are actually involved in decision-making for the licensed premises. A member above the 5 percent threshold who is a purely passive investor — someone who contributed capital and receives distributions but plays no role in the operational or management decisions of the business — is not necessarily required to file a Schedule A.

What "involved in decision-making" means in practice is that the ATC is focused on the people who actually run the business: who sets operational policy, who hires and fires, who makes choices about alcohol service and compliance. Those are the individuals whose suitability the ATC needs to evaluate. A passive equity holder above 5 percent who has no governance role is a different category from the managing members who are running the restaurant day to day.

This distinction needs to be reflected in the LLC's operating agreement. If a member above 5 percent is characterized as a passive investor with no decision-making authority, that characterization needs to be accurate and documented. An operating agreement that gives all members voting rights over operational decisions — even as a formality — undercuts the argument that those members are not "involved in decision-making" for Schedule A purposes.

The ATC's Discretionary Authority to Designate Any Three Members

Separate from the ownership threshold and the decision-maker standard, the ATC also retains the authority to designate any three members of the LLC for Schedule A submission. This is a discretionary tool the ATC can use in complex ownership situations — and it functions differently from the other two provisions.

The ownership threshold and decision-maker provisions operate as applicant-side exemptions: the LLC can apply them in preparing its application. The ATC's designation authority operates as a regulator-side tool: the ATC identifies which three members it wants to investigate and requires those three to submit. The ATC may use this authority when it has questions about the actual control structure of an entity, when a complex ownership arrangement warrants deeper scrutiny, or when the applicant's own Schedule A submissions raise issues the ATC wants to examine further.

For applicants, this means the 5 percent threshold and decision-maker exemptions reduce the number of members who must file — but they don't eliminate the ATC's ability to require additional disclosure if the ATC determines it is warranted. Applicants who structure their ownership to exploit the thresholds in ways that don't reflect the actual control of the business are taking a risk that the ATC's designation authority will be used to look more carefully at what is actually happening.

Why LLC Structure and Operating Agreements Must Be Built Around These Rules

The three-prong Schedule A framework — the 5 percent threshold, the decision-maker standard, and the ATC's designation authority — doesn't work in isolation from how the LLC is structured. The operating agreement needs to accurately reflect who has decision-making authority. Ownership percentages need to be set with the 5 percent threshold in mind. The individuals who will be identified as decision-makers on the Schedule A need to be suitability-clear — any prior conviction, prior license revocation, or other disqualifying factor in those individuals can jeopardize the entire application.

The right time to work through this is before the LLC is capitalized and the operating agreement is finalized — not after the investors are committed and the application is being prepared. Restructuring an LLC's ownership or governance after investors are in place is difficult, and attempting to do so in response to ATC questions during an application creates additional scrutiny rather than resolving it.

Amanda Butler, Esq. is listed on the National Association of Alcoholic Beverage Licensing Attorneys (NAABLA) Louisiana state page — naabla.com/louisiana — which identifies attorneys who practice specifically in alcoholic beverage licensing law. ATC licensing for multi-investor restaurant LLCs sits at the intersection of entity structuring and regulatory compliance, and it requires counsel who understands both.

Frequently Asked Questions

If an LLC member owns exactly 5 percent, do they have to file a Schedule A in Louisiana?

The exemption applies to members who own less than 5 percent. A member at exactly 5 percent is above the threshold and is subject to the Schedule A requirement if they are also involved in decision-making. Whether a member at the threshold is characterized as a decision-maker depends on the facts of their actual role and what the operating agreement provides.

How does the ATC determine who counts as "involved in decision-making" for Schedule A purposes?

The ATC looks at who actually exercises operational and management control over the licensed premises — who sets policy, who manages staff, who makes decisions about alcohol service and compliance. The operating agreement is relevant evidence, but the ATC can look beyond the agreement to the actual conduct of the business. Members who are genuinely passive investors with no governance role are in a different category from managing members, regardless of what the operating agreement says about them.

Can the ATC require a Schedule A from a member who owns less than 5 percent?

The sub-5 percent threshold is a regulatory exemption — not an absolute bar on ATC inquiry. The ATC's authority to designate any three members for Schedule A submission is a separate tool. Whether the ATC would use that designation authority to reach below the 5 percent threshold in a specific case depends on the circumstances and what the ATC's review of the application reveals.

What happens if one of the designated Schedule A members has a disqualifying background?

A disqualifying background in any member required to file a Schedule A can result in permit denial. For multi-location restaurant groups, a denial based on a key decision-maker's background affects every location simultaneously. Confirming the suitability of every member who will file a Schedule A — before the application is submitted and before the LLC is fully capitalized — is one of the most important steps in ATC licensing for a new restaurant venture.

If you're structuring a restaurant venture with multiple investors and you need an ATC permit, the time to think about Schedule A is before the LLC is formed — not after the application is filed. BLG handles ATC licensing for Louisiana restaurant groups. Schedule a consultation.