Is Paying a Cover Charge for Live Music at Bars and Restaurants Mandatory?

O entertainment cover charge is a fee charged by bars, restaurants and other venues that offer live music or artistic performances. This fee is meant to pay the artists and cover the costs of the performance.

Common as it is, the cover charge still raises plenty of questions: is it mandatory? How much can be charged? If you want to know more, keep reading this article to understand these points and learn the benefits of adding live music to your bar or restaurant's lineup.

Is the charge mandatory for the end customer?

The entertainment cover charge is not mandatory for the customer. Brazil's Consumer Protection Code establishes that paying it is optional — in other words, the customer has the right to choose whether or not to pay the fee.

For the entertainment cover charge to be valid, the establishment must follow the rules recommended by Abrasel (the Brazilian Association of Bars and Restaurants): inform the customer about the charge clearly and visibly, in an easily accessible place (such as at the entrance, on the menu or on the table); tell the customer the cover charge amount before they order; and pass the full amount on to the artist or group responsible for the performance.

But watch out: the venue cannot charge customers for recorded music. So if the music playing comes from a playlist, for example, no charge can be applied — that's what the law says.

A cover charge may only be applied when there are live performances, such as voice-and-guitar sets, bands and stand-up comedy, among others. In other words, you cannot charge for playing recorded music or showing sports matches.

André Panerai, owner of the bar Jangal in Belo Horizonte (Minas Gerais), follows the rule of posting a notice at the entrance of his venue about the cover charge. “When it comes to the charge, we have an individual card where we add the amount for the performance.”

He also comments on how customers receive the fee. “Not many customers ask to have the fee taken off the card, but there's always an exception. Anyway, people do have that right”.

And how much can the venue charge as a cover?

The establishment is responsible for deciding how much to charge for the entertainment cover charge, based on the type of performance, its length and the artist. So, the amount varies, but it must be disclosed to the customer in advance, following the rules above.

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The benefits of having music in your venue

Many bars and restaurants offer live entertainment to boost foot traffic and keep customers ordering for longer. Essa prática tem diversos benefícios para os negócios, como:

1. More customers: concerts and performances can draw different audiences. Building a varied lineup is a good strategy for catering to a range of tastes.

2. A different atmosphere: the acts can make the atmosphere more pleasant and reinforce the establishment's concept, increasing how long people stay and encouraging customers to order more.

3. Standing out from the competition: a special lineup is a way to give your customers a distinctive experience and stand out from other venues.

4. Extra revenue: the establishment can charge customers an extra amount and, in doing so, create an additional revenue stream.

So building a special lineup and investing in live entertainment is an excellent strategy for driving traffic to your bar or restaurant and increasing your revenue.

By applying the tips in this article, you'll be able to apply the entertainment cover charge without any friction with your customers and deliver a distinctive experience — which is essential to your business's success.

*Author: Carolina Cerqueira, of the Abrasel News Agency