The Fringe Festival director's application for a licence to serve alcohol until midnight during the annual arts festival was rejected due to new regulations, forcing bartenders to stop serving at 10pm.

Mr Gardner said he applied for midnight licensing for both Friday and Saturday evenings, but was shocked to be denied both.

"We were willing to cop Saturday night, because we understand it's a big day and you want to keep people safe," he said.

"The argument is that there's people drinking all day, but on Friday there aren't people drinking all day. It's a work day."

Mr Gardner said he had received support from liquor licensing staff in the Office of Regulatory Services, but believed the increasing coverage of alcohol-fuelled violence had led to "wowserism" regarding drinking.

"I find it embarrassing on a Friday night where I'm doing a big burlesque show that I cannot serve my audience a drink after 10pm, half way through my show," he said.

The Fringe Festival had previously been granted liquor licenses until midnight in 2007, 2008 and 2009, but a Justice and Community Safety Directorate spokeswoman said changes were brought in after phasing out the Liquor Act 1975 in 2010.

The spokeswoman said a 10pm restriction on liquor licenses at the Multicultural Festival was first applied in 2011, coinciding with the commencement of the Liquor Act 2010. "The 10pm restriction was not applied in 2012, consequently stall holders were provided with an opportunity to trade until midnight," she said.

"This decision created an overlap between the Multicultural Festival and the Civic night time activities. As a result, ACT Policing identified an increase in alcohol-related incidents in Civic, which prompted a request for a 10pm trading restriction for the festival in 2013."

Multicultural Festival director Nic Manikis declined from commenting.