"It's a real shame the legislation doesn't allow for anything in terms of flexibility," he said.
"It's going to be disappointing and frustrating for them on the night but unfortunately there's nothing we can do about it on that occasion.
"We tried. For every other occasion during the season we're covered and there will be no problem."
Liquor laws require special licences to serve liquor at venues such as McLean Park be lodged at least 20 days before the event.
Hawke's Bay Rugby Union lodged applications for licences for all this season's ITM Cup home matches on July 28, which the Napier District Licensing Committee said in a ruling was "outside the required filing time" for the August 22, event by one working day. Mr Bishop said the ground bars would be open on the night but would only sell non-alcoholic refreshments, he said.
"We were intending to promote the game as a family-friendly game anyway, with the aim of testing the temporary seating put up for the upcoming test [between the All Blacks and Argentina on September 6].
"In those areas where there are families we'd prefer for them not to have alcohol anyway."
Mr Bishop said talks had been held with Napier City Council and police to try to find a solution but without success.
Napier Mayor Bill Dalton said the council's hands were tied because the licence application was lodged late.
"You just have to abide by the rules," he said.
"As somebody who enjoys an occasional drink, I don't think it's absolutely essential that people have to drink during a rugby match.
"You can have a drink before and after.
"I know it's an important part of the occasion for some and I'm sure the rugby union will in future ensure they get their application in on time," Mr Dalton said.
"There's an assumption, from applicants for these special licences, particularly from sporting organisations, that there is flexibility in the rules and we can bend the rules for some. There is no flexibility in the rules."
The Magpies open their ITM Cup campaign against the Tasman Makos in Blenheim tomorrow.