By Madla S.B. No. 1346
75R5085 BEM-D
A BILL TO BE ENTITLED
1-1 AN ACT
1-2 relating to requirements for ownership interest in a business that
1-3 is the holder of an alcoholic beverage permit or license.
1-4 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-5 SECTION 1. Section 102.01, Alcoholic Beverage Code, is
1-6 amended by amending Subsection (c) and adding Subsection (l) to
1-7 read as follows:
1-8 (c) Except as provided by Subsection (l), no [No] person
1-9 having an interest in a permit issued under Subtitle A, Title 3, of
1-10 this code may secure or hold, directly or indirectly, an ownership
1-11 interest in the business or corporate stocks, including a stock
1-12 option, convertible debenture, or similar interest, in a permit or
1-13 business of a permittee of a different level who maintains licensed
1-14 premises in Texas.
1-15 (l) A business entity that is owned in whole or in part by
1-16 another business entity that owns a direct or indirect interest in
1-17 an entity that is the holder of a nonresident seller's permit may
1-18 own a minority equity interest in an entity that is the holder of a
1-19 retail permit or license under Chapter 25, 28, 32, or 69 if:
1-20 (1) no person who acts or serves as an officer,
1-21 director, or employee of the retail permit or license holder serves
1-22 as an officer, director, or employee of the holder of the
1-23 nonresident seller's permit or any entity substantially controlled
1-24 by the holder;
2-1 (2) the retail permit or license holder serves brands
2-2 of beer, wine, and distilled spirits other than the brands produced
2-3 by the holder of the nonresident seller's permit;
2-4 (3) the retail permit or license holder's purchases of
2-5 the brands of alcoholic beverages produced or distributed by the
2-6 holder of the nonresident seller's permit constitute not more than
2-7 25 percent of the retail permit or license holder's total alcoholic
2-8 beverage purchases in any month; and
2-9 (4) the commission or administrator determines, after
2-10 investigation, that the direct or indirect relationship between the
2-11 holder of the nonresident seller's permit and the holder of the
2-12 retail permit or license:
2-13 (A) is not being used to exclude any alcoholic
2-14 beverage not produced or distributed by the holder of the
2-15 nonresident seller's permit from being sold on the premises of the
2-16 retail permit or license holder; and
2-17 (B) does not result in unfair competition or
2-18 unfair trade practices.
2-19 SECTION 2. Section 102.04(b), Alcoholic Beverage Code, is
2-20 amended to read as follows:
2-21 (b) Except as permitted in Sections [Section] 23.01 and
2-22 102.01(l) of this code, no person to whom this section applies may:
2-23 (1) have a direct or indirect interest in the
2-24 business, premises, equipment, or fixtures of a mixed beverage
2-25 establishment;
2-26 (2) furnish or lend any money, service, or other thing
2-27 of value to a mixed beverage permittee or guarantee the fulfillment
3-1 of a financial obligation of a mixed beverage permittee;
3-2 (3) enter or offer to enter into an agreement,
3-3 condition, or system which in effect amounts to the shipment and
3-4 delivery of alcoholic beverages on consignment;
3-5 (4) furnish, rent, lend, or sell to a mixed beverage
3-6 permittee any equipment, fixtures, or supplies used in the selling
3-7 or dispensing of alcoholic beverages;
3-8 (5) pay or make an allowance to a mixed beverage
3-9 permittee for a special advertising or distributing service, or
3-10 allow the permittee an excessive discount;
3-11 (6) offer to a mixed beverage permittee a prize,
3-12 premium, or other inducement, except as permitted by Section
3-13 102.07(b) of this code; or
3-14 (7) advertise in the convention program or sponsor a
3-15 function at a meeting or convention or a trade association of
3-16 holders of mixed beverage permits, unless the trade association was
3-17 incorporated before 1950.
3-18 SECTION 3. Section 102.07(a), Alcoholic Beverage Code, is
3-19 amended to read as follows:
3-20 (a) Except as provided in Subsections (b) and (d) of this
3-21 section, no person who owns or has an interest in the business of a
3-22 distiller, brewer, rectifier, wholesaler, class B wholesaler,
3-23 winery, or wine bottler, nor the agent, servant, or employee of
3-24 such a person, may:
3-25 (1) except as provided in Section 102.01(l), own or
3-26 have a direct or indirect interest in the business, premises,
3-27 equipment, or fixtures of a retailer;
4-1 (2) furnish, give, or lend any money, service, or
4-2 thing of value to a retailer;
4-3 (3) guarantee a financial obligation of a retailer;
4-4 (4) make or offer to enter an agreement, condition, or
4-5 system which will in effect amount to the shipment and delivery of
4-6 alcoholic beverages on consignment;
4-7 (5) furnish, give, rent, lend, or sell to a retail
4-8 dealer any equipment, fixtures, or supplies to be used in selling
4-9 or dispensing alcoholic beverages, except that alcoholic beverages
4-10 may be packaged in combination with other items if the package is
4-11 designed to be delivered intact to the ultimate consumer and the
4-12 additional items have no value or benefit to the retailer other
4-13 than that of having the potential of attracting purchases and
4-14 promoting sales;
4-15 (6) pay or make an allowance to a retailer for a
4-16 special advertising or distribution service;
4-17 (7) allow an excessive discount to a retailer;
4-18 (8) offer a prize, premium, gift, or similar
4-19 inducement to a retailer or to the agent, servant, or employee of a
4-20 retailer.
4-21 SECTION 4. The importance of this legislation and the
4-22 crowded condition of the calendars in both houses create an
4-23 emergency and an imperative public necessity that the
4-24 constitutional rule requiring bills to be read on three several
4-25 days in each house be suspended, and this rule is hereby suspended,
4-26 and that this Act take effect and be in force from and after its
4-27 passage, and it is so enacted.