General Credit Law Information

The Credit Law section of the Compliance Department is responsible for compiling and publishing the Credit Law Delinquent List, as required by Section 102.32 of the Alcoholic Beverage Code and Chapter 45.121 of the TABC Rules. "Credit Law" applies to the terms under which liquor (distilled spirits, wine, & malt liquor, but not beer) is sold from a wholesaler to a retailer.

• If a retailer becomes delinquent, the wholesaler must report this to the Texas Alcoholic Beverage Commission. The TABC compiles and publishes the Credit Law Delinquent List twice a month, listing all retailers who are delinquent.
• While a retailer is delinquent NO sales or deliveries may be made to that retailer on or after the effective date of the list, even if the order was taken prior to the effective date. The retailer's buying privileges may resume only when all delinquencies are paid and the TABC's records are cleared.
• No wholesaler is required to sell liquor on credit to a retailer. However, if credit is extended by a wholesaler, it may only be extended in accordance with the provisions of the law. Briefly, on purchases made from the 1st through the 15th day of a month, payment must be made on or before the 25th of that month. On purchases made from the 16th through the last day of a month, payment must be made on or before the 10th day of the following month.
• To speed the loading and printing of the Complete Credit Law Delinquent List, the list has been split into four segments in alphabetical order by trade name. A through E, F through L, M through R, and S through 9. Please note that trade names beginning with numeric characters (1,2,3…0) appear at the end of the list.
• The CLP No./Related column displays the Class License Permit (CLP) account that is on the delinquent list over the "Related" CLP that placed them on the list. The "Related" CLP appears in parenthesis and italic print. An asterisk (*) that appears next to the "Related" CLP indicates that there are multiple related delinquent accounts. Example: (P 123456*). An account is not released from the delinquent list until all "Related" accounts have been released.

TEXAS ALCOHOLIC BEVERAGE CODE EXCERPT

Sec. 102.32. Sale of Liquor: Credit Restrictions.

 (a)   In this section:
   (1)   "Wholesale dealer" means a wholesaler, class B wholesaler, winery, wine bottler, or local distributor's permittee.
   (2)   "Retailer" means a package store, wine only package store, wine and beer retailer's, wine and beer retailer's off-premise, or mixed beverage permittee, any other retailer, or a private club registration permittee.
   (3)   "Month" means a calendar month.
 (b)   No wholesale dealer may sell and no retailer may purchase liquor except for cash or on terms requiring payment by the retailer in accordance with Subsection (c) of this section.
 (c)   On purchases made from the 1st through 15th day of a month, payment must be made on or before the 25th day of that month. On purchases made on the 16th through the last day of a month, payment must be made on or before the 10th day of the following month.
 (d)   Each delivery of liquor shall be accompanied by an invoice giving the date of purchase. If a retailer becomes delinquent in the payment of an account for liquor, the wholesale dealer immediately shall report that fact in writing to the commission or administrator. No wholesale dealer may sell any liquor to a retailer who is delinquent until the delinquent account is paid in full and cleared from the records of the commission. An account becomes delinquent if it is not paid when it is required to be paid under Subsection (c) of this section.
 (e)   A wholesale dealer who accepts a postdated check, a note or memorandum, or participates in a scheme to assist a retailer in the violation of this section commits an offense.
 (f)   The commission shall adopt rules and regulations to give effect to this section.

TABC ADMINISTRATIVE RULES EXCERPT

45.121. Credit Restrictions and Delinquent List for Liquor.

 (a)   Purpose. This rule implements §§102.32, 11.61(b)(2), and 11.66 of the Texas Alcoholic Beverage Code (Code).
 (b)   Definitions.
   (1)   Alcoholic beverage--As used in this section includes only liquor, as that term is defined in §1.04 of the Code.
   (2)   Cash equivalent--A financial transaction or instrument that is not conditioned on the availability of funds upon presentment, including , money order, cashier's check, certified check or completed electronic funds transfer.
   (3)   Delinquent payment--A financial transaction or instrument that fails to provide payment in full or is returned to the Seller as unpaid for any reason, on or before the day it is required to be paid by §102.32(c) of the Code.
   (4)   Event--A financial transaction or instrument that fails to provide payment to a Retailer and results in a Retailer making one or more delinquent payments to one or more Sellers.
   (5)   Incident--A single delinquent payment.
   (6)   Retailer--A package store permittee, wine only package store permittee, private club permittee, private club exemption certificate permittee, mixed beverage permittee, or other retailer, and their agents, servants and employees.
   (7)   Seller--A wholesaler, class B wholesaler, winery, wine bottler, or local distributor and their agents, servants and employees.
 (c)   Invoices. A delivery of alcoholic beverages by a Seller, to a Retailer, must be accompanied by an invoice of sale showing the name and permit number of the Seller and the Retailer, a full description of the alcoholic beverages, the price and terms of sale, and the place and date of delivery.
   (1)   The Seller's copy of the invoice must be signed by the Retailer to verify receipt of alcoholic beverages and accuracy of invoice.
   (2)   The Seller and Retailer must retain invoices in compliance with the requirements of §206.01 of the Code.
   (3)   Invoices may be created, signed and retained in an electronic or internet based inventory system, and may be retained on or off the licensed premise.
 (d)   Delinquent Payment Violation. A Retailer who makes a delinquent payment to a Seller for the delivery of alcoholic beverages violates this section unless an exception applies.
   (1)   A Retailer who violates this section must pay a delinquent amount, and a Seller may accept payment, only in cash or cash equivalent financial transaction or instrument.
   (2)   A Retailer whose permit or license is cancelled for cause, voluntarily cancelled, expires, suspended or placed in suspension while on the delinquent list will be disqualified from applying for or being issued an original or renewal permit or license until all delinquent payments are satisfied. For purposes of this section, the Retailer includes all persons who were owners, officers, directors and shareholders of the Retailer at the time the delinquency occurred.
 (e)   Reporting Violation and Payment; Failure to Report.
   (1)   A report of a violation or payment must be submitted electronically to the commission on the commission's web based reporting system at www.tabc.state.tx.us
   (2)   A Seller who cannot access the commission's web based reporting system must either:
     (A)   submit a request for exception to submit reports by paper; or
     (B)   contract with another seller or service provider to make electronic reports on behalf of the Seller.
   (3)   All reports of violations or payment under this subsection must be made to the commission on or before the date the delinquent list is published.
   (4)   A Seller who fails to report a violation or a payment as required by this subsection is in violation of this section.
 (f)   Prohibited Sales and Delivery.
   (1)   Sellers are prohibited from selling or delivering alcoholic beverages to any licensed location of a Retailer who appears on the commission's Delinquent List from the date the violation appears on the Delinquent List until the Release Date on Delinquent List, or the Retailer no longer appears on the Delinquent List.
   (2)   A sale or delivery of alcoholic beverages prohibited by this section is a violation of this section.
 (g)   Prohibited Purchase or Acceptance.
   (1)   A Retailer who violates subsection (d) is prohibited from purchasing or accepting delivery of alcoholic beverages from any source to any of Retailer's licensed locations from the date any violation occurs until all delinquent payment are paid in full.
   (2)   A prohibited purchase or acceptance of a delivery of alcoholic beverages is a violation of this section.
 (h)   Exception. A Retailer who wishes to dispute a violation of this section or inclusion on the commission's Delinquent List, based on a good faith dispute between the Retailer and the Seller may submit a detailed electronic or paper written statement with the commission with an electronic or paper copy to the Seller explaining the basis of the dispute.
   (1)   The written statement must be submitted with documents and/or other records tending to support the Retailer's dispute, which may include:
     (A)   a copy of the front and back of the cancelled check of Retailer showing endorsement and deposit by Seller;
     (B)   bank statement or records of bank showing funds were available in the account of Retailer on the date the check was delivered to Seller; and
     (C)   bank statement or records showing bank error or circumstances beyond the control of Retailer caused the check to be returned to Seller unpaid, or
     (D)   bank statement or records showing the check cleared Retailer's account and funds were withdrawn from Retailer's account in the amount of the check.
   (2)   A disputed delinquent payment will not be removed from the delinquent list until documents and/or other records tending to support the Retailer's dispute are submitted to the commission.
   (3)   The Retailer must immediately submit an electronic notice of resolution of a dispute to the commission under this subsection.
 (i)   Penalty for Violation. An action to cancel or suspend a permit or license may be initiated under §11.61(b)(2) of the Code for one or more violations of this section. The commission may consider whether the violation(s) is/are the result of an event or incident when initiating an action under this subsection.
 (j)   Delinquent List.
   (1)   The Delinquent List is published bi-monthly on the commission's public web site at http://www.tabc.state.tx.us. An interested person may receive the Delinquent List by electronic mail each date the Delinquent List is published by registering for this service online.
   (2)   The Delinquent List will be published the 5th day of the month for purchases made from the 1st to the 15th day of the preceding month, for which payment was not made on or before the 25th day of the preceding month. The Delinquent List will be published the 20th day of the month for purchases made between the 16th and the last day of the preceding month for which payment was not made on or before the 10th day of the month.
   (3)   The Delinquent List is effective at 12:01 A.M. on the date of publication.
   (4)   The Delinquent List is updated hourly to reflect reports of payments submitted.
 (k)   Calculation of Time. A due date under this section or §102.32(c) of the Code or the publication date of the Delinquent List that would otherwise fall on a Saturday, Sunday or a state or federal holiday, will be the next regular business day. A payment sent by U.S. postal service or other mail delivery service is deemed made on the date postmarked or proof of date delivered to the mail delivery service. A payment hand delivered to an individual authorized to accept payment on behalf of the Seller is deemed made when the authorized individual takes possession of the payment.