In the state of Texas, you need to be certified by the Texas Alcoholic Beverage Commission in order to sell alcohol. This holds true whether you are a manufacturer of alcoholic beverages or a retailer, and it makes sense. Alcohol is an age-restricted item and an irresponsible distributor of it could end up causing harm to others. As a result, no one is surprised that there are hoops to jump through and applications to file if you want to sell alcohol.
What if you don’t plan to sell the alcohol though? What if you’re giving it away? On its face this might seem like some kind of scheme to get around regulations, but there are actually some situations in which someone without a certificate from the TABC can give away free alcohol. However, there are also some restrictions and specific guidelines to keep in mind if you don’t want to run afoul of law enforcement and regulatory agencies.
When Can You give Away Alcohol?
You can give away alcohol, but it has to be in situations where the distribution of alcoholic beverages could not possibly be seen as a transaction. This means that the alcohol is not just free, but that it’s free and that there is no expectation whatsoever that you will be getting money for it, even indirectly.
Let’s look at some examples of different scenarios and make this clearer. Let’s say that your venue is hosting an event like a wedding reception. If guests are offered free drinks, this is often fine because the guests have not paid you to be there. They have offered you no financial compensation for these beverages. If you do not accept any kind of money for this transaction, like tips or a donation, then you should be able to give away alcohol without a certificate from the Texas Alcoholic Beverage Commission.
Sometimes retail stores can also give away alcoholic beverages. However, there has to be no expectation of a sale when the beverage is offered. For example, a dress shop could give out champagne to a party that’s come in to browse their wares. What the shop cannot do is give away drinks only to those who plan to spend money. It must be a perk that the shop offers without tying it to a transaction.
On the other hand, a fundraiser or charity event is one situation in which you would usually not be able to legally give away drinks without a certificate from the TABC. This is because there is a transaction happening here, even if it isn’t one that requires someone to directly hand over cash for alcohol. According to regulations, there is not much of a difference between donating to get into an event where alcohol is served and paying directly for the alcohol itself.
The rules around this are strict and easy to run afoul of. Even having a tip jar out when you’re giving away alcohol can muddy the waters. The bottom line is that you need to ensure that no money is changing hands, even indirectly, or the Texas Alcoholic Beverage Commission is not going to be happy about it.
If You Have More Legal Questions
If you do not know if your planned event or scenario would allow you to give away alcohol without running into regulatory and legal hurdles, you may want to consult a lawyer. At BERTOLINO LLP, we have plenty of experience navigating our state’s regulatory bodies and can answer any questions that you have. Dial (512) 476-5757 and talk to our attorneys. We can help you make sure that you’re following the rules of the Texas Alcoholic Beverage Commission and that you’re not putting yourself or your business at risk.
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