Repurchasing of Product from Retailers

On March 18, 2020, Governor Abbott issued a press release that “directed the TABC to waive certain provisions to allow manufacturers, wholesalers and retailers of alcohol beverages to repurchase or sell back unopened product.”  In response, the TABC posted a Repurchasing of Product From Retailers section  on the Coronavirus Information page on its website and subsequently issued an Industry Notice dated March 19, 2020 addressing the matter.

TABC states certain manufacturers, distributors, wholesalers, and package stores with local distributors permits may repurchase unused/unopened alcoholic beverage products from retailers under the following conditions:

  • Repurchases must be limited to relieving a retailer adversely affected by major event cancellation due to the coronavirus;
  • Wholesalers may only consider repurchasing for sales made to a retailer on or after 2/16/20;
  • Wholesalers must verify each repurchase using the original purchase invoice;
  • Wholesalers must maintain invoices in case of subsequent audits; and
  • Wholesalers have complete discretion to determine whether to repurchase product from a retailer.

The temporary waiver applies to distributors, wholesalers, and package stores with local distributor permits that hold any of the following licenses or permits:

  • General Distributor’s License (BB)
  • Branch Distributor License (BC)
  • Wholesaler’s Permit (W)
  • Wholesaler’s (General Class B) Permit (X)
  • Local Distributor’s Permit (LP)

Curiously, the following manufacturers permits and licenses, which authorize sales directly to retailers, were left off the list, even though the Governor’s press release and Commissions’ guidance both include mention of applicability to manufacturers:

  • Brewer’s Self-Distribution Permit (DA)
  • Manufacturer’s Self-Distribution License (DB)
  • Brewpub License (BP) if the holder is qualified to self-distribute its products; and
  • Winery Permit (G)

MFH has contacted TABC to request confirmation that its guidance applies to self-distributing manufacturers, also. We will send additional information as we receive it.

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