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Can I offer contests that involve loyalty programs in Texas? What are the requirements?

To offer contests that involve loyalty programs in Texas, you must comply with the requirements set forth in Tex. Admin. Code §45.102. The section applies only to members of the retail and manufacturing tiers who are authorized to sell directly to consumers.

According to the section, a loyalty program is defined as a marketing program that offers certain incentives to encourage customer retention. It does not include the use of coupons. The holder of a manufacturer or wholesale tier license or permit may not directly or indirectly reimburse a retailer for a loyalty program.

Retailers and holders of a manufacturing tier licenses or permits who are authorized to sell directly to consumers may offer a loyalty program subject to the following conditions:

  1. A manufacturer authorized to sell directly to consumers may only award loyalty program purchase points, benefits, or incentives to the consumer in conjunction with transactions directly between the manufacturer and consumer. Any purchases of the manufacturer’s products through a retailer shall not be credited to the loyalty program.
  2. The loyalty program may give consumers discounts on the purchase of alcoholic beverages and on non-alcoholic beverage products or items sold directly to the consumer by the manufacturer or retailer.
  3. The loyalty program may have a point accrual and redemption component in addition to discounts. Accrued points may be redeemed on alcoholic beverages and on non-alcoholic beverage products or items sold directly to the consumer by the manufacturer or retailer.
  4. If the license or permit holder is authorized to sell alcoholic beverages for on-premises consumption, the license or permit holder may not give or offer to give the consumer any alcoholic beverage in a manner that conflicts with §45.103 of this chapter (relating to On-Premises Promotions).

Therefore, you can offer contests that involve loyalty programs in Texas as long as you comply with the requirements set forth in Tex. Admin. Code §45.102.

Jurisdiction

Texas