1. (a) Each holder of a general distributor's license, local distributor's license, or branch distributor's license shall furnish a bond to insure the payment of the tax on beer imposed by the Texas Alcoholic Beverage Code, §203.01. Each holder of a brewpub license shall furnish a bond to insure the payment of the tax on beer and/or ale or malt liquor imposed by the Alcoholic Beverage Code, §203.01 and §201.42, respectively.
2. (b) Each bond shall be set by the administrator at an amount that will protect the state against the anticipated tax liability of the principal for any six-week period based on previous average beer sales or estimates of the future average volume of sales.

3. (c) Form and contents.

   1. (1) A bond required under this section must be executed with the licensee as principal, a qualified surety company doing business in this state as surety, and the state as payee. All such bonds must be payable in Travis County.
   2. (2) The bond must be conditioned as required by the administrator and must include that the licensee will account for and pay all fees and taxes levied by the Texas Alcoholic Beverage Code.
   3. (3) The form of all bonds must be approved by the attorney general of Texas.

4. (d) Bond alternatives.

   1. (1) A licensee required to furnish a bond under this section may furnish, in lieu of all or part of the amount of the bond required:

      1. (A) one or more certificates of deposit or savings assigned to the state, issued by one or more banks or savings institutions authorized to do business in this state; or
      2. (B) one or more letters of credit by one or more banks or savings institutions authorized to do business in this state.
   2. (2) If certificates of deposit or savings or letters of credit are furnished under paragraph (1) of this subsection, the administrator shall keep them in his possession. Interest earned on a certificate of deposit or savings is not subject to the assignment and remains the property of the owner of the certificate.
5. (e) A licensee is not required to furnish a bond under this section if for the preceding 36 months the licensee has filed all reports and has paid all taxes and fees required by the Texas Alcoholic Beverage Code and the commission under all licenses held by him on or before the due date.
6. (f) An exemption under subsection (e) or (h) of this section terminates and the licensee must furnish a bond if the licensee fails to pay a tax or fee imposed by the Texas Alcoholic Beverage Code on or before the due date.
7. (g) A finding of deficiency as a result of an audit does not constitute a failure to pay a tax when due, if the deficiency and any applicable penalty are paid within 10 days of the date of demand for payment by the commission.

8. (h) A licensee required to furnish a bond under subsection (f) of this section, is again entitled to exemption from the surety requirement if the licensee:

   1. (1) pays all delinquent taxes and fees and any applicable penalties; and
   2. (2) pays all taxes and fees required by the Texas Alcoholic Beverage Code on or before the due date of 18 consecutive months after the month in which the delinquent taxes and fees and penalties are paid.
9. (i) A licensee who qualifies for an exemption under subsection (e) or subsection (h) of this section or the Texas Alcoholic Beverage Code, §204.01(f), is also exempt from the bonding requirement for any other license currently held by or subsequently issued to the same licensee for use at licensed premises different from and additional to those covered by the license under which the licensee qualified for exemption. However, if a licensee fails to pay a tax or fee imposed by the Texas Alcoholic Beverage Code on or before the due date and the licensee holds multiple licenses, the requirements for a bond shall be imposed or reimposed under subsection (f) of this section only on the license covering the licensed premises for which the tax or fee and any applicable penalty were not timely paid.
10. (j) A certificate of deposit or savings furnished by a licensee under this section must be assigned to the state in a manner approved by the administrator to secure the payment of the tax.
11. (k) A letter of credit furnished by a licensee under this section must be in a form and the administrator to secure the payment of the tax.
12. (l) If another license is required, incidental to the operation of a business for which a basic license is procured, the administrator may accept one bond to support all of the licenses. The administrator shall determine the amount of the bond.
13. (m) The administrator may not cancel a surety bond until the surety company has paid and discharged in full all of its liabilities on the bond to the state as of the date of cancellation.
14. (n) For the purposes of subsection (e) of this section, the 36 months preceding the effective date of this rule shall be taken into account.

Source Note:The provisions of this §33.22 adopted to be effective May 27, 1985, 10 TexReg 1416; amended to be effective February 24, 1994, 19 TexReg 1039.