1. (a) As used herein, the following words and terms, when used in this section, shall have the following meanings, unless the context clearly indicates otherwise.

   1. (1) Happy hour--Any promotional scheme for the sale of alcoholic beverages for sale at a reduced price or prices.
   2. (2) Permittee or licensee--A holder of a permit or license issued by the commission, which allows on-premise consumption of alcoholic beverages, and includes any agent, servant, or employee of either a permittee or a licensee.
2. (b) No "happy hour" promotion may be offered or advertised after 11:00 p.m. on any day of the week.

3. (c) Except as provided in subsection (d) of this section, the following rules shall apply.

   1. (1) No permittee or licensee shall sell or serve, offer to sell or serve two or more open containers of alcoholic beverages for the price of one such container of alcoholic beverages, or for the price of any number of containers of alcoholic beverages less than the number offered, sold or served.
   2. (2) Except as specifically authorized by this rule, no permittee or licensee shall serve more than one alcoholic beverage in a business day at no charge to any general segment of the population; provided, however, it shall not be construed as preventing the permittee or licensee from giving, without prior advertising, an alcoholic beverage to individual customers celebrating their weddings, birthdays, anniversaries or similar events in a situation where the providing of an alcoholic beverage at no charge would be in conformity with normal business practices.
   3. (3) No permittee or licensee shall sell or offer to sell any alcoholic beverages at a price fixed on an "all you can drink" basis.
   4. (4) No permittee or licensee shall sponsor, join in the sponsorship of or allow any person on the licensed premises to sponsor, conduct, or participate in any game or contest to be determined on the basis of the number of servings of an alcoholic beverage or beverages consumed or where alcoholic beverages or reduced-priced alcoholic beverages are awarded as prizes.
   5. (5) No permittee or licensee shall increase the volume of alcohol contained in a drink without increasing proportionally the price regularly charged for the same type of drink, including beer and wine.
   6. (6) No permittee or licensee shall assess an entry fee, door charge, cover charge, or buy-in related to the reduced price of an alcoholic beverage. Such assessments shall be presumed to be related to reduced prices on alcoholic beverages if they coincide with the lower drink price promotion unless the reduced price promotion is regularly and uniformly carried on when no assessment is levied. An entry fee, door charge, cover charge or buy-in may not be levied or increased to more than the amount charged prior to the reduced prices of alcoholic beverages. Assessments may still be made for the cost of entertainment, food specials or for any other purpose not connected with reduced alcohol prices and may run concurrently with reduced prices on alcoholic beverages.
   7. (7) No permittee or licensee shall deliver more than two drinks to any one person at one time during a period of reduced drink prices.

4. (d) The rules set out in subsection (c) of this section are not to be applied in circumstances where:

   1. (1) the permittee or licensee has entered into an agreement under the terms of which all or a portion of the licensed premises are utilized for a private party, a meeting of a particular organization, or an event sponsored by a specifically identified group of individuals; or
   2. (2) a caterer's permit is used for a private party, a meeting of a particular organization, or an event sponsored by a specifically identified group of individuals.

5. (e) Nothing in subsection (c) of this section shall be construed to prohibit any permittee or licensee from:

   1. (1) offering free or reduced-price food or entertainment at any time, provided the offer is not based on the purchase of an alcoholic beverage;
   2. (2) including one alcoholic beverage as part of a meal package;
   3. (3) including one alcoholic beverage as part of a hotel/motel package;
   4. (4) holding wine tastings with prior approval of the commission;
   5. (5) selling or delivering wine by the bottle or carafe; or
   6. (6) selling pitchers of beer or other beverages (or the equivalent, including, but not limited to, buckets, carafes, or bottles of alcoholic beverages) which are sold in such manner and delivered to two or more persons at one time.
6. (f) No licensee or permittee shall advertise or promote in any way, within or without the licensed premise, any of the practices prohibited under subsection (c) of this section.
7. (g) Violation of any provision of this section shall be grounds for denial, suspension or cancellation of a license or permit.

8. (h) Some specific practices which shall be considered as violation of this rule are listed below. This list is intended to enumerate some of the most common practices and is neither meant to be exclusive in its content nor to infer that any practice not listed here is legal:

   1. (1) sale of two for one; or any multiple drinks for the price of one;
   2. (2) "doubles" for the price of singles;
   3. (3) ladies nights (where ladies drink free or for a reduced price);
   4. (4) one price, all you can drink;
   5. (5) covers, door charges, or a buy-in for penny drinks or drinks for "any coin";
   6. (6) promotions in which the purpose is to encourage customers to drink to excess. An example of such promotions are drink prices contingent on the amount of alcohol consumed by an individual. Any of the practices listed in subsection (e) of this section are not promotions in which the specific purpose is to encourage customers to drink to excess.

Source Note:The provisions of this §45.103 adopted to be effective August 6, 1990, 15 TexReg 4203; amended to be effective December 20, 1994, 19 TexReg 9597.