Welcome to NALLOA Online

The National Auctioneer License Law Officials Association, or as it is more commonly known, NALLOA, has been in existence for almost 40 years.

Our organization serves as a forum of licensing board members and associate members, who communicate, endorse reciprocity and promote the common good in regulating the auction profession.

We constantly look for ways to improve reciprocity and make it easier to obtain and maintain a license in this manner.

Learn More About NALLOA »

Welcome to NALLOA Online

The National Auctioneer License Law Officials Association, or as it is more commonly known, NALLOA, has been in existence for almost 40 years.

Our organization serves as a forum of licensing board members and associate members, who communicate, endorse reciprocity and promote the common good in regulating the auction profession.

We constantly look for ways to improve reciprocity and make it easier to obtain and maintain a license in this manner.

Learn More About NALLOA »

Blog Archives

TEXAS AUCTION LAW, RULES & REGULATIONS, AND FEES

Auctioneer Law

You can download the entire Auctioneers Occupations Code document (69kb) as an Adobe PDF file, suitable for printing. Acrobat Reader is necessary to view .pdf files. If you need to obtain a copy of this program it is available as a free download for Windows or Macintosh operating systems.

AUCTIONEERS
Occupations Code
Title 11. Regulation of Sales and Solicitation
Chapter 1802
Administered by the Texas Department of Licensing and Regulation
(Effective September 1, 2015)

Table of Contents

SUBCHAPTER A. GENERAL PROVISIONS

Sec. 1802.001. Definitions
Sec. 1802.002. Applicability
Sec. 1802.003. Preemption

SUBCHAPTER B. LICENSE REQUIREMENTS

Sec. 1802.051. License Required
Sec. 1802.052. Eligibility for Auctioneer’s License
Sec. 1802.054. Application for License
Sec. 1802.055. Application for Examination
Sec. 1802.056. License Examination
Sec. 1802.058. Reexamination
Sec. 1802.059. Licensing By Reciprocity
Sec. 1802.060. Term of License

SUBCHAPTER C. AUCTIONEER ADVISORY BOARD

Sec. 1802.101. Auctioneer Advisory Board
Sec. 1802.102. Appointment of Advisory Board; Membership; Eligibility
Sec. 1802.103. Terms; Vacancies
Sec. 1802.104. Presiding Officer
Sec. 1802.106. Compensation
Sec. 1802.107. Meetings
Sec. 1802.108. Civil Liability
Sec. 1802.109. Auctioneer Education Programs

SUBCHAPTER D. AUCTIONEER EDUCATION AND RECOVERY FUND

Sec. 1802.151. Fund
Sec. 1802.152. Management of Fund
Sec. 1802.153. Additional Fees
Sec. 1802.154. Investment of Fund
Sec. 1802.155. Liability
Sec. 1802.156. Education Expenditures Permitted

SUBCHAPTER E. COMPLAINT PROCEDURES

Sec. 1802.201. Investigation of Complaints
Sec. 1802.202. Consumer Claims
Sec. 1802.203. Hearing
Sec. 1802.204. Appeal
Sec. 1802.205. Payment of Claim
Sec. 1802.206. Payment Limits
Sec. 1802.207. Reimbursement; Interest
Sec. 1802.208. Subrogation
Sec. 1802.209. Effect on Disciplinary Proceedings

SUBCHAPTER F. DENIAL OF LICENSE AND DISCIPLINARY PROCEDURES

Sec. 1802.251. Denial of Application; Suspension or Revocation of License
Sec. 1802.252. Revocation for Claim on Fund
Sec. 1802.253. Hearing By the State Office of Administrative Hearings

SUBCHAPTER G. CRIMINAL PENALTIES

Sec. 1802.301. Practicing Without License; Offense
Sec. 1802.302. Frivolous Claim; Offense
Sec. 1802.303. General Criminal Penalty

Subchapter A. General Provisions

Sec. 1802.001. Definitions.

(1) “Advisory board” means the Auctioneer Education Advisory Board.

(2) “Associate auctioneer” means an individual who, for compensation, is employed by and under the direct supervision of a licensed auctioneer to sell or offer to sell property at an auction.

(3) “Auction” means the sale of property by competitive bid using any method, format, or venue.

(4) “Auction company” means a person who engages in the business of arranging, managing, sponsoring, advertising, or conducting auctions.

(5) “Auctioneer” means any individual who   sells or offers to sell property of another person by live bid at auction, with or without receiving consideration.

(6) “Commission” means the Texas Commission of Licensing and Regulation.

(8) “Department” means the Texas Department of Licensing and Regulation.

(8-a)  “Executive director” means the executive director of the department.

(9) “Fund” means the auctioneer education and recovery fund.

(10)    “Personal property” means any property other than real property.

(11)    “Real property” means land, including improvements, fixtures, and other property appurtenant to or used in connection with the land, and any other estate, interest, or legal or equitable right in the land, improvement, fixture, or appurtenant property.

(13)    “Sealed bid auction” means a sealed bidding procedure that incorporates or allows for the competitive increasing or decreasing of bids after the opening of sealed bids.

Sec. 1802.002. Applicability.

(a) This chapter does not apply to:

(1) a sale conducted by order of a United States court under Title 11, United States Code;

(2) a sale conducted by an employee of the United States, this state, or a political subdivision of this state in the course and scope of employment;

(3) a sale conducted by a charitable, religious, or civic organization, including an organization having a tax exempt status under Section 501(c), Internal Revenue Code of 1986, or organized as a nonprofit entity, if the person organizing, arranging, or conducting the auction receives no compensation;

(4) a foreclosure sale of real property personally conducted by a trustee under a deed of trust;

(5) a foreclosure sale of personal property personally conducted by:

(A) a person who holds a security interest in the property, including a mortgage; or

(B) an employee or agent of a person described by Paragraph (A) acting in the course and scope of employment, if:

(i) the employee or agent is not otherwise engaged in the auction business; and

(ii) all property for sale in the auction is subject to a security agreement;

(6) a sale conducted by sealed bid without the option of increasing or decreasing the amount of a bid;

(7) an auction conducted only for student training purposes as part of a course of study approved by department;

(8) an auction conducted by a posted stockyard or market agency as defined by the federal Packers and Stockyards Act (7 U.S.C. Section 181 et seq.), as amended;

(9) an auction of livestock conducted by a nonprofit livestock trade association chartered in this state, if the auction involves only the sale of livestock owned by members of the trade association;

(10)    an auction conducted by a charitable or nonprofit organization chartered in this state, if the auction:

(A) is part of a fair that is organized under state, county, or municipal authority; and

(B) involves only the sale of property owned by the organization’s members;

(11)    a sale or auction conducted by an auctioneer while the auctioneer is physically located outside of this state;

(12)    a sale of motor vehicles at auction by a person licensed under Chapter 2301 or 2302;

(13)    a sale of motor vehicles at auction by a person who holds a wholesale motor vehicle auction general distinguishing number or an independent motor vehicle general distinguishing number issued by the Texas Department of Motor Vehicles; or

(14)    an auction of property through the Internet.

(b) This chapter applies to a sealed bid auction.

Sec. 1802.003. Preemption.

A political subdivision of this state may not levy on or collect from an auctioneer a license tax or fee as a regulatory or revenue measure or require the licensing of an auctioneer, if the auctioneer holds a license under this chapter and is in compliance with this chapter.

Sec. 1802.004. Advertisement of Auction.

The commission, by rule, may adopt standards for the advertisement of an auction by an auctioneer or associate auctioneer licensed under this chapter.

SUBCHAPTER B. LICENSE REQUIREMENTS

Sec. 1802.051. License Required.

(a) A person may not act as an auctioneer or associate auctioneer in this state unless the person holds a license issued by the executive director under this chapter.

(c) Except as provided by Subsection (d), an individual who is licensed under this chapter may not act as an auctioneer for an entity unless the entity:

(1) is an auction company owned or operated by an individual who is licensed under this chapter; or

(2) is a real estate brokerage firm that is operated by a broker licensed by the Texas Real Estate Commission.

(d) An individual who is licensed under this chapter may conduct an auction to sell motor vehicles, as defined by Section 501.002 or 502.001, Transportation Code, if the individual conducts the auction for a person who holds a dealer general distinguishing number or wholesale motor vehicle auction general distinguishing number issued under Subchapter B, Chapter 503, Transportation Code, or a license issued under Subchapter C, Chapter 2302, of this code.

Sec. 1802.052. Eligibility for Auctioneer’s License.

(a) An individual is eligible for an auctioneer’s license if the individual:

(1) is at least 18 years of age;

(2) is a citizen of the United States or a legal alien;

(3) either:

(A) passes a written or oral examination demonstrating knowledge of the auction business and of the laws of this state relating to the auction business; or

(B) shows proof of employment by a licensed auctioneer for at least two years and participation in at least 10 auctions during that employment;

(4) holds a high school diploma or a high school equivalency certificate;

(5) has not been convicted of a felony during the five years preceding the date of application; and

(6) has completed at least 80 hours of classroom instruction at an auction school with a curriculum approved by the department in accordance with the standards and procedures established by rule adopted under this chapter.

(b) The department, as provided by rule, may charge an auction school a reasonable fee for approving the curriculum as required under Subsection (a) (6).

Sec. 1802.053. Eligibility for Associate Auctioneer License.

An individual is eligible for an associate auctioneer license if the individual is:

(1) a citizen of the United States or a legal alien; and

(2) employed under the direct supervision of an auctioneer licensed under this chapter.

Sec. 1802.054. Application for License.

An applicant for a license must apply to the executive director on a form provided by the executive director that establishes the applicant’s eligibility for the license. The application must be accompanied by:

(1) any fee required for the auctioneer education and recovery fund authorized under Section 1802.153;

(2) the required application fee; and

(3) either:

(A) the permit number of a sales tax permit issued to the applicant by the comptroller under Subchapter F, Chapter 151, Tax Code; or

(B) proof of exemption from the tax permit requirement under Chapter 151, Tax Code.

Sec. 1802.055. Application for Examination.

An individual who establishes that the individual is eligible for an auctioneer’s license may apply to the executive director to take the license examination.  The application must be accompanied by the application fee.

Sec. 1802.056. License Examination.

(a) The license examination must be designed to establish:

(1) an applicant’s general knowledge of the auction business;

(2) the principles of conducting an auction; and

(3) the laws of this state relating to auctioneers.

(b) The license examination shall be offered at least four times each year at locations designated by the executive director.

(c) The executive director shall prepare:

(1) examinations for an auctioneer’s license; and

(2) study and reference materials on which the examinations are based.

Sec. 1802.058. Reexamination.

An applicant who fails the license examination may reapply to take the examination. If the applicant fails the examination twice during a one-year period, the applicant may not reapply for one year.

Sec. 1802.059. Licensing By Reciprocity.

(a) An applicant for an auctioneer’s license who is not a resident of this state but is licensed as an auctioneer in another state must submit to the executive director:

(1) a license application;

(2) a certified copy of the auctioneer’s license issued to the applicant by the state or political subdivision in which the applicant resides; and

(3)  proof that the state or political subdivision in which the applicant is licensed has competency standards equivalent to or stricter than those of this state.

(b) The executive director shall accept the applicant’s auctioneer’s license submitted under Subsection (a)(2) as proof of the applicant’s professional competence and waive the examination or employment and training requirements of Section 1802.052 if the state or political subdivision that issued the nonresident a license extends similar recognition and courtesies to this state.

(c) A nonresident applicant must comply with all other application requirements prescribed by this chapter.

(d) A nonresident applicant must submit with the application a written irrevocable consent to service of process. The consent must be in the form and supported by additional information that the commission by rule requires. The consent must:

(1) provide that an action relating to any transaction subject to this chapter may be commenced against the license holder in the proper court of any county of this state in which the cause of action may arise or in which the plaintiff may reside by service of process on the executive director as the license holder’s agent; and

(2) include a statement stipulating and agreeing that service provided by this section is as valid and binding as if service had been made on the person according to the laws of this or any other state.

Sec. 1802.060. Term of License.

A license issued under this chapter shall be issued for the period prescribed by the commission.

SUBCHAPTER C. AUCTIONEER ADVISORY BOARD

Sec. 1802.101. Auctioneer Advisory Board.

The advisory board shall advise the commission on educational matters, operational matters, and common practices within the auction industry.

Sec. 1802.102. Appointment of Advisory Board; Membership; Eligibility.

(a) The advisory board consists of seven members appointed as follows:

(1) four members who are licensed auctioneers appointed by the presiding officer of the commission, with the commission’s approval;

(2) the administrative head, or the administrative head’s designee, of any state agency or office that is selected by the commission; and

(3) two public members.

(b) In appointing advisory board members under Subsection (a)(1), the presiding officer of the commission shall consider the geographical diversity of the members.

(c) Appointments to the advisory board shall be made without regard to the race, color, handicap, sex, religion, age, or national origin of the appointees.

Sec. 1802.103. Terms; Vacancies.

(a) The members appointed under Section 1802.102(a)(1) serve two-year terms that expire on September 1 and may not serve more than two consecutive terms. If a vacancy occurs during the term of such a member, the presiding officer of the commission, with the commission’s approval, shall appoint a replacement to serve for the remainder of the term.

(b) The remaining members are ex officio members. Each ex officio member shall continue to serve during the time the member holds office.

Sec. 1802.104. Presiding Officer.

The presiding officer of the commission, with the commission’s approval, shall appoint a member of the advisory board to serve as presiding officer of the board. The presiding officer serves for two years and may not serve more than two consecutive terms.

Sec. 1802.106. Compensation.

A member appointed under Section 1802.102(a)(1) may not receive compensation for serving on the advisory board.

Sec. 1802.107. Meetings.

The advisory board shall meet at the call of the presiding officer of the commission or the executive director.

Sec. 1802.108. Civil Liability.

A member of the advisory board is not liable in a civil action for an act performed in good faith while performing duties as an advisory board member.

Sec. 1802.109. Auctioneer Education Programs.

(a) The advisory board shall:

(1) evaluate educational programs, seminars, and training projects; and

(2) make recommendations to the commission on their usefulness and merit as continuing education tools.

(b) On the recommendation of the advisory board, the commission may fund or underwrite specific classes, seminars, or events for the education and advancement of the auctioneering profession in this state.

SUBCHAPTER D. AUCTIONEER EDUCATION AND RECOVERY FUND

Sec. 1802.151. Fund.

The auctioneer education and recovery fund is a trust fund with the comptroller for the payment of claims against auctioneers licensed under this chapter.

Sec. 1802.152. Management of Fund.

(a) The department is the manager of the fund and shall:

(1) administer the fund without appropriation;

(2) maintain books and records as required by the executive director;

(3) appear at hearings or judicial proceedings; and

(4) invest and reinvest the fund’s assets as instructed by the executive director.

(b) The department, as manager, is entitled to compensation for reasonable and necessary costs and expenses for the management of the fund. The department shall be compensated from the earnings from the fund.

Sec. 1802.153. Additional Fees.

(a) In addition to any other fees required by this chapter, an applicant entitled to receive a license under this chapter must pay a fee before the executive director issues the license.

(b) If the balance in the fund on December 31 of a year is less than $350,000, each license holder at the next license renewal shall pay, in addition to the renewal fee, a fee that is equal to the greater of $50 or a pro rata share of the amount necessary to obtain a balance in the fund of $350,000.

(c) The fees paid under this section shall be deposited in the fund.

Sec. 1802.154. Investment of Fund.

(a) Amounts deposited in the fund may be invested and reinvested in the same manner as funds of the Employees Retirement System of Texas, and income from the investments shall be deposited to the credit of the fund.

(b) The department may not make an investment that would impair the liquidity required to satisfy payments made from the fund.

Sec. 1802.155. Liability.

(a) The fund or the department is not liable to a consumer for a recovery from the fund if the assets of the fund are insufficient to pay the amount awarded.

(b) If the fund contains insufficient assets to pay the consumer:

(1) the department shall record the time and date an order for payment to a consumer was received; and

(2) the executive director shall pay consumers for whom an order is recorded under Subdivision (1) as funds become available in the order of the recorded time and date of the order.

Sec. 1802.156. Education Expenditures Permitted.

The executive director may use amounts in excess of $300,000 in the fund to:

(1) advance education and research in the auctioneering profession for the benefit of license holders and to improve and increase the efficiency of the industry;

(2) underwrite educational seminars, training centers, and other educational projects for the use and benefit of license holders;

(3) sponsor, contract, and underwrite other educational and research projects that advance the auctioneering profession in this state; and

(4) cooperate with associations of auctioneers and other groups for the education and advancement of the auctioneering profession in this state.

SUBCHAPTER E. COMPLAINT PROCEDURES

Sec. 1802.201. Investigation of Complaints.

The executive director may, on the executive director’s motion, and shall, on the written complaint of a person aggrieved by the actions of an auctioneer in an auction, investigate an alleged violation of this chapter by a licensed or unlicensed auctioneer or an applicant.

Sec. 1802.202. Consumer Claims.

(a) A person who deals with an auctioneer licensed under this chapter and who is aggrieved by an action of the auctioneer as a result of a violation of a contract made with the auctioneer may initiate a claim against the fund by filing with the department a complaint against the auctioneer.

(b) The executive director may not pay a claim against an auctioneer who was not licensed at the time of the transaction on which the claim is based.

(c) The department shall investigate a complaint filed under this section and determine the amount owed to the aggrieved party.

Sec. 1802.203. Hearing.

If the amount determined by the department under Section 1802.202 is disputed by the auctioneer or the aggrieved party, the department shall refer the matter to the State Office of Administrative Hearings for a hearing on the disputed claim.

Sec. 1802.204. Appeal.

A party may appeal a decision of the commission in the manner provided for a contested case under Chapter 2001, Government Code.

Sec. 1802.205. Payment of Claim.

(a) If the department’s determination under Section 1802.202 is not disputed by the auctioneer or the aggrieved party, the executive director shall pay the claim from the fund, subject to Section 1802.206.

(b) If a hearing is held on the department’s determination, the executive director shall pay to the aggrieved party the amount of actual damages determined by the executive director.

(c) The amount of actual damages may not include attorney’s fees, speculative damages, or lost profits.

Sec. 1802.206. Payment Limits.

(a) The executive director may not pay a single aggrieved party more than $15,000.

(b) The total payment of all claims by more than one aggrieved party arising from one auction at one location, regardless of the length of the auction, may not exceed $30,000.

(c) The total payment of claims against a single auctioneer may not exceed $30,000.

Sec. 1802.207. Reimbursement; Interest.

(a) If the executive director pays a claim against an auctioneer, the auctioneer shall:

(1) reimburse the fund immediately or agree in writing to reimburse the fund on a schedule to be determined by rule of the commission; and

(2) immediately pay the aggrieved party any amount due to that party or agree in writing to pay the party on a schedule to be determined by rule of the commission.

(b) Payments made by an auctioneer to the fund or to an aggrieved party under this section include interest accruing at the rate of eight percent a year beginning on the date the executive director pays the claim.

Sec. 1802.208. Subrogation.

If the executive director pays a claim against an auctioneer, the department is subrogated to all rights of the aggrieved party against the auctioneer to the extent of the amount paid to the aggrieved party.

Sec. 1802.209. Effect on Disciplinary Proceedings.

(a) This subchapter and Section 1802.252 do not limit the commission’s or executive director’s authority to take disciplinary action against a license holder for a violation of this chapter or a rule adopted under this chapter.

(b) A license holder’s repayment of all amounts owed to the fund does not nullify or modify the effect of another disciplinary proceeding brought under this chapter.

SUBCHAPTER F. DENIAL OF LICENSE AND DISCIPLINARY PROCEDURES

Sec. 1802.251. Denial of Application; Suspension or Revocation of License.

The commission or executive director may deny an application for a license or suspend or revoke the license of any auctioneer for:

(1) violating this chapter or a rule adopted under this chapter;

(2) obtaining a license through false or fraudulent representation;

(3) making a substantial misrepresentation in an application for an auctioneer’s license;

(4) engaging in a continued and flagrant course of misrepresentation or making false promises through an agent, advertising, or otherwise;

(5) failing to account for or remit, within a reasonable time, money belonging to another that is in the auctioneer’s possession and commingling funds of another with the auctioneer’s funds or failing to keep the funds of another in an escrow or trust account; or

(6) violating a provision of the Business & Commerce Code in conducting an auction.

Sec. 1802.252. Revocation for Claim on Fund.

(a) The commission may revoke a license issued under this chapter if the executive director makes a payment from the fund as the result of an action of the license holder.

(b) The commission may probate an order revoking a license.

(c) An auctioneer is not eligible for a new license until the auctioneer has repaid in full the amount paid from the fund on the auctioneer’s account, including interest, unless:

(1) a hearing is held; and

(2) the executive director issues a new probated license.

Sec. 1802.253.   Hearing By State Office of Administrative Hearings.

(a) Before denying an application for a license, the commission or executive director shall:

(1) set the matter for a hearing to be conducted by the State Office of Administrative Hearings; and

(2) before the hearing date, notify the applicant in writing of:

(A) the charges alleged or the question to be determined at the hearing; and

(B) the date and location of the hearing.

(b) At a hearing under this section, the applicant may:

(1) be present and be heard in person or by counsel; and

(2) have an opportunity to offer evidence by oral testimony, affidavit, or deposition.

(c) Written notice may be served by personal delivery to the applicant or by certified mail to the last known mailing address of the applicant.

SUBCHAPTER G. CRIMINAL PENALTIES

Sec. 1802.301. Practicing Without License; Offense.

(a) A person commits an offense if the person acts as an auctioneer without a license.

(b) An offense under this section is a Class B misdemeanor.

Sec. 1802.302. Frivolous Claim; Offense.

(a) A person commits an offense if the person intends to benefit personally or to harm another and the person:

(1) institutes under this chapter a claim in which the person knows the person has no interest; or

(2) institutes under this chapter a frivolous suit or a claim that the person knows is false.

(b) An offense under this section is a Class B misdemeanor.

Sec. 1802.303. General Criminal Penalty.

(a) A person commits an offense if the person violates a provision of this chapter or a rule adopted by the commission under this chapter for which a penalty is not provided.

(b) An offense under this section is a Class C misdemeanor.

NOTE: AS AMENDED BY ACTS 2015, 84th LEG., HB 2481, SECTION 17 READS:

(a) Notwithstanding Chapter 1802, Occupations Code, as amended by this Act, a person is not required to hold a license under that chapter to act as an associate auctioneer until March 1, 2016.

(b) An individual who was licensed by the Texas Department of Licensing and Regulation as an associate auctioneer on or before June 14, 2013, may apply the individual’s work experience participating in auctions as an associate on or before June 14, 2013, toward the individual’s eligibility for an auctioneer’s license under Chapter 1802, Occupations Code.

Auctioneer Administrative Rules

You can download the entire Auctioneer Administrative Rules document (87kb) as an Adobe PDF file, suitable for printing. Acrobat Reader is necessary to view .pdf files. If you need to obtain a copy of this program it is available as a free download for Windows or Macintosh operating sys

 Auctioneer Administrative Rules

TABLE OF CONTENTS

67.1. Authority
67.10. Definitions
67.20. License Requirements–Auctioneer
67.21. License Requirements–Associate Auctioneers
67.22. License Requirements–Examinations
67.23. Pre-licensure Education
67.24. License Renewal
67.25. Continuing Education
67.30. Exemptions
67.40. Auctioneer Education and Recovery Fund
67.65. Auctioneer Advisory Board
67.70. Auctioneer Standards of Practice
67.71. Requirements–Sponsoring Auctioneer
67.72. Requirements–Associate Auctioneers
67.80. Fees

67.1. Authority. 
(Effective April 18, 1990, 15 TexReg 1959; amended effective April 17, 1992, 17 TexReg 2393; amended effective December 1, 2003, 28 TexReg 10456)

These rules are promulgated under the authority of the Texas Occupations Code, Chapter 1802, Auctioneers and the Texas Occupations Code, Chapter 51, Texas Department of Licensing and Regulation.

67.10. Definitions.
(January 27, 1993, 18 TexReg 301; amended effective June 1, 1993, 18 TexReg 3241; amended effective January 7, 1994, 18 TexReg 9928; amended effective February 13, 1995, 20 TexReg 564; amended effective December 1, 2006, 31 TexReg 9601; amended effective January 1, 2014, 38 TexReg 9507)

The following words and terms, when used in this chapter shall have the following meanings, unless the context clearly indicates otherwise.

(1) Advertisement–Any written, print, or broadcast commercial message that promotes the services of an auctioneer. For purposes of this chapter and the Texas Occupations Code, a general listing in a telephone directory that does not otherwise solicit auction business is not an advertisement.

(2) Auction listing contract–An agreement executed by the auctioneer and the seller which authorizes the auctioneer to conduct the auction, identifies the property to be sold at auction, and sets out the terms of the agreement and the rights and responsibilities of each party. This includes seller and consignment contracts.

(3) Auction without reserve–(also called Absolute Auction)–An auction in which property put up for sale is sold to the highest bidder, where the seller may not withdraw the property from the auction after the auctioneer calls for bids unless no bid is made in a reasonable time, and where the seller may not bid himself or through an agent.

(4) Auction with reserve–An auction in which the seller or his agent reserves the right to establish a minimum bid, accept or reject any and all bids, and withdraw the property at any time prior to the announcement of the completion of the sale by the auctioneer.

(5) Operated–To have fiduciary and operational responsibilities for an auction company’s auctions conducted in Texas.

67.20. License Requirements–Auctioneer.
(Effective April 18, 1990, 15 TexReg 1959; amended effective April 17, 1992, 17 TexReg 2393; amended effective January 27, 1993, 18 TexReg 301; amended effective December 1, 2003, 28 TexReg 10456; amended effective December 1, 2006, 31 TexReg 9601; amended effective January 1, 2014, 38 TexReg 9507; amended effective February 15, 2016, 41 TexReg 799)

(a) An applicant for licensure as an auctioneer must submit a completed application along with required fees.

(b) To obtain a license as an auctioneer an applicant must:

(1) be at least 18 years of age;

(2) be a citizen of the United States or a legal alien;

(3) either:

(A) pass a written or oral examination provided by the department; or

(B) provide proof of employment and licensure as an associate auctioneer for at least two (2) years, and of having participated in at least (10) auctions, as described in §67.72(c).

(4) hold a high school diploma or a high school equivalency certificate;

(5) not have been convicted of a felony during the five (5) years preceding the application date; and

(6) show proof of successful completion of at least eighty (80) hours of classroom instruction at an auction school with a curriculum approved by the department.

67.21. License Requirements–Associate Auctioneers.
(Effective February 15, 2016, 41 TexReg 799)

An applicant for licensure as an associate must:

(1) submit a completed application along with required fees;

(2) be employed under the direct supervision of an auctioneer licensed under this chapter; and

(3) either be a citizen of the United States or a legal alien.

67.22. License Requirements–Examinations.
(Effective January 27, 1993, 18 TexReg 301; amended effective June 1, 1993, 18 TexReg 3241; amended effective February 13, 1995, 20 TexReg 564; amended effective May 7, 1996, 21 TexReg 3607; amended effective December 1, 2006, 31 TexReg 9601)

If an applicant fails the examination twice during the one year application period, the application will be terminated and the applicant may not reapply until one year from the date of the second failure.

67.23. Pre-licensure Education.
(New section adopted effective December 1, 2006, 31 TexReg 9601)

(a) Proprietary auction schools having a Certificate of Approval issued by the Texas Workforce Commission may obtain department approval by submitting an application for Auction School Registration along with the certification and payment of the curriculum review fee.

(b) Other auction schools submitting an application for Auction School Registration will be reviewed on a case by case basis to assure that licensing applicants presenting credentials from the schools will have completed at least 80 hours of classroom instruction in courses relating to auctions.

67.24. License Renewal.
(New section adopted effective December 1, 2006, 31 TexReg 9601)

Licenses expire one year from the date of issuance and must be renewed by that date to avoid late renewal fees.

67.25. Continuing Education.
(Adopted effective June 1, 2005, 30 TexReg 3094; amended effective December 1, 2006, 31 TexReg 9601; amended effective April 30, 2012, 37 TexReg 3075; amended effective January 1, 2014, 38 TexReg 9507; amended effective February 15, 2016, 41 TexReg 799)

(a) Terms used in this section have the meanings assigned by Chapter 59 of this title, unless the context indicates otherwise.

(b) To renew a license as an auctioneer or associate auctioneer, a licensee must complete six hours of continuing education in courses approved by the department, including two hours of instruction in laws and rules that regulate the conduct of auctioneers and associate auctioneers.

(c) The continuing education hours must have been completed within the term of the current license, in the case of a timely renewal. For a late renewal, the continuing education hours must have been completed within the one year period immediately prior to the date of renewal.

(d) A licensee may not receive continuing education credit for attending the same course more than once.

(e) A licensee must retain a copy of the certificate of completion for a course for one year after the date of completion. In conducting any inspection or investigation of the licensee, the department may examine the licensee’s records to determine compliance with this subsection.

(f) To be approved under Chapter 59 of this title, a provider’s course must be dedicated to instruction in one or more of the following topics:

(1) Texas Occupations Code, Chapter 1802, Auctioneers;

(2) Title 16, Texas Administrative Code, Chapter 67, Auctioneers Administrative Rules;

(3) other laws and rules that regulate the conduct of auctioneers and associate auctioneers;

(4) auction-related laws, such as the Uniform Commercial Code – Sales, Title 1, Chapter 2, Texas Business and Commerce Code §2.328 and the Deceptive Trade Practices-Consumer Protection Act, Chapter 17, Subchapter E, Texas Business and Commerce Code; or

(5) business practices, such as insurance, auction ethics, contracts, maintenance of trust accounts, and marketing.

(g) A licensee whose license has been placed on inactive status, pursuant to Texas Occupations Code, §51.4011 is not required to complete continuing education as required by this section until the licensee seeks to change to ‘active’ status.

67.30. Exemptions.
(Effective January 1, 2014, 38 TexReg 9507; amended effective February 15, 2016, 41 TexReg 799)

(a) An auction of property by live bid call, if the property is solely bid upon through the internet, is not subject to this chapter or Texas Occupations Code, Chapter 1802 and is exempt under §1802.002(4).

(b) For purposes of this chapter and Texas Occupations Code, Chapter 1802, the sale of real or personal property is not considered to be a competitive bid subject to this chapter if all of the material terms of the transaction other than price are not the same.

(c) This chapter does not apply to a person providing an online platform to facilitate an auction.

67.40. Auctioneer Education and Recovery Fund.
(Effective April 18, 1990, 15 TexReg 1959; amended effective April 17, 1992, 17 TexReg 2393; amended effective January 27, 1993, 18 TexReg 301; repealed effective April 3, 2001, 26 TexReg 2538; new section effective April 3, 2001, 26 TexReg 2539; amended effective December 1, 2006, 31 TexReg 9601; amended effective January 1, 2014, 38 TexReg 9507)

(a) In each year in which the balance of the Auctioneer Education and Recovery Fund is less than $350,000 the department will determine the fee that shall be paid by all license holders into the Auctioneer Education and Recovery Fund (the Fund).

(b) The necessity for assessing the fee will be determined by the department based on the Fund balance on each December 31st. The fee shall be paid in addition to the renewal fee. The renewal notice sent by the department will reflect the fee due to the Fund.

(c) Applicants for an auctioneer license shall pay the initial recovery fee to the Fund before a license will be issued.

(d) If the department determines, either with the agreement of the auctioneer and claimant or at a hearing held on a disputed amount, that the auctioneer owes to the aggrieved person damages greater than the maximum of $15,000 allowed under the Act, the auctioneer must pay the amount not paid by the department to the aggrieved party. If the department determines that the auctioneer owes damages to more than one aggrieved person arising out of one auction at one location, and the sum of all damages owed exceeds $30,000, the department shall prorate $30,000 from the Fund among the aggrieved persons, and the auctioneer must pay the amount not paid to each of the aggrieved persons.

(e) The total payment from the Fund of claims against an auctioneer may not exceed $30,000. If additional claims are filed before the auctioneer has reimbursed the Fund and repaid any amounts due an aggrieved party, the department shall hold a hearing to determine if the additional claims must be satisfied by the auctioneer before the department issues or renews a license, whether probated or not.

(f) If a claim is paid against an auctioneer, and the auctioneer cannot immediately reimburse the Fund, the executive director may allow the auctioneer to sign an agreement with the department to reimburse the Fund at the applicable rate described below plus the interest accrued on the unpaid principal during the prior month at the rate of 8 percent per year.

(g) If an amount is due an aggrieved party, and the auctioneer cannot immediately pay the aggrieved party, the executive director may allow the auctioneer to sign an agreement with the party to reimburse the aggrieved party at the applicable rate described below plus the interest accrued on the unpaid principal during the prior month at the rate of 8 percent per year.

(h) Reimbursement of the principal owed is to be paid in monthly installments determined by agreement between the department and the auctioneer with consideration given to input from any aggrieved party. If an agreement is not reached, monthly installments shall be determined as a percentage of the initial principal amount according to the following schedule:

(1) $0.01 – $500.00–20%

(2) $500.01 – $1,000–10%

(3) $1,000.01 – $3,000.00–5%

(4) $3,000.01 and over–3%

67.65. Auctioneer Advisory Board.
(Effective January 7, 1994, 18 TexReg 9928; amended effective December 1, 2003, 28 TexReg 10456 ; amended effective December 1, 2006, 31 TexReg 9601; amended effective January 1, 2014, 38 TexReg 9507; amended effective February 15, 2016, 41 TexReg 799)

(a) The board is established to advise the commission on educational matters, operational matters, and common practices within the auction industry, including those matters relating to use of the educational trust fund established with fees collected for the auctioneer education and recovery fund.

(b) Recommendations of the board will be transmitted to the commission.

(c) Board meetings are called by the presiding officer. Meetings in excess of one each calendar quarter shall be authorized by the commission or the commission’s designee.

(d) One member shall be the administrative head, or the administrative head’s designee, of any state agency or office that is selected by the commission.

67.70. Auctioneer Standards of Practice.
(Effective February 15, 2016, 41 TexReg 799)

(a) Advertising

(1) All advertisements designed to solicit auction business, including the advertisement of an auction, shall include the auctioneer’s name as it appears on the license and the license number.

(2) If an auctioneer advertises an auction as “absolute” or “without reserve”, no lots included may have a minimum bid. Advertising may include the wording “many lots are without reserve”; however, the auction may not be titled, headed or called an “absolute” or “without reserve” auction unless all lots meet the criteria.

(3) An auctioneer who intends to charge a buyer’s premium at an auction must state this condition and the amount of the buyer’s premium in all advertising for the auction.

(4) An auctioneer may not make a false or misleading statement in an advertisement.

(b) Recordkeeping

(1) An auctioneer must furnish to the department the name, including assumed names, addresses, website, or social media pages, and telephone numbers of all auction companies that the auctioneer owns or operates.

(2) An auctioneer must report any changes of address to the department in writing within thirty (30) days of the change.

(3) Each licensed auctioneer shall keep records relative to all auctions for a minimum of two (2) years from the date of the sale.

(4) The records for each auction must state the name(s) and address of the owners of the property auctioned, the date of the sale, the name of the auctioneer and clerk of the sale, the gross proceeds, the location and account number of the auctioneer’s trust or escrow account, an itemized list of all expenses charged to the consignor or seller, a list of all purchasers at the auction and a description and selling price for each item sold.

(5) The auctioneer shall keep, as part of the records for each auction, all documents relating to the auction. These documents shall include, but are not limited to, settlement sheets, written contracts, copies of advertising and clerk sheets.

(6) These documents include records and documents online.

(7) Each licensed auctioneer must:

(A) Maintain a separate trust or escrow account in a federally insured bank or savings and loan association, in which shall be deposited all funds belonging to others which come into the auctioneer’s possession and control.

(B) Deposit all proceeds from an auction into the trust or escrow account within seventy two (72) hours of the auction unless the owner or consignor of the property auctioned is paid immediately after the sale or the written contract stipulates other terms, such as sight drafts.

(C) Pay any public monies, including, but not limited to state sales tax, received into the State Treasury at the times and as per the regulations prescribed by law; and

(D) Pay all amounts due the seller or consignor within fifteen (15) banking days of the auction unless otherwise required by statute or a written contract between license holder and seller.

(8) A licensed auctioneer shall cooperate with the department in the performance of an investigation. This includes, but is not limited to responding to requests from the department, including producing requested documents or other information, within thirty (30) days of request.

(9) The failure of a licensed auctioneer to timely pay a consignor may subject the licensed auctioneer to a claim under the Auctioneer Education and Recovery Fund.

(c) At auction

(1) Before beginning an auction, a licensee must ensure the announcement of, give notice, display notice or disclose:

(A) that the auctioneer conducting the sale is licensed by the department;

(B) the terms and conditions of the sale including whether a buyer’s premium will be assessed; and

(C) if the owner, consignor, or agent thereof has reserved the right to bid.

(2) A licensee may not allow any person who is not either a Texas licensed auctioneer or associate auctioneer who is directly supervised by a licensed auctioneer, to call bids at a sale.

(3) A licensee may not knowingly use or permit the use of false bidders at any auction.

(4) All licensed auctioneers shall notify consumers and service recipients of the department’s name, mailing address, telephone number and website “www.tdlr.texas.gov” for purposes of directing complaints to the department. The notification shall be included on any auction listing contract and on at least one of the following:

(A) A sign prominently displayed at the place of the auction or on any auction website;

(B) Bills of sale or receipt to be given to buyers; or

(C) Bidder cards.

67.71. Requirements–Sponsoring Auctioneer.
(Effective February 15, 2016, 41 TexReg 799)

(a) There must be a legitimate employee-employer relationship between an associate auctioneer and the sponsoring auctioneer or between the associate and an auction company operated by a licensed auctioneer that employs the sponsoring auctioneer.

(b) A sponsoring auctioneer must be on the premises and directly supervising an associate auctioneer when the associate is bid calling.

(c) A sponsoring auctioneer is responsible for supervision of an associate auctioneer as the associate performs the items listed in §67.72(c).

(d) An auctioneer who terminates the sponsorship of an associate auctioneer must:

(1) within thirty (30) days notify the department in writing; and

(2) provide signed documentation to the associate auctioneer showing:

(A) the beginning and ending date of sponsorship;

(B) date and location of up to ten (10) auctions bid called by the associate;

(C) items listed in 67.72(c), that the associate has performed.

67.72. Requirements–Associate Auctioneers.
(Effective February 15, 2016, 41 TexReg 799)

(a) An associate auctioneer shall provide auction services only when under the supervision of the licensed Texas auctioneer whose name is on file with the department as the associate’s sponsoring auctioneer.

(b) When bid calling, an associate auctioneer must be under the direct on-premises supervision of the sponsoring auctioneer.

(c) In order to be eligible for licensure as an auctioneer without taking the examination, an associate auctioneer must participate in all aspects of the auction business involving the laws of this state, in at least ten (10) auctions including but not limited to:

(1) appraising;

(2) inventorying;

(3) advertising;

(4) property make ready;

(5) site selection and preparation;

(6) lotting;

(7) registration;

(8) clerking;

(9) cashiering;

(10) bid-calling;

(11) ring working;

(12) property check out;

(13) security;

(14) accounting; and

(15) escrow account procedures.

(d) An associate auctioneer must report any change of address to the department within thirty (30) days.

(e) When a sponsoring auctioneer terminates the sponsorship of an associate auctioneer, the associate may not provide auction services until an agreement with a new sponsoring auctioneer, whose name and signature are on file with the department, has been made.

67.80. Fees.
(Effective April 18, 1990, 15 TexReg 1959; amended effective September 30, 1994, 19 TexReg 7272; amended effective December 1, 2004, 29 TexReg 11028; amended effective December 1, 2006, 31 TexReg 9601; amended effective November 1, 2008, 33 TexReg 8787; amended effective April 30, 2012, 37 TexReg 3075; amended effective January 1, 2014, 38 TexReg 9510; amended effective February 15, 2016, 41 TexReg 799)

(a) The application fee for an auctioneer license is $50.

(b) The application fee for an associate auctioneer license is $25.

(c) The annual application fee to renew an auctioneer license is $50.

(d) The annual fee to renew an associate auctioneer license is $25.

(e) Late renewal fees for licenses issued under this chapter are provided under §60.83 of this title (relating to Late Renewal Fees).

(f) Inactive License Status–Auctioneer

(1) The fee to place a license on ‘inactive’ status–no charge.

(2) The fee to renew a license on ‘inactive’ status–renewal fee as stated in subsection (c) or (d).

(3) The fee to change from ‘inactive’ status to ‘active status’ is $25.

(g) Revised/Duplicate License/Certificate/Permit/Registration–$25

(h) A $250 curriculum review fee will be assessed to all schools submitting their curriculum for review and approval by the department.

(i) The initial recovery fund fee is $50.

(j) All fees are non-refundable.

FEES 

PLEASE  SEE RULE 67-80 DIRECTLY ABOVE