Texas Craft Beer

There are three types of permits that are currently offered for brewing in Texas, a Brewer‘s Permit, a Manufacturer’s License, or a Brewpub Permit. A Brewer’s Permit must be obtained to produce “Ale and Malt Liquor” (above 4%ABW/5%ABV) and a Manufacturer’s License is required to produce “Beer” (below 4%ABW/5%ABV), but they are are similar in distribution regulations. If holding either (or both, as is allowed) of these, you may not sell directly to a consumer in any fashion, and you must use a distributor through the three tier system, who then sells to bars and wholesalers, who in turn sell to consumers. Texas brewers holding this permit are unable to sell any of their beers directly to consumers at their breweries or at any other venue. In contrast, a Brewpub Permit enables a brewer to sell on the premises of their brewery to consumers for consumption there or to take with them (in sealed containers) as long as they do not produce more than 5,000 bbls per year. These brewpubs are prohibited from selling through the distributors. Thus they are limited to this 5,000 bbl per year maximum production. If a brewpub were to wish to expand their brewery, they would have to discontinue selling to the community that made them who they have become and obtain a Brewer’s Permit to distribute through the three tier system.

In addition, Texas does not prohibit the distribution of beers from brewpubs located in other states as long as they have acquired a “Non-Resident Brewer’s Permit and/or Manufacturing Licenses” and the labeling of their products meets the Texas Alcoholic Beverage Code (TABC) requirements. Again, this requires that any beverage above 5% ABV must be labeled an “Ale,” regardless of the method and ingredients (yeast) used for brewing. Texas Brewpubs are not eligible for this option as they are residents. As you can imagine, this is quite the dilemna for anyone who wishes to set up or expand a brewery in Texas. Not only do you need to expect to compete with the majors already established in the public sector, but you then must also compete with others of the same size from other states who have more rights than you do yourself, in your own state.

The above was blatantly copied from Ladys of Craft Beer posting by