Last week, the Texas Alcoholic Beverage Commission (TABC) granted Core-Mark Midcontinent, Inc.’s request for renewal of its permit to distribute wine and other alcoholic beverages, rejecting a protest filed by its competitor, the McLane Company. Both companies are distributors of various products to convenience stores throughout Texas and the rest of the United States. Because McLane’s parent company owns companies operating in Texas’ alcoholic beverage business, they have been unable to procure distributing authority from the TABC. Core-Mark’s parent company has no such disqualifying ownership.
McLane’s protest was based on the argument that institutional funds like Vanguard who invest in Core-Mark’s publicly traded parent also invest in companies that do business in other tiers – retail and manufacturing – of the alcoholic beverage business. The TABC agreed with Core-Mark that McLane’s argument, if accepted, would create an absurd result that would disqualify all publicly traded companies from being in the alcoholic beverage business in Texas and could lead to “no legal alcoholic beverage industry in Texas.” The TABC held that neither the statutes nor the case law supported McLane’s argument.
The TABC also announced a new protest policy. Although it was the TABC that authorized this protest to go to hearing, the TABC has now decided that competitors like McLane lack standing to protest renewals or granting of permits to its competitors
For more, view article in Austin American-Statesman.