Key Safeguards

The three-tier system limits the authorized channels through which alcohol enters our state and establishes clear “”checks and balances” that Texas regulators and law enforcement can monitor. The combination of these safeguards ensures that alcohol is distributed and sold safely to consumers.

These checks and balances work to ensure that:

Minors do not have access to alcohol;
Alcohol is not sold or distributed in “dry” communities in which alcohol sales are banned or restricted; and
Proper taxes are collected and remitted back to state and local governments.
For more information about the economic benefits of the three-tier system to our state and local economies, visit our section outlining the Benefits for Texans.

Why the Three-Tier System Works

The three-tier system ensures that alcohol is not sold or delivered through unlawful channels—and is delivered responsibly to the people who are licensed to sell it and subsequently sold to those who are of legal age to buy it.

The threat to a Texas-based wholesaler or Texas-based retailer of losing its license to do business in Texas is an enormous incentive for these companies to comply strictly with Texas law.

The same cannot be said for those companies seeking to bypass the three-tier system through direct shipment of alcoholic beverages by selling products across state lines over the Internet or through catalogue sales to anyone with a credit card.

The Internet’s lack of in-state enforceable responsibilities and a clear chain of accountability as provided by the three-tier system means companies are less likely to pay taxes or ensure minors or households in “dry” areas are not receiving alcoholic beverages illegally.