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

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.

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.

Cheating - attempting to obtain, obtaining, providing, or using answers to examination questions by deceit, fraud, dishonesty, or deception while taking a qualification examination.

Employed by a licensed auctioneer - Participating in all aspects of the auction business under the supervision of a licensed auctioneer.

Recurring basis - More than once every twelve months.

(a) Each license must be renewed within 30 days after expiration. A license not renewed within 30 days of the expiration date will not be issued without the applicant first taking and passing the written examination administered by the department. Any person who acts as an auctioneer within that 30-day period after expiration of the license is subject to the penalties under the Auctioneers Act, Section 11(a).

(b) All licensees must report any change of address to the department within 30 days.

(a) Associate auctioneers must be employed by, and under the direct on-premises supervision of a licensed Texas auctioneer. An associate auctioneer shall offer his services only to a Texas licensed auctioneer. There must be a legitimate employee-employer relationship between the associate and the licensed auctioneer.

(b) An associate auctioneer must participate in all aspects of the auction business involving the laws of this state. He must bid-call in at least five auctions, and he must participate in, but not have sole responsibility for, each of the following tasks at least once: appraising, inventorying, advertising, property make ready, site selection and preparation, lotting, registration, clerking, cashiering, bid calling, ring working, property check out, security, accounting, managing an escrow account.

(c) Any change of employment by a licensed associate auctioneer must be submitted to the department's Austin office prior to such action, and a letter must be submitted by the former employer stating the areas in which the associate auctioneer participated and the number of auction sales at which the associate participated as bid-caller.

(a) Applications for examinations must be complete and must be postmarked at least 30 days before the scheduled examination.

(b) An applicant who wishes to reschedule his examination for a later date must notify the department in writing, postmarked no later than five working days before the exam date. Two free reschedules are allowed.

(c) An applicant who does not take an examination for which he was scheduled, and does not notify the department that he will not take the exam, must pay another exam fee.

(d) An applicant who passes an examination may be licensed up to 90 days from the date on the grade notice sent by the department.

(e) Cheating on an examination is grounds for denial of a license.

(a) On each December 31 beginning in 1991, the department will determine the pro-rata share to be paid into education and recovery fund (the fund) in order to renew a license.

(b) The pro-rata share will be due from all license holders whose renewal date falls between the next September 1 and August 31 of the following year. The renewal notice sent by the department will reflect the amount due to the fund.

(c) All new applicants for an auctioneer or associate auctioneer license will pay a $100 fee to the fund before a license will be issued.

For the purpose of filing claims against the Recovery Fund, the following terms mean:

Person - an individual, partnership, corporation, association, or other legal entity.

Contract - a written or verbal agreement between an auctioneer and a person who wishes to sell property at auction.

(a) If the department determines, either with the agreement of the auctioneer or at a hearing held on a disputed amount, that the auctioneer owes to the aggrieved person damages greater than the maximum of $10,000 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 $20,000, the department shall pro-rate $20,000 from the Recovery Fund among the aggrieved persons, and the auctioneer must pay the amount not paid to each of the aggrieved persons.

(b) The total payment from the Recovery Fund of claims against an auctioneer may not exceed $20,000. 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 commissioner issues a new license, whether probated or not.

(c) If a claim is paid against an auctioneer, and the auctioneer cannot immediately reimburse the Recovery Fund, the commissioner may allow the auctioneer to sign an agreement to reimburse the Fund at the rate of ten percent of the principal each month plus the interest accrued during the prior month.

(d) If an amount is due an aggrieved party, and the auctioneer cannot immediately pay the aggrieved party, the commissioner may allow the auctioneer to sign an agreement to pay the aggrieved party at the rate of ten percent of the principal each month plus interest accrued during the prior month.

(a) The department may initiate administrative action against a licensed auctioneer or associate auctioneer to suspend or revoke his license based upon proof of cause of action and final order issued by another state, whether or not the department has a reciprocal agreement with the other state. The action taken by the other state may pertain to felony or misdemeanor convictions or to any offense against the other state's law or administrative rules.

(b) The department may initiate administrative action to deny a license based upon proof of cause of action and final order issued by another state if the offense against the other state's law or administrative rules is also an offense against the Act or these rules.

(a) The purpose of the Auctioneer Education Advisory Board is to advise the commissioner on educational matters relating to use of the educational trust fund established with fees collected for the Auctioneer Recovery Fund.

(b) Recommendations of the Board will be transmitted to the commissioner through the director of policies and standards.

(c) Board meetings are called by the chair. Meetings in excess of one each calendar quarter shall be authorized by the commissioner or the commissioner's designee.

(d) The Board shall consist of the auctioneer members specified in the Act, the commissioner of the Texas Department of Commerce and the commissioner of education or their designees, and three consumers of services provided by licensed auctioneers.

(e) The consumers of services should include at least one person who consigns property to auctioneers for sale and at least one person who regularly buys at auction. Consumer members serve for terms of two years and expire September 1 of the year of expiration.

(a) An auction company must list the license number under which it is operating in any yellow page advertisement which consists of more than name, address and phone number.

(b) An auctioneer must furnish to the department the name, address, and phone number of all auction companies which he owns or operates. Any auction company using an assumed name must furnish a copy of the assumed name registration.

(c) An auctioneer who is supervising an associate auctioneer must be on premises for any auction which is bid-called by the associate auctioneer.

(d) An auctioneer or an associate auctioneer who is licensed in Texas, or who is licensed in another state as well as in Texas, who has been convicted of a felony or a misdemeanor either in Texas or in another state, must notify the department no later than thirty days after being convicted.

(e) An auctioneer or an associate auctioneer who is in another state as well as in Texas, who has had his auctioneer license in another state suspended, revoked, or renewal denied as a result of an administrative hearing, must notify the department of the administrative action no later than thirty days after receipt of the final order advising of that action.

(a) The fee for an auctioneer license is $100.

(b) The fee for an associate auctioneer license is $50.

(a) The annual fee for renewing an auctioneer license is $100.

(b) The annual fee for renewing an associate auctioneer license is $50.

(c) A late fee of $50 will be charged for renewal applications postmarked between midnight of the day a current license expires and midnight of the 30th day after the expiration.

A $25 fee will be charged for issuing a duplicate license.

A $50 fee will be charged for each examination.

Pursuant to Texas Civil Statutes, Article 6252-13c, the commissioner, after a hearing, may suspend, revoke, or deny an existing license, or disqualify a person from receiving a license, because that person has a felony or misdemeanor conviction that directly relates to the duties and responsibilities involved in performing the duties of an auctioneer. The commissioner may also, after hearing, suspend, revoke, or deny a license because of a person's felony probation revocation, parole revocation, or revocation of mandatory supervision.

(a) With regard to bid calling, a licensee may not allow an unlicensed auctioneer or an unlicensed associate auctioneer to call bids at a sale.

(b) A licensed auctioneer may not knowingly use, or permit the use of, false bidders, cappers, or shills at any auction.

(c) Before beginning an auction, the auctioneer must announce, give notice, display notice and/or disclose:

(1) that the auctioneer conducting the sale is licensed by the department and is covered by a Recovery Fund administered by the department;

(2) the terms and conditions of the sale; and

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

(d) 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 that criteria.

(e) All auctioneers and auction companies shall notify consumers and service recipients of the name, mailing address, and telephone number of the department for purposes of directing complaints to the department. The licensees may use a sticker or rubber stamp to convey the required information. The notification shall be included on any seller or consignor contract and on at least one of the following:

(1) a sign prominently displayed at the place of the auction;

(2) any bill of sale or receipt to be given to the buyer; or

(3) on bidder cards.

(f) 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.

(g) Any statement in an advertisement for an auction that alters the meaning of another statement in the advertisement must be in a type font at least as large as the type font of the statement it alters.

Every licensed auctioneer must:

(1) 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 shall come into the auctioneers possession;

(2) deposit all proceeds from an auction into his trust or escrow account within 72 hours of the auction unless the owner/consignor of the property auctioned is paid immediately after the sale or the written contract stipulates other terms, such as sight drafts;

(3) 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

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

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

(b) 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 for 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.

(c) In addition, 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.