AUCTIONEERS

Tex. OCC Code ch. 1802
in effect

Tex. OCC Code § 1802.001. DEFINITIONS.

In this chapter: (1) "Advisory board" means the Auctioneer Advisory Board. (2) "Associate auctioneer" means an individual who, for compensation, sells or offers to sell property at an auction under the direct supervision of a licensed auctioneer. (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. (7) Repealed by Acts 2003, 78th Leg., ch. 816, Sec. 4.019(1); Acts 2003, 78th Leg., ch. 1276, Sec. 14A.351(a). (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. (12) Repealed by Acts 2015, 84th Leg., R.S., Ch. 777 , Sec. 15, eff. September 1, 2015. (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. (14) "Security instrument," "substitute trustee," and "trustee" have the meanings assigned by Section 51.0001 , Property Code. Acts 2013, 83rd Leg., R.S., Ch. 1048 (H.B. 3038 ), Sec. 1, eff. June 14, 2013. Acts 2013, 83rd Leg., R.S., Ch. 1048 (H.B. 3038 ), Sec. 17, eff. June 14, 2013.

Tex. OCC Code § 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 auction involving the sale of real property personally conducted by a trustee or substitute trustee under a security instrument; (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 the 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. Acts 2013, 83rd Leg., R.S., Ch. 1048 (H.B. 3038 ), Sec. 2, eff. June 14, 2013.

Tex. OCC Code § 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. Acts 2013, 83rd Leg., R.S., Ch. 1048 (H.B. 3038 ), Sec. 2, eff. June 14, 2013.

Tex. OCC Code § 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. Added by Acts 2015, 84th Leg., R.S., Ch. 777 (H.B. 2481 ), Sec. 3, eff. September 1, 2015.

Tex. OCC Code § 1802.005. RULES.

The commission shall adopt rules necessary to administer and enforce this chapter. Added by Acts 2023, 88th Leg., R.S., Ch. 626 (H.B. 4416 ), Sec. 2, eff. September 1, 2023. SUBCHAPTER B. LICENSE REQUIREMENTS

Tex. OCC Code § 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 department under this chapter. (b) Repealed by Acts 2015, 84th Leg., R.S., Ch. 777 (H.B. 2481 ), Sec. 15, eff. September 1, 2015. (c) Except as provided by Subsection (d), an individual who is licensed under this chapter may not act as an auctioneer or associate 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, for a person who holds: (1) a dealer general distinguishing number or a wholesale motor vehicle auction general distinguishing number issued under Subchapter B , Chapter 503 , Transportation Code; or (2) a license issued under Subchapter C , Chapter 2302 . Acts 2011, 82nd Leg., R.S., Ch. 325 (H.B. 2519 ), Sec. 1, eff. September 1, 2011. Acts 2013, 83rd Leg., R.S., Ch. 1048 (H.B. 3038 ), Sec. 3, eff. June 14, 2013.

Tex. OCC Code § 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 as a licensed associate 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; and (5) 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)(5). Acts 2013, 83rd Leg., R.S., Ch. 1048 (H.B. 3038 ), Sec. 4, eff. June 14, 2013.

Tex. OCC Code § 1802.053. ELIGIBILITY FOR ASSOCIATE AUCTIONEER LICENSE.

An individual is eligible for an associate auctioneer license if the individual: (1) is a citizen of the United States or a legal alien; and (2) works under the direct supervision of an auctioneer licensed under this chapter. Added by Acts 2015, 84th Leg., R.S., Ch. 777 (H.B. 2481 ), Sec. 6, eff. September 1, 2015.

Tex. OCC Code § 1802.054. APPLICATION FOR LICENSE.

(a) An applicant for a license must apply to the department on a form and in a manner prescribed by the department. 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. (b) A nonresident applicant must submit with an application for a license under this chapter a written irrevocable consent to service of process. The consent must: (1) be in the form and supported by additional information that the commission by rule requires; (2) provide that an action relating to any transaction governed by 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 (3) 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. Acts 2013, 83rd Leg., R.S., Ch. 1048 (H.B. 3038 ), Sec. 5, eff. June 14, 2013.

Tex. OCC Code § 1802.055. APPLICATION FOR EXAMINATION.

An individual who meets the requirements for an auctioneer's license may apply to the department to take the license examination. The application must be accompanied by the application fee.

Tex. OCC Code § 1802.056. LICENSE EXAMINATION.

(a) The department shall prepare, recognize, administer, or arrange for the administration of a license examination 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) Repealed by Acts 2023, 88th Leg., R.S., Ch. 626 (H.B. 4416 ), Sec. 26(1), eff. September 1, 2023. (c) Repealed by Acts 2023, 88th Leg., R.S., Ch. 626 (H.B. 4416 ), Sec. 26(1), eff. September 1, 2023.

Tex. OCC Code § 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. SUBCHAPTER C. AUCTIONEER ADVISORY BOARD

Tex. OCC Code § 1802.101. AUCTIONEER ADVISORY BOARD.

The advisory board shall advise the commission on educational matters, operational matters, and common practices within the auction industry. Acts 2013, 83rd Leg., R.S., Ch. 1048 (H.B. 3038 ), Sec. 6, eff. June 14, 2013.

Tex. OCC Code § 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) one member who represents an auction school; and (3) two public members. (b) In appointing advisory board members, 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. Acts 2009, 81st Leg., R.S., Ch. 457 (H.B. 2548 ), Sec. 5, eff. September 1, 2009. Acts 2011, 82nd Leg., R.S., Ch. 1176 (H.B. 3278 ), Sec. 10, eff. June 17, 2011. Acts 2013, 83rd Leg., R.S., Ch. 1048 (H.B. 3038 ), Sec. 7, eff. June 14, 2013.

Tex. OCC Code § 1802.103. TERMS; VACANCIES.

Advisory board members serve staggered six-year terms. If a vacancy occurs during a member's term, the presiding officer of the commission, with the commission's approval, shall appoint a replacement to serve for the remainder of the term. Acts 2013, 83rd Leg., R.S., Ch. 1048 (H.B. 3038 ), Sec. 8, eff. June 14, 2013.

Tex. OCC Code § 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 shall serve a term of two years. Acts 2013, 83rd Leg., R.S., Ch. 1048 (H.B. 3038 ), Sec. 9, eff. June 14, 2013.

Tex. OCC Code § 1802.106. COMPENSATION.

A member of the advisory board may not receive compensation from the department for serving on the advisory board.

Tex. OCC Code § 1802.107. MEETINGS.

The advisory board shall meet at the call of the presiding officer of the commission or the executive director. Acts 2013, 83rd Leg., R.S., Ch. 1048 (H.B. 3038 ), Sec. 10, eff. June 14, 2013.

Tex. OCC Code § 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. SUBCHAPTER C-1. PRACTICE STANDARDS

Tex. OCC Code § 1802.121. WRITTEN CONTRACTS.

(a) An auctioneer who agrees to provide services to a person shall provide to the person a written contract with the terms of the agreement. (b) Each contract for the services of an auctioneer must include information required by the commission by rule. (c) Before any auction, the auctioneer and client must agree in writing to an itemized inventory of property to be sold or offered for sale by the auctioneer at auction. An amendment to the inventory must be in writing and signed by both parties. Added by Acts 2023, 88th Leg., R.S., Ch. 626 (H.B. 4416 ), Sec. 12, eff. September 1, 2023.

Tex. OCC Code § 1802.122. STANDARDS OF PRACTICE.

The commission by rule shall adopt standards for the practice of auctioneers and associate auctioneers, including standards for: (1) the maintenance and use of a trust or escrow account for funds belonging or owed to another; and (2) required consumer notices. Added by Acts 2023, 88th Leg., R.S., Ch. 626 (H.B. 4416 ), Sec. 12, eff. September 1, 2023. SUBCHAPTER D. AUCTIONEER EDUCATION AND RECOVERY FUND

Tex. OCC Code § 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.

Tex. OCC Code § 1802.152. MANAGEMENT OF FUND.

(a) The department is the manager of the fund and shall maintain books and records of the fund. (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.

Tex. OCC Code § 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 department issues the license. (b) If the balance in the fund on August 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. Acts 2013, 83rd Leg., R.S., Ch. 1048 (H.B. 3038 ), Sec. 11, eff. June 14, 2013.

Tex. OCC Code § 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 department 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. SUBCHAPTER E. COMPLAINT PROCEDURES

Tex. OCC Code § 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 department 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.

Tex. OCC Code § 1802.203. HEARING.

If the amount determined by the department under Section 1802.202 is disputed by the auctioneer, the department shall refer the matter to the State Office of Administrative Hearings for a hearing on the disputed claim. Reenacted and amended by Acts 2023, 88th Leg., R.S., Ch. 626 (H.B. 4416 ), Sec. 17, eff. September 1, 2023.

Tex. OCC Code § 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.

Tex. OCC Code § 1802.205. PAYMENT OF CLAIM.

(a) If the department's determination under Section 1802.202 is not disputed by the auctioneer, the department shall pay the claim from the fund, subject to Section 1802.206 . (b) If a hearing is held on the department's determination, the department shall pay to the aggrieved party the amount of actual damages as determined by an administrative law judge with the State Office of Administrative Hearings who presided over the hearing, subject to Section 1802.206 . (c) The amount of actual damages may not include attorney's fees, speculative damages, or lost profits.

Tex. OCC Code § 1802.206. PAYMENT LIMITS.

(a) The department may not pay a single aggrieved party more than $15,000 for all claims arising from a single auction. (b) Repealed by Acts 2023, 88th Leg., R.S., Ch. 626 (H.B. 4416 ), Sec. 26(9), eff. September 1, 2023. (c) The total payment of claims against a single auctioneer arising from a single auction may not exceed $100,000. Acts 2013, 83rd Leg., R.S., Ch. 1048 (H.B. 3038 ), Sec. 13, eff. June 14, 2013.

Tex. OCC Code § 1802.207. REIMBURSEMENT; INTEREST.

(a) If the department 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 department pays the claim.

Tex. OCC Code § 1802.208. SUBROGATION.

If the department 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.

Tex. OCC Code § 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. Acts 2013, 83rd Leg., R.S., Ch. 1048 (H.B. 3038 ), Sec. 14, eff. June 14, 2013. SUBCHAPTER F. DENIAL OF LICENSE AND DISCIPLINARY PROCEDURES

Tex. OCC Code § 1802.251. DISCIPLINARY ACTION; ADMINISTRATIVE PENALTY.

The commission or executive director may take any action or impose a penalty under Subchapter F or G, Chapter 51 , against an auctioneer or associate 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 or property belonging to another that is in the auctioneer's possession or commingling funds of another with the auctioneer's funds or failing to keep the funds of another in an escrow or trust account; (6) violating a provision of the Business & Commerce Code in conducting an auction; or (7) violating a rule or order of the commission or executive director. Acts 2013, 83rd Leg., R.S., Ch. 1048 (H.B. 3038 ), Sec. 15, eff. June 14, 2013.

Tex. OCC Code § 1802.252. REVOCATION FOR CLAIM ON FUND.

(a) The commission may revoke a license issued under this chapter if the department 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 or associate auctioneer is not eligible for a new license until the auctioneer or associate auctioneer has repaid in full the amount paid from the fund on the auctioneer's account, including interest.

Tex. OCC Code § 1802.253. HEARING BY STATE OFFICE OF ADMINISTRATIVE HEARINGS.

(a) If the department proposes to deny an application for a license or take a disciplinary action or impose an administrative penalty against a license holder, the applicant or license holder is entitled to a 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. (d) A proceeding relating to a license denial or disciplinary action by the department under this chapter is a contested case under Chapter 2001 , Government Code. Acts 2011, 82nd Leg., R.S., Ch. 91 (S.B. 1303 ), Sec. 18.004, eff. September 1, 2011. Acts 2013, 83rd Leg., R.S., Ch. 1048 (H.B. 3038 ), Sec. 16, eff. June 14, 2013. Acts 2013, 83rd Leg., R.S., Ch. 1048 (H.B. 3038 ), Sec. 17, eff. June 14, 2013. SUBCHAPTER G. CRIMINAL PENALTIES

Tex. OCC Code § 1802.301. PRACTICING WITHOUT LICENSE; OFFENSE.

(a) A person commits an offense if the person acts as an auctioneer or an associate auctioneer without a license. (b) An offense under this section is a Class B misdemeanor.

Tex. OCC Code § 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.
Source: TX Statutes (Official Site)URL: https://statutes.capitol.texas.gov/Fetched: 6/29/2026

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