SECTION 9.5. Effect of Safety Violations

(a) Except as provided by subsections (c) and (d) of this section, the Commission may not approve an application for a license, an exemption, or a manufacturer registration, or their associated renewals, under this chapter if the applicant has violated a statute or Commission rule, order, license, permit, or certificate that relates to safety. If a person who holds a position of ownership or control in the applicant has held a position of ownership or control in another person during the seven years preceding the date on which the application is filed and during that period of ownership or control the other person violated a statute or Commission rule, order, license, registration, permit, or certificate that relates to safety, then that violation will be attributed to the applicant. Regardless of whether the person's name appears or is required to appear on an application, a person holds a position of ownership or control in an applicant if the person is:

(1) an officer, director, general partner, sole owner, or trustee of, or the owner of at least 25 percent of the beneficial interest in the applicant; or

(2) the applicant and has been determined by a final judgment or final administrative order to have exerted actual control over the applicant.

(b) An applicant has committed a violation described by subsection (a) of this section if:

(1) a final judgment or final administrative order finding the violation has been entered against the applicant and all appeals have been exhausted; or

(2) the Commission and the applicant have entered into an agreed order relating to the alleged violation.

(c) Notwithstanding subsection (a) of this section, the Commission shall approve an application for a license, an exemption, or a manufacturer registration under this chapter if all of the following conditions, if applicable, are met:

(1) the conditions that constituted the violation have been corrected or are being corrected in accordance with a schedule to which the Commission and the applicant have agreed;

(2) all administrative, civil, and criminal penalties have been paid or are being paid in accordance with a payment schedule to which the Commission and the applicant have agreed; and

(3) the application complies with all other requirements of law and Commission rules.

(d) The Commission may issue a license, exemption, or manufacturer registration to an applicant described by subsection (a) of this section for a term specified by the Commission if the license, exemption, or manufacturer registration is necessary to remedy a violation of law or Commission rules.

(e) If the Commission is prohibited by subsection (a) of this section from approving an application for a license, an exemption, or a manufacturer registration, then the Commission, after notice and opportunity for a hearing, by order may refuse to renew or may revoke a license, an exemption, or a manufacturer registration issued under this chapter.

(1) In determining whether to refuse to renew or to revoke a person's license, exemption, or manufacturer registration under this subsection, the Commission shall consider the person's history of previous violations, the seriousness of previous violations, any hazard to the health or safety of the public, and the demonstrated good faith of the person.

(2) If the Commission issues a refusal or revocation under this subsection, the Commission shall provide the applicant with a written statement explaining the reason for the denial.

(3) An order issued under this subsection must provide the applicant a reasonable period to comply with the judgment or order finding the violation before the order takes effect.

(4) The Commission's refusal to renew or revocation of a person's license, exemption, or manufacturer registration under this subsection does not relieve the person of any existing or future duty under law, rules, or license, or registration conditions.

(5) On refusal to renew or revocation of a person's license, exemption, or manufacturer registration under this subsection, the person may not perform any activities under the jurisdiction of the Commission under this chapter, except as necessary to remedy a violation of law or Commission rules and as authorized by the Commission under a license, an exemption, or a manufacturer registration issued under subsection (d) of this section.

(6) A fee tendered in connection with an application that is denied under this section is nonrefundable.

(7) The Commission may not revoke or refuse to renew a license, an exemption, or a manufacturer registration under this subsection if the Commission finds that the applicant, licensee, registered manufacturer, or other registrant has fulfilled the conditions set out in subsection (c) of this section.

Source Note: The provisions of this §9.5 adopted to be effective December 19, 2005, 30 TexReg 8428; amended to be effective January 6, 2020, 45 TexReg 127