SECTION 72.4. Exemptions

(a) State agencies and officials who use the state seal for official uses or state functions have no application or fee requirement; however, in an effort to achieve uniformity and continuity, state agencies and officials are encouraged to submit their intended uses and renditions of the state seal to the secretary of state.

(1) When a user solely produces for or solely sells or distributes to a state agency a product bearing the state seal for an official use or for a state function, no application or license is required.

(2) A user seeking the exemption as set forth in paragraph (1) of this subsection should provide the secretary of state's office with the following:

(A) a signed statement from that state agency or appropriate state official that the product has been or will be used by the state agency for an official use or a state function. See Form 3303-A; and

(B) a certification, on a form prescribed by the secretary of state's office, from the user that the product is not available to the general public. See Form 3303.

(3) Distribution or sale of the product to the general public by the state agency shall not preclude a user from obtaining the exemption, as set forth in paragraph (1) of this subsection.

(4) When a user produces for or sells or distributes to a state agency a product bearing the state seal that is also available to the general public, the user must file an application and obtain a license in accordance with §72.3 of this title (relating to Application and License) and pay, except as otherwise provided by these sections, all fees required by §72.6 of this title (relating to Fees: Payment of Money).

(5) Gross receipts received from the sale of licensed products to state agencies under the conditions set forth in paragraph (4) of this subsection are exempt from the royalty fee required by the statute and §72.6 of this title, provided the manufacturer or vendor of the licensed products provides the secretary of state's office with a signed statement from that state agency or appropriate state official that the products have been or will be used by the state agency for an official use or a state function.

(b) Elected officials who use the state seal for political purposes have no application or fee requirement.

(1) When a user solely produces for or solely sells or distributes to an elected official a product bearing the state seal for a political purpose, no application or license is required.

(2) A user seeking the exemption as set forth in paragraph (1) of this subsection should provide the secretary of state's office with the following:

(A) a signed statement from the elected official or designated agent that the product has been or will be used by the elected official for a political purpose. See Form 3303-A; and

(B) a certification, on a form prescribed by the secretary of state's office, from the user that the product is not available to the general public. See Form 3303.

(3) Distribution or sale of the product to the general public by the elected official shall not preclude a user from obtaining the exemption, as set forth in paragraph (1) of this subsection.

(4) When a user produces for, sells, or distributes to an elected official a product bearing the state seal that is also available to the general public, the user must file an application and obtain a license in accordance with §72.3 of this title and pay, except as otherwise provided by these sections, all fees required by §72.6 of this title.

(5) Gross receipts received from the sale of licensed products to an elected official under the conditions set forth in paragraph (4) of this subsection are exempt from the royalty fee required by the statute and §72.6 of this title, provided the user of the licensed products provides the secretary of state's office with a signed statement from the elected official or designated agent that the products have been or will be used by the elected official for a political purpose.

(c) The manufacturer of a product bearing the state seal bears the responsibility for filing the necessary application, obtaining the appropriate license, and paying all fees required by the statute and these sections.

(1) Vendors or resellers are exempt from the application, licensing, and fee requirements of the statute and these sections where the manufacturer of the product transferred has obtained the required state seal license, provided the vendor or reseller, prior to resale, obtains from the manufacturer, on a form prescribed by the secretary of state's office, a certification of the manufacturer's license.

(2) The certification shall contain the name and address of the vendor or reseller, as well as the manufacturer's name, license number, and the type and number of items purchased. See Form 3304.

(3) The certification must be kept and maintained at the vendor's or reseller's place of business for four years and made readily available for inspection by the secretary of state's office upon request.

(4) A vendor or reseller who fails to obtain, maintain, or make readily available for inspection the certifications of the manufacturer's license shall be responsible for obtaining the necessary license and the payment of all fees required by the statute and these sections.

Source Note: The provisions of this §72.4 adopted to be effective December 10, 2012, 37 TexReg 9617