TennesseeAlcohol business owners can hold overlapping interests through independent trustees
Tennessee allows certain alcohol businesses and investors to hold retail interests if an independent trustee holds one side in a trust the owner cannot revoke.
What it does
Covered alcohol businesses and investors can also hold retail interests if one side is in a trust they cannot revoke. They cannot manage the business held in trust.
People whose interests are in trust can endorse the business through paid agreements. Payments based on sales or profits cannot exceed 10%, and submitted agreements receive business-information protections.
People who benefit from these trusts and their trustees receive existing limits on personal legal responsibility. Beneficiaries’ protections also cover licensing agreements placed in the trust.
Argument forIndependent trustees could allow investment across alcohol businesses while keeping investors from managing the businesses they hold through trusts.
Argument againstProtecting submitted endorsement agreements as business information could make financial ties between endorsers and alcohol businesses harder for the public to examine.
More detail
Covered alcohol businesses and their investors may also hold direct or indirect interests in licensed alcohol retail establishments. This covers licensed manufacturers, wineries, the out-of-state sellers specified in the law, and people with direct or indirect interests in them. Either the manufacturing or selling interest or the retail interest must be held by an independent trustee in a trust the owner cannot revoke. The person whose interest is held in trust cannot manage or operate that brand or business. These provisions took effect May 1, 2026, when the law was signed.
People may license the use of their name or image through the trust and personally promote the brand or business. This permission covers people whose interests are held in trusts they cannot revoke and that independent trustees manage. Promotion must be limited to the brand or licensed retail establishment and must not violate existing federal law. Payment goes to the trust and may be a fixed fee or a share of sales or profits capped at 10%. Licensing agreements and related documents submitted to the commission are classified as proprietary business information. These provisions took effect May 1, 2026, when the law was signed.
The law applies existing limits on personal legal responsibility to people who benefit from these trusts and to trustees. These protections cover trustees and beneficiaries, meaning people who benefit from trusts formed under these provisions. The protections have the limits set by the trust-law sections referenced in this law. For people who benefit from the trust, licensing agreements receive those protections as though the trustee made the agreement or committed the wrongful act while managing the trust. These provisions took effect May 1, 2026, when the law was signed.
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Where it stands
- Introduced
- Passed House
- Passed Senate
- To Governor
- Became Law
Looking ahead
No hearings or votes scheduled.
History
- 2026
- May 18Pub. Ch. 917Latest
- May 18Effective date(s) 05/01/2026
- May 1Signed by Governor Bill Lee.Became Law
- Apr 21Transmitted to Governor for his action.To Governor
- Apr 20Signed by Senate SpeakerMajor
- Apr 16Signed by H. SpeakerMajor
- Apr 14H. concurred in S. am. no. 2 Ayes 78, Nays 6 PNV 11 HB2272
- Vote recorded FLOOR VOTE: MESSAGE CALENDAR CONCUR IN SENATE AMENDMENT # 2 4/14/2026 Passed. Result: pass.Lower
- Apr 14Enrolled; ready for sig. of H. Speaker.Minor
- Apr 13H. Placed on Message Calendar
- Apr 9Received from House, Passed on First ConsiderationMinor
- Vote recorded FLOOR VOTE: as Amended Third Consideration 4/9/2026 Passed. Result: pass.Upper
- Apr 9Senate substituted House Bill for companion Senate Bill.Major
- Apr 9Amendment withdrawn. (Amendment 1 - SA0769)
- Apr 9Senate adopted Amendment (Amendment 2 - SA0872)
- Apr 9Passed Senate as amended, Ayes 27, Nays 0, PNV 1Passed Senate
- Apr 6Sponsor(s) Added.Minor
- Vote recorded HOUSE CALENDAR & RULES COMMITTEE: H. Placed on Regular Calendar for 4/6/2026 4/2/2026. Result: fail.Lower
- Vote recorded FLOOR VOTE: REGULAR CALENDAR AS AMENDED PASSAGE ON THIRD CONSIDERATION 4/6/2026 Passed. Result: pass.Lower
- Apr 6H. adopted am. (Amendment 1 - HA0869)Major
- Apr 6Passed H., as am., Ayes 78, Nays 7, PNV 11Passed House
- Apr 6Engrossed; ready for transmission to Sen.Minor
- Apr 2H. Placed on Regular Calendar for 4/6/2026
- Apr 1Placed on cal. Calendar & Rules Committee for 4/2/2026
- Mar 25Rec. for pass. if am., ref. to Calendar & Rules CommitteeMinor
- Vote recorded HOUSE JUDICIARY COMMITTEE: Rec. for pass. if am., ref. to Calendar & Rules Committee 3/25/2026 Passed. Result: pass.Lower
- Mar 18Action def. in Judiciary Committee to 3/25/2026
- Mar 18Placed on cal. Judiciary Committee for 3/23/2026
- Mar 11Rec for pass if am by s/c ref. to Judiciary CommitteeMinor
- Vote recorded HOUSE CIVIL JUSTICE SUBCOMMITTEE: Rec for pass if am by s/c ref. to Judiciary Committee 3/11/2026 Passed. Result: pass.Lower
- Mar 11Placed on cal. Judiciary Committee for 3/18/2026
- Mar 4Placed on s/c cal Civil Justice Subcommittee for 3/11/2026
- Feb 5P2C, ref. to Judiciary CommitteeMinor
- Feb 5Assigned to s/c Civil Justice SubcommitteeMinor
- Feb 4Intro., P1C.Minor
- Feb 2Filed for introductionIntroduced
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