[Federal Register Volume 64, Number 248 (Tuesday, December 28, 1999)]
[Proposed Rules]
[Pages 72612-72617]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 99-33574]
[[Page 72612]]
=======================================================================
-----------------------------------------------------------------------
DEPARTMENT OF THE TREASURY
Bureau of Alcohol, Tobacco and Firearms
27 CFR Part 4
[Notice No. 890]
RIN 1512-AB86
Labeling of Flavored Wine Products (98R-317P)
AGENCY: Bureau of Alcohol, Tobacco and Firearms (ATF), Department of
the Treasury.
ACTION: Notice of proposed rulemaking.
-----------------------------------------------------------------------
SUMMARY: The Bureau of Alcohol, Tobacco and Firearms (ATF) proposes to
amend the regulations to create a new standard of identity for flavored
wine products. ATF believes that this regulation change is necessary to
avoid consumer confusion between established classes/types of wines
(including varietals, semi-generics, and type designations of varietal
significance) and products that fall outside existing classes because
of the addition of flavoring materials. In general, ATF proposes that
such products must be labeled as ``Flavored Wine Product'' together
with a truthful and adequate statement of composition.
In addition, we are proposing to amend the existing definition of
``brand label'' for wine to be consistent with the definition currently
provided for distilled spirits products. This change would minimize the
likelihood of consumer confusion concerning the identity of the product
by making mandatory information readily visible to the consumer at
retail.
Finally, this document discusses and solicits comments on a
petition we received from the California Association of Winegrape
Growers (CAWG) concerning the labeling of wine specialty products.
DATES: Comments must be received on or before March 29, 2000.
ADDRESSES: Send written comments to: Chief, Regulations Division;
Bureau of Alcohol, Tobacco and Firearms; P.O. Box 50221; Washington, DC
20091-0221; Attention: Notice No. 890. See Public Participation section
of this notice for alternative means of commenting.
FOR FURTHER INFORMATION CONTACT: Edward A. Reisman, Product Compliance
Branch, Bureau of Alcohol, Tobacco and Firearms, 650 Massachusetts
Avenue, NW., Washington, DC 20226, (202) 927-8485. You may also write
questions by e-mail to EAReisman@atfhq.atf.treas.gov. ATF will not
accept comments on the proposal that are submitted to this e-mail
address.
SUPPLEMENTARY INFORMATION:
Background
The Federal Alcohol Administration Act (FAA Act) provides ATF, as
the delegate of the Secretary of the Treasury, with the authority to
promulgate regulations with respect to the bottling, packaging, and
labeling of distilled spirits, wine, and malt beverages. 27 U.S.C.
205(e). The FAA Act provides that these regulations shall prevent
deception of the consumer, and provide the consumer with adequate
information as to the identity and quality of alcohol beverage
products.
The wine labeling regulations require that all wines sold, shipped
or otherwise introduced into interstate commerce must bear labels that
contain certain mandatory information. Among other things, wine labels
must contain a statement relating to the class, type, or other
designation of the wine. 27 CFR 4.32(a)(2). With certain exceptions,
the class of the wine must be stated on the label in conformity with
the standards of identity regulations. However, under certain
circumstances, certain grape wine type designations may appear in lieu
of a class designation, e.g., grape varietal designations (e.g.,
Chardonnay), semi-generic type designations (e.g., Chablis), or type
designations of varietal significance (e.g., Muscatel). If the class of
wine is not defined by the regulations, then a truthful and adequate
statement of composition must appear on the brand label in lieu of the
class designation. 27 CFR 4.34(a).
Subpart C of part 4 sets forth standards of identity for several
classes and types of wine. 27 CFR 4.21. Section 4.21(a) defines ``grape
wine'' as wine produced by the normal alcoholic fermentation of the
juice of sound, ripe grapes. Pure condensed grape must and wine spirits
may be added to grape wine. Section 4.21(a) also provides limitations
on the amelioration of grape wine. Over-ameliorated grape wine may not
be designated as grape wine. Rather, such wine must be designated as
``substandard wine'' or ``other than standard wine.'' 27 CFR 4.21(h).
In general, the name of a grape variety may be used as the type
designation of a grape wine only if the wine is also labeled with an
appellation of origin (e.g., ``California Chardonnay'') and if not less
than 75 percent of the finished wine is derived from grapes of that
variety. 27 CFR 4.23. A semi-generic name of geographic significance
may be used to designate wines of an origin other than that indicated
by such name only if there appears in direct conjunction therewith an
appropriate appellation of origin disclosing the true place of origin
of the wine (e.g., ``California Burgundy''), and if the wine so
designated conforms to the standard of identity for the product or, if
there is no such standard, to the trade understanding of such class or
type. A semi-generic designation is a name of geographic significance
that is also the designation of a class or type of wine found to have
become semi-generic by the Director of ATF. The regulations provide
several examples of semi-generic designations that are also type
designations for grape wines, such as Burgundy and Chablis. 27 CFR
4.24(b)(2). Semi-generic designations are also established by the
Internal Revenue Code (IRC), 26 U.S.C. 5388(c). In the case of still
grape wine there may also appear in lieu of the class designation, a
type designation of varietal significance. This applies to American
wines only. The regulations provide several examples of type
designations of varietal significance, such as Muscatel and
Scuppernong. 27 CFR 4.28.
Also, grape wine may be vintage dated if it is made in accordance
with the standards prescribed in 27 CFR 4.27(a). Vintage wine is wine
labeled with the year of harvest of the grapes, and made in accordance
with classes 1, 2, or 3 of 27 CFR 4.21.
Section 4.21 does not allow for the addition of flavoring
material(s) to wines with a standard of identity under subpart C of
part 4. For example, a class 1, grape wine containing added flavoring
material(s) is not entitled to a standard grape wine designation,
appellation of origin, or vintage date since these statements only
apply to a ``standard'' grape wine. Likewise, ``substandard wine'' or
``other than standard wine'' under Sec. 4.21(h)(2) does not
specifically include wine to which flavoring material(s) have been
added. Substandard wine or other than standard wine typically includes
any wine to which has been added sugar and water solution in an amount
which is in excess of the limitations prescribed in the standards of
identity for these products.
It has been ATF's longstanding policy that wines to which flavoring
material(s) are added do not fall within any of the current standards
of identity set forth in the wine regulations. A truthful and adequate
statement of composition is required on the brand label for such
flavored wine products, pursuant to Sec. 4.34(a).
Flavored wine products may be derived from grape wine or other
wines. They may be derived from citrus wine
[[Page 72613]]
(orange wine, grapefruit wine, etc.), fruit wine (apple wine, berry
wine, pear wine, etc.) or other agricultural products (carrot wine,
dandelion wine, honey wine, etc.).
Flavored Wine Products
Flavored wine product labels have traditionally displayed
statements of composition such as ``Grape Wine With Natural Flavors''
to describe to consumers the composition of these products. Recently,
some domestic wineries have begun using varietal and semi-generic names
in the statement of composition on their product labels to describe the
base wine portion of their flavored wine products. These flavored wine
products most often have an appellation of origin such as
``California'' in conjunction with the grape varietal or semi-generic
name in the statement of composition (e.g., ``California Chardonnay (or
Chablis) With Natural Flavors''). Flavored wine products are composed
differently from existing standard of identity wines. Typically, such
flavored wine products contain additional flavoring material(s). Such
products may contain coloring material(s). Flavored wine products may
also contain sugar and water in excess of that allowed in standard
wine.
ATF is aware that the recent appearance of these grape varietal and
semi-generic names on flavored wine products has caused a great deal of
discussion within the wine industry. On February 26, 1998, ATF wrote to
the Wine Institute to respond to their concerns about this matter. Soon
after the letter was sent to the Wine Institute it was placed on the
ATF internet website as public information.
Consumer Survey
In view of ATF's concerns about the labeling of flavored wine
products, ATF commissioned a consumer survey in July 1998 to determine
consumer interpretations of varietal and semi-generic claims on labels
of flavored wine products. Among other things, the survey was designed
to assess whether wine consumers distinguish between grape wine and
flavored wine products based on information provided on product labels.
The survey involved portraying examples of two flavored wine products:
one product was portrayed as containing a grape wine base that
qualified as a varietal wine and another was portrayed as a product
containing a grape wine base that qualified as a semi-generic wine.
Both products chosen for the survey were depicted in ``bag-in-box''
containers. Consumers were shown labels bearing only varietal or semi-
generic designations and labels bearing a varietal or semi-generic type
designation as part of a statement of composition including the term
``With Natural Flavors.'' Consumers were shown boxes bearing the
statement of composition on the side panel only, and other boxes with
the statement of composition prominently displayed on the front label.
None of the labels was identical to the labels of wines currently
marketed. The brand names, package designs, and label information were
selected by the contractor, U.S. Research Company, in order to best
measure consumer perceptions about the overall label presentations and
were chosen in order to ensure that the results were not specific to
any one particular product or brand of wine.
The survey revealed that even when the ``With Natural Flavors''
disclosure was prominently displayed on the front panel of the product,
a large majority (80%) of the respondents failed to distinguish between
grape wine and flavored wine products. The survey also revealed that
placing the term ``With Natural Flavors'' on the label had no impact on
consumer understanding of the amount of varietal or semi-generic wine
in the product. This is important because over 55 percent of the
consumers surveyed believed that all or almost the entire product was
composed of the varietal or semi-generic wine. Moreover, when asked to
interpret the ``With Natural Flavors'' disclosure, more than one-third
of the consumers surveyed perceived it to convey a positive ``no
chemicals or additives'' message. Seventeen percent indicated that they
thought the ``With Natural Flavors'' disclosure meant that the product
was ``natural,'' and only fourteen percent suggested that it indicated
that flavors had been added to the product.
California Association of Winegrape Growers Petition
ATF received a petition, dated September 15, 1999, filed on behalf
of the California Association of Winegrape Growers (CAWG), requesting
an amendment of the regulations to prohibit the use of any varietal,
semi-generic or geographic name as part of a statement of composition
on wine specialty products. Specifically, CAWG has requested an
amendment of section 4.34(a). This section states that if the class of
wine is not defined in the standards of identity in subpart C of part
4, ``a truthful and adequate statement of composition shall appear upon
the brand label of the product in lieu of a class designation.'' The
petitioner is requesting that the regulation be amended to add the
following wording:
A statement of composition shall include the standard of
identity (class and type designation) of the wine used in the
product, but shall not be permitted to include, in lieu of the class
designation for the wine used in the product, any varietal (grape
type) designation, type designation of varietal significance, or
semigeneric geographic type designation, or geographic distinctive
designation, to which the wine used in the product may otherwise be
entitled.
The petitioner contends that the manner in which flavored wine
products are labeled, packaged, and marketed deceives consumers into
thinking they are consuming varietal wine rather than flavored wine. As
stated in the petition,
Varietal-based specialty products appear on retailers' shelves
next to or intermingled with traditional still wines, in packaging
similar to traditional still wines [750 milliliter or 1.5 liter
glass bottles sealed with a cork, or 5 liter ``bag-in-box''
containers] and with a varietal designation and an appellation of
origin traditionally associated with still wines prominently
displayed.
The petitioner asserts that over the last 20 years, American wine
producers and grape growers have developed an important consumer market
for still grape wines with varietal designations and appellations of
origin. According to the petitioner, these wines represent a large
volume of the domestic wine sold in the United States (64 percent for
the 52 week period ending July 18, 1999). As stated in the petition,
``[v]arietal designations and appellations of origin have earned an
important place in the wine consumer marketplace as indications of
quality wines with certain distinctive tastes and styles.''
In support of its petition, CAWG commissioned a survey to study
consumers' understanding of the current labeling of flavored wine
products that include a varietal name with an appellation of origin in
the statement of composition. A total of 800 telephone interviews were
conducted. According to CAWG, the results of the survey showed that
most respondents believe that wine labels accurately reflect what is in
the container and that label information is important to their buying
decisions. A little more than 48 percent of the respondents expected
that products containing labels with such statements as ``California
Cabernet Sauvignon with natural flavors'' and ``California Chardonnay
with natural flavors'' to be standard grape wines which contain 75
percent wine made from grapes of that variety. The petitioner notes
that flavored wine products which include a varietal name
[[Page 72614]]
in the statement of composition have no minimum varietal content
requirement.
CAWG states that the results of its survey clearly show that the
labeling of flavored wine products that include a variety name along
with an appellation of origin in the statement of composition is
misleading to consumers. The petitioner believes that its proposed
amendment ``is targeted directly at the misleading nature of current
statements of composition on varietal-based specialty products.'' By
prohibiting varietal and semi-generic designations and appellations of
origin in the statement of composition, the petitioner contends that
consumers will not be misled as to the actual identity of the product.
Flavored wine products that have a varietal wine base would have
statements of composition in the form ``grape wine with natural
flavors'' or ``white wine with natural flavors.''
ATF is not proposing the amendment requested by CAWG, however, we
are soliciting comments on the petition. This will be addressed further
in the section titled ``Proposed Regulation.''
Significance of Wine Labeling Terms
ATF believes that consumers have learned to attach significance to
grape wines entitled to varietal/semi-generic designations,
appellations of origin, and vintage dates. This belief is based on the
fact that for many years the grape wine industry has heavily utilized
varietal/semi-generic designations, appellations of origin, and vintage
dating in the marketing of grape wines. Additionally, ATF has conducted
rulemaking projects spanning nearly 14 years identifying American grape
variety names. See e.g., Treasury Decision ATF-370, 61 FR 522 (January
8, 1996). Similarly, Congress has recently amended the Internal Revenue
Code to recognize semi-generic names as being distinctive grape wine
designations. 26 U.S.C. 5388(c), as added by Public Law 105-34,
Sec. 910(a). These efforts illustrate the importance of varietal and
semi-generic grape wine designations to both the wine industry and to
wine consumers. This was also addressed in the CAWG petition.
ATF believes that consumers do not understand that flavored wine
products are composed differently from existing standard of identity
wines. ATF further believes that consumers are confused about the
distinction between an existing standard of identity wine and flavored
wine products, especially when grape varietal or semi-generic terms
appear on the labels of flavored wine products. Flavored wine products
are often located next to varietal wines or semi-generic wines on the
shelves of grocery and liquor stores. Also, the promotional and
advertising materials accompanying these flavored wine products
frequently feature or highlight the varietal or semi-generic component
of the finished wine product, even though the finished flavored wine
product is not entitled to the varietal or semi-generic designation.
Proposed Regulation
ATF has concluded that current statements of composition that
include varietal or semi-generic names tend to mislead consumers to
believe that flavored wine products are the same as wines that meet the
percentage requirements for a varietal or semi-generic designation. ATF
is basing this conclusion on its experience in regulating the labeling
of wine. ATF also believes that the consumer survey it commissioned and
the CAWG consumer survey support that conclusion.
Furthermore, examination of this issue has caused ATF to review its
policy relating to statements of composition for all flavored wine
products, including those that do not include varietal or semi-generic
names, such as those that state ``Grape Wine With Natural Flavors,''
since the finished products are no longer ``Grape Wine'' but are
``Flavored Wine Products'' because of the presence of flavors.
Although we are soliciting comments on the CAWG petition, we are
not proposing the amendment requested by the petitioner. We believe the
regulation change proposed by CAWG is more restrictive and does not
provide the industry with the flexibility in labeling their flavored
wine products. On the other hand, we believe that the proposals made in
this notice provide the consumer with sufficient information as to the
actual identity of the product without imposing an undue burden on the
industry.
Accordingly, ATF is proposing to establish a new class designation
that would be called ``Flavored Wine Product.'' Under this designation,
a flavored wine product would be a wine-based alcohol beverage that
does not qualify for any of the class or type designations listed in
the existing wine regulations because of the addition of flavoring
material(s).
ATF believes that all flavored wine products need to be labeled to
indicate to consumers that such products are composed differently from
existing standard of identity wines. ATF, therefore, proposes to add a
Class 10 to the standards of identity for wine to be called ``Flavored
Wine Product.'' Such product will be required to be designated as
``Flavored Wine Product'' on labels. Furthermore, the designation must
appear together with a truthful and adequate statement of composition.
The designation and the statement of composition must appear in the
same size, style and color typeface on the brand label.
At a minimum, the statement of composition for flavored wine
products must:
1. Identify Class and/or Type
It must identify the class and/or type of each wine used in the
flavored wine product (e.g., ``grape wine,'' ``table wine,'' ``peach
wine,'' ``honey wine''). A single grape variety, type designation of
varietal significance, or semi-generic name may be used if such named
grape variety, type designation of varietal significance, or semi-
generic name appears together with an appellation of origin no smaller
than a country and the named grape variety, type designation of
varietal significance, or semi-generic wine constitutes not less than
75 percent by volume of the finished flavored wine product. For Vitis
labrusca varieties, the named grape variety must constitute not less
than 51 percent by volume of the flavored wine product. An appellation
of origin may not otherwise appear on the label of a product of this
class. Similar provisions are being proposed for specialty products
that do not contain any flavor(s) (Sec. 4.34(c)).
2. Identify Added Flavoring Material(s)
If one flavoring material is used in the production of the flavored
wine product, the flavoring material must be specifically identified
(e.g., ``strawberry flavor''). If two or more flavoring materials are
used in the production of the flavored wine product, each flavoring
material may be specifically identified (e.g., ``peach flavor,'' ``kiwi
flavor,'' or ``peach and kiwi flavors'') or the characterizing flavor
must be specifically identified and the remaining flavoring material(s)
must be generally referenced as ``other flavor(s).''
With regard to the term ``natural'' as used on alcohol beverage
labels to describe a flavor, e.g., ``With Natural Flavors,'' ATF
believes that there is no consensus among consumers as to a meaning for
the term ``natural.'' This belief is based upon ATF's experience in
regulating the wine industry and on its consumer survey noted above,
which supports this conclusion. An example indicated in the survey
reflects that fully one-third of respondents considered the term
``natural'' to indicate that no additives or chemicals are present in
the product. This
[[Page 72615]]
conclusion is clearly erroneous. Therefore, to avoid consumer deception
concerning the identity of flavored wine products, the term ``natural''
may not be used anywhere on the flavored wine product labels to
describe flavoring materials. When artificial flavoring material(s) are
used, they must be so described (e.g., ``artificial raspberry
flavor'').
3. Identify Added Coloring Material(s)
ATF proposes to require that coloring materials(s) be disclosed in
the statement of composition, whether added directly or through
flavoring material(s). The coloring materials may be identified
specifically (e.g., ``caramel,'' ``certified color,'' ``annato,'' etc.)
or as a general statement, such as ``artificially colored,'' to
indicate the presence of any one or a combination of coloring
material(s). However, FD&C Yellow No. 5 requires specific disclosure in
accordance with 27 CFR 4.32(c).
4. Include a Reference to Sugar
ATF proposes to require that sugar be listed in the statement of
composition if sugar is used in the production of the flavored wine
product (not including its use in the production of the base wine
within the range authorized by the regulations).
5. Include a Reference to Water
ATF proposes to require that water be listed in the statement of
composition, if the water addition, whether added directly to the
flavored wine product or by the addition of flavoring material(s),
exceeds 5 percent by volume of the flavored wine product.
6. Include a Reference to Wine Spirits
ATF proposes to require, except for flavored wine products made
from a base of a class 6 wine and imported flavored wine products, a
reference to the addition of wine spirits in the statement of
composition, whether such wine spirits are added in the production of
the wine component of the flavored wine product or added in the
production of the flavored wine product, if the wine spirits are not
derived from the same kind of fruit from which the wine component was
fermented. Section 4.39(a)(7) prohibits the appearance on a wine label
of any statement that the wine contains distilled spirits with one
exception. Accordingly, we are proposing to amend the exception to
cover the reference to distilled spirits in the statements of
composition for flavored wine products.
Miscellaneous--Amended Definition of ``Brand Label''
ATF also proposes to revise the meaning of the term ``brand label''
in 27 CFR 4.10. Under the amended definition, a brand label is the
principal display panel that is most likely to be displayed, presented,
shown, or examined under normal and customary conditions of display for
retail sale, and any other label appearing on the same side of the
container as the principal display panel. The brand label appearing on
a cylindrical surface is that 40 percent of the circumference which is
most likely to be displayed, presented, shown or examined under normal
and customary conditions of display for retail sale.
ATF believes that the existing definition of the term ``brand
label'' allows the mandatory information to be placed on the container
in such a way that it is not readily visible to consumers. ATF also
believes consumers are having difficulty locating important mandatory
product label information necessary to be adequately informed as to the
identity and quality of the wine products, including bag-in-boxes and
other new wine containers.
The amended brand label definition proposal is based on the
definition of ``brand label'' that is currently in the distilled
spirits regulations and is consistent with the principal display panel
approach of the Fair Packaging and Labeling Act. ATF recognizes that
the proposal to amend the definition of the term ``brand label'' was
raised before. On September 12, 1991, ATF published Notice No. 727,
``Definition of 'Brand Label' for Wine, and; Standard Wine Containers''
(56 FR 46393). At that time ATF proposed that the definition of ``brand
label'' be amended, consistent with the definition currently proposed.
This proposal was subsequently withdrawn for further study (58 FR
56801, October 25, 1993).
ATF has re-examined this issue in the context of the wine
regulations for the purpose of ensuring that consumers are not misled
about the identity and quality of wine products. The popularity of
flavored wine products and the potential for consumer confusion between
such products and other wines that fit specific class designations
makes this more specific definition of ``brand label'' necessary. Under
the proposed definition, the mandatory information will be readily
visible to consumers at the point of purchase.
Public Participation
Who May Comment on This Notice?
We are requesting comments on these proposed regulations and the
CAWG petition from all interested persons. We are also requesting
comments on the clarity of this proposed rule and how it may be made
easier to understand. Comments received on or before the closing date
will be carefully considered. Comments received after that date will be
given the same consideration if it is practical to do so, but assurance
of consideration cannot be given except as to comments received on or
before the closing date.
Will ATF Keep My Comment Confidential?
We will not recognize any material in comments as confidential. All
comments and materials received may be disclosed to the public. If you
consider your material to be confidential or inappropriate for
disclosure to the public you should not include it in a comment. We may
also disclose the name of any person who submits a comment.
Disclosure: Who May Review the Comments ATF Receives for This Notice?
Any interested person may inspect copies of this notice and all
comments. You may inspect these documents during normal business hours
in the ATF Reference Library, Room 6480, 650 Massachusetts Avenue, NW,
Washington, DC.
How Do I Send Facsimile Comments?
You may submit comments by facsimile transmission to (202) 927-
8602. Facsimile comments must:
be legible;
reference this notice number;
be 8\1/2\'' x 11'' in size;
contain a legible written signature; and
be not more than three pages long.
We will not acknowledge receipt of facsimile transmissions. We will
treat facsimile transmissions as originals.
How Do I Send Electronic Mail (E-mail) Comments?
You may submit comments by e-mail by sending them to
nprm.notice.890@atfhq.atf.treas.gov.
You must follow these instructions. E-mail comments must:
contain your name, mailing address, and e-mail address;
reference this notice number; and
be legible when printed on not more than three pages 8\1/
2\'' x 11'' in size.
We will not acknowledge receipt of e-mail. We will treat e-mail as
originals.
[[Page 72616]]
How Do I Send Comments to the ATF Internet Web Site?
You may also submit comments using the comment form provided with
the online copy of the proposed rule on the ATF internet web site at
http://www.atf.treas.gov/core/regulations/rules.htm
Can I Request a Public Hearing?
If you desire the opportunity to comment orally at a public hearing
on this proposed regulation, you must submit a request in writing to
the Director within the 90-day comment period. The Director reserves
the right, in light of all circumstances, to determine if a public
hearing is necessary.
Is This a Significant Regulatory Action as Defined by Executive Order
12866?
We have determined that this proposed regulation is not a
significant regulatory action as defined in Executive Order 12866.
Therefore, a Regulatory Assessment is not required.
Does the Paperwork Reduction Act Apply to this Proposed Rule?
The Paperwork Reduction Act of 1995 (PRA), 44 U.S.C. 3507, and its
implementing regulations (5 CFR part 1320) apply to this proposed rule.
The collection of information contained in this notice has been
submitted to the Office of Management and Budget (OMB) for review in
accordance with section 3507(d) of the PRA. The estimated average
burden associated with the collection of information is 0 hours per
respondent or recordkeeper because the requirement is usual and
customary for wine producers. The number of respondents/recordkeepers
is 6,060. Comments on the collection of information should be sent to
the Office of Management and Budget, Attention: Desk Officer for the
Bureau of Alcohol, Tobacco and Firearms, Office of Information and
Regulatory Affairs, Washington, DC 20503, with copies to the Chief,
Document Services Branch, Room 3110, Bureau of Alcohol, Tobacco and
Firearms, at the address previously specified.
Comments are specifically requested concerning:
Whether the collection of information is necessary for the proper
performance of the functions of ATF, including whether the information
will have practical utility;
The accuracy of the estimated burden associated with the collection
of information;
How the quality, utility, and clarity of the information to be
collected may be enhanced;
How the burden of complying with the collection of information may
be minimized, including through the application of automated collection
techniques or other forms of information technology; and
Estimates of capital or start-up costs and costs of operation,
maintenance, and purchase of services to provide information.
The collection of information in this proposed regulation is in 27
CFR 4.21(j) and 4.34. This information is required to properly identify
flavored wine products. The collection of information is mandatory. The
likely respondents are businesses.
An agency may not conduct or sponsor, and a person is not required
to respond to, a collection of information unless it displays a valid
control number assigned by the Office of Management and Budget.
Does the Regulatory Flexibility Act Apply to This Proposed Rule?
The Regulatory Flexibility Act (RFA) generally requires an agency
to conduct a regulatory flexibility analysis of any rule required to be
issued for notice and comment unless the agency certifies that the rule
will not have a significant economic impact on a substantial number of
small entities. Small entities include small businesses, small not-for-
profit enterprises, and small government jurisdictions. We hereby
certify that this proposed regulation, if adopted, will not have a
significant economic impact on a substantial number of small entities.
Since producers routinely make changes to their labels, we do not
believe that the proposed amendments, if adopted, would result in any
additional burdens on the industry. Accordingly, a regulatory
flexibility analysis is not required.
Drafting information. This document was drafted by Edward A.
Reisman, Product Compliance Branch, Bureau of Alcohol, Tobacco and
Firearms. However, other personnel within ATF also participated in the
development of this document.
List of Subjects in 27 CFR Part 4
Advertising, Consumer protection, Customs duties and inspection,
Imports, Labeling, Packaging and containers, Wine.
Authority and Issuance
For the reasons discussed in the preamble, ATF amends 27 CFR part 4
as follows:
PART 4--LABELING AND ADVERTISING OF WINE
Paragraph 1. The authority citation for part 4 continues to read as
follows:
Authority: 27 U.S.C. 205.
Par. 2. Section 4.10 is amended by revising the definition of the
term ``brand label'' to read as follows:
Sec. 4.10 Meaning of terms.
* * * * *
Brand label. The principal display panel that is most likely to be
displayed, presented, shown, or examined under normal and customary
conditions of display for retail sale, and any other label appearing on
the same side of the container as the principal display panel. The
brand label appearing on a cylindrical surface is that 40 percent of
the circumference which is most likely to be displayed, presented,
shown, or examined under normal and customary conditions of display for
retail sale.
* * * * *
Par. 3. Section 4.21 is amended by adding new paragraph (j) to read
as follows:
Sec. 4.21 The standards of identity.
* * * * *
(j) Class 10; flavored wine product. A flavored wine product is a
wine-based alcohol beverage that does not qualify for any of the other
class or type designations listed in this section because of the
addition of flavoring material(s).
(1) Mandatory class and type designation. The designation of such
product is ``flavored wine product,'' together with a truthful and
adequate statement of composition, all of which must appear in the same
size, style and color typeface. At a minimum, the statement of
composition must:
(i) Identify the class and/or type of each wine used in the
flavored wine product (e.g., ``grape wine,'' ``table wine,'' ``peach
wine,'' ``honey wine''). A single grape variety, type designation of
varietal significance, or semi-generic name, as provided in Secs. 4.23,
4.28, and 4.24(b), respectively, may be used if such named grape
variety, type designation of varietal significance, or semi-generic
name appears together with an appellation of origin no smaller than a
country and the named grape variety, type designation of varietal
significance, or semi-generic wine constitutes not less than 75 percent
by volume of the finished flavored wine product: Provided, That for
Vitis labrusca varieties, the named grape variety must constitute not
less than 51 percent by volume of the finished
[[Page 72617]]
flavored wine product. An appellation of origin may not otherwise
appear on the label of a product of this class.
(ii) Identify added flavoring material(s). If one flavoring
material is used in the production of the flavored wine product, the
flavoring material must be specifically identified (e.g., ``peach
flavor'' or ``kiwi flavor''). If two or more flavoring materials are
used in the production of the flavored wine product, each flavoring
material may be specifically identified (e.g., ``peach flavor,'' ``kiwi
flavor,'' or ``peach and kiwi flavors'') or the characterizing flavor
must be specifically identified and the remaining flavoring material(s)
must be generally referenced as ``other flavor(s).'' The term
``natural'' may not be used to describe flavoring materials anywhere on
the product label(s). Artificial flavoring material(s) must be so
described (e.g., ``artificial raspberry flavor'');
(iii) Identify coloring material(s), whether added directly or
through flavoring material(s). The coloring materials may be identified
specifically (e.g., ``caramel,'' ``certified color,'' ``annato,'' etc.)
or the words ``artificially colored'' may be used to indicate the
presence of any one or a combination of coloring material(s), except
that FD&C Yellow No. 5 requires specific disclosure in accordance with
27 CFR 4.32(c);
(iv) Include a reference to sugar, if the sugar is used in the
production of the flavored wine product (not including the use of sugar
in the production of the base wine within the authorized limits);
(v) Include a reference to water, if the water addition, whether
added directly to the flavored wine product or by the addition of
flavoring material(s), exceeds 5 percent by volume of the flavored wine
product;
(vi) Include, except for flavored wine products made from a base of
a class 6 wine and imported flavored wine products, a reference to the
addition of wine spirits, whether added in the production of the wine
component of the flavored wine product or added in the production of
the flavored wine product, if the wine spirits are not derived from the
same kind of fruit from which the wine component was fermented.
(2) Optional statements. In addition to the statement of
composition portion of the mandatory designation, additional statements
regarding the components of the flavored wine product may appear on a
back or side label, but not the brand label. Such statements must
reference all components listed in the mandatory statement of
composition and must include the percentage of each component totaling
100 percent. Furthermore, such additional statements must be truthful,
accurate and specific, within the meaning of Sec. 4.38(f).
Par. 4. Section 4.34 is amended by removing the last two sentences
in paragraph (a) and adding in their place three new sentences and by
adding a new paragraph (c) to read as follows:
Sec. 4.34 Class and type.
(a) * * * Except as provided in paragraph (c) of this section, an
appellation of origin may not appear on the label of the product. If
the statement of composition includes a single grape variety, type
designation of varietal significance, or semi-generic name, as provided
in Secs. 4.23, 4.28, and 4.24(b), respectively, the product must comply
with the provisions of paragraph (c) of this section. In addition to
the mandatory designation for the wine, there may be stated a
distinctive or fanciful name, or a designation in accordance with trade
understanding. All parts of the designation of the wine, whether
mandatory or optional, must appear together in the same size, style and
color typeface.
* * * * *
(c) If the class of wine is not defined in subpart C, and the
statement of composition required by paragraph (a) of this section
includes a single grape variety, type designation of varietal
significance, or semi-generic name, as provided in Secs. 4.23, 4.28,
and 4.24(b), respectively,
(1) An appellation of origin no smaller than a country must appear
together with the named grape variety, type designation of varietal
significance, or semi-generic name; and
(2) The named grape variety, type designation of varietal
significance, or semi-generic type wine must constitute not less than
75 percent by volume of the finished wine product: Provided, That for
Vitis labrusca varieties, the named grape variety must constitute not
less than 51 percent by volume of the finished wine product.
Par. 5. Section 4.39(a) is amended by revising the introductory
text in paragraph (7) to read as follows:
Sec. 4.39 Prohibited practices.
(a) * * *
(7) Any statement, design, device, or representation (other than
the statement of composition required by Sec. 4.21(j)(1) and a
statement of alcohol content in conformity with Sec. 4.36), which tends
to create the impression that a wine:
* * * * *
Signed: October 13, 1999.
John W. Magaw,
Director.
Approved: November 12, 1999.
John P. Simpson,
Deputy Assistant Secretary (Regulatory, Tariff and Trade Enforcement).
[FR Doc. 99-33574 Filed 12-27-99; 8:45 am]
BILLING CODE 4810-31-P
