[Federal Register Volume 60, Number 227 (Monday, November 27, 1995)]
[Proposed Rules]
[Pages 58311-58318]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 95-28471]
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DEPARTMENT OF THE TREASURY
27 CFR Parts 5, 19, 24, 25, 70, and 250
[Notice No. 816]
RIN 1512-AB40
Registration of Formulas and Statements of Process for Certain
Domestically Produced Wines, Distilled Spirits and Beer (95R-019P)
AGENCY: Bureau of Alcohol, Tobacco and Firearms (ATF), Department of
the Treasury.
ACTION: Notice of proposed rulemaking.
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SUMMARY: The Bureau of Alcohol, Tobacco and Firearms (ATF) is proposing
to amend the regulations to require the registration, rather than
approval, of formulas and statements of process for certain
domestically produced wines, distilled spirits, and beer. ATF believes
that the proposed regulations will provide greater flexibility to the
industry by enabling proprietors to commence production in a more
expeditious manner.
The proposed amendments are part of the Administration's
Reinventing Government effort to reduce burden and streamline
requirements.
DATES: Written comments must be received on or before January 26, 1996.
ADDRESSES: Send written comments to: Chief, Wine, Beer and Spirits
Regulations Branch; Bureau of Alcohol, Tobacco and Firearms; P.O. Box
50221; Washington, DC 20091-0221; ATTN: Notice No. 816.
FOR FURTHER INFORMATION CONTACT: James P. Ficaretta, Wine, Beer and
Spirits Regulations Branch, Bureau of Alcohol, Tobacco and Firearms,
650 Massachusetts Avenue, NW., Washington, DC 20226, (202-927-8230).
SUPPLEMENTARY INFORMATION:
Background
Under the current regulations, approved formulas or statements of
process are required for certain domestically produced distilled
spirits, wines, and beer. Pursuant to regulations in 27 CFR Part 5, an
approved formula on ATF Form 5110.38 (Formula For Distilled Spirits
Under The Federal Alcohol Administration Act) is required to blend,
mix, purify, refine, compound, or treat distilled spirits in a manner
which results in a change of character, composition, class or type of
the spirits. The formula requirement applies to: (1) Proprietors of
distilled spirits plants qualified as processors under 27 CFR Part 19;
(2) Persons in Puerto Rico who manufacture distilled spirits products
for shipment to the United States in accordance with 27 CFR Part 250;
and (3) Persons who ship Virgin Islands distilled spirits products into
the United States in accordance with 27 CFR Part 250.
As it relates to wine, the regulations in 27 CFR Part 24 provide
that a proprietor must, before commencing production, obtain approval
of the formula and process by which special natural wine, agricultural
wine, and certain other than standard wines (e.g., Spanish type
blending sherry) are to be made. An approved formula is also required
under certain conditions in the production of an effervescent
(sparkling) wine. Wine formulas are filed on ATF Form 5120.29, Formula
And Process For Wine.
With regard to beer, the regulations in 27 CFR Part 25 require that
a brewer file a statement of process for any fermented beverage which
the proprietor intends to produce and market under a name other than
``beer,'' ``ale,'' ``porter,'' ``stout,'' ``lager,'' or ``malt
liquor.'' The statement of process, which is contained in the Brewer's
Notice, ATF Form 5130.10, includes the name or designation of the
product, the kinds and quantities of materials to be used, the method
of manufacture, and the approximate alcohol content of the finished
product.
ATF reviews approximately 1,700 formulas and statements of process
annually. The Bureau examines the formulas and statements of process to
ensure that, among other things, the ingredients used are not only
approved by the Food and Drug Administration (FDA), but are used within
prescribed limitations established by the FDA. The average turnaround
time for processing a formula or statement of process is approximately
3 weeks.
The majority of formulas and statements of process that ATF
examines are approved without any substantive changes. The Bureau
attributes this, in part, to its continued efforts at providing
guidance and information to members of the alcoholic beverage industry.
Through the publication of industry circulars and other publications,
such as the ``Compliance Matters'' bulletin, ATF is able to apprise the
industry of policies or procedures which might affect them. With regard
to formulas for wine and distilled spirits, specifically, the Bureau
recommends that proprietors review Industry Circular 89-3. This
circular clarifies and provides information and guidelines for the
completion and submission of formulas. This circular can also be
utilized by brewers in the
[[Page 58312]]
preparation of statements of process for flavored malt beverage
products.
Proposed Registration of Formulas and Statements of Process
ATF is proposing to amend the regulations to provide for the
registration, rather than approval, of formulas and statements of
process. ATF believes that a registration system will provide greater
flexibility to the industry by enabling proprietors to commence
production in a more expeditious manner. As indicated, ATF's current
average turnaround time for processing a formula or statement of
process is 3 weeks. Under a registration system, the turnaround time
would be less than 1 week. The proposed amendments are part of the
Administration's Reinventing Government effort to reduce burden and
streamline requirements.
Registration merely indicates that a formula or statement of
process is on file with ATF. For formulas and statements of process
registered on or after the effective date of the final rule,
registration does not mean that ATF has determined that the formula or
statement of process complies with the laws and regulations enforced by
ATF.
If the proposed regulations are adopted, the forms which are
currently used by proprietors for filing distilled spirits and wine
formulas (ATF F 5110.38 and ATF F 5120.29, respectively) will be
revised accordingly. No additional information will be required on the
revised forms. With regard to distilled spirits and wine, the
procedures for filing the revised forms will be the same as is
currently required. For beer products, the statement of process will no
longer be included as part of the Brewer's Notice, Form 5130.10.
Rather, brewers will prepare the statement of process on letterhead
stationery, in triplicate. The statement will be filed with the Chief,
Product Compliance Branch.
Once received, ATF will register the formula or statement of
process and include the date of registration. The registered formula or
statement of process will then be forwarded to the proprietor.
Production may commence upon the receipt by the proprietor of a
registered formula or statement of process.
With the exception of special natural wines, ATF will register all
formulas for distilled spirits and wine as well as statements of
process for beer. In the case of special natural wine, section 5386 of
the Internal Revenue Code of 1986, 26 U.S.C. 5386, requires that such
wine be made pursuant to an approved formula. Therefore, ATF will
continue to approve formulas for special natural wine filed on ATF Form
5120.29.
Each applicant submitting a formula or statement of process for
registration should ensure that such formula or statement of process is
properly completed. In addition to following the guidelines presented
in Industry Circular 89-3, the instructions on the reverse side of the
forms should be followed carefully. ATF will continue to provide
guidance to proprietors, as needed, through the publication of its
``Compliance Matters'' bulletin and through other methods.
Previously approved formulas and statements of process will not
have to be submitted to ATF for registration. These will continue to be
valid and, except for special natural wines, will automatically be
deemed and included as registered formulas and statements of process
for all purposes. When a change is made in the registered formula or
statement of process (including those previously approved), the new
formula or statement of process must be registered. When a change is
made in an approved special natural wine formula, the new formula must
be approved.
Cancellation of Registered Formulas and Statements of Process
The proposed regulations also set forth the procedures for the
cancellation of registered formulas and statements of process
(including those previously approved). These procedures will appear in
27 CFR Part 70, Procedure and Administration. The establishment of
these procedures in the regulations will ensure that all industry
members are aware of this practice and will afford due process of a
notice and opportunity to present their position before their
registered formula or statement of process is cancelled. The proposed
cancellation procedures do not apply to approved formulas for special
natural wines. ATF is considering whether these procedures should apply
to such approved formulas and is interested in comments on this
question.
Executive Order 12866
It has been determined that this proposed rule is not a significant
regulatory action as defined in E.O. 12866. Therefore, a regulatory
assessment is not required.
Regulatory Flexibility Act
It is hereby certified that this proposed regulation will not have
a significant economic impact on a substantial number of small
entities. The proposed rule is liberalizing in nature in that domestic
proprietors will be able to commence production in a more timely manner
for those wines, distilled spirits, and beers which require a
registered formula or statement of process. Accordingly, a regulatory
flexibility analysis is not required.
Pursuant to section 7805(f) of the Internal Revenue Code, this
proposed regulation has been submitted to the Chief Counsel for
Advocacy of the Small Business Administration for comment on its impact
on small business.
Paperwork Reduction Act
The collections of information contained in this notice of proposed
rulemaking have been previously reviewed and approved by the Office of
Management and Budget in accordance with the requirements of the
Paperwork Reduction Act of 1980 (44 U.S.C. 3504(h)) under the following
control numbers: 1512-0045, 1512-0058, 1512-0059, 1512-0192, 1512-0198,
1512-0203, 1512-0204, 1512-0205, 1512-0206, 1512-0207, 1512-0216, 1512-
0250, 1512-0298, 1512-0352, 1512-0461, 1512-0462, 1512-0503. These
control numbers were in effect on October 1, 1995, the effective date
of the Paperwork Reduction Act of 1995. Comments on the collections of
information should be sent to the Office of Management and Budget,
Attention: Desk officer for the Department of the Treasury, Bureau of
Alcohol, Tobacco and Firearms, Office of Information and Regulatory
Affairs, Washington, DC 20503, with copies to the Chief, Document
Services Branch, Room 3450, Bureau of Alcohol, Tobacco, and Firearms,
650 Massachusetts Avenue, NW., Washington, DC 20226.
Public Participation
ATF requests comments on the proposed regulations from all
interested persons. 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.
ATF will not recognize any material in comments as confidential.
Comments may be disclosed to the public. Any material which the
commenter considers to be confidential or inappropriate for disclosure
to the public should not be included in the comment. The name of the
person submitting a comment is not exempt from disclosure.
Any interested person who desires an opportunity to comment orally
at a public hearing should submit his or her request, in writing, to
the Director within the 60-day comment period. The
[[Page 58313]]
Director, however, reserves the right to determine, in light of all
circumstances, whether a public hearing is necessary.
Disclosure
Copies of this notice and the written comments will be available
for public inspection during normal business hours at: ATF Public
Reading Room, Room 6480, 650 Massachusetts Avenue, NW., Washington, DC.
Drafting Information:
The author of this document is James P. Ficaretta, Wine, Beer, and
Spirits Regulations Branch, Bureau of Alcohol, Tobacco and Firearms.
List of Subjects
Part 5
Advertising, Consumer protection, Customs duties and inspection,
Imports, Labeling, Liquors, and Packaging and containers.
Part 19 q02
Administrative practice and procedure, Alcohol and alcoholic
beverages, Authority delegations, Claims, Chemicals, Customs duties and
inspection, Electronic funds transfers, Excise taxes, Exports, Gasohol,
Imports, Labeling, Liquors, Packaging and containers, Reporting
requirements, Research, Security measures, Spices and flavorings,
Surety bonds, Transportation, U.S. possessions, Warehouses, and Wine.
Part 24
Administrative practice and procedure, Authority delegations,
Claims, Electronic funds transfers, Excise taxes, Exports, Food
additives, Fruit juices, Labeling, Liquors, Packaging and containers,
Reporting and recordkeeping requirements, Research, Scientific
equipment, Spices and flavorings, Surety bonds, Taxpaid wine bottling
house, Transportation, Vinegar, Warehouses, and Wine.
Part 25
Administrative practice and procedure, Authority delegations, Beer,
Claims, Electronic funds transfers, Excise taxes, Labeling, Packaging
and containers, Reporting and recordkeeping requirements, Research,
Surety bonds, and Transportation.
Part 70
Administrative practice and procedure, Alcohol and alcoholic
beverages, Appeals, Authority delegations, Cancellations, Claims,
Government employees, Informal conferences, Law enforcement, and Law
enforcement officers.
Part 250
Administrative practice and procedure, Alcohol and alcoholic
beverages, Authority delegations (Government agencies), Beer, Claims,
Customs duties and inspection, Drugs, Electronic funds transfers,
Excise taxes, Foods, Liquors, Packaging and containers, Puerto Rico,
Reporting and recordkeeping requirements, Spices and flavorings, Surety
bonds, Transportation, Virgin Islands, Warehouses, and Wine.
Authority and Issuance
27 CFR Parts 5, 19, 24, 25, 70, and 250 are amended as follows:
PART 5--LABELING AND ADVERTISING OF DISTILLED SPIRITS
Paragraph 1. The authority citation for 27 CFR Part 5 continues to
read as follows:
Authority: 26 U.S.C. 5301, 7805; 27 U.S.C. 205.
Par. 2. Section 5.11 is amended by adding a definition for
``registered formula'' to read as follows:
Sec. 5.11 Meaning of terms.
* * * * *
Registered formula. A distilled spirits formula which has been
filed with the Director and bears the signature of the Director or the
Director's delegate.
* * * * *
Par. 3. Section 5.26 is revised to read as follows:
Sec. 5.26 Formula requirements.
(a) General. A registered formula is required to blend, mix,
purify, refine, compound, or treat spirits in a manner which results in
a change of character, composition, class or type of the spirits. Form
5110.38 (formerly 27-B Supplemental) shall be filed with the Director
in accordance with the instructions on the form and shall designate all
ingredients and, if required, the process used. Any approved formula on
Form 27-B Supplemental and any approved or registered formula on Form
5110.38 shall remain in effect until canceled, superseded, or
voluntarily surrendered. Any existing qualifying statements as to the
rate of tax or the limited use of drawback flavors appearing on a Form
27-B Supplemental are obsolete.
(b) Registration of formulas approved before (effective date of
final rule). Any formula on Form 27-B Supplemental or Form 5110.38 that
was approved before (effective date of final rule) is included as a
registered formula, as required by paragraph (a) of this section,
without any resubmission by the holder of the approved formula or
notification by ATF.
(c) Change in formula. Any change in a registered formula shall
require the filing of a new Form 5110.38. After a change in a formula
has been registered, the original formula shall be surrendered to the
Director.
(d) Cancellation of registered formula. The procedures for the
cancellation of a registered formula are prescribed in 27 CFR Part 70,
Subpart E.
Par. 4. Section 5.28 is revised to read as follows:
Sec. 5.28 Adoption of predecessor's formulas.
The adoption by a successor of registered Forms 5110.38 shall be in
the form of an application filed with the Director. The application
shall clearly show that the predecessor has authorized the use of its
previously approved or registered formulas by the successor. The
application shall list the formulas for adoption by:
(a) Formula number,
(b) Name of product, and
(c) Date of registration (or original date of approved formula, if
any).
PART 19--DISTILLED SPIRITS PLANTS
Par. 5. The authority citation for 27 CFR Part 19 continues to read
as follows:
Authority: 19 U.S.C. 81c, 1311; 26 U.S.C. 5001, 5002, 5004-5006,
5008, 5010, 5041, 5061, 5062, 5066, 5081, 5101, 5111-5113, 5142,
5143, 5146, 5171-5173, 5175, 5176, 5178-5181, 5201-5204, 5206, 5207,
5211-5223, 5231, 5232, 5235, 5236, 5241-5243, 5271, 5273, 5301,
5311-5313, 5362, 5370, 5373, 5501-5505, 5551-5555, 5559, 5561, 5562,
5601, 5612, 5682, 6001, 6065, 6109, 6302, 6311, 6676, 6806, 7011,
7510, 7805; 31 U.S.C. 9301, 9303, 9304, 9306.
Par. 6. Section 19.11 is amended by adding a definition for
``registered formula'' to read as follows:
Sec. 19.11 Meaning of terms.
* * * * *
Registered formula. A distilled spirits formula which has been
filed with the Director and bears the signature of the Director or the
Director's delegate.
* * * * *
Par. 7. Section 19.187(a) is revised to read as follows:
Sec. 19.187 Adoption of formulas.
(a) Forms 5110.38. The adoption by a successor of registered Forms
5110.38 shall be in the form of an application, filed with the
Director. The application shall list the formulas for adoption by
formula number, name of product, and date of registration (or original
date of
[[Page 58314]]
the approved formula, if any). The application shall clearly show that
the predecessor has authorized the use of its previously registered
formulas by the successor.
* * * * *
Par. 8. Section 19.324(b), under the undesignated center heading
``FORMULA'', is revised to read as follows:
Formula
Sec. 19.324 Statement of production procedure or Form 5110.38.
* * * * *
(b) As provided in 27 CFR 5.27, a registered formula on Form
5110.38 is required for the redistillation of spirits in the production
account. Any formula on Form 5110.38 that was approved before
(effective date of final rule) is included as a registered formula, as
required by this paragraph, without any resubmission by the holder of
the approved formula or notification by ATF. The procedures for the
cancellation of a registered formula are prescribed in 27 CFR Part 70,
Subpart E.
* * * * *
Par. 9. Section 19.331 is revised to read as follows:
Sec. 19.331 General.
Distillers or processors may redistill spirits, denatured spirits,
articles, and spirits residues. Certain products may only be
redistilled pursuant to a registered formula on Form 5110.38, as
specified in 27 CFR 5.27. Any formula on Form 5110.38 that was approved
before (effective date of final rule) is included as a registered
formula, as required by this paragraph, without any resubmission by the
holder of the approved formula or notification by ATF. The procedures
for the cancellation of a registered formula are prescribed in 27 CFR
Part 70, Subpart E.
(Sec. 201, Pub. L. 85-859, 72 Stat. 1365, as amended (26 U.S.C.
5223))
Par. 10. Section 19.378, under the undesignated center heading
``FORMULAS'', is revised to read as follows:
Formulas
Sec. 19.378 Formula requirements.
A registered formula on ATF Form 5110.38 must be secured for
spirits for domestic use or export as provided in 27 CFR 5.26-5.27
before processors may blend, mix, purify, refine, compound or treat
spirits in any manner which results in a change of character,
composition, class or type of the spirits including redistillation as
provided in Sec. 19.331, and the production of gin or vodka by other
than original and continuous distillation. Any formula on ATF Form
5110.38 that was approved before (effective date of final rule) is
included as a registered formula, as required by this paragraph,
without any resubmission by the holder of the approved formula or
notification by ATF. The procedures for the cancellation of a
registered formula are prescribed in 27 CFR part 70, Subpart E.
(Sec. 201, Pub. L. 85-859, 72 Stat. 1356, as amended, 1395, as
amended (26 U.S.C. 5201, 5555))
Par. 11. Section 19.596(b)(6) is amended by removing the words ``an
approved'' and adding the words ``a registered'' in their place.
Par. 12. Section 19.723(c)(2) is amended by removing the word
``approved'' and adding in its place the word ``registered'' in the
first sentence.
Par. 13. Section 19.778(b) is amended by removing the word
``approved'' and adding in its place the word ``registered''.
PART 24--WINE
Par. 14. The authority citation for 27 CFR Part 24 continues to
read as follows:
Authority: 5 U.S.C. 552(a); 26 U.S.C. 5001, 5008, 5041, 5042,
5044, 5061, 5062, 5081, 5111-5113, 5121, 5122, 5142, 5143, 5173,
5206, 5214, 5215, 5351, 5353, 5354, 5356-5357, 5361, 5362, 5364-
5373, 5381-5388, 5391, 5392, 5551, 5552, 5661, 5662, 5684, 6065,
6091, 6109, 6301, 6302, 6311, 6651, 6676, 7011, 7302, 7342, 7502,
7503, 7606, 7805, 7851; 31 U.S.C. 9301, 9303, 9304, 9306.
Par. 15. Section 24.10 is amended by adding the words ``or
registered'' after the word ``approved'' in the definition for
``formula wine'' and by adding a definition for ``registered formula''
to read as follows:
Sec. 24.10 Meaning of terms.
* * * * *
Registered formula. A wine formula which has been filed with the
Director and bears the signature of the Director or the Director's
delegate.
* * * * *
Par. 16. Sections 24.80, 24.81, and 24.82, under the designated
heading ``FORMULAS'', are revised and new section 24.83 is added to
read as follows:
Formulas
Sec. 24.80 General.
The proprietor shall, before production, register the formula and
process by which agricultural wine and other than standard wine (except
distilling material or vinegar stock) are to be made. Any formula for
an agricultural wine and other than standard wine that was approved
before (effective date of final rule) is included as a registered
formula, as required by this section, without any resubmission by the
holder of the approved formula or notification by ATF. For special
natural wine, the proprietor shall, before production, obtain approval
of the formula and process by which such wine is to be made. The
formula shall be prepared and filed with the Director on ATF F 5120.29,
Formula and Process for Wine, in accordance with the instructions on
the form. A nonbeverage wine formula shall show the intended use of the
finished wine or wine product. Any formula registered or approved under
this section shall remain in effect until revoked, cancelled,
superseded, or voluntarily surrendered. Except for research,
development, and testing, no special natural wine, agricultural wine
or, if required to be covered by a registered formula, other than
standard wine may be produced prior to approval or registration by the
Director of a formula covering each ingredient and process (if the
process requires approval or registration) used in the production of
the product.
(Sec. 201, Pub. L. 85-859, 72 Stat. 1380, as amended, 1381, as
amended, 1386, as amended, 1395, as amended (26 U.S.C. 5361, 5367,
5386, 5387, 5555))
(Approved by the Office of Management and Budget under control
number 1512-0059)
Sec. 24.81 Filing of formulas.
The proprietor shall designate on each formula filed all
ingredients and, if required, describe each process used to produce the
wine. The addition or elimination of ingredients, changes in quantities
used, and changes in the process of production or any other change in
an approved or registered formula shall require the filing of a new ATF
F 5120.29. After a change in formula is approved or registered, the
original formula shall be surrendered to the Director. The proprietor
shall serially number each formula, commencing with ``1'' and
continuing thereafter in numerical sequence. Nonbeverage wine formulas
shall be prefixed with the symbol ``NB.'' The Director or the regional
director (compliance) may at any time require the proprietor to file a
statement of process in addition to that required by the ATF F 5120.29
or any other data to determine whether the formula should be approved,
registered, revoked, or cancelled.
(Sec. 201, Pub. L. 85-859, 72 Stat. 1381, as amended, 1395, as
amended (26 U.S.C. 5367, 5555))
[[Page 58315]]
(Approved by the Office of Management and Budget under control
number 1512-0059)
Sec. 24.82 Samples.
The Director or the regional director (compliance) may, at any
time, require the proprietor to submit samples of any wine or wine
product made in accordance with an approved or registered formula or of
any materials used in production.
(Sec. 201, Pub. L. 85-859, 72 Stat. 1380, as amended (26 U.S.C.
5351, 5361, 5362))
(Approved by the Office of Management and Budget under control
number 1512-0059)
Sec. 24.83 Cancellation of registered formulas.
The procedures for the cancellation of a registered formula are
prescribed in 27 CFR part 70, subpart E.
Par. 17. Section 24.127 is revised to read as follows:
Sec. 24.127 Adoption of formulas.
The adoption of approved or registered formulas by a successor
proprietor shall be in the form of an application, filed with the
Director. The application shall list the formulas for adoption by
formula number, name of product, and date of approval or registration
(or original date of the approved formula for an agricultural wine or
other than standard wine, if any). The application shall clearly show
that the outgoing proprietor has authorized the successor proprietor's
use of the approved or registered formulas.
(Sec. 201, Pub. L. 85-859, 72 Stat. 1379, as amended (26 U.S.C.
5356))
(Approved by the Office of Management and Budget under control
number 1512-0058)
Par. 18. Section 24.192 is amended by removing the word
``approval'' in the third sentence and by adding in its place the word
``registration''.
Par. 19. Section 24.201 is revised to read as follows:
Sec. 24.201 Formula required.
Before producing any agricultural wine, the proprietor shall
register with the Director the formula and process by which it is to be
made pursuant to the provisions of Sec. 24.80. Any change in a formula
shall be registered in advance as provided by Sec. 24.81. The
procedures for the cancellation of a registered formula are prescribed
in 27 CFR part 70, subpart E.
(Sec. 201, Pub. L. 85-859, 72 Stat. 1386, as amended (26 U.S.C.
5387))
(Approved by the Office of Management and Budget under control
number 1512-0059)
Par. 20. Section 24.211 is revised to read as follows:
Sec. 24.211 Formula required.
A proprietor who desires to produce other than standard wine shall
first register the formula by which it is to be made, except that no
formula is required for distilling material or vinegar stock. The
formula shall be filed with the Director as provided by Sec. 24.80. Any
change in the formula shall be registered in advance as provided by
Sec. 24.81. The procedures for the cancellation of a registered formula
are prescribed in 27 CFR part 70, subpart E.
(Sec. 201, Pub. L. 85-859, 72 Stat. 1387, as amended (26 U.S.C.
5388))
(Approved by the Office of Management and Budget under control
number 1512-0059)
Par. 21. Section 24.214 is amended by removing the words ``an
approved'' in the fourth sentence and by adding in its place the words
``a registered''.
Par. 22. Section 24.303(b) is amended by adding the words ``or
registered'' after the word ``approved''.
PART 25--BEER
Par. 23. The authority citation for 27 CFR part 25 continues to
read as follows:
Authority: 19 U.S.C. 81c; 26 U.S.C. 5002, 5051-5054, 5056, 5061,
5091, 5111, 5113, 5142, 5143, 5146, 5222, 5401-5403, 5411-5417,
5551, 5552, 5555, 5556, 5671, 5673, 5684, 6011, 6061, 6065, 6091,
6109, 6151, 6301, 6302, 6311, 6313, 6402, 6651, 6656, 6676, 6806,
7011, 7342, 7606, 7805; 31 U.S.C. 9301, 9303-9308.
Par. 24. Section 25.11 is amended by adding definitions for
``Chief, Product Compliance Branch'' and ``registered statement of
process'' to read as follows:
Sec. 25.11 Meaning of terms.
* * * * *
Chief, Product Compliance Branch. The ATF official responsible for
registering statements of process under this part.
* * * * *
Registered statement of process. A statement of process under
Sec. 25.67 which has been filed with ATF and bears the signature of the
Chief, Product Compliance Branch or his or her delegate.
* * * * *
Par. 25. Section 25.62 is amended by removing paragraph (a)(7) and
by redesignating paragraphs (a)(8) through (a)(12) as paragraphs (a)(7)
through (a)(11).
Par. 26. Section 25.67 is amended by revising paragraphs (a) and
(c), and by adding new paragraph (d) to read as follows:
Sec. 25.67 Statement of process.
(a) A statement of process shall be prepared on letterhead
stationery, in triplicate, and filed and registered with the Chief,
Product Compliance Branch for any fermented beverage which the brewer
intends to produce and market under a name other than ``beer,''
``ale,'' ``porter,'' ``stout,'' ``lager,'' or ``malt liquor.'' Each
statement of process shall include a serial number and shall identify
each of the brewer's breweries for which it is filed. The brewer may
not commence production of such beverages until the statement of
process has been registered. Any statement of process that was approved
before (effective date of final rule) is included as a registered
statement of process, as required by this paragraph, without any
resubmission by the holder of the approved statement of process or
notification by ATF.
* * * * *
(c) The base product for any fermented beverage (other than sake or
cereal beverage) requiring a statement of process shall have the
characteristics of beer as defined in Sec. 25.11.
(d) The procedures for the cancellation of a registered statement
of process are prescribed in 27 CFR part 70, Subpart E.
(Sec. 201, Pub. L. 85-859, 72 Stat. 1333, as amended, 1388, as
amended (26 U.S.C. 5052, 5401))
Par. 27. Section 25.71(b)(2) is revised to read as follows:
Changes After Original Qualification
Sec. 25.71 Amended or superseding notices.
* * * * *
(b) * * *
(2) If the information required by Sec. 25.62(a)(4), (5), (6), (8),
and (9) is on file as part of an approved Form 5130.10 and is current,
the brewer may incorporate by reference those documents as part of any
superseding notice.
* * * * *
Par. 28. Section 25.76 is revised to read as follows:
Sec. 25.76 Change in statement of process.
When there is a change in the information in a statement of process
required by Sec. 25.67 for any fermented beverage produced and marketed
under a name other than ``beer,'' ``ale,'' ``porter,'' ``stout,''
``lager,'' or ``malt liquor,'' the brewer shall file and register an
amended statement of process with the Chief, Product Compliance Branch
prior to using such changed statement.
(Sec. 201, Pub. L. 85-859, 72 Stat. 1388, as amended (26 U.S.C.
5401))
[[Page 58316]]
PART 70--PROCEDURE AND ADMINISTRATION
Par. 29. The authority citation for 27 CFR Part 70 continues to
read as follows:
Authority: 5 U.S.C. 301, 552; 26 U.S.C. 4181, 4182, 5146, 5203,
5207, 5275, 5367, 5415, 5504, 5555, 5684(a), 5741, 5761(b), 6020,
6021, 6064, 6102, 6155, 6159, 6201, 6203, 6204, 6301, 6303, 6311,
6313, 6314, 6321, 6323, 6325, 6326, 6331-6343, 6401-6404, 6407,
6416, 6423, 6501-6503, 6511, 6513, 6514, 6532, 6601, 6602, 6611,
6621, 6622, 6651, 6653, 6656, 6657, 6658, 6665, 6671, 6672, 6701,
6723, 6801, 6862, 6863, 6901, 7011, 7101, 7102, 7121, 7122, 7207,
7209, 7214, 7304, 7401, 7403, 7406, 7423, 7424, 7425, 7426, 7429,
7430, 7432, 7502, 7503, 7505, 7506, 7513, 7601-7606, 7608-7610,
7622, 7623, 7653, 7805.
Par. 30. Section 70.11 is amended by adding definitions for
``Chief, Alcohol and Tobacco Programs Division'', ``Chief, Product
Compliance Branch'', ``registered formula'', and ``registered statement
of process'' to read as follows:
Sec. 70.11 Meaning of terms.
* * * * *
Chief, Alcohol and Tobacco Programs Division. The Bureau official
responsible for deciding appeals of cancellations of registered
formulas and registered statements of process under this part.
Chief, Product Compliance Branch. The Bureau official responsible
for issuing cancellations of registered formulas and registered
statements of process under this part.
* * * * *
Registered formula. A distilled spirits or wine formula which has
been filed with the Bureau and bears the signature of the Director or
the Director's delegate.
Registered statement of process. A statement of process under 27
CFR 25.67 which has been filed with the Bureau and bears the signature
of the Chief, Product Compliance Branch or his or her delegate.
* * * * *
Par. 31. Sections 70.421 through 70.428, under the new undesignated
center heading ``CANCELLATION OF REGISTERED FORMULAS OR STATEMENTS OF
PROCESS FOR DISTILLED SPIRITS, WINES AND BEER'', are added to Subpart E
to read as follows:
Cancellation of Registered Formulas or Statements of Process for
Distilled Spirits, Wines and Beer
Sec. 70.421 Cancellation of registration.
(a) Cancellation of registered formulas or statements of process.
Formulas registered on ATF Form 5110.38 or ATF Form 5120.29 and
registered statements of process, may be cancelled by the Chief,
Product Compliance Branch, upon a finding that the formula or statement
of process is not in compliance with the applicable laws or
regulations.
(b) Notice of proposed cancellation. Except as provided in section
70.422(a), when the Chief, Product Compliance Branch, determines that a
formula or statement of process which has been registered is not in
compliance with the laws or regulations, he or she shall issue to the
holder of the formula or statement of process a notice of proposed
cancellation which shall set forth the basis for the proposed
cancellation. The notice of proposed cancellation will advise the
holder of the formula or statement of process that he or she has 45
days from the date of the notice in which to present written arguments
or evidence as to why the cancellation should not occur. If the holder
of the formula or statement of process does not respond to the notice
of proposed cancellation within 45 days of such notice, the holder will
be deemed to concur with the finding of non-compliance, and the formula
or statement of process will be cancelled. In either case, the right of
appeal afforded in paragraph (d) of this section applies.
(c) Decision after notice of proposed cancellation. After
considering any written arguments or evidence presented by the holder
of the registered formula or statement of process, the Chief, Product
Compliance Branch, shall issue a decision. If the decision is to cancel
the registered formula or statement of process, a letter shall be
issued explaining the basis for the cancellation and the specific laws
or regulations relied upon in determining that the registered formula
or statement of process was not in conformance with law or regulations.
If the decision is to withdraw the proposed cancellation, a letter to
that effect shall be issued.
(d) Appeal of cancellation. A holder of a registered formula or
statement of process who wishes to appeal the decision of the Chief,
Product Compliance Branch, may file a written appeal with the Chief,
Alcohol and Tobacco Programs Division. The written appeal should set
forth in detail the reasons he or she believes the decision of the
Chief, Product Compliance Branch, was in error. Such appeal must be
filed with the Chief, Alcohol and Tobacco Programs Division, within 45
days after the date of the decision of the Chief, Product Compliance
Branch.
(e) Final decision after appeal. After considering any written
arguments or evidence presented by the holder of the registered formula
or statement of process the Chief, Alcohol and Tobacco Programs
Division, shall issue a written decision to the holder of the
registered formula or statement of process. If the decision is to
cancel the registered formula or statement of process, a letter shall
be issued explaining the basis for the cancellation and the specific
laws or regulations relied upon in determining that the registered
formula or statement of process was not in conformance with law or
regulations. If the decision is to withdraw the proposed cancellation,
a letter to that effect shall be sent to the holder of the registered
formula or statement of process. The decision of the Chief, Alcohol and
Tobacco Programs Division, shall be the final decision of the Bureau.
Sec. 70.422 Cancellation of registration by operation of law or
regulation.
(a) Cancellation by operation of law or regulation. The Bureau will
not individually notify all holders of registered formulas or
statements of process that such registrations have been canceled in
situations where such cancellation occurs by operation of law or
regulation. Where changes in requirements are made as a result of
amendments or revisions to the law or regulations, it is the
responsibility of the holder of the registered formula or statement of
process to surrender voluntarily all registered formulas or statements
of process which are no longer in compliance and to submit new formulas
and statements of process that are in compliance with the new
requirements; Provided, that in certain circumstances, the Bureau may
announce that the submission of new formulas or statements of process
for registration is not necessary in order to implement a new
requirement in the law or regulations. In such circumstances, it is the
responsibility of the holder of the registered formula or statement of
process to ensure that formulas and statements of process are in
compliance with the requirements of the new regulations or law,
notwithstanding the fact that registration of new formulas or
statements of process was not required.
(b) Notice of cancellation. If the Bureau determines that a holder
of a registered formula or statement of process is using such
registered formula or statement of process when it is no longer in
compliance due to amendments or revisions in the law or regulations,
the Chief, Product Compliance Branch, will notify the holder of the
registered formula or statement of process in writing that the
[[Page 58317]]
subject formula or statement of process has been canceled by operation
of law or regulations, with a brief description of the grounds for such
cancellation.
(c) Appeal of notice of cancellation. Within 45 days after the date
of a notice of cancellation by operation of law or regulations, the
holder of a registered formula or statement of process may file a
written appeal with the Chief, Alcohol and Tobacco Programs Division.
The appeal should set forth the reasons why the holder of the
registered formula or statement of process believes that the regulation
or law at issue does not require the cancellation of the registered
formula or statement of process.
(d) Decision after appeal. After considering all written arguments
and evidence submitted by the holder of the registered formula or
statement of process, the Chief, Alcohol and Tobacco Programs Division,
shall issue a decision regarding the cancellation by operation of law
or regulation of the registered formula or statement of process. If the
decision is that the law or regulation at issue requires the
cancellation of the registered formula or statement of process, a
letter shall be issued explaining the basis for the cancellation and
citing the specific laws or regulations which required the cancellation
of the registered formula or statement of process. If the decision is
that the law or regulation at issue does not require the cancellation
of such registered formula or statement of process, a letter to that
effect shall be sent to the holder of the registered formula or
statement of process. The decision of the Chief, Alcohol and Tobacco
Programs Division, shall be the final decision of the Bureau.
Sec. 70.423 Informal conferences.
(a) General. As part of a timely filed written appeal of a notice
of proposed cancellation, notice of cancellation by operation of law or
regulations, or a decision of the Chief, Product Compliance Branch, to
cancel a registered formula or statement of process, a holder of a
registered formula or statement of process may file a written request
for an informal conference with the Chief, Alcohol and Tobacco Programs
Division. The decision whether to hold an informal conference is at the
sole discretion of the Chief, Alcohol and Tobacco Programs Division.
(b) Informal conference procedures. If the Chief, Alcohol and
Tobacco Programs Division determines that the holding of an informal
conference would be beneficial, he or she shall inform the holder of
the registered formula or statement of process and a date shall be
agreed upon. The informal conference is for purposes of discussion only
and no transcript shall be made. If the holder of the registered
formula or statement of process wishes to rely upon arguments, facts,
or evidence presented at the informal conference, he or she has 10 days
after the date of the conference to incorporate such arguments, facts,
or evidence in a written submission to the Chief, Alcohol and Tobacco
Programs Division.
Sec. 70.424 Effective dates of cancellations.
With the exception of cancellations occurring pursuant to section
70.422(a), the Bureau shall allow at least 45 days between the issuance
of a decision to cancel a registered formula or statement of process
and the actual cancellation of the registered formula or statement of
process. The deciding official may, at his or her discretion, allow the
holder of the registered formula or statement of process a longer
period of time in which to use the registered formula or statement of
process. The decision to allow such a ``use-up'' period and the length
of the ``use-up'' period allowed are matters committed entirely to the
discretion of the deciding official, based on the circumstances of the
case.
Sec. 70.425 Effect of cancellations.
(a) General. On the effective date of a final decision which has
been issued by the Chief, Product Compliance Branch, or the Chief,
Alcohol and Tobacco Programs Division, to cancel a registered formula
or statement of process, the holder of the registered formula or
statement of process shall be asked to surrender the original of such
registered formula or statement of process to the Bureau for manual
cancellation. Whether or not the original registered formula or
statement of process has been manually cancelled, the formula or
statement of process shall be null and void after the effective date of
the cancellation of the registered formula or statement of process. It
shall be a violation of this section for any holder of a registered
formula or statement of process to present a registered formula or
statement of process to an official of the United States Government as
a valid registered formula or statement of process if the holder of the
registered formula or statement of process has been previously notified
that such registered formula or statement of process has been cancelled
by the Bureau or the formula or statement of process was cancelled by
operation of law or regulation.
(b) Use of registered formula or statement of process during period
of appeal. If a holder of a registered formula or statement of process
files a timely appeal after receipt of a notice of cancellation from
the Chief, Product Compliance Branch pursuant to section 70.421(c), he
or she may continue to use the registered formula or statement of
process at issue until the effective date of a final decision issued by
the Chief, Alcohol and Tobacco Programs Division. However, the
effective date of a notice of cancellation by operation of law or
regulations, issued pursuant to section 70.422(b), is not stayed during
the pendency of an appeal.
Sec. 70.426 Service on holder of registered formula or statement of
process.
Notices of proposed cancellation and notices of cancellation shall
be served on a holder of a registered formula or statement of process
by first class mail or by personal delivery. When service is by mail, a
signed duplicate original copy of the document shall be mailed to the
holder of the registered formula or statement of process at the address
stated on the registered formula or statement of process or at the last
known address. If authorized by the holder of the registered formula or
statement of process, the signed duplicate original copy of the
document may be mailed to a designated representative. Where service is
by personal delivery, a signed duplicate original copy of the document
shall be delivered to the holder of the registered formula or statement
of process or to a designated representative or, in the case of a
corporation, partnership, or association, by delivering it to an
officer, manager, or general agent thereof or to its attorney of
record.
Sec. 70.427 Representation before the Bureau.
A holder of a registered formula or statement of process may be
represented by an attorney, certified public accountant, or other
person recognized to practice before the Bureau as provided in 31 CFR
Part 8 (Practice Before the Bureau of Alcohol, Tobacco and Firearms) if
he or she has otherwise complied with the applicable requirements of 26
CFR 601.521 through 601.527 (conference and practice requirements for
alcohol, tobacco, and firearms activities).
Sec. 70.428 Computation of time.
(a) Computation. In computing any period of time prescribed or
allowed by sections 70.421 through 70.425, the day of the act, event or
default after which the designated period of time is to run is not to
be included. The last day of the period to be computed is to be
included, unless it is a Saturday, Sunday, or legal
[[Page 58318]]
holiday, in which event the period runs until the next day which is
neither a Saturday, Sunday, or legal holiday. Papers or documents which
are required or permitted to be filed under the aforementioned sections
of regulations must be received for filing at the appropriate office
within the time limits, if any, for such filing.
(b) Extensions. For good cause shown, the Chief, Product
Compliance Branch, or the Chief, Alcohol and Tobacco Programs Division,
may grant extensions as to any time limits prescribed in sections
70.421 through 70.425.
PART 250--LIQUORS AND ARTICLES FROM PUERTO RICO AND THE VIRGIN
ISLANDS
Par. 32. The authority citation for 27 CFR Part 250 continues to
read as follows:
Authority: 19 U.S.C. 81c; 26 U.S.C. 5001, 5007, 5008, 5010,
5041, 5051, 5061, 5081, 5111, 5112, 5114, 5121, 5122, 5124, 5131-
5134, 5141, 5146, 5207, 5232, 5271, 5276, 5301, 5314, 5555, 6001,
6301, 6302, 6804, 7101, 7102, 7651, 7652, 7805; 27 U.S.C. 203, 205;
31 U.S.C. 9301, 9303, 9304, 9306.
Par. 33. Section 250.50 is amended by revising paragraph (b) and by
adding new paragraph (c) to read as follows:
Sec. 250.50 Formula for liquors.
* * * * *
(b) Wine. Persons in Puerto Rico who ship wine to the United States
shall comply with the formula requirements of 27 CFR Part 24. If any
wine contains liquors made outside of Puerto Rico, the country of
origin for each such liquor shall be stated on the formula. All
formulas required by this paragraph shall be submitted on ATF Form
5120.29, in accordance with Sec. 250.54.
(c) Cancellation of registered formulas. The procedures for the
cancellation of a registered distilled spirits or wine formula are
prescribed in 27 CFR Part 70, Subpart E.
* * * * *
(Approved by the Office of Management and Budget under control
number 1512-0204)
Par. 34. Section 250.51(b)(2) is revised to read as follows:
Sec. 250.51 Formulas for articles, eligible articles and products
manufactured with denatured spirits.
* * * * *
(b) * * *
(2) Products made with specially denatured spirits shall be made in
accordance with a general-use formula approved as provided in Part 20
of this chapter, or an approved formula on Form 5150.19, or previously
approved on ATF Form 1479-A or registered on 27-B Supplemental.
* * * * *
Par. 35. Sections 250.53 and 250.54 are amended by adding the words
``or registered'' after the word ``approved'' wherever it appears.
Par. 36. Section 250.55 is revised to read as follows:
Sec. 250.55 Previously approved formulas.
(a) Any formula on Form 27-B Supplemental that was approved before
(effective date of final rule) is included as a registered formula as
required by 27 CFR 5.26(a) and shall remain in effect until cancelled
or voluntarily surrendered. Except as provided in paragraph (b) of this
section, any person holding such a formula is not required to submit a
new formula.
(b) Any change in a registered formula shall require the filing of
a new Form 5110.38. After a change in a formula has been registered,
the original formula shall be surrendered to the Director.
(c) If a registered formula on Form 27-B Supplemental indicates
that carbon dioxide will be added to, or retained in, still wine, the
notice requirement of Sec. 250.52 shall not apply.
Par. 37. Section 250.173(b)(4) is amended by adding the words ``or
registered'' after the word ``approved''.
Par. 38. Section 250.197 is amended by removing the word
``approved'' and adding in its place the word ``registered'', and by
adding a second sentence to read as follows:
Sec. 250.197 Furnishing formula to consignee.
* * * Any formulas that were approved before (effective date of
final rule) are included as registered formulas, without any
resubmission by the holder of the approved formula or notification by
ATF.
* * * * *
Par. 39. Sections 250.205(a)(4) (i) and (ii) are amended by adding
the words ``or registered'' after the word ``approved''.
Par. 40. Section 250.220 is amended by revising paragraph (b) and
by adding new paragraph (c) to read as follows:
Sec. 250.220 Formulas for liquors.
* * * * *
(b) Wine. Persons in the Virgin Islands who ship wine to the
United States shall comply with the formula requirements of Part 24 of
this chapter. If any wine contains liquors made outside of the Virgin
Islands, the country of origin for each such liquor shall be stated on
the formula. All formulas required by this paragraph shall be submitted
on ATF Form 5120.29, in accordance with Sec. 250.224.
(c) Cancellation of registered formulas. The procedures for the
cancellation of a registered distilled spirits or wine formula are
prescribed in 27 CFR Part 70, Subpart E.
Par. 41. Section 250.221(b)(2) is revised to read as follows:
Sec. 250.221 Formulas for articles, eligible articles and products
manufactured with denatured spirits.
* * * * *
(b) * * *
(2) Products made with specially denatured spirits shall be made in
accordance with a general-use formula approved as provided in Part 20
of this chapter, or an approved formula on Form 5150.19, or previously
approved on ATF Form 1479-A or registered on 27-B Supplemental.
* * * * *
Par. 42. Sections 250.223 and 250.224 are amended by adding the
words ``or registered'' after the word ``approved'' wherever it
appears.
Par. 43. Section 250.225 is revised to read as follows:
Sec. 250.225 Previously approved formulas.
(a) Any formula on Form 27-B Supplemental that was approved before
(effective date of final rule) is included as a registered formula as
required by 27 CFR 5.26(a) and shall remain in effect until cancelled
or voluntarily surrendered. Except as provided in paragraph (b) of this
section, any person holding such a formula is not required to submit a
new formula.
(b) Any change in a registered formula shall require the filing of
a new Form 5110.38. After a change in a formula has been registered,
the original formula shall be surrendered to the Director.
(c) If a registered formula on Form 27-B Supplemental indicates
that carbon dioxide will be added to, or retained in, still wine, the
notice requirement of Sec. 250.222 shall not apply.
Par. 44. Section 250.309(b)(4) is amended by adding the words ``or
registered'' after the word ``approved''.
Signed: October 17, 1995.
John W. Magaw,
Director.
Approved: October 24, 1995.
Dennis M. O'Connell,
Acting Deputy Assistant Secretary (Regulatory, Tariff and Trade
Enforcement).
[FR Doc. 95-28471 Filed 11-24-95; 8:45 am]
BILLING CODE 4810-31-U
