[Federal Register Volume 61, Number 151 (Monday, August 5, 1996)]
[Proposed Rules]
[Pages 40568-40587]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-19427]


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DEPARTMENT OF THE TREASURY

Bureau of Alcohol, Tobacco and Firearms

27 CFR Parts 4, 5, 7, 19, 20, 22, 24, 25, 27, 70, 250, and 251

[Notice No. 834]
RIN 1512-AA72


Importation of Distilled Spirits, Wine and Beer (90 D 003)

AGENCY: Bureau of Alcohol, Tobacco and Firearms (ATF), Department of 
the Treasury.

ACTION: Notice of proposed rulemaking.

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SUMMARY: ATF is proposing to revise and recodify the regulations 
pertaining to the importation of distilled spirits, wine and beer. The 
purpose of this revision and recodification is to update and simplify 
the regulations in 27 CFR part 251, and to reissue those regulations as 
part 27 of the same chapter. The proposed changes will reduce the 
regulatory burden on importers of distilled spirits, wine and beer.

DATES: Written comments must be received on or before October 4, 1996.

ADDRESSES: Send written comments to: Chief, Wine, Beer and Spirits 
Regulations Branch, Alcohol and Tobacco Programs Division, Bureau of 
Alcohol, Tobacco and Firearms, PO Box 50221, Washington, DC 20091-0221. 
Attn: Notice No. 834.

FOR FURTHER INFORMATION CONTACT: Jennifer Kirn, Alcohol Import-Export 
Branch, Bureau of Alcohol, Tobacco and Firearms, 650 Massachusetts 
Ave., NW, Washington, DC 20226, telephone (202-927-8110).

SUPPLEMENTARY INFORMATION:

Background

    These proposed regulations pertaining to the importation of 
distilled spirits, wine and beer revise and recodify existing 
regulations in part 251 in order to update and simplify present 
requirements. The importation regulations now found in 27 CFR part 251 
will be reissued as part 27 of the same chapter.
    Certain restrictive regulations have been eliminated and, where 
appropriate, ATF rulings and Internal Revenue Service (IRS) Revenue 
Rulings have been incorporated into the proposed importation 
regulations. Current United States Customs Service (Customs Service) 
procedures are also incorporated in this notice where appropriate. 
Also, many existing regulations have been rewritten in order to clarify 
current requirements.
    The organization of the proposed importation regulations has been 
changed from the organization of 27 CFR part 251, in order to put 
related regulations together. Some of the substantive proposed changes 
from part 251 are noted below.

Change in Designation of Office

    The designation of Product Compliance Branch has been changed where 
it appeared in existing regulations in part 251 to Wine, Beer, and 
Spirits Regulations Branch in conformity with the change of office 
designations resulting from the executive level restructuring effective 
October 2, 1994.

Alternate Methods or Procedures

    Proposed subpart C contains proposed regulations changing the 
alternate methods or procedures requirements for importers. Importers 
will no longer be required to file an application in triplicate, with 
the regional director (compliance) for each place of business. Under 
the proposed regulations, importers will only be required to file one 
application with the regional director (compliance) for each place of 
business.

Special Occupational Taxes, Warehouse Receipts Covering Distilled 
Spirits

    Proposed subpart D contains clarifying amendments to existing 
regulations pertaining to importers engaged in the business of selling, 
or offering for sale, distilled spirits, wines or beer, and warehouse 
receipts covering distilled spirits.

Commercial Samples--Tax Free

    In proposed Subpart E, the quantity of distilled spirits, wine or 
beer which may be imported free of internal revenue tax as samples for 
use in soliciting orders for products of foreign countries has been 
increased slightly and changed to metric quantities, to be consistent 
with the metric quantities given in the Harmonized Tariff Schedule of 
the United States (19 U.S.C. 1202).

ATF and IRS Rulings

    Also, proposed Subpart E will incorporate pertinent parts of ATF 
Ruling 77-33, 1977 ATF C.B. 179, into the proposed importation 
regulations as recodified, and render the ruling obsolete. ATF Ruling 
77-33 held that alcohol may be used to increase the alcohol content in 
wine provided such use of alcohol is an authorized procedure and is 
consistent with a standard winemaking process in the country of origin. 
Wine produced in this manner which is imported into the United States 
will be taxed as a wine, so long as the alcoholic content of that wine 
does not exceed 24 percent by volume. Imported products which contain 
distilled spirits and which do not meet the conditions described in 
proposed 27 CFR 27.44, will be taxed as distilled spirits.
    In proposed Subpart F, ATF Ruling 83-6, ATF Q.B. 1983-4, 93, and 
ATF Ruling 84-3, ATF Q.B. 1984-4, 71, relating to the use of 
certificates of label (COLA) approval by a person other than the owner, 
will be declared obsolete, with pertinent parts of these rulings 
incorporated into proposed subpart F as described below. These rulings 
held that an importer may use COLAs to release products from customs 
custody only if the certificates are issued to that importer but that 
shipments may be released to an importer of record who is not the owner 
of the COLA provided certain conditions are met.
    Also in proposed subpart F, Revenue Ruling 56-579, C.B. 1956-2, 
1031, will be declared obsolete, upon incorporation of pertinent parts 
of that ruling into the proposed regulations. Revenue Ruling 56-579 
held that distilled spirits withdrawn from customs bond solely for the 
use of persons determined by the collector of customs to be entitled to 
free withdrawal privileges such as duly accredited foreign embassy 
personnel, the foreign diplomatic corps, or members of the armed 
services of foreign countries on active duty in the United States are 
not subject to labeling and liquor bottle regulations.

Alcoholic Beverage Health Warning Statement

    Proposed subpart F contains information about the health warning 
labeling requirements for alcoholic beverages bottled on or after 
November 18, l989. The proposed regulations

[[Page 40569]]

require that a health warning statement appear on the labels of all 
containers of alcoholic beverages sold or distributed. Sale and 
distribution includes sampling or any other distribution not for sale.

Samples for Foreign Embassy Use--Exempt From Marking, Bottling and 
Labeling Requirements

    Proposed subpart F contains requirements relating to samples of 
distilled spirits or wine solely for the use of foreign embassy 
personnel. Under the proposed regulations, samples to be used solely 
for the use of the embassy will be exempted from most of the marking, 
bottling and labeling requirements otherwise applicable.

Certificates of Origin

    Proposed subpart F provides that distilled spirits and wine 
imported in bottles shall not be released from customs custody unless 
the invoice for such products is accompanied by a certificate of age 
and origin in accordance with 27 CFR 5.52 (relating to distilled 
spirits) or a certificate of origin and identity in accordance with 27 
CFR 4.45, (relating to wine).

Section 5010 Credit Provisions

    Proposed subpart F also contains information regarding the credit 
allowable under 26 U.S.C. 5010 against the tax imposed on distilled 
spirits by 26 U.S.C. 5001. The credit against the tax imposed on 
distilled spirits is allowed under 26 U.S.C. 5010 on each proof gallon 
of alcohol derived from eligible wine, or from eligible flavors which 
do not exceed 2\1/2\ percent of the finished product on a proof gallon 
basis.

Wine Less Than 7 Percent Alcohol by Volume

    In proposed subpart F, wine having less than 7 percent alcohol by 
volume must be labeled prior to importation, or, if entered into 
customs bond, at the time of withdrawal therefrom, under regulations 
administered by the U.S. Food and Drug Administration (FDA), rather 
than under the labeling requirements of the Federal Alcohol 
Administration Act (FAA). In addition, under the Internal Revenue Code 
of 1986 (IRC), such wine labels should name the kind of wine (class and 
type), alcoholic content, net content and, if it is an effervescent 
wine, whether it is sparkling wine or carbonated wine.

Closures

    Subpart F proposes regulations requiring closures or other devices 
on imported containers of distilled spirits. These proposed regulations 
will explain the criteria for closures or other devices.

Use of Other Importer's Certificates of Label Approval

    Proposed subpart F also discusses use of certificates of label 
approval (COLA) (ATF F 5100.31) by persons other than the holder of 
such certificates for purposes of obtaining release of imported 
products from customs custody. The proposed regulations follow the 
procedures provided for in ATF Rulings 83-6 and 84-3, supra.

Record/Filing Requirements

    Proposed subpart H contains information instructing importers who 
have obtained certificates of label approval (COLA) to maintain the 
original COLAs on file at the basic permit location for not less than 3 
years following the last importation of such products. This is the 
usual retention period for required records under most ATF regulations. 
A record retention requirement is necessary to facilitate the 
enforcement of the labeling laws and to deter the use of false, 
fraudulent, and inaccurate COLAs. Further, the paperless entry 
procedures pursued by the Customs Service makes the retention of these 
records particularly necessary.

Bulk Importations

    Proposed Subpart I discusses the importation of distilled spirits, 
wine and beer in bulk. Bulk beer may be imported in containers under 
the provisions of 27 CFR, part 7. Bulk distilled spirits for 
nonindustrial use will not be released from customs custody unless the 
invoice is accompanied by a certificate of age and origin in accordance 
with 27 CFR, part 5. Bulk wine for nonindustrial use may be imported in 
containers in accordance with the provisions of 27 CFR, part 4.

Removal of Customs Officers from Customs Bonded Warehouses

    Subpart K also proposes changes in importation procedures resulting 
from removal of U. S. Customs officers from customs bonded warehouse 
regulations.
    These proposed changes implement procedures as a result of the 
withdrawal of customs officers from both customs bonded warehouses and 
customs manufacturing bonded warehouses. The Customs Service withdrew 
these officers in accordance with Treasury Decision 82-204, 47 FR 
49355, November 1, 1982.
    Following the implementation of changes brought about by T.D. 82-
204, when spirits are transferred directly from the place of 
importation to distilled spirits plant premises without being deposited 
in a customs bonded warehouse, the customs officer remains responsible 
for signing the transfer record. However, when spirits are transferred 
from a customs bonded warehouse to distilled spirits premises, the 
proprietor of the customs bonded warehouse is responsible for signing 
the transfer record. While existing regulations specifically state that 
distilled spirits plant proprietors are not required to file an 
application on ATF Form 5100.16 to receive imported spirits from 
customs custody, such statement has been deleted from the proposed 
subpart K to avoid confusion. Finally, under the proposed regulations, 
importers are no longer required to submit copies of the transfer 
record and package gauge records to ATF. Instead, the proposed 
regulations require that a copy of such records be retained as part of 
the importer's records.
    The following table is provided to give a better understanding of 
the regulation changes proposed. The table provides the applicable 
regulatory section from which the proposed regulation is derived. In 
addition the table describes the extent to which a regulation is 
revised or whether it is a new regulatory section.

                      Derivation Table for Part 27                      
------------------------------------------------------------------------
            The requirements of                   Are derived from      
------------------------------------------------------------------------
                               Subpart A                                
                                                                        
------------------------------------------------------------------------
                   Sec.                                 Sec.            
27.1......................................  251.1 P                     
27.2......................................      N                       
27.3......................................  251.2 P                     
27.4-27.10 [Reserved]                                                   
                                                                        
------------------------------------------------------------------------

[[Page 40570]]

                                                                        
                               Subpart B                                
                                                                        
------------------------------------------------------------------------
                   Sec.                                 Sec.            
27.11.....................................  251.11 P                    
Alcoholic beverage........................  251.11 P                    
ATF Officer...............................  251.11 N                    
Beer......................................  251.11 O                    
Bonded premises-distilled spirits plant...  251.11 O                    
Bulk beer.................................  251.11 N                    
Bulk distilled spirits....................  251.11 O                    
Bulk wine.................................  251.11 N                    
Cereal beverage...........................  251.11 N                    
CFR.......................................  251.11 0                    
Commercial bank...........................  251.11 N                    
Container.................................  251.11 N                    
Customs bonded warehouse..................  251.11 C                    
Customs officer...........................  251.11 O                    
Delegate..................................  251.11 N                    
Director..................................  251.11 P                    
Distilled spirits or spirits..............  251.11 P                    
Distilled spirits plant...................  251.11 P                    
Effective tax rate........................  251.11 O                    
Eligible flavor...........................  251.11 O                    
Eligible wine.............................  251.11 O                    
Foreign-trade zone or zone................  251.11 N                    
5010 credit...............................  251.11 N                    
Gallon or wine gallon.....................  251.11 O                    
Importer..................................  251.11 O                    
Industrial or nonindustrial use of spirits  251.11 N                    
 or wine.                                                               
Kind......................................  251.11 P                    
Liquors...................................  251.11 N                    
Liquor bottle.............................  251.11 O                    
Liter.....................................  251.11 N                    
Malt beverage.............................  251.11 N                    
Package...................................  251.11 N                    
Person....................................  251.11 O                    
Port Director of Customs..................  251.11 P                    
Proof.....................................  251.11 O                    
Proof Gallon..............................  251.11 O                    
Region....................................  251.11 O                    
Regional Director (Compliance)............  251.11 O                    
Secretary.................................  251.11 N                    
Specially denatured spirits...............  251.11 N                    
Standard effective tax rate...............  251.11 N                    
Tank truck................................  251.11 N                    
Tax.......................................  251.11 N                    
This chapter..............................  251.11 N                    
United States.............................  251.11 O                    
U.S.C.....................................  251.11 O                    
Wine......................................  251.11 C                    
27.12-27.20 [Reserved]                                                  
                                                                        
------------------------------------------------------------------------
                               Subpart C                                
                                                                        
------------------------------------------------------------------------
27.21.....................................  251.221 P                   
27.22-22.30 [Reserved]                                                  
                                                                        
------------------------------------------------------------------------
                               Subpart D                                
                                                                        
------------------------------------------------------------------------
27.31.....................................  251.30 P                    
27.32.....................................  251.31 P                    
27.33-27.40 [Reserved]                                                  
                                                                        
------------------------------------------------------------------------
                               Subpart E                                
                                                                        
------------------------------------------------------------------------
27.41.....................................  251.40 P                    
27.42.....................................  251.40a O                   
27.43.....................................  251.41 P                    
27.44.....................................  251.42 C                    
27.45.....................................  251.42a P                   

[[Page 40571]]

                                                                        
27.46.....................................  251.43 P                    
27.47.....................................  251.44 P                    
27.48.....................................  251.45 P                    
27.49.....................................  251.46 O                    
27.50.....................................  251.48 P                    
27.51.....................................  251.48a P                   
27.52.....................................  251.49 P                    
27.53-27.60 [Reserved]                                                  
                                                                        
------------------------------------------------------------------------
                               Subpart F                                
                                                                        
------------------------------------------------------------------------
27.61.....................................  251.55 P                    
27.62.....................................        N                     
27.63.....................................  251.56 P                    
27.64.....................................  251.57 O                    
27.65.....................................  251.58 P                    
27.66.....................................        N                     
27.67.....................................  251.59 P                    
27.68.....................................        N                     
27.69.....................................  251.60 C                    
27.70.....................................        N                     
27.71.....................................        N                     
27.72.....................................  251.61 P                    
27.73.....................................  251.61 & 251.62 C           
27.74.....................................  251.74 C                    
27.75.....................................  251.75 C                    
27.76.....................................  251.76 P                    
27.77.....................................  251.76 P                    
27.78.....................................  251.77 P                    
27.79-27.80 [Reserved]                                                  
                                                                        
------------------------------------------------------------------------
                        Subparts G-H [Reserved]                         
                                                                        
------------------------------------------------------------------------
27.81-27.110 [Reserved]                                                 
                                                                        
------------------------------------------------------------------------
                               Subpart I                                
                                                                        
------------------------------------------------------------------------
27.111....................................  251.121 P                   
27.112....................................  251.120 P                   
27.113....................................          N                   
27.114....................................          N                   
27.115-27.120 [Reserved]                                                
                                                                        
------------------------------------------------------------------------
                               Subpart J                                
                                                                        
------------------------------------------------------------------------
27.121....................................  251.133 C                   
27.122....................................  251.134 O                   
27.123....................................  251.136 P                   
27.124....................................  251.137 P                   
27.125....................................  251.138 O                   
27.126....................................  251.139 O                   
27.127-27.130 [Reserved]                                                
                                                                        
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                               Subpart K                                
                                                                        
------------------------------------------------------------------------
27.131....................................  251.171 P                   
27.132....................................  251.172 P                   
27.133....................................  251.173 C                   
27.134....................................  251.174 P                   
27.135....................................  251.175 P                   
27.136-27.140 [Reserved]                                                
                                                                        
------------------------------------------------------------------------
                               Subpart L                                
                                                                        
------------------------------------------------------------------------
27.141....................................  251.181 P                   
27.142....................................  251.182 O                   
27.143....................................  251.183 O                   
27.144....................................  251.184 O                   
27.145....................................  251.185 O                   

[[Page 40572]]

                                                                        
27.146-27.150 [Reserved]                                                
                                                                        
------------------------------------------------------------------------
                                Subpart M                               
                                                                        
------------------------------------------------------------------------
27.151....................................  251.201 O                   
27.152....................................  251.202 O                   
27.153....................................  251.204 P                   
27.154....................................  251.206 P                   
27.155....................................  251.207 P                   
27.156....................................  251.209 P                   
27.157-27.160 [Reserved]                                                
------------------------------------------------------------------------
Action Legend:                                                          
C--Complete revision.                                                   
O--No revision.                                                         
P--Partial revision.                                                    
N--New section.                                                         



                     Distribution Table for Part 251                    
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            The requirements of                   Are now found in      
------------------------------------------------------------------------
                               Subpart A                                
                                                                        
------------------------------------------------------------------------
                   Sec.                                 Sec.            
251.1.....................................  27.1                        
251.2.....................................  27.3                        
                                                                        
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                                Subpart B                               
                                                                        
------------------------------------------------------------------------
251.11....................................  27.11                       
                                                                        
------------------------------------------------------------------------
                                Subpart C                               
                                                                        
------------------------------------------------------------------------
251.30....................................  27.31                       
251.31....................................  27.32                       
                                                                        
------------------------------------------------------------------------
                                Subpart D                               
                                                                        
------------------------------------------------------------------------
251.40....................................  27.41                       
251.40a...................................  27.42                       
251.41....................................  Obsolete.                   
251.42....................................  27.44                       
251.42a...................................  27.45                       
251.43....................................  27.46                       
251.44....................................  27.47                       
251.45....................................  27.48                       
251.46....................................  27.49                       
251.48....................................  27.50                       
251.48a...................................  27.51                       
251.49....................................  27.52                       
                                                                        
------------------------------------------------------------------------
                                Subpart E                               
                                                                        
------------------------------------------------------------------------
251.55....................................  27.61                       
251.56....................................  27.63                       
251.57....................................  27.64                       
251.58....................................  27.65                       
251.59....................................  27.67                       
251.60....................................  27.69                       
251.61....................................  27.72                       
251.62....................................  27.72 & 27.73               
251.74....................................  27.74                       
251.75....................................  27.75                       
251.76....................................  27.76                       
251.77....................................  27.77                       
                                                                        
------------------------------------------------------------------------

[[Page 40573]]

                                                                        
                               Subpart H                                
                                                                        
------------------------------------------------------------------------
251.120...................................  27.112                      
251.121...................................  27.111                      
                                                                        
------------------------------------------------------------------------
                               Subpart I                                
                                                                        
------------------------------------------------------------------------
251.133...................................  27.121                      
251.134...................................  27.122                      
251.136...................................  27.123                      
251.137...................................  27.124                      
251.138...................................  27.125                      
251.139...................................  27.126                      
                                                                        
------------------------------------------------------------------------
                               Subpart L                                
                                                                        
------------------------------------------------------------------------
251.171...................................  27.131                      
251.172...................................  27.132                      
251.173...................................  27.133                      
251.174...................................  27.134                      
251.175...................................  27.135                      
                                                                        
------------------------------------------------------------------------
                                Subpart M                               
                                                                        
------------------------------------------------------------------------
251.181...................................  27.141                      
251.182...................................  27.142                      
251.183...................................  27.143                      
251.184...................................  27.144                      
251.185...................................  27.145                      
                                                                        
------------------------------------------------------------------------
                               Subpart N                                
                                                                        
------------------------------------------------------------------------
251.201...................................  27.151                      
251.202...................................  27.152                      
251.204...................................  27.153                      
251.206...................................  27.154                      
251.207...................................  27.155                      
251.208...................................  Obsolete.                   
251.209...................................  27.156                      
                                                                        
------------------------------------------------------------------------
                               Subpart O                                
                                                                        
------------------------------------------------------------------------
251.221...................................  27.21                       
------------------------------------------------------------------------



Public Participation--Written Comments

    ATF requests written comments or suggestions concerning these 
proposed regulations from all interested persons. All written 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 the comments as 
confidential. Comments may be disclosed to the public. Any material 
which the commenter considers to be confidential or inappropriate for 
disclosure should not be included in the comment. The name of the 
person submitting the comment is not exempt from disclosure.
    Comments may also be submitted by facsimile transmission during the 
hours of 8 a.m. to 3 p.m. (Eastern time) to (202)-927-8602, provided 
the comment is: (1) Legible; (2) 8\1/2\'' x 11'' in size; (3) contains 
a written signature; and (4) three pages or less in length. This 
limitation is necessary in order to assure reasonable access to the 
equipment. Comments sent by FAX in excess of three pages will not be 
accepted. Receipt of FAX transmittals will not be acknowledged. 
Facsimile transmitted comments will be treated as originals.
    During the comment period, any person may request an opportunity to 
present oral testimony at a public hearing. However, the Director 
reserves the right, in light of all circumstances, to determine if a 
public hearing will be held.

Disclosure

    Copies of this notice, and the written comments will be available 
for public inspection from 7 a.m. to 3:30 p.m. in the ATF Reference 
Library, Office of Public Affairs and Disclosure, Room 6480, 650 
Massachusetts Ave., NW, Washington, DC 20226.

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. Accordingly, a regulatory flexibility analysis is not 
required because the

[[Page 40574]]

proposal, if promulgated as a final rule, is not expected (1) to have a 
secondary, or incidental effect on a substantial number of small 
entities; or (2) to impose, or otherwise cause a significant increase 
in the reporting, recordkeeping, or other compliance burdens on a 
substantial number of small entities.
    Pursuant to section 7805(f) of the Internal Revenue Code, this 
regulation has been submitted to the Chief Counsel for Advocacy of the 
Small Business Administration for comment on its impact on small 
business.

Executive Order 12866

    It has been determined that this proposed rule is not a significant 
regulatory action as defined in Executive Order 12866. Therefore, a 
regulatory assessment is not required.

Paperwork Reduction Act

    The provisions of the Paperwork Reduction Act of 1995, Pub. L. 104-
13, 44 U.S.C. Chapter 35, and its implementing regulations, 5 CFR part 
1320, do not apply to this notice since the only collection of 
information involved was previously approved under OMB Control No. 
1512-0352 and OMB Control No. 1512-0250 and is proposed to be 
recodified without change.

Drafting Information

    The principal author of this document is Jennifer Kirn, Alcohol 
Import-Export Branch, Bureau of Alcohol, Tobacco and Firearms.

Lists of Subjects

27 CFR Part 4

    Advertising, Consumer protection, Customs duties and inspection, 
Imports, Labeling, Packaging and containers.

27 CFR Part 5

    Advertising, Consumer protection, Customs duties and inspection, 
Imports, Labeling, Packaging and containers.

27 CFR Part 7

    Advertising, Consumer protection, Customs duties and inspection, 
Imports, Labeling, Packaging and containers.

27 CFR Part 16

    Beer, Consumer protection, Customs duties and inspection, Health, 
Imports, Labeling, Liquors, Packaging and containers, Safety, and Wine.

27 CFR Part 19

    Administrative practice and procedure, Alcohol and alcoholic 
beverages, Authority delegations (Government agencies), Chemicals, 
Claims, Customs duties and inspection, Electronic fund transfers, 
Excise taxes, Exports, Gasohol, Imports, Labeling, Liquors, Packaging 
and containers, Puerto Rico, Reporting and recordkeeping requirements, 
Research, Security measures, Spices and flavorings, Surety bonds, 
Transportation, Vinegar, Virgin Islands, Warehouses, Wine.

27 CFR Part 20

    Administrative practice and procedure, Advertising, Alcohol, 
Authority delegations (Government agencies), Chemicals, Claims, 
Cosmetics, Labeling, Packaging and containers, Reporting and 
recordkeeping requirements, Surety bonds, Transportation.

27 CFR Part 22

    Administrative practice and procedure, Advertising, Alcohol, 
Authority delegations (Government agencies), Chemicals, Claims, 
Cosmetics, Labeling, Packaging and containers, Reporting and 
recordkeeping requirements, Surety bonds, Transportation.

27 CFR Part 25

    Administrative practice and procedure, Authority delegations 
(Government agencies), Beer, Claims, Electronic fund transfers, Excise 
taxes, Labeling, Packaging and containers, Reporting and recordkeeping 
requirements, Research, Surety bonds, Transportation.

27 CFR Part 27

    Administrative practice and procedure, Alcohol and alcoholic 
beverages, Authority delegations (Government agencies), Beer, 
Cosmetics, Customs duties and inspection, Excise taxes, Imports, 
Labeling, Liquors, Packaging and containers, Perfume, Reporting and 
recordkeeping requirements, Transportation, Wine.

27 CFR Part 70

    Administrative practice and procedure, Alcohol and alcoholic 
beverages, Authority delegations (Government agencies), Claims, Excise 
taxes, Firearms and ammunition, Government employees, Law enforcement, 
Law enforcement officers, Tobacco.

27 CFR Part 250

    Administrative practice and procedure, Alcohol and alcoholic 
beverages, Authority delegations, Beer, Customs duties and inspection, 
Electronic Funds Transfers, Excise taxes, Liquors, Packaging and 
containers, Reporting requirements, Surety bonds, Transportation, U.S. 
possessions, Wine.

27 CFR Part 251

    Administrative practice and procedure, Alcohol and alcoholic 
beverages, Authority delegations, Beer, Customs duties and inspection, 
Excise taxes, Imports, Labeling, Liquors, Packaging and containers, 
Perfume, Reporting requirements, Transportation, Wine.

Authority and Issuance

    Title 27, Chapter I, 27 CFR Parts 4, 5, 7, 19, 20, 22, 24, 25, 27, 
70, 250 and 251 are proposed to be amended as follows:

PART 4--LABELING AND ADVERTISING OF WINE

    Paragraph 1. The authority citation for 27 CFR part 4 continues to 
read as follows:

    Authority: 27 U.S.C. 205, unless otherwise noted.

    Par. 2. The table of contents is amended by removing from the CROSS 
REFERENCES section the phrase ``27 CFR Part 251--Importation of 
Distilled Spirits, Wine and Beer.'' and by adding the phrase ``27 CFR 
Part 27--Importation of Distilled Spirits, Wine and Beer.'' immediately 
after ``27 CFR Part 16--Alcoholic Beverage Health Warning Statement.''.

PART 5--LABELING AND ADVERTISING OF DISTILLED SPIRITS

    Par. 3. 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.


Sec. 5.2  [Amended]

    Par. 4. Section 5.2 is amended by removing the reference to ``27 
CFR Part 251--Importation of Distilled Spirits, Wine and Beer.'' and by 
adding the reference ``27 CFR Part 27--Importation of Distilled 
Spirits, Wine and Beer'' immediately after ``27 CFR Part 19--Distilled 
Spirits Plants.''.

PART 7--LABELING AND ADVERTISING OF MALT BEVERAGES

    Par. 5. The authority citation for 27 CFR part 7 continues to read 
as follows:

    Authority: 27 U.S.C. 205.


Sec. 7.4  [Amended]

    Par. 6. Section 7.4 is amended by removing the reference to ``27 
CFR Part 252--Importation of Distilled Spirits, Wine and Beer.'', and 
by adding the reference ``27 CFR Part 27--Importation of Distilled 
Spirits, Wine and Beer.''

[[Page 40575]]

immediately after ``27 CFR Part 25--Beer.''.

PART 19--DISTILLED SPIRITS PLANTS

    Par. 7. 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, 
5211-5215, 5221-5223, 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.


Sec. 19.3  [Amended]

    Par. 8. Section 19.3 is amended by removing the reference to ``27 
CFR Part 251--Importation of Distilled Spirits, Wine and Beer.'' and by 
adding the reference ``27 CFR Part 27--Importation of Distilled 
Spirits, Wine and Beer'' immediately after ``27 CFR Part 24--Wine.''.


Sec. 19.524  [Amended]

    Par. 9. Section 19.524(a)(1) is amended by removing the phrase 
``parts 250 and 251'' and adding the phrase ``parts 27 and 250'' in the 
first sentence.
    Par. 10. Section 19.524(b)(1) is amended by removing the phrase 
``parts 250 and 251'' and adding the phrase ``parts 27 and 250'' in the 
first sentence.
    Par. 11. Section 19.524(b)(3) is amended by removing the phrase 
``part 250 and 251'' and adding the phrase ``part 27 and 250'' in the 
first sentence.


Sec. 19.538  [Amended]

    Par. 12. Section 19.538(a)(1)(iii) is amended by removing the 
phrase ``part 251'' and by adding the phrase ``part 27''.
    Par. 13. In Sec. 19.662, the undesignated paragraph is redesignated 
as paragraph (a) and paragraph (b) is added to read as follows:


Sec. 19.662  Affixing closures.

* * * * *
    (b) Closures or other devices need bear no letter or design; 
however, if a closure or other device bears any lettering or design 
which was not approved for use on such closure or other device as part 
of the certificate of label approval, ATF Form 5100.31, or which does 
not appear on a label used in connection with a closure or device, then 
such lettering or design is required to be approved for use by the 
Director in response to a letterhead application from the importer. 
Such application shall contain a copy of the lettering or design which 
is to appear on the closure or other device and identify the label or 
labels with which such closures or other devices will be used.

PART 20--DISTRIBUTION AND USE OF DENATURED ALCOHOL AND RUM

    Par. 14. The authority citation for 27 CFR part 20 continues to 
read as follows:

    Authority: 26 U.S.C. 5001, 5206, 5214, 5271-5275, 5311, 5552, 
5555, 5607, 6065, 7805.


Sec. 20.3  [Amended]

    Par. 15. Section 20.3 is amended by removing the reference to ``27 
CFR Part 251--Importation of Distilled Spirits, Wine and Beer.'' and by 
adding the reference ``27 CFR Part 27--Importation of Distilled 
Spirits, Wine and Beer.'' immediately after ``27 CFR Part 21--Formulas 
for Denatured Alcohol and Rum.''.

PART 22--DISTRIBUTION AND USE OF TAX-FREE ALCOHOL

    Par. 16.The authority citation for 27 CFR part 22 continues to read 
as follows:

    Authority: 26 U.S.C. 5001, 5121, 5142, 5143, 5146, 5206, 5214, 
5271-5276, 5311, 5552, 5555, 6056, 6061, 6065, 6109, 6151, 6806, 
7011, 7805; 31 U.S.C. 9304, 9306.


Sec. 22.3  [Amended]

    Par. 17. Section 22.3 is amended by removing the reference to ``27 
CFR Part 251--Importation of Distilled Spirits, Wine and Beer.'' and by 
adding the reference ``27 CFR Part 27--Importation of Distilled 
Spirits, Wine and Beer.'' immediately after ``27 CFR Part 19--Distilled 
Spirits Plants.''.

PART 24--WINE

    Par. 18. The authority citation for 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, 5511, 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 and 9306.


Sec. 24.4  [Amended]

    Par. 19. Section 24.4 is amended by removing the reference to ``27 
CFR Part 251--Importation of Distilled Spirits, Wine and Beer.'' and by 
adding the reference ``27 CFR Part 27--Importation of Distilled 
Spirits, Wine and Beer.'' immediately after ``27 CFR Part 19--Distilled 
Spirits Plants.''.


Sec. 24.272  [Amended]

    Par. 20. Section 24.272(a)(1) is amended by removing ``parts 250 
and 251'' and by adding ``parts 27 and 250'' in the first sentence.
    Par. 21. Section 24.272(b)(1) is amended by removing ``parts 250 
and 251'' and by adding ``parts 27 and 250'' in the first sentence.
    Par. 22. Section 24.272(b)(3) is amended by removing ``parts 250 
and 251'' and by adding ``parts 27 and 250''.

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.


Sec. 25.4  [Amended]

    Par. 24. Section 25.4 is amended by adding the reference ``27 CFR 
Part 27--Importation of Distilled Spirits, Wine and Beer.'' immediately 
after ``27 CFR Part 7--Labeling and Advertising of Malt Beverages.''.


Sec. 25.165  [Amended]

    Par. 25. Section 25.165(a)(1) is amended by removing ``parts 250 
and 251'' and by adding ``parts 27 and 250'' in the first sentence.
    Par. 26. Section 25.165(b)(1) is amended by removing ``parts 250 
and 251'' and by adding ``parts 27 and 250'' in the first sentence.
    Par. 27. Section 25.165(b)(3) is amended by removing ``parts 250 
and 251'' and by adding ``parts 27 and 250'' in the first sentence.
    Par. 28. Part 27 is added to read as follows:

PART 27--IMPORTATION OF DISTILLED SPIRITS, WINE AND BEER

Subpart A--Scope Of Regulations

Sec.
27.1  Imported distilled spirits, wine and beer.
27.2  Related regulations.
27.3  Forms prescribed.
27.4-27.10  [Reserved]

Subpart B--Definitions

27.11  Meaning of terms.
27.12-27.20  [Reserved]

Subpart C--Miscellaneous Provisions

27.21  Alternate methods or procedures.
27.22-27.30  [Reserved]

[[Page 40576]]

Subpart D--Special (Occupational) Taxes

27.31  Special (occupational) taxes.
27.32  Warehouse receipts covering distilled spirits.
27.33-27.40  [Reserved]

Subpart E--Tax On Imported Distilled Spirits, Wine, and Beer

Distilled Spirits

27.41  Distilled spirits.
27.42  Computation of effective tax rate.
27.43  Perfumes containing distilled spirits.

Wine

27.44  Wine.
27.45  Still wine containing carbon dioxide.

Liqueurs, Cordials, and Other Compounds and Preparations

27.46  Liqueurs, cordials, and similar compounds.
27.47  Other compounds and preparations.

Beer

27.48  Rate of tax.
27.49  Computation of tax.

Collection of Internal Revenue Taxes

27.50  Imported distilled spirits, wine and beer.
27.51  Payment of tax by electronic fund transfer. (EFT).

Exemption of Certain Samples From Internal Revenue Taxes

27.52  Commercial samples of alcoholic beverages.
27.53-27.60  [Reserved]

Subpart F--General Requirements

Permit for Importation of Distilled Spirits, Wine and Beer

27.61  Federal Alcohol Administration Act permit.

Certificate of Origin

27.62  Certificate of origin for distilled spirits and wine.

Packaging and Marking of Distilled Spirits

27.63  Distilled spirits containers of a capacity of not more than 1 
gallon (3.785 liters).
27.64  Containers in excess of 1 gallon (3.785 liters).

Labeling of Distilled Spirits

27.65  Containers of 1 gallon (3.785 liters) or less.

Labeling and Marking of Wine and Malt Beverages or Beer

27.66  Wine containing from one-half of one percent to less than 7 
percent alcohol by volume.
27.67  Wine containing 7 percent to 24 percent alcohol by volume.
27.68  Mixtures of wine and distilled spirits.
27.69  Malt beverages (Beer).

Alcoholic Beverage Health Warning Statement

27.70  Containers of imported alcoholic beverages to bear health 
warning statement.

Use of Another Importer's Certificate of Label Approval

27.71  Use of certificates of label approval by other importers.

Closures for Containers of Distilled Spirits

27.72  Containers of distilled spirits to bear closures or other 
devices.
27.73  Criteria for closures or other devices, and marks appearing 
thereon.

Exemptions

27.74  Exemption from requirement pertaining to marks, bottles, and 
labels.
27.75  Imported samples of distilled spirits, wine and beer.

Wine and Flavors Content of Distilled Spirits

27.76  Approval and certification of wine and flavors content.
27.77  Certificate of effective tax rate computation.
27.78  Standard effective tax rate.
27.79-27.80  [Reserved]

Subparts G-H [Reserved]

27.81-27.110  [Reserved]
Subpart I--Importation Of Distilled Spirits, Wine and Beer in Bulk
27.111  Distilled spirit containers.
27.112  Persons authorized to receive distilled spirits imported in 
bulk.
27.113  Persons authorized to receive wine imported in bulk.
27.114  Persons authorized to receive beer imported in bulk.
27.115-27.120  [Reserved]

Subpart J--Importer's Records and Reports

Records and Reports of Imported Liquors

27.121  General requirements.
27.122  Proprietors of qualified premises.

Filing and Retention of Records and Reports

27.123  Filing.
27.124  Retention.

Other Records

27.125  Transfer record.
27.126  Package gauge record.
27.127-27.130  [Reserved]
Subpart K--Transfer Of Distilled Spirits From Customs Custody To Bonded 
Premises Of Distilled Spirits Plant
27.131  General provisions.
27.132  Preparation of transfer record and package gauge record.
27.133  Inspection and release.
27.134  Sealing of bulk conveyances.
27.135  Receipt by consignee.
27.136-27.140  [Reserved]
Subpart L--Withdrawal Of Imported Distilled Spirits From Customs 
Custody Free Of Tax For Use Of The United States
27.141  General.
27.142  Application and permit, Form 5150.33.
27.143  Use of permit, Form 5150.33.
27.144  Entry documents.
27.145  Customs release.
27.146-27.150  [Reserved]

Subpart M--Requirements For Liquor Bottles

27.151  Scope of subpart.
27.152  Standards of fill.
27.153  Distinctive liquor bottles.
27.154  Bottles not constituting approved containers.
27.155  Bottles to be used for display purposes.
27.156  Used liquor bottles.
27.157-27.160  [Reserved]

    Authority: 19 U.S.C. 81c, 1202; 26 U.S.C. 5001, 5007, 5008, 
5041, 5051, 5054, 5061, 5111, 5112, 5114, 5121, 5122, 5124, 5201, 
5205, 5207, 5232, 5273, 5301, 5313, 5555, 6302, 7805; 27 U.S.C. 203, 
205, 206, 215.

    Cross References: For regulations with respect to distilled 
spirits, wine, and beer arriving in the United States from Puerto 
Rico and the Virgin Islands, see part 250 of this chapter.
    For regulations with respect to the exportation of distilled 
spirits, denatured spirits, wine, beer or beer concentrate without 
payment of tax or with benefit of drawback of tax, see part 252 of 
this chapter.

Subpart A--Scope Of Regulations


Sec. 27.1   Imported distilled spirits, wine, and beer.

    This part, ``Importation of Distilled Spirits, Wine, and Beer,'' 
contains the regulations relating to the importation of distilled 
spirits, wine, and beer into the United States from foreign countries, 
including special (occupational) and commodity taxes, permits, marking, 
branding, closing and labeling of containers, and records and reports.


Sec. 27.2   Related regulations.

    Regulations related to this part are listed below:
    19 CFR Chapter I--Customs Regulations.
    27 CFR Part 1--Basic Permit Requirements under the Federal Alcohol 
Administration Act, Nonindustrial Use of Spirits and Wine, Bulk Sales 
and Bottling of Distilled Spirits.
    27 CFR Part 4--Labeling and Advertising of Wine.
    27 CFR Part 5--Labeling and Advertising of Distilled Spirits.
    27 CFR Part 7--Labeling and Advertising of Malt Beverages.
    27 CFR Part 16--Alcoholic Beverage Health Warning Statement.
    27 CFR Part 19--Distilled Spirits Plants.
    27 CFR Part 21--Formulas for Denatured Alcohol and Rum.
    27 CFR Part 24--Wine.
    27 CFR Part 25--Beer.
    27 CFR Part 30--Gauging Manual.
    27 CFR Part 194--Liquor Dealers.
    31 CFR Part 225--Acceptance of Bonds, Notes, or Other 
Obligations Issued or Guaranteed by the United States as Security in 
Lieu of Surety or Sureties on Penal Bonds.

[[Page 40577]]

Sec. 27.3   Forms prescribed.

    (a) The Director is authorized to prescribe all forms required by 
this part, including reports, returns and records. All of the 
information called for in each form shall be furnished as indicated by 
the headings on the form and the instructions on or pertaining to the 
form. In addition, information called for in each form shall be 
furnished as required by this part.
    (b) Requests for forms should be mailed to the ATF Distribution 
Center, P.O. Box 5950, Springfield, Virginia 22150-5950.


Secs. 27.4--27.10   [Reserved]

Subpart B--Definitions


Sec. 27.11   Meaning of terms.

    When used in this part and in forms prescribed under this part, 
unless the context otherwise requires, terms shall have the meaning 
ascribed in this section. Words in the plural form shall include the 
singular, and vice versa, and words importing the masculine gender 
shall include the feminine. The terms ``includes'' and ``including'' do 
not exclude things not enumerated which are in the same general class.
    Alcoholic beverage. Any beverage in liquid form which contains not 
less than one-half of one percent (.5%) of alcohol by volume and is 
intended for human consumption.
    ATF Officer. An officer or employee of the Bureau of Alcohol, 
Tobacco and Firearms (ATF) authorized to perform any function relating 
to the administration or enforcement of this part.
    Beer. Beer, ale, porter, stout, and other similar fermented 
beverages (including sake or similar products) of any name or 
description containing one-half of one percent or more of alcohol by 
volume, brewed or produced from malt, wholly or in part, or from any 
substitute for malt.
    Bonded premises-distilled spirits plant. The premises of a 
distilled spirits plant, or part thereof, on which distilled spirits 
operations defined in 26 U.S.C. 5002 are authorized to be conducted.
    Bulk beer. Beer in a container other than an authorized original 
consumer container.
    Bulk distilled spirits. Distilled spirits in a container having a 
capacity in excess of 1 gallon.
    Bulk wine. Wine in a container having a capacity in excess of 60 
liters.
    Cereal beverage. A beverage produced either wholly or in part from 
malt (or a substitute for malt), and either fermented or unfermented, 
which contains, when ready for consumption, less than one-half of 1 
percent of alcohol by volume.
    CFR. The Code of Federal Regulations.
    Commercial bank. A bank, whether or not a member of the Federal 
Reserve System, which has access to the Federal Reserve Communications 
System (FRCS) or Fedwire. The ``FRCS'' or ``Fedwire'' is a 
communications network that allows Federal Reserve System member banks 
to effect a transfer of funds for their customers (or other commercial 
banks) to the Treasury Account at the Federal Reserve Bank of New York.
    Container. Any receptacle, vessel, or form of package, bottle, can, 
tank, or pipeline used, or capable of being used, for holding, storing, 
transferring, or conveying liquor or specially denatured spirits.
    Customs bonded warehouse. A customs bonded warehouse, class 2, 3, 6 
or 8, established under the provisions of customs regulations (19 CFR 
Ch. I).
    Customs officer. Any officer of the Customs Service or any 
commissioned, warrant, or petty officer of the Coast Guard, or any 
agent or other person authorized by law or designated by the Secretary 
of the Treasury to perform any duties of an officer of the Customs 
Service.
    Delegate. Any officer, employee, or agency of the Department of the 
Treasury authorized by the Secretary of the Treasury directly, or 
indirectly by one or more redelegations of authority, to perform the 
function mentioned or described in the context.
    Director. The Director, Bureau of Alcohol, Tobacco and Firearms, 
the Department of the Treasury, Washington, DC 20226 or his/her 
delegate.
    Distilled spirits or spirits. That substance known as ethyl 
alcohol, ethanol, or spirits of wine, in any form (including all 
dilutions and mixtures thereof, from whatever source or by whatever 
process produced), including alcohol, whisky, brandy, gin, rum and 
vodka, but not denatured spirits. Distilled spirits does not include 
beer or wine.
    Distilled spirits plant. An establishment qualified under the 
provisions of Part 19 of this chapter for the production, storage or 
processing of distilled spirits.
    Effective tax rate. The net tax rate after reduction for any credit 
allowable under 26 U.S.C. 5010 for wine and flavor content at which the 
tax imposed on distilled spirits by 26 U.S.C. 5001 is paid or 
determined.
    Eligible flavor. A flavor which:
    (1) Is of a type that is eligible for drawback of tax under 26 
U.S.C. 5134,
    (2) Was not manufactured on the premises of a distilled spirits 
plant, and
    (3) Was not subjected to distillation on distilled spirits plant 
premises such that the flavor does not remain in the finished product.
    Eligible wine. A wine containing not more than 0.392 gram of carbon 
dioxide per 100 milliliters of wine which has not been subject to 
distillation at a distilled spirits plant after receipt in bond.
    Foreign-trade zone or zone. A foreign-trade zone established and 
operated pursuant to the Act of June 18, l934, as amended. See customs 
regulations.
    5010 credit. A credit against the tax imposed on distilled spirits 
by 26 U.S.C. 5001 is allowable under 26 U.S.C. 5010 on each proof 
gallon of alcohol derived from eligible wine or from eligible flavors 
which do not exceed 2\1/2\ percent of the finished product on a proof 
gallon basis. The credit is allowable at the time the tax is payable as 
if it constituted a reduction in the rate of tax.
    Gallon or wine gallon. A United States gallon of liquid measure 
equal to the volume of 231 cubic inches.
    Importer. Any person who imports distilled spirits, wine or beer 
into the United States.
    Industrial or nonindustrial use of spirits or wine. The use of 
spirits or wine shall, for the purposes of this part, be regarded as 
industrial or nonindustrial based on the provisions of 27 CFR part 1.
    Kind. As applied to spirits, kind shall mean class and type as 
prescribed in 27 CFR part 5. As applied to wine, kind shall mean the 
classes and types of wine as prescribed in 27 CFR parts 4 and 24.
    Liquors. Distilled spirits, wine and beer which are fit for 
beverage use. The word liquor does not include specially denatured 
spirits, nonbeverage wine or beer concentrate.
    Liquor bottle. A bottle made of glass or earthenware, or of other 
suitable material approved by the Food and Drug Administration, which 
has been designed or is intended for use as a container for distilled 
spirits for sale for beverage purposes and which has been determined by 
the Director to adequately protect the revenue.
    Liter. A metric unit of capacity equal to 1,000 cubic centimeters 
at 20 degrees C. or 33.814 United States fluid ounces at 68 degrees F. 
of alcoholic beverage.
    Malt beverage. When used in connection with the Federal Alcohol 
Administration Act, a beverage made by the alcoholic fermentation of an 
infusion or decoction, or combination of both, in potable brewing 
water, of

[[Page 40578]]

malted barley with hops, or their parts, or their products, and with or 
without other malted cereals, and with or without the addition of 
unmalted or prepared cereals, other carbohydrates or products prepared 
therefrom, and with or without the addition of carbon dioxide, and with 
or without other wholesome products suitable for human food 
consumption. The term includes such products containing alcohol in an 
amount of less than one-half of one percent alcohol by volume.
    Package. Any cask, keg, barrel, drum, or similar portable 
container.
    Person. An individual, a trust, estate, partnership, association, 
company, or corporation.
    Port Director of customs. The chief customs official at a customs 
port.
    Proof. The ethyl alcohol content of a liquid at 60 degrees 
Fahrenheit, stated as twice the percent of ethyl alcohol by volume.
    Proof gallon. A gallon of liquid at 60 degrees Fahrenheit which 
contains 50 percent by volume of ethyl alcohol having a specific 
gravity of 0.7939 at 60 degrees Fahrenheit referred to water at 60 
degrees Fahrenheit as unity, or the alcoholic equivalent thereof.
    Region. A Bureau of Alcohol, Tobacco and Firearms region.
    Regional Director (Compliance). The principal ATF regional official 
responsible for administering regulations in this part.
    Secretary. The Secretary of the Treasury or his/her delegate.
    Specially denatured spirits. Alcohol, or rum, as defined in part 2l 
of this chapter, denatured pursuant to the formulas authorized in part 
21 for specially denatured alcohol or rum, and including denatured 
spirits for export as authorized by 27 CFR 21.5.
    Standard effective tax rate. The rate of tax established based on 
the least quantity and the lowest alcohol content of eligible wine or 
eligible flavors used in the manufacture of a distilled spirits 
product.
    Tank truck. A tank-equipped trailer, semi-trailer, or truck.
    Tax. The distilled spirits, wine or beer tax imposed by 26 U.S.C. 
Chapter 51.
    This chapter. Title 27, Code of Federal Regulations, Chapter I (27 
CFR Ch. I).
    United States. ``United States'' includes only the States and the 
District of Columbia.
    U.S.C. The United States Code.
    Wine. When used without qualification, the term includes every kind 
(class and type) of product produced from fruit, berries, or other 
suitable agricultural products, excluding a product containing less 
than one-half percent of alcohol by volume or more than 24 percent of 
alcohol by volume. The term includes all imitation, other than 
standard, or artificial wine and compounds sold as wine.

(68A Stat. 917, as amended (26 U.S.C. 7805); 49 Stat. 981, as 
amended (27 U.S.C. 205))


Secs. 27.12-27.20   [Reserved]

Subpart C--Miscellaneous Provisions


Sec. 27.21   Alternate methods or procedures.

    (a) Application. An importer who desires to use an alternate method 
or procedure in lieu of a method or procedure prescribed by this part 
shall file an application with the regional director (compliance) of 
the appropriate region, (in which the place of business is located, as 
determined by the address shown on the importer's basic permit). If the 
importer has several places of business at which such alternate method 
or procedure will be used, a separate application shall be submitted 
for each location. Each application shall:
    (1) Specify the name, address, and permit number of the importer to 
which it relates;
    (2) State the purpose for which filed; and
    (3) Specifically describe the alternate method or procedure and set 
forth the reasons therefor.
    (b) Approval. When an application for use of an alternate method or 
procedure is received, the regional director (compliance) shall 
determine whether approval thereof would unduly hinder the effective 
administration of this part or would result in jeopardy to the revenue. 
No alternate method or procedure relating to the assessment, payment, 
or collection of tax shall be authorized under this paragraph. The 
regional director (compliance) shall forward the application to the 
Director, together with a report of findings and a recommendation. The 
Director may approve the alternate method or procedure if it is found 
that:
    (1) Good cause has been shown for the use of the alternate method 
or procedure;
    (2) The alternate method or procedure is within the purpose of, and 
consistent with the effect intended by, the specifically prescribed 
method or procedure, and affords equivalent security to the revenue; 
and
    (3) The alternate method or procedure will not be contrary to any 
provision of law, and will not result in an increase in cost to the 
Government or hinder the effective administration of this part.
    (c) Conditions for use. No alternate method or procedure shall be 
used until approval has been received from the Director. Authorization 
for the alternate method or procedure may be withdrawn whenever in the 
judgment of the Director the revenue is jeopardized or the effective 
administration of this part is hindered by the continuation of such 
authorization.

(Approved by the Office of Management and Budget under control 
number 1512-0352)


Secs. 27.22-27.30   [Reserved]

Subpart D--Special (Occupational) Taxes


Sec. 27.31   Special (occupational) taxes.

    Importers engaged in the business of selling liquors (whether 
distilled spirits, wine or beer) or offering liquors for sale, are 
subject to the provisions of Part 194 of the chapter relating to 
special (occupational) taxes. Part 194 requires that before commencing 
business the special tax registration and return, Form 5630.5, with 
payment of the tax, shall be filed with ATF in accordance with the 
instructions on the form. Subsequently, Form 5630.5 with tax shall be 
filed each year on or before July 1, as long as the proprietor 
continues in business.

(Sec 201, Pub. L. 85-859, 72 Stat. 1340 as amended, 1343 as amended, 
1344 as amended (26 U.S.C. 5111, 5112, 5121, 5122))


Sec. 27.32   Warehouse receipts covering distilled spirits.

    The sale of warehouse receipts for distilled spirits is equivalent 
to the sale of distilled spirits, and every person engaged in business 
as an importer of distilled spirits, who sells, or offers for sale, 
warehouse receipts for distilled spirits stored in customs bonded 
warehouses, or elsewhere, incurs liability for special tax as a dealer 
in liquors at the place where the warehouse receipts are sold or 
offered for sale, and must file a return and pay special tax as 
provided in Sec. 27.31.

(68A Stat. 618, 620, 621 (26 U.S.C. 5111, 5112, 5121, 5122))


Secs. 27.33-27.40   [Reserved]

Subpart E--Tax on Imported Distilled Spirits, Wine, and Beer

Distilled Spirits


Sec. 27.41   Distilled spirits.

    (a) A tax is imposed on all distilled spirits in customs bonded 
warehouses or imported into the United States at the rate prescribed by 
26 U.S.C. 5001 on each proof gallon and a proportionate tax at a like 
rate on all fractional parts of each proof gallon. All products of 
distillation, by whatever name known, which contain distilled spirits, 
are

[[Page 40579]]

considered to be distilled spirits and are taxed as such. The tax will 
be determined at the time of importation, or, if entered into customs 
bond, at the time of removal therefrom.
    (b) A credit against the tax imposed on distilled spirits by 26 
U.S.C. 5001 is allowable under 26 U.S.C. 5010 on each proof gallon of 
alcohol derived from eligible wine or from eligible flavors which do 
not exceed 2\1/2\ percent of the finished product on a proof gallon 
basis. The credit is allowable at the time tax is payable as if it 
constituted a reduction in the rate of tax.
    (c) Where credit against the tax is desired, the person liable for 
the tax shall establish an effective tax rate in accordance with 
Sec. 27.42. The effective tax rate established will be applied to each 
entry.

    Sec. 201, Pub. L. 85-859, 72 Stat. 1314, as amended (26 U.S.C. 
5001); Sec. 201, Pub. L. 85-859, 72 Stat. 1356, as amended (26 
U.S.C. 5201); Sec 6, Pub. L. 96-598, 94 Stat. 3488, as amended (26 
U.S.C. 5010))


Sec. 27.42   Computation of effective tax rate.

    (a) The proprietor shall compute the effective tax rate for 
distilled spirits containing eligible wine or eligible flavors as the 
ratio of the numerator and denominator as follows:
    (1) The numerator will be the sum of:
    (i) The proof gallons of all distilled spirits used in the product 
(exclusive of distilled spirits derived from eligible flavors), 
multiplied by the tax rate prescribed by 26 U.S.C. 5001;
    (ii) The wine gallons of each eligible wine used in the product, 
multiplied by the tax rate prescribed by 26 U.S.C. 5041(b) (1), (2), 
(3), as applicable; and
    (iii) The proof gallons of all distilled spirits derived from 
eligible flavors used in the product, multiplied by the tax rate 
prescribed by 26 U.S.C. 5001, but only to the extent that such 
distilled spirits exceed 2\1/2\ percent of the denominator prescribed 
in paragraph (a)(2) of this section.
    (2) The denominator will be the sum of:
    (i) The proof gallons of all distilled spirits used in the product, 
including distilled spirits derived from eligible flavors; and
    (ii) The wine gallons of each eligible wine used in the product, 
multiplied by twice the percentage of alcohol by volume of each, 
divided by 100.
    (b) In determining the effective tax rate, quantities of distilled 
spirits, eligible wine, and eligible flavors will be expressed to the 
nearest tenth of a proof gallon. The effective tax rate may be rounded 
to as many decimal places as the proprietor deems appropriate, provided 
that, such rate is expressed no less exactly than the rate rounded to 
the nearest whole cent, and the effective tax rates for all products 
will be consistently expressed to the same number of decimal places. In 
such case, if the number is less than five it will be dropped; if it is 
five or over, a unit will be added.
    (c) The following is an example of the use of the formula:

                              Batch Record                              
------------------------------------------------------------------------
                                                                        
------------------------------------------------------------------------
Distilled spirits.......................  2249.1 proof gallons.         
Eligible wine (14% alcohol by volume)...  2265.0 wine gallons.          
Eligible wine (19% alcohol by volume)...  1020.0 wine gallons.          
Eligible flavors........................  100.9 proof gallons.          
------------------------------------------------------------------------

                                          [GRAPHIC] [TIFF OMITTED] TP05AU96.000
                                          
(Approved by the Office of Management and Budget under control 
number 1512-0352)

    * Proof gallons by which distilled spirits derived from eligible 
flavors exceed 2\1/2\ percent of the total proof gallons in the 
batch (100.9-(2\1/2\%)  x  3.371.8 = 16.6).
---------------------------------------------------------------------------

(Sec. 6, Pub. L. 96-598, 94 Stat. 3488, as amended (26 U.S.C. 5010))


Sec. 27.43   Perfumes containing distilled spirits.

    (a) Perfumes imported into the United States containing distilled 
spirits are subject to the internal revenue tax at the rate prescribed 
by 26 U.S.C. 5001 per wine gallon, and a proportionate tax at a like 
rate on all fractional parts of such wine gallon.
    (b) This section does not apply to importations after December 31, 
1994.

(Sec. 201, Pub. L. 85-859, 72 Stat. 1314, as amended (26 U.S.C. 
5001))

Wine


Sec. 27.44   Wine.

    (a) A tax is imposed by 26 U.S.C. 5041 on all wine imported into 
the United States at the rate prescribed in such section on each wine 
gallon and a proportionate tax at a like rate on all fractional parts 
of such wine gallon. Fractions of less than one-tenth gallon shall be 
converted to the nearest one-tenth gallon, and five-hundredths gallon 
shall be converted to the next full one-tenth gallon. The tax shall be 
determined at the time of importation, or, if entered into customs 
bond, at the time of removal therefrom for consumption or sale. All 
wine containing more than 24 percent of alcohol by volume shall be 
classed as distilled spirits and shall be taxed accordingly.
    (b) Imported wine may contain added spirits and remain taxable as 
wine under 26 U.S.C. 5041 provided:
    (1) Such spirits were added to increase the alcoholic content of 
the wine as part of an authorized fortification procedure and as a 
standard winemaking process in the country of origin; and
    (2) The alcoholic content of the wine is not increased to more than 
24 percent by volume.
(72 Stat. 1331, as amended; 26 U.S.C. 5041)


Sec. 27.45   Still wine containing carbon dioxide.

    Still wine may contain not more than 0.392 gram of carbon dioxide 
per 100 milliliters of wine; except that a tolerance to this maximum 
limitation, not to exceed 0.009 gram of carbon dioxide per 100 
milliliters of wine, will be allowed where the amount of carbon dioxide 
in excess of 0.392 gram per 100 milliliters of wine was due to 
mechanical variations which could not be completely controlled under 
good commercial practices. Such tolerance

[[Page 40580]]

will not be allowed where it is found that the limitation of 0.392 gram 
of carbon dioxide per 100 milliliters of wine is continuously or 
intentionally exceeded. The carbon dioxide contained in wine will be 
determined in accordance with authorized test procedures approved by 
the Director. Penalties are provided in 26 U.S.C. 5662 for any person 
who, whether by manner of packaging or advertising or by any other form 
of representation, represents any still wine to be effervescent wine or 
a substitute for effervescent wine.

Liqueurs, Cordials, and Other Compounds and Preparations


Sec. 27.46   Liqueurs, cordials, and similar compounds.

    A tax is imposed by 26 U.S.C. 5001 on all liqueurs, cordials, and 
similar compounds containing distilled spirits, in customs bonded 
warehouses or imported into the United States, at the rate prescribed 
in such section on each proof gallon, and a proportionate tax at a like 
rate on all fractional parts of such proof gallon. The tax shall be 
determined at the time of importation, or, if entered into customs 
bond, at the time of removal. Fortified or unfortified wine, containing 
not over 24 percent alcohol by volume, to which sweetening or flavoring 
materials, but no distilled spirits, have been added are not classified 
as liqueurs, cordials, or similar compounds, but are considered to be 
flavored wine only, and are subject to internal revenue tax at the 
rates applicable to wine.

(Sec. 201, Pub.L. 85-859, 72 Stat. 1314, as amended, 1331, as 
amended (26 U.S.C. 5001, 5041))


Sec. 27.47   Other compounds and preparations.

    Compounds and preparations, other than those specified in 
Sec. 27.46, containing distilled spirits, which are fit for beverage 
purposes, in customs bonded warehouses or imported into the United 
States, are subject to internal revenue tax at the rates applicable to 
distilled spirits. Compounds and preparations containing fortified or 
unfortified wine, but no distilled spirits, which are fit for beverage 
purposes and which are sold as wine, are subject to internal revenue 
tax at the rates applicable to wine.

(68A Stat. 595, as amended, 609, as amended; 26 U.S.C. 5001, 5041)

Beer


Sec. 27.48   Rate of tax.

    A tax is imposed by 26 U.S.C. 5051, on all beer imported into the 
United States, at the rate prescribed in such section, for every barrel 
containing not more than 31 gallons, and at a like rate for any other 
quantity or for the fractional parts of a barrel. The tax on beer shall 
be determined at the time of importation, or, if entered into customs 
bond, at the time of removal.

(Sec. 201, Pub. L. 85-859, 72 Stat. 1333, as amended, 1334, as 
amended (26 U.S.C. 5051, 5054))


Sec. 27.49   Computation of tax.

    The tax on imported beer shall be computed on the basis of the 
actual quantity in a container, at the rate prescribed by law.

(72 Stat. 1333; 26 U.S.C. 5051)

Collection of Internal Revenue Taxes


Sec. 27.50   Imported distilled spirits, wine, and beer.

    Internal revenue taxes payable on imported distilled spirits, wine, 
and beer, are collected, accounted for, and deposited as internal 
revenue collections by directors of customs in accordance with customs 
requirements. However, the taxes on distilled spirits withdrawn from 
customs custody without payment of tax under the provisions of subpart 
I of this part and thereafter withdrawn from the bonded premises of a 
distilled spirits plant subject to tax, shall be collected and paid 
under the provisions of part 19 of this chapter.

(72 Stat. 1314, 1366; 26 U.S.C. 5001, 5232)


Sec. 27.51   Payment of tax by electronic fund transfer (EFT).

    (a) General. (1) Each importer who was liable, during a calendar 
year, for a gross amount equal to or exceeding five million dollars in 
distilled spirits taxes combining tax liabilities incurred under this 
part and parts 19 and 250 of this chapter, a gross amount equal to 
exceeding five million dollars in wine taxes combining tax liabilities 
incurred under this part and parts 24 and 250 of this chapter, or a 
gross amount equal to or exceeding five million dollars in beer taxes 
combining tax liabilities incurred under this part and parts 25 and 250 
of this chapter, shall use a commercial bank in making payment by 
electronic fund transfer (EFT), as defined in paragraph (c) of this 
section, of such taxes during the succeeding calendar year. Payment of 
such taxes by cash, check, or money order is not authorized for an 
importer who is required, by this section, to make remittances by EFT. 
For purposes of this section, the dollar amount of tax liability is to 
be summarized separately for distilled spirits taxes, wine taxes, or 
beer taxes, and is defined as the gross tax liability on all taxable 
withdrawals from premises within the United States and importations 
(including products of the same tax class brought into the United 
States from Puerto Rico or the Virgin Islands) during the calendar 
year, without regard to any drawbacks, credits, or refunds, for all 
premises from which such activities are conducted by the taxpayer.
    (b) For the purposes of this section, a taxpayer includes a 
controlled group of corporations, as defined in 26 U.S.C. 1563, and 
implementing regulations in 26 CFR 1.1563-1 through 1.1563-4, except 
the words ``at least 80 percent'' shall be replaced by the words ``more 
than 50 percent'' in each place it appears in subsection (a) of 26 
U.S.C. 1563, as well as in the implementing regulations. Also, the 
rules for a ``controlled group of corporations'' apply in a similar 
fashion to groups which include partnerships and/or sole 
proprietorships. If one entity maintains more than 50 percent control 
over a group consisting of corporations and one, or more, partnerships 
and/or sole proprietorships, all of the members of the controlled group 
are one taxpayer for the purpose of determining who is required to make 
remittances by EFT.
    (c) Electronic funds transfer (EFT) means any transfer of funds, 
other than a transaction originated by cash, check or similar paper 
instrument, that is initiated through an electronic terminal, 
telephone, computer or magnetic tape, for the purpose of ordering, 
instructing, or authorizing a financial institution to debit or credit 
an account. The term includes, but is not limited to, Fed Wire 
transfers, Automated Clearing House (ACH) transfers, transfers made at 
automatic teller machines (ATM) and Point-of-Sale (POS) terminals (to 
include use of the Government small purchase card), and other means of 
credit card transactions.
    (d) An importer who is required by this section to make remittances 
by EFT, shall make the EFT remittance in accordance with the 
requirements of the U.S. Customs Service.
    (e) Failure to request an electronic fund transfer message. The 
taxpayer is subject to a penalty imposed by 26 U.S.C. 5684, 6651, or 
6656, as applicable, for failure to make a tax payment by EFT on or 
before the close of business on the prescribed last day for filing.

(Act of August 16, 1954, 68A Stat. 775, as amended (26 U.S.C. 6302); 
Sec. 201, Pub. L. 85-859, 72 Stat. 1335, as amended (26 U.S.C. 
5061))

[[Page 40581]]

Exemption of Certain Samples From Excise Taxes


Sec. 27.52   Commercial samples of alcoholic beverages.

    Samples of distilled spirits, wine, and beer, to be used in the 
United States by persons importing alcoholic beverages in commercial 
quantities are, subject to the limitations in this section, exempt from 
the payment of any internal revenue tax imposed on, or by reason of, 
importation. This exemption applies only to samples to be used for 
soliciting orders for products of foreign countries. In no case shall 
this exemption apply to more than one sample of each alcohol beverage 
product admitted during any calendar quarter for the use of each such 
person. No sample of beer shall contain more than 300 milliliters, no 
sample of wine shall contain more than 150 milliliters, and no sample 
of distilled spirits shall contain more than 100 milliliters.

(76 Stat. 72, as amended; 19 U.S.C. 1202)


Secs. 27.53-27.60   [Reserved]

Subpart F--General Requirements

Permit for Importation of Distilled Spirits, Wine and Malt Beverages or 
Beer


Sec. 27.61   Federal Alcohol Administration Act permit.

    Under the Federal Alcohol Administration Act and the regulations 
issued pursuant thereto, (27 CFR part 1) any person, except an agency 
of a State or political subdivision thereof, or any officer or employee 
of any such agency, intending to engage in the business of importing 
distilled spirits, wine or malt beverages (including beer and cereal 
beverages) for nonindustrial use is required to procure an importer's 
basic permit.

(49 Stat. 978, as amended; 27 U.S.C. 203)

Certificate of Origin


Sec. 27.62   Certificate of origin for distilled spirits and wine.

    (a) Distilled spirits (for nonindustrial use) imported in bottles 
shall not be released from customs custody for consumption unless the 
invoice is accompanied by a certificate of age and origin when required 
by 27 CFR 5.52.
    (b) Imported wine (which contains 7 percent or more alcohol by 
volume and not more than 24 percent alcohol by volume) shall not be 
released from customs custody for consumption unless the invoice is 
accompanied by a certificate of origin and identity when required by 27 
CFR 4.45.

Packaging and Marking of Distilled Spirits


Sec. 27.63   Distilled spirits containers of a capacity of not more 
than 1 gallon (3.785 liters).

    Except as provided in Sec. 27.74, bottled distilled spirits 
imported into the United States for sale shall be in liquor bottles 
which conform to the requirements of subpart K of this part and part 5 
of this chapter. Such liquor bottles shall bear closures as described 
in Secs. 27.72 and 27.73. Empty bottles imported for the packaging of 
distilled spirits shall conform to the requirements of subpart K of 
this part. (For customs marking requirements, see 19 CFR parts 11 and 
12.)


Sec. 27.64   Distilled spirits containers in excess of 1 gallon (3.785 
liters).

    Imported containers of distilled spirits in excess of 1 gallon are 
required to be marked in accordance with customs regulations (19 CFR 
parts 11 and 12).

Labeling of Distilled Spirits


Sec. 27.65   Containers of 1 gallon (3.785 liters) or less.

    (a) All imported distilled spirits in bottles are required to be 
labeled in conformity with the Federal Alcohol Administration Act and 
regulations issued pursuant thereto (27 CFR part 5), before they are 
removed from customs custody. Labels on imported containers of 
distilled spirits, and on containers of distilled spirits bottled in 
customs custody, are required to be covered by a certificate of label 
approval, ATF Form 5100.31, issued pursuant to part 5 of this chapter.
    (b) Containers of imported distilled spirits bottled after tax 
payment and removal from customs custody are required to be covered by 
a certificate of label approval or a certificate of exemption from 
label approval, ATF Form 5100.31 issued pursuant to part 5 of this 
chapter.
    (c) When imported distilled spirits are labeled under a certificate 
of exemption from label approval, the labels affixed to containers are 
required to conform to the provisions of part 19 of this chapter.

Labeling and Marking of Wine and Malt Beverages or Beer


Sec. 27.66  Wine containing from one-half of one percent to less than 7 
percent alcohol by volume.

    Wine containing from one-half of one percent to less than 7 percent 
alcohol by volume which is imported in bottles shall be labeled, prior 
to removal from customs custody, under regulations administered by the 
United States Food and Drug Administration. In addition, the IRC 
requires that the labels shall, as a minimum, reflect the kind of wine 
(class and type), alcoholic content, net content, and indicate whether 
effervescent wine is sparkling or carbonated. Imported containers of 
wine are also required to be marked, branded and labeled in accordance 
with customs regulations (19 CFR parts 11 and 12).


Sec. 27.67  Wine containing 7 percent to 24 percent alcohol by volume.

    ``Wine,'' in this section, refers in all cases to wine containing 
not less than 7 percent and not more than 24 percent of alcohol by 
volume.
    (a) All imported bottled or packaged wine is required to be 
packaged, marked, branded, and labeled in conformity with the Federal 
Alcohol Administration Act and regulations issued pursuant thereto in 
27 CFR part 4 before they are removed from customs custody. Labels on 
imported containers of wine are required to be covered by a certificate 
of label approval, ATF Form 5100.31, issued pursuant to part 4 of this 
chapter.
    (b) Containers of imported wine bottled or packaged after tax 
payment and removal from customs custody are required to be covered by 
a certificate of label approval, ATF Form 5100.31, or a certificate of 
exemption from label approval, ATF Form 5100.31, issued pursuant to the 
regulations in 27 CFR part 4. The label on such wine must conform with 
27 CFR part 24.
    (c) Imported containers of wine must also be marked, branded and 
labeled in accordance with customs regulations (19 CFR parts 11 and 
12).


Sec. 27.68  Mixtures of wine and distilled spirits.

    (a) Imported wine which contains distilled spirits in accordance 
with the provisions of Sec. 27.44(b) shall be labeled as wine.
    (b) Imported wine which contains distilled spirits other than in 
accordance with Sec. 27.44(b) shall be labeled as distilled spirits.


Sec. 27.69  Malt Beverages (Beer).

    All imported malt beverages (including beer and cereal beverages) 
must conform with the provisions of the FederalAlcohol Administration 
Act and regulations issued pursuant thereto in 27 CFR part 7 upon 
release from customs custody. In addition, labels on containers of 
cereal beverages shall bear the phrase ``Nontaxable under Section 5051 
I.R.C.''. Imported containers of malt beverages are also required to be 
marked and labeled in accordance with customs regulations (19 CFR parts 
11 and 12).

[[Page 40582]]

Alcoholic Beverage Health Warning Statement


Sec. 27.70  Containers of imported alcoholic beverages to bear health 
warning statement.

    On and after November 18, 1989, no person shall import for sale or 
distribution in the United States any alcoholic beverage unless the 
container of such beverage bears the health warning statement required 
by part 16 of this chapter, in conformity with the requirements 
prescribed by that part. The alcoholic beverage health warning 
statement is required on the labels of all containers (as defined in 
Sec. 16.10 of this chapter) of alcoholic beverages for sale or 
distribution. Sale and distribution includes sampling or any other 
distribution not for sale. This requirement does not apply to alcoholic 
beverages that were bottled in the foreign country prior to November 
18, l989.

Use of Another Importer's Certificate of Label Approval


Sec. 27.71  Use of certificates of label approval by other importers.

    (a) An importer may use certificates of label approval to release 
distilled spirits, wine or malt beverages or beer from customs custody 
only if such certificates are issued in that importer's name, except 
that such products may be released from customs custody upon 
presentation of a certificate of label approval by an importer who is 
not the owner of the certificate of label approval if all of the 
following 3 conditions are met:
    (1) The certificate owner has authorized such use.
    (2) Each bottle or individual container bears the name or trade 
name and address of the certificate owner.
    (3) The certificate owner maintains records of the companies 
authorized by such owner to use the certificate.
    (b) The certificate owner is considered to have granted 
authorization to use a label approval to another importer if either:
    (1) The certificate owner's name or trade name appears in the 
sales-in-transit invoice required by 19 CFR 141.86(c) or other invoice 
such as the bill of lading or in other shipping documents, such as the 
bill of lading, pertaining to an importation; or
    (2) The certificate owner has granted such authorization, by 
letter, to the importer.

Closures for Containers of Distilled Spirits


Sec. 27.72  Containers of distilled spirits to bear closures or other 
devices.

    No person shall transport, buy, possess, sell, or transfer any 
imported distilled spirits in containers of 1 gallon (3.785 liters) or 
less, unless the immediate containers of distilled spirits withdrawn 
from bonded premises or customs custody, on determination of tax, bears 
a closure or other device affixed in accordance with the provisions of 
this part.

(Sec. 454, Pub. L. 98-369. 98 Stat. 494 (26 U.S.C. 5301))


Sec. 27.73  Criteria for closures or other devices, and marks appearing 
thereon.

    (a) Closures or other devices on containers of imported distilled 
spirits which have been tax determined, having a capacity of 1 gallon 
(3.785 liters) or less shall be constructed so that such closures or 
other devices must be broken or torn in order to gain access to the 
contents in such a manner giving visual evidence to the consumer that 
the container has been opened and cannot be resealed again to appear 
unopened.
    (b) Closures or other devices need bear no letter or design; 
however, if a closure or other device bears any lettering or design 
which was not approved for use on such closure or other device as part 
of the certificate of label approval, ATF Form 5100.31, or which does 
not appear on a label used in connection with a closure or device, then 
such lettering or design is required to be approved for use by the 
Director in response to a letterhead application from the importer. 
Such application shall contain a copy of the lettering or design which 
is to appear on the closure or other device and identify the label or 
labels with which such closures or other devices will be used.

Exemptions


Sec. 27.74  Exemption from requirements pertaining to marks, bottles, 
and labels.

    (a) The provisions of this part pertaining to closures, the 
requirements for containers prescribed by subpart K of this part, and 
the labeling of containers as prescribed by part 5 of this chapter are 
not applicable to imported distilled spirits.
    (1) Not for sale or for any other commercial purpose whatever;
    (2) On which no internal revenue tax is required to be paid or 
determined on or before withdrawal from customs custody;
    (3) For use as ship supplies; or
    (4) For personal use.
    (b) Distilled spirits or wine withdrawn from customs bond solely 
for the use of foreign embassy personnel, the foreign diplomatic corps, 
members of the armed forces of foreign countries on active duty in the 
United States or certain other persons are not subject to excise taxes, 
labeling, liquor bottle or closure regulations. The United States 
Customs Service determines whether a person is a qualified person 
entitled to tax-exempt withdrawal under this subsection.
    (c) Exemptions from the requirement that imported distilled 
spirits, wine and malt beverages (beer) be marked to indicate the 
country of origin are set forth in customs regulations (19 CFR part 
11.)
    (d) The health warning statement in part 16 of this chapter is 
required on labels of all containers sold or distributed.

(Sec. 201, Pub. L. 85-859, 72 Stat. 1358, as amended, 1374, as 
amended (26 U.S.C. 5301)


Sec. 27.75  Imported samples of distilled spirits, wine and beer.

    (a) Samples of distilled spirits, wine and beer in containers of 
not more than 1.75 liters, imported solely for organoleptic testing, 
quality control testing, research and product development testing, and 
not for sale or for use in the manufacture or production of any article 
for sale, shall be exempt from any requirements relating to marks, 
bottles, labels and standards of fill. However, the health warning 
statement in part 16 of this chapter is required on labels of all 
containers of imported samples.
    (b) Samples imported for the purposes indicated above shall not be 
exempt from the payment of any internal revenue tax or duty imposed on, 
or by reason of, importation, or from the provisions in this part 
pertaining to closures.
    (c) Samples of distilled spirits imported for any purposes not 
described above, with the exception of those samples of distilled 
spirits provided for in Sec. 27.52 or Sec. 27.74, are not exempt from 
the requirements pertaining to closures, marks, bottles and labels. 
Samples of wine, distilled spirits or beer brought into the United 
States pursuant to Sec. 27.52 or Sec. 27.74 are exempt from the 
labeling requirements of parts 4, 5 and 7 of this chapter, 
respectively.
    (d) Samples of alcoholic beverages imported for display and taste 
testing at trade fairs (as defined in the Trade Fair Act of 1959, 19 
U.S.C. Chapter 6) are exempt from any requirements relating to 
closures, marks, bottles, labels, and standards of fill.

[[Page 40583]]

Wine and Flavors Content of Distilled Spirits


Sec. 27.76  Approval and certification of wine and flavors content.

    (a) Any person, who imports into the United States distilled 
spirits on which the tax is to be paid or determined at an effective 
tax rate based in whole, or in part, on the alcohol content derived 
from eligible wine or eligible flavors which have not been previously 
approved on ATF Form 5530.5 (1678) shall, before the first tax 
determination at that rate, request and receive a statement of 
eligibility for each wine or flavor to be used in the computation of 
the effective tax rate.
    (b) To receive a statement of eligibility, the importer shall cause 
to be submitted to the ATF National Laboratory, 1401 Research 
Boulevard, Attn: NBA, Rockville, Maryland 20850, the following:
    (1) The kind (class and type) of the distilled spirits product to 
which the request applies;
    (2) An 8-ounce sample of each distilled spirits, wine and flavor 
contained in the product; and
    (3) A statement of composition for the wine and flavors listing--
    (i) For wine, the kind (class and type) and percentage of alcohol 
by volume (if stated as a range, the entire range must be within one 
tax class); and
    (ii) For flavors, the name and percentage of alcohol by volume, and 
the name and quantity of each ingredient used in the manufacture of the 
flavor.


Sec. 27.77  Certificate of effective tax rate computation.

    (a) Each time distilled spirits containing eligible wine or 
eligible flavors are imported into the United States (unless a standard 
effective tax rate has been approved under Sec. 27.78) the importer 
shall prepare a certificate of effective tax rate computation showing 
the following:
    (1) Name, address, and permit number of the importer;
    (2) Kind (class and type) of product;
    (3) Elements necessary to compute the effective tax rate in 
accordance with Sec. 27.42 as follows--
    (i) Proof gallons of distilled spirits (exclusive of distilled 
spirits derived from eligible flavors);
    (ii) Wine gallons of each eligible wine and the percentage of 
alcohol by volume of each; and
    (iii) Proof gallons of distilled spirits derived from eligible 
flavors;
    (4) The date of the statement of eligibility of each eligible wine 
and of each eligible flavor;
    (5) Effective tax rate applied to the product; and
    (6) Signature of the importer or other duly authorized person under 
the following declaration:

    I declare under the penalties of perjury that this certificate 
of effective tax rate computation has been examined by me and, to 
the best of my knowledge and belief, is true, correct, and complete.

    (b) The importer shall file the certificate of effective tax rate 
computation with the port director of customs at the port of entry, at 
the time of entry summary, or, for distilled spirits to be withdrawn 
from customs custody under the provisions of subpart K of this part, 
and attach it to the transfer record required by Sec. 27.132.

(Approved by the Office of Management and Budget under control 
number 1512-0352)

(Sec. 6, Pub. L. 96-598, 94 Stat. 3488, as amended (26 U.S.C. 5010))


Sec. 27.78  Standard effective tax rate.

    (a) In lieu of preparing a certificate of effective tax rate 
computation each time distilled spirits containing eligible wine or 
eligible flavors are imported as prescribed in Sec. 27.77, an importer 
may have a standard effective tax rate established. The standard 
effective tax rate shall be equal to the highest effective tax rate 
that may be applicable to the product within the range of possible 
manufacturing variations.
    (b) To have a standard effective tax rate established, the importer 
shall cause to be submitted to the ATF National Laboratory, 1401 
Research Boulevard, Rockville, MD 20850, the following:
    (1) The samples and information prescribed in Sec. 27.76(b);
    (2) An 8-ounce sample of the finished product;
    (3) A statement of composition for the finished product listing 
the--
    (i) Name of the product;
    (ii) The least quantity, minimum alcohol content (percentage of 
alcohol by volume), and kind (class and type) of each eligible wine;
    (iii) The least quantity, minimum alcohol content (percentage of 
alcohol by volume), and the name of each eligible flavor used in the 
manufacture of the product; and
    (iv) Standard effective tax rate for the product computed in 
accordance with Sec. 27.42, based on the least quantity and the lowest 
alcohol content of eligible wine or eligible flavors used in the 
manufacture of the product.
    (c) Where a standard effective tax rate has been previously 
approved for a product, an importer, other than the person to whom the 
approval was issued, may use the approved rate in accordance with the 
following procedure: The importer shall obtain a copy of the approval 
from the person to whom it was issued and, over the signature of the 
importer or other duly authorized person, place the following 
declaration.

    I declare under the penalties of perjury that this approval has 
been examined by me and, to the best of my knowledge and belief, the 
standard effective tax rate established for this product is 
applicable to all like products contained in this shipment.

    (d) A standard effective tax rate may not be employed until 
approved by the ATF National Laboratory, 1401 Research Boulevard, Attn: 
NBA, Rockville, Maryland 20850. At the time of importation, the 
importer shall file with the port Director of Customs, or attach a copy 
to the transfer record, a copy of the standard effective tax rate 
approval in the manner prescribed in 27.77(b). The use of a standard 
effective tax rate shall not relieve an importer from the payment of 
any tax found to be due. The Director may at any time require an 
importer to immediately discontinue the use of a standard effective tax 
rate.

(Approved by the Office of Management and Budget under control 
Number 1512-0352)

(Sec. 6, Pub. L. 96-598, 94 Stat. 3488, as amended (26 U.S.C. 5010))


Secs. 27.79-27.80  [Reserved]

Subpart G-H--[Reserved]


Secs. 27.81-27.110  [Reserved]

Subpart I--Importation of Distilled Spirits, Wine and Beer in Bulk


Sec. 27.111  Distilled spirits containers.

    Imported distilled spirits for nonindustrial use may be bottled 
only in containers conforming to the provisions of subpart M of this 
part.

(72 Stat. 1374; 26 U.S.C. 5301)


Sec. 27.112  Persons authorized to receive distilled spirits imported 
in bulk.

    Distilled spirits for nonindustrial use which are imported in bulk 
(i.e., in containers having a capacity in excess of 1 gallon (3.785 
liters)) may be entered into a class 8 Customs bonded warehouse for 
bottling, or may be withdrawn in bulk from Customs custody, only if 
entered for exportation or if withdrawn by a person to whom it is 
lawful to sell or otherwise dispose of distilled spirits in bulk 
pursuant to the Federal Alcohol Administration Act and regulations 
issued pursuant thereto (27 CFR part 1). The importation and 
disposition of distilled spirits imported in bulk shall be reported as 
prescribed by Secs. 27.121 and 27.122.


[[Page 40584]]


(Sec. 201, Pub. L. 85-859, 72 Stat. 1342, 1361, 1374, 1395, (26 
U.S.C. 5114. 5207, 5301, 5555))


Sec. 27.113  Persons authorized to receive wine imported in bulk.

    Bulk wine for nonindustrial use may be imported in containers in 
accordance with the provisions of 27 CFR parts 4 and 24. The 
importation and disposition of wine imported in bulk shall be reported 
as prescribed by Secs. 27.121 and 27.122.


Sec. 27.114  Persons authorized to receive beer imported in bulk.

    Bulk beer may be imported in containers under the provisions of 27 
CFR parts 7 and 25. The importation and disposition of beer imported in 
bulk shall be reported as prescribed by Secs. 27.121 and 27.122.


Secs. 27.115-27.120  [Reserved]

Subpart J--Importer's Record and Reports

Record and Report of Imported Liquors


Sec. 27.121  General requirements.

    (a) Except as provided in Sec. 27.122, every importer who imports 
distilled spirits, wine, or beer shall keep such records and render 
such reports of the physical receipt and disposition of such liquors as 
are required to be kept by a wholesale or retail dealer, depending upon 
whether the importer is selling as a wholesaler or retailer, under the 
provisions of part 194 of this chapter.
    (b) Any importer who does not take physical possession of the 
liquors at the time of, but is responsible for, their release from 
customs custody shall keep commercial records reflecting such release. 
Such records shall identify the kind and quantity of the liquors 
released, the name and address of the person receiving the liquors from 
customs custody, and the date of release. These records may be 
maintained in any system of filing the importer chooses provided the 
required information is readily available for examination by ATF 
officers.
    (c) Importers who have obtained certificates of label approval 
shall maintain the originals of such certificates, if in active use, on 
file at the premises covered by the importer's basic permit for a 
period of not less than 3 years following the last importation of 
products covered by such certificates.
    (d) Importers who have obtained certifications of label approval 
and are no longer using such certificates shall, after 3 years 
following the last inportation using such certificate, submit the 
original certificate and any copies of such certificate should be 
submitted to the Product Compliance Branch, 650 Massachusetts Avenue, 
NW, Washington, DC 20226, for cancellation. A letter from the importer 
should accompany the certificates of label approval requesting that the 
attached certificates be cancelled.
    (e) Records of receipt and disposition, as required under 
paragraphs (a) or (b) of this section, shall be filed at the premises 
covered by the importer's basic permit not later than one business day 
following the date of transaction.
    (f) Records and reports will not be required under this part with 
respect to liquors while in customs custody.

(72 Stat. 1342, 1345, 1395; 26 U.S.C. 5114, 5124, 5555)


Sec. 27.122  Proprietors of qualified premises.

    Importing operations conducted by proprietors of premises qualified 
under the provisions of this chapter shall be recorded and reported in 
accordance with the regulations governing the operations of each such 
premises.

(72 Stat. 1342, 1361, 1395; 26 U.S.C. 5114, 5207, 5555)

Filing and Retention of Records and Reports


Sec. 27.123  Filing.

    (a) All records and reports required by this part shall be 
maintained separately, by transaction or reporting date, at the 
premises covered by the importer's basic permit. The regional director 
(compliance) may, pursuant to an application, authorize an importer to 
maintain files or an individual record at another business location 
under the control of the importer, if the alternative location does not 
cause undue inconvenience to ATF or customs officers desiring to 
examine the files, or delay in the timely submission of documents.
    (b) If an importer conducts wholesale operations, one legible copy 
of each required record of receipt and disposition shall be filed not 
later than one business day following the date of transaction.
    (c) If an importer conducts only retail operations, they may 
maintain either loose-leaf or book records of the daily receipt of 
liquors which contain all the required information.
    (d) Supporting documents, such as consignors' invoices, delivery 
receipts, bills of lading, etc., or exact copies of the same, may be 
filed in accordance with the importer's regular accounting and 
recordkeeping practices.
    (e) Customs will release shipments to importers when the 
certificate of label approval (COLA), ATF F 5100.31, is presented by 
the responsible importer. Customs date stamps the COLA with the actual 
release date. When additional shipments of the same products arrive at 
the port of entry, importers shall exclusively either use the original 
COLAs or a copy of the COLA without the release date on it, in order to 
obtain release of such additional shipments.

(Approved by the Office of Management and Budget under control 
number 1512-0352)

(Sec. 201, Pub. L. 85-859, 72 Stat. 1342, as amended, 1395, as 
amended (26 U.S.C. 5114, 5555))


Sec. 27.124  Retention.

    (a) All records required by this part, documents or copies of 
documents supporting these records, and file copies of reports required 
by this part to be submitted to the regional director (compliance) or 
to the port director of customs, shall be retained for not less than 
three years.
    (b) During this period the records shall be available, during 
business hours, for inspection and copying by ATF or customs officers. 
Any records, or copies thereof, containing any of the information 
required by this part to be prepared, wherever kept, shall also be made 
available for inspection and copying.
    (c) The regional director (compliance) may require these records to 
be kept for an additional period of not more than three years in any 
case where he or she determines such retention necessary or advisable.

(72 Stat. 1342, 1345, 1361, 1395; 26 U.S.C. 5114, 5124, 5207, 5555)

Other Records


Sec. 27.125  Transfer record.

    The transfer record for imported distilled spirits prescribed in 
Sec. 27.132 shall show the following information:
    (a) Date prepared;
    (b) Serial number of the transfer record, beginning with ``1'' each 
January 1;
    (c) Name and distilled spirits plant number of the proprietor who 
received the spirits from customs custody;
    (d) Country of origin;
    (e) Name of foreign producer;
    (f) Class and type of spirits
    (g) Age, in years, months and days of the spirits;
    (h) Proof of the spirits;
    (i) Type and number of containers; and
    (j) Proof gallons of spirits in the shipment.

(Approved by the Office of Management and Budget under control 
number 1512-0250).


Sec. 27.126  Package gauge record.

    When required in this part, a package gauge record shall be 
prepared to show:

[[Page 40585]]

    (a) The date prepared;
    (b) The related transaction record and its serial number; and
    (c) For each package:
    (1) Package identification or serial number;
    (2) Class and type of spirits
    (3) Gross weight;
    (4) Proof;
    (5) Proof gallons;
    (6) Name of warehouseman who received the spirits from customs 
custody; and
    (7) Name of importer.

(Approved by the Office of Management and Budget under control 
number 1512-0250)


Secs. 27.127-27.130  [Reserved]

Subpart K--Transfer of Distilled Spirits From Customs Custody to 
Bonded Premises of Distilled Spirits Plant


Sec. 27.131  General provisions.

    (a) Imported distilled spirits in bulk containers may, under the 
provisions of this subpart, be withdrawn by the proprietor of a 
distilled spirits plant from customs custody and transferred in such 
bulk containers or by pipelines to the bonded premises of the distilled 
spirits plant without payment of the internal revenue tax imposed on 
imported spirits by 26 U.S.C. 5001. Imported spirits so withdrawn and 
transferred to a distilled spirits plant:
    (1) May be redistilled or denatured only if of 185 degrees or more 
of proof, and
    (2) May be withdrawn from internal revenue bond for any purpose 
authorized by 26 U.S.C. Chapter 51, in the same manner as domestic 
distilled spirits.
    (b) Imported distilled spirits transferred from customs custody to 
the bonded premises of a distilled spirits plant under the provisions 
of this subpart shall be received and stored thereat, and withdrawn or 
transferred therefrom, subject to the applicable provisions of 27 CFR 
part 19. The person operating the distilled spirits plant receiving the 
imported spirits shall become liable for the tax on distilled spirits 
withdrawn from customs custody under 26 U.S.C. 5232. Upon release of 
the spirits from customs custody, the importer shall then be relieved 
of liability for such tax.

(Sec. 3, Pub. L. 90-630, 82 Stat. 1328, as amended 26 U.S.C. 5232))


Sec. 27.132  Preparation of transfer record and package gauge record.

    The person importing spirits under this subpart shall prepare a 
transfer record according to Sec. 27.125. A separate transfer record 
shall be prepared for each conveyance. If the spirits are in packages 
he/she shall prepare a package gauge record according to Sec. 27.126 
and attach it to the transfer record. If the spirits are subject to an 
effective tax rate based on the alcohol content eligible for 5010 
credit, either the certificate of effective tax rate computation 
prescribed by Sec. 27.77 or a copy of the approved standard effective 
tax rate issued under Sec. 27.78 shall be attached to the transfer 
record. The transfer record and appropriate attachments shall be 
prepared in triplicate and, upon release of the spirits from customs 
custody, dispersed in the following method:
    (a) the original will be forwarded to the consignee;
    (b) one copy will be given to the customs officer or proprietor of 
the customs bonded warehouse, whichever is appropriate;
    (c) the final copy will be retained as part of the importer's 
records.

(Approved by the Office of Management and Budget control number 
1512-0250)


Sec. 27.133  Inspection and release.

    (a) Transfer from customs custody without being deposited in a 
customs bonded warehouse. Imported spirits shall be released from 
customs custody under procedures administered by the U.S. Customs 
Service. The transfer record presented to the proprietor of the 
distilled spirits plant shall reflect (in addition to the information 
required by Sec. 27.125) the amount of spirits transferred to such 
plant, the port of entry, carrier identification, applicable rate of 
duty, and serial number of any customs seals affixed to bulk 
conveyances.
    (b) Transfer from customs bonded warehouse. (1) The proprietor of 
the customs bonded warehouse shall not release distilled spirits under 
this subpart until the proprietor receives from the importer a transfer 
record, if the spirits are in a bulk conveyance, or a package gauge 
record and a transfer record, if the spirits are in packages. The 
proprietor will enter the elements of the gauge on the appropriate 
record and will also enter on the transfer record the port of entry, 
carrier identification, warehouse entry number, applicable rate of 
duty, and serial number of any customs seals affixed to bulk 
conveyances.
     (2) When all customs requirements are complied with, the 
proprietor of the customs bonded warehouse shall release the spirits 
for transfer to the distilled spirits plant by dating and signing on 
the transfer record with his title and the statement:

    ``To the best of my knowledge the information herein is accurate 
and the spirits are released.''

The original of the transfer record with any attachments shall be 
retained by the consignee.

(Sec. 3, Pub. L. 90-630, 82 Stat. 1328, as amended (26 U.S.C. 5232))


Sec. 27.134  Sealing of bulk conveyances.

    Whenever a shipment of distilled spirits is made from customs 
custody to the distilled spirits plant in a tank car or tank truck, all 
openings affording access to the spirits shall be sealed under customs 
supervision in accordance with customs procedures in such manner as 
will prevent unauthorized removal of spirits through such openings 
without detection.

(72 Stat. 1314, 1322, 1366; 26 U.S.C. 5001, 5007, 5232)


Sec. 27.135  Receipt by consignee.

    Proprietors of distilled spirits plants who receive imported 
spirits under this subpart shall follow the requirements in 27 CFR part 
19 for spirits received by transfer in bond.


Secs. 27.136-27.140  [Reserved]

Subpart L--Withdrawal of Imported Distilled Spirits From Customs 
Custody Free of Tax for Use of the United States


Sec. 27.141  General.

    The United States or any of its Government agencies may, upon 
filing proper customs entry, withdraw imported distilled spirits free 
of tax from customs custody, for non-beverage purposes as authorized by 
26 U.S.C. 5313 and under the provisions of this subpart. Before any 
distilled spirits may be withdrawn, a permit to procure the spirits 
shall be obtained from the Director. A bond is not required for any 
Government agency to procure and withdraw spirits free of tax under 
this subpart. The provisions of subpart N of part 22 of this chapter 
cover the withdrawal of domestically produced tax-free spirits for use 
of the United States or any of its Government agencies.

(Sec. 201, Pub. L. 85-859, 72 Stat. 1372, as amended, 1375, as 
amended (26 U.S.C. 5273, 5313))


Sec. 27.142  Application and permit, Form 5150.33.

    (a) General. All permits previously issued to the United States or 
any of its Government agencies on Form 1444 shall remain valid and will 
be regulated by the same provisions of this subpart which refer to 
permits on Form 5150.33.

[[Page 40586]]

    (b) Application. (1) A Government agency of the United States shall 
apply to the Director for a permit to procure and withdraw spirits free 
of tax on Form 5150.33. Upon approval by the Director, Form 5150.33 
will be returned to the agency.
    (2) If a Government agency intends to withdraw spirits free of tax 
under this part and part 22 of this chapter, Form 5150.33 may be 
annotated to cover both types of withdrawals.
    (3) A separate permit is not required for each port of entry. The 
application, Form 5150.33, may be completed to indicate the applicable 
ports of entry in which spirits will be withdrawn from customs custody.
    (4) A Government agency may specify on its application that it 
desires a single permit authorizing all sub-agencies under its control 
to procure and withdraw spirits free of tax under this subpart and 
subpart N of part 22 of this chapter; or, each Government location may 
individually file an application for a permit, Form 5150.33.
    (5) Each application for a permit shall be signed by the head of 
the agency or sub-agency, or the incumbent of an office which is 
authorized by the head of the agency or sub-agency, to sign. Evidence 
of authorization to sign on behalf of the head of an agency or sub-
agency shall be furnished with the application.
    (c) Use of spirits. Spirits withdrawn under this subpart may not be 
used for non-Government purposes.
    (d) Cancellation of permit. All permits on Form 5150.33 and 
previous editions on Form 1444 shall remain in force until surrendered 
or canceled. Upon surrender or cancellation, the Government agency 
shall obtain and destroy all photocopies of the permit furnished to 
district directors of customs, and forward the original to the Director 
for cancellation.

(Sec. 201, Pub. L. 85-859, 72 Stat. 1375, as amended (26 U.S.C. 
5313))


Sec. 27.143  Use of permit, Form 5150.33.

    Each Government agency shall retain the original of its permit, 
Form 5150.33, on file until such time as such permit is surrendered or 
cancelled. When filing an initial customs entry to withdraw spirits 
free of tax from a port of entry, the agency shall furnish a photocopy 
of its permit to the district director of customs for retention. In the 
case of an agency holding a single permit for use of its sub-agencies, 
an attachment to the permit shall list all locations authorized to 
withdraw spirits free of tax from customs custody. Any subsequent 
requests for customs entry from the same port shall refer to the permit 
number.

(Sec. 201 Pub. L. 85-859, 72 Stat. 1375, as amended (26 U.S.C. 
5313))


Sec. 27.144  Entry documents.

    Entry documents for importation of tax-free spirits under this 
subpart shall record the serial numbers or other identifying numbers of 
the containers and the total quantity in proof gallons of the spirits 
to be entered.


Sec. 27.145  Customs release.

    (a) Upon receipt of appropriate customs entry and a photocopy of a 
permit, Form 5150.33 or previous editions on Form 1444, the port 
director of customs shall, following an inspection of the shipment, 
release spirits free of tax to the Government agency named on the 
permit, or attachment thereto.
    (b) Customs officers shall not release spirits for shipment until 
the shipment has been inspected for losses in transit. If it appears 
that a container or containers have sustained losses in transit, the 
customs officers shall gauge the damaged container and prepare a 
package gauge record for the entire shipment, according to Sec. 27.126. 
A copy of the package gauge record will be retained for the customs 
files and the original forwarded to the consignee agency.

(Sec. 201, Pub. L. 85-859, 72 Stat. 1375, as amended (26 U.S.C. 
5313)


Secs. 27.146-27.150  [Reserved]

Subpart M--Requirements For Liquor Bottles


Sec. 27.151  Scope of subpart.

    The provisions of this subpart shall apply only to liquor bottles 
having a capacity of 200 ml or more, except where expressly applied to 
liquor bottles of less than 200 ml capacity.


Sec. 27.152  Standards of fill.

    Distilled spirits imported into the United States in containers of 
1 gallon (3.785 liters) or less for sale shall be imported only in 
liquor bottles, including liquor bottles of less than 200 ml capacity, 
which conform to the applicable standards of fill provided in 
Sec. 5.47a of this chapter. Empty liquor bottles, including liquor 
bottles of less than 200 ml capacity, which conform to the provisions 
of part 19, or subpart E of part 5 of this chapter, may be imported for 
packaging distilled spirits in the United States as provided in part 19 
of this chapter.


Sec. 27.153  Distinctive liquor bottles.

    (a) Application. Liquor bottles of distinctive shape or design, 
including bottles of less than 200 ml. capacity, may be imported by an 
importer (filled bottles) or a bottler (empty bottles). For filled 
bottles, the importer shall submit Form 5100.31 to the Director for 
bottle approval prior to importation of such bottles into the United 
States. For empty bottles, the bottler shall obtain approval from the 
Director on Form 5100.31 prior to using the bottles. The importer or 
bottler, as applicable, shall certify as to the total capacity of a 
representative sample bottle before closure (expressed in milliliters) 
on each copy of the form. In addition, the applicant shall affix a 
readily legible photograph of the bottle (both front and back) to the 
front of each copy of Form 5100.31 along with the label(s) to be used 
on the bottle. The applicant shall not submit an actual bottle or an 
authentic model unless specifically requested to do so.
    (b) Approval or Disapproval. Properly submitted Form 5100.31 to 
import distinctive liquor bottles (filled or empty) which have been 
imported shall be approved provided such bottles are found by the 
Director to:
    (1) Meet the requirements of 27 CFR part 5;
    (2) Be other than a standard liquor bottle (distinctive);
    (3) Be suitable for their intended purpose;
    (4) Not jeopardize the revenue; and
    (5) Not be deceptive to the consumer. If Form 5100.31 is 
disapproved, the applicant shall be notified by the Director of the 
reasons for disapproval.
    (c) Maintenance and Use of Approved Copy. The applicant shall keep 
a copy of the approved Form 5100.31, including an approved photograph 
of the distinctive liquor bottle (both front and back), on file at the 
applicant's premises. The applicant importer is responsible for 
furnishing a copy of the approved Form 5100.31, including a photograph 
of the distinctive liquor bottle, to customs officials at each affected 
port of entry where the merchandise is examined.

(Sec 201, Pub. L. 85-859, 72 Stat. 1374, as amended (26 U.S.C. 
5301))


Sec. 27.154  Bottles not constituting approved containers.

    The Director is authorized to disapprove any bottle, including a 
bottle of less than 200 ml capacity, for use as a liquor bottle which 
is determined to be deceptive. The customs officer at the port of entry 
shall deny entry of any such bottle containing distilled spirits upon 
advice from the Director that such bottle is not an approved container 
for

[[Page 40587]]

distilled spirits for consumption in the United States.

(Sec. 201, Pub. L. 85-859, 72 Stat. 1374, as amended (26 U.S.C. 
5301))


Sec. 27.155  Bottles to be used for display purposes.

    Empty liquor bottles may be imported and furnished to liquor 
dealers for display purposes, provided each bottled is marked to show 
that it is to be used for such purpose. The importer shall keep records 
of the receipt and disposition of such bottles, showing the names and 
addresses of consignees, dates of shipment, and size, quantity, and 
description of such bottles.

(Approved by the Office of Management and Budget under control 
number 1512-0352)


Sec. 27.156   Used liquor bottles.

    The Director may, pursuant to letterhead application, authorize an 
importer to receive liquor bottles assembled for the importer as 
provided in Sec. 194.263 of this chapter. Used liquor bottles so 
received may be stored at any suitable location pending exportation for 
reuse. The importer shall keep records of the receipt and disposition 
of used liquor bottles.

(Approved by the Office of Management and Budget under control 
number 1512-0352)


Secs. 27.157-27.160   [Reserved]

PART 70--PROCEDURE AND ADMINISTRATION

    Par. 29. The authority citation for part 70 continues to read as 
follows:

    Authority: 5 U.S.C. 301 and 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 70.411(c)(27) is revised to read as follows:


Sec. 70.411   Imposition of taxes, qualification requirements, and 
regulations.

* * * * *
    (c) * * *
    (27) Importation of liquors. Part 27 of Title 27 CFR contains the 
substantive and procedural requirements relative to the importation of 
distilled spirits, wine, and beer into the United States from foreign 
countries including special (occupational) and commodity taxes, 
permits, marking, branding, and labeling of containers and packages.
* * * * *

PART 250--LIQUORS AND ARTICLES FROM PUERTO RICO AND THE VIRGIN 
ISLANDS

    Par. 31. The authority citation for 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.


Sec. 250.112a   [Amended]

    Par. 32. In Sec. 250.112a remove the number ``251'' and add in its 
place the number ``27'' in the following places.
    (a) Section 250.112a(a)(1)
    (b) Section 250.112a(b)(1)
    (c) Section 250.112a(b)(3)
    Par. 33. In Sec. 250.136, the undesignated paragraph is 
redesignated as paragraph (a) and paragraph (b) is added to read as 
follows:


Sec. 250.136   Affixing closures.

    (a) * * *
    (b) Closures or other devices need bear no letter of design; 
however, if a closure or other device bears any lettering or design 
which was not approved for use on such closure or other device as part 
of the certificate of label approval (COLA), ATF Form 5100.31, or which 
does not appear on a label used in connection with a closure or device, 
then such lettering or design is required to be approved for use by the 
Director in response to a letterhead application from the importer. 
Such application shall contain a copy of the lettering or design which 
is to appear on the closure or other device and identify the label or 
labels with which such closures or other devices will be used as 
provided in section 27.73(b).
    Par. 34. In Sec. 250.231, the undesignated paragraph is 
redesignated as paragraph (a) and paragraph (b) is added to read as 
follows:


Sec. 250.231   Affixing closures.

    (a) * * *
    (b) Closures or other devices need bear no letter or design; 
however, if a closure or other device bears any lettering or design 
which was not approved for use on such closure or other device as part 
of the certificate of label approval (COLA), ATF Form 5100.31, or which 
does not appear on a label used in connection with a closure or device, 
then such lettering or design is required to be approved for use by the 
Director in response to a letterhead application from the importer. 
Such application shall contain a copy of the lettering or design which 
is to appear on the closure or other device and identify the label or 
labels with which such closures or other devices will be used as 
provided in Sec. 27.73(b).


Sec. 250.267   [Amended]

    Par. 35. In Sec. 250.267(a) is amended by removing the number 
``251'' and adding the number ``27'' wherever it appears.

PART 251--IMPORTATION OF DISTILLED SPIRITS, WINES, AND BEER 
[REMOVED AND RESERVED]

    Par. 29. Part 251 is removed and reserved.

    Dated: June 10, 1996.
John W. Magaw,
Director.
    Approved: July 3, 1996.
John P. Simpson,
Deputy Assistant Secretary (Regulatory, Tariff and Trade Enforcement).
[FR Doc. 96-19427 Filed 8-2-96; 8:45 am]
BILLING CODE 4810-31-U