[Federal Register Volume 61, Number 206 (Wednesday, October 23, 1996)]
[Rules and Regulations]
[Pages 54935-54936]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-27083]


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DEPARTMENT OF THE TREASURY

27 CFR Part 16

[T.D. ATF-385]
RIN 1512-AB62


Implementation of the Debt Collection Improvement Act of 1996 
(Public Law 104-134) With Respect to the Civil Penalties Provision of 
the Alcoholic Beverage Labeling Act of 1988 (96R-023P)

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

ACTION: Final rule, Treasury decision.

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SUMMARY: This final rule implements the provisions of the Debt 
Collection Improvement Act of 1996 with respect to the civil penalties 
provision of the Alcoholic Beverage Labeling Act of 1988 (ABLA). This 
regulation implements the statute by increasing the maximum civil 
monetary penalty from $10,000 to $11,000 for violations of the 
provisions of the ABLA.

EFFECTIVE DATE: The effective date of this final rule is October 23, 
1996.

FOR FURTHER INFORMATION CONTACT: James P. Ficaretta, Wine, Beer and 
Spirits Regulations Branch, Bureau of Alcohol, Tobacco and Firearms, 
650 Massachusetts Avenue, NW., Washington, DC 20226 (202-927-8230).

SUPPLEMENTARY INFORMATION:

Background

Debt Collection Improvement Act of 1996

    The Debt Collection Improvement Act of 1996 (Pub. L. 104-134, 
Sec. 31001(s), 110 Stat. 1321-358, 1321-373), enacted on April 26, 
1996, amended the Federal Civil Penalties Inflation Adjustment Act of 
1990 (Pub. L. 101-410, 104 Stat. 890, hereinafter ``the Act''), 28 
U.S.C. 2461 note, by requiring the inflation adjustment of civil 
monetary penalties. A ``civil monetary penalty'' is defined in the Act 
as any penalty, fine or other such sanction that (1) is for a specific 
monetary amount as provided by Federal law, or has a maximum amount 
provided for by Federal law; (2) is assessed or enforced by an agency 
pursuant to Federal law; and, (3) is assessed or enforced pursuant to 
an administrative proceeding or a civil action in the Federal courts. 
The purpose of the law is to provide more effective tools for 
collections of delinquent debts owed to the Government.
    The amendment to the Act requires that the head of each Federal 
agency shall, not later than 180 days after the date of enactment of 
the Debt Collection Improvement Act of 1996, and at least once every 4 
years thereafter, adjust each civil monetary penalty provided by law 
within the jurisdiction of the respective agency by the inflation 
adjustment described under section 5 of the Act. The adjustment of the 
civil monetary penalty must be done by regulation and published in the 
Federal Register. The first inflation adjustment is required by October 
23, 1996, 180 days after the date of enactment of the Debt Collection 
Improvement Act of 1996.
    Any increase in a civil monetary penalty made pursuant to the 
amendment will apply only to violations which occur after the date the 
increase takes effect. The amendment also provides that the first 
adjustment of a penalty made pursuant to the amendment may not exceed 
10 percent of such penalty.
    Certain civil monetary penalties are excluded from the mandatory 
inflation adjustment. The statute specifically provides that the 
inflation adjustment does not apply to penalties under the Internal 
Revenue Code of 1986, the Tariff Act of 1930, the Occupational Safety 
and Health Act of 1970, and the Social Security Act. Most of the civil 
monetary penalties administered by ATF are imposed by the Internal 
Revenue Code of 1986, and are thus not subject to the inflation 
adjustment mandated by the Act. Accordingly, the only civil monetary 
penalty enforced by ATF which is subject to the inflation adjustment is 
the civil monetary penalty imposed by the Alcoholic Beverage Labeling 
Act (ABLA), 27 U.S.C. 218.

Alcoholic Beverage Labeling Act

    On November 18, 1988, the Alcoholic Beverage Labeling Act of 1988, 
Title VIII of the Anti-Drug Abuse Act of 1988, was enacted. The law 
requires that the following health warning statement appear on the 
labels of all containers of alcoholic beverages sold or distributed in 
the United States, as well as on containers of alcoholic beverages that 
are sold, distributed, or shipped to members or units of the U.S. Armed 
Forces, including those located outside the United States:

    Government Warning: (1) According to the Surgeon General, women 
should not drink alcoholic beverages during pregnancy because of the 
risk of birth defects. (2) Consumption of alcoholic beverages 
impairs your ability to drive a car or operate machinery, and may 
cause health problems.

See 27 U.S.C. 215. The health warning statement requirement applies to 
alcoholic beverages bottled on or after November 18, 1989.
    Section 207 of the ABLA, 27 U.S.C. 218, provides that any person 
who violates the provisions of the ABLA is subject to a civil penalty 
of not more than $10,000, with each day constituting a separate 
offense.

Civil Monetary Penalty Inflation Adjustment for Non-Compliance With the 
ABLA

    The Act provides that the inflation adjustment will be determined 
by increasing the maximum civil monetary penalty by the cost-of-living 
adjustment. The ``cost-of-living'' adjustment is the percentage by 
which the consumer price index for all-urban consumers (CPI) for the 
month of June of the calendar year preceding the adjustment exceeds the 
CPI for the month of June of the calendar year in which the amount of 
such civil monetary penalty was last set or adjusted pursuant to law. 
Any increase determined under section 5 of the Act must be rounded in 
accordance with the provisions of that section, which provides that for 
penalties less than or equal to $10,000, the increase shall be rounded 
to the nearest multiple of $1,000.
    Since the ABLA was enacted in 1988, the inflation adjustment is 
achieved by calculating the percentage by which the CPI for June of 
1995 (456.7) exceeds the CPI for June of 1988 (353.5). This results in 
an inflation factor of approximately 1.29. Thus, the maximum penalty 
amount after increase and rounding would be $13,000. However, the Debt 
Collection Improvement Act of 1996 provides that the first adjustment 
of a civil monetary penalty may not exceed 10 percent of such penalty. 
Accordingly, the regulations in Part 16 are amended to provide that the 
maximum penalty amount for violations of the ABLA is $11,000 
($10,000 x 10%=$1,000; $10,000 x $1,000=$11,000).
    The regulations in 27 CFR Part 16 implement the statutory 
requirement for a health warning statement under the ABLA; however, the 
current regulations do not specifically reference the penalty imposed 
by 27 U.S.C. 218. ATF is accordingly amending the regulations to 
include a new section 16.33 which will set forth the $10,000 penalty 
imposed by the ABLA. The new regulation will

[[Page 54936]]

also explain that this civil penalty shall be periodically adjusted for 
inflation in accordance with the provisions of the Federal Civil 
Penalties Inflation Adjustment Act of 1990. Finally, the regulation 
shall state that for violations occurring after October 23, 1996, the 
civil penalty shall be not more than $11,000 for each offense.

Executive Order 12866

    It has been determined that this final rule is not a significant 
regulatory action as defined in E.O. 12866, because any economic 
effects flow directly from the underlying statute and not from this 
final rule. Therefore, a regulatory assessment is not required.

Administrative Procedure Act

    Because this document merely implements the law and because 
immediate guidance is necessary to implement the provisions of the law, 
it is found to be impracticable to issue this Treasury decision with 
notice and public procedure under 5 U.S.C. 553(b), or subject to the 
effective date limitation in section 553(d).

Regulatory Flexibility Act

    The provisions of the Regulatory Flexibility Act relating to an 
initial and final regulatory flexibility analysis (5 U.S.C. 603, 604) 
are not applicable to this final rule because the agency was not 
required to publish a notice of proposed rulemaking under 5 U.S.C. 553 
or any other law. Accordingly, a regulatory flexibility analysis 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 final rule because no requirement to collect 
information is imposed.

Drafting Information

    The author of this document is James P. Ficaretta, Wine, Beer and 
Spirits Regulations Branch, Bureau of Alcohol, Tobacco and Firearms.

List of Subjects in 27 CFR Part 16

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

Authority and Issuance

    27 CFR Part 16--ALCOHOLIC BEVERAGE HEALTH WARNING STATEMENT is 
amended as follows:
    Paragraph 1. The authority citation for 27 CFR Part 16 is revised 
to read as follows:

    Authority: 27 U.S.C. 205, 215, 218; 28 U.S.C. 2461 note.

    Par. 2. Section 16.33 is added to Subpart D to read as follows:


Sec. 16.33  Civil penalties.

    (a) General. Any person who violates the provisions of this part 
shall be subject to a civil penalty of not more than $10,000, and each 
day shall constitute a separate offense.
    (b) Adjusted penalty for violations occurring after October 23, 
1996. Pursuant to the provisions of the Federal Civil Penalties 
Inflation Adjustment Act of 1990, as amended, the civil penalty 
provided for in paragraph (a) of this section shall be periodically 
adjusted in accordance with inflation. Accordingly, for violations 
occurring after October 23, 1996, the civil penalty shall be not more 
than $11,000.

    Signed: September 25, 1996.
John W. Magaw,
Director.

    Approved: October 3, 1996.
Timothy E. Skud,
Acting Deputy Assistant Secretary (Regulatory, Tariff and Trade 
Enforcement).
[FR Doc. 96-27083 Filed 10-22-96; 8:45 am]
BILLING CODE 4810-31-P