[Federal Register Volume 65, Number 126 (Thursday, June 29, 2000)]
[Rules and Regulations]
[Pages 40050-40051]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 00-16203]


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DEPARTMENT OF THE TREASURY

Bureau of Alcohol, Tobacco and Firearms

27 CFR Parts 270, 275 and 295

[T.D. ATF-427; Ref: Notice No. 889]
RIN 1512-AB92


Extension of Package Use-Up Rule for Roll-Your-Own Tobacco 
Manufacturers and Importers (98R-370P)

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

ACTION: Temporary rule (Treasury decision).

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SUMMARY: In Treasury Decision ATF-424, ATF issued temporary regulations 
requiring manufacturers and importers to mark packages of roll-your-own 
tobacco as either ``roll-your-own tobacco'' or ``Tax Class J.'' The 
temporary regulations provided a use-up period until April 1, 2000 for 
manufacturers who used packages that did not meet the marking 
requirements, provided they used the packages before January 1, 2000. 
In this temporary rule, ATF is extending the date by which 
manufacturers of roll-your-own tobacco must comply with the package 
marking requirements. ATF is also adding regulations to provide the 
same compliance date for importers of roll-your-own tobacco.

DATES: Effective date: June 29, 2000. This temporary rule extends the 
compliance date for both manufacturers and importers until October 1, 
2000.

FOR FURTHER INFORMATION CONTACT: Robert P. Ruhf, Regulations Division, 
650 Massachusetts Avenue, NW., Washington, DC 20226; (202) 927-8210; or 
[email protected].

SUPPLEMENTARY INFORMATION:

Background

    This temporary rule extends the date stated in 27 CFR 270.216b(c) 
and 295.45c for manufacturers to comply with the requirements that 
packages be marked as ``roll-your-own tobacco'' or ``Tax Class J'' from 
April 1, 2000, to October 1, 2000. This temporary rule also adds a new 
section, 27 CFR 275.72c, that will allow importers to have this same 
benefit. We are taking this action as a result of comments from the 
Pipe Tobacco Council, Washington, DC. These comments were received in 
response to the notice of proposed rulemaking, Notice No. 889 (64 FR 
71935), issued concurrently with the temporary rule T.D. ATF-424 (64 FR 
71929).
    The Pipe Tobacco Council submitted written comments concerning the 
inability of manufacturers and importers of roll-your-own tobacco to 
comply with the April 1, 2000 deadline. The Pipe Tobacco Council stated 
that they represented manufacturers and importers who account for more 
than 90 percent of the roll-your-own tobacco sold in the United States. 
The Pipe Tobacco Council stated that since there is a long lead time 
for acquiring new packaging of at least 5 to 6 months, most 
manufacturers and importers would be unable to meet the April 1, 2000 
deadline for marking packages as ``roll-your-own tobacco'' or ``Tax 
Class J''. In addition, they stated that although manufacturers and 
importers could place stickers on the packages with ``roll-your-own 
tobacco'' or ``Tax Class J'' markings, the amount of hand labor 
involved would make this very costly. The Pipe Tobacco Council 
requested an extension of the compliance date to October 1, 2000, to 
allow all manufacturers and importers a reasonable time to comply with 
this requirement to mark packages ``roll-your-own tobacco'' or ``Tax 
Class J''.
    We have considered the jeopardy to the revenue in extending the 
compliance date with these package markings and the costs that would be 
incurred. Since the jeopardy to the revenue is minimal and the costs 
would be comparatively large for manufacturers and importers to comply, 
we have decided to extend the use-up date from April 1, 2000, to 
October 1, 2000.
    We note that the Pipe Tobacco Council letter also requested that 
``cigarette tobacco,'' be allowed as an alternative marking designation 
on packages of roll-your-own tobacco. We are not addressing this issue 
at this time. We will address this issue after we have analyzed all 
comments received during the 60-day comment period to Notice No. 889 
(64 FR 71935), which was issued concurrently with the temporary rule 
T.D. ATF-424 (64 FR 71929) published December 22, 1999.

Regulatory Flexibility Act

    Because no notice of proposed rulemaking is required for this 
temporary rule, according to the provisions of the Regulatory 
Flexibility Act (5 U.S.C. 601 et seq.) do not apply. Moreover, to give 
immediate guidance to manufacturers and importers, this temporary rule 
to extends the date they have to comply with the requirement to mark 
packages as ``roll-your-own tobacco'' or ``Tax Class J''. The extension 
of this date does not impose any additional requirements on small

[[Page 40051]]

businesses. Pursuant to 26 U.S.C. 7805(f), the temporary rulemaking 
(T.D. ATF-424 (64 FR 71929)) 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 temporary rule is not a 
significant regulatory action as defined by Executive Order 12866 
because any economic effects flow directly from the underlying statute 
and not from this rule. Therefore, a regulatory assessment is not 
required.

Paperwork Reduction Act

    This rule does not impose any collection of information as defined 
in the Paperwork Reduction Act of 1995 (44 U.S.C. 3507(j)). 
Consequently, this rule is being issued without prior notice and public 
procedure pursuant to the Administrative Procedure Act (5 U.S.C. 553).

Administrative Procedure Act

    Because this document merely extends the date when manufacturers 
and importers must comply with certain marking requirements, and 
because immediate guidance is necessary to implement this extension, 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 under 5 U.S.C. 553(d).

Drafting Information

    The principal author of this document is Robert P. Ruhf, of the 
Regulations Division, Bureau of Alcohol, Tobacco and Firearms.

List of Subjects

27 CFR Part 270

    Administrative practice and procedure, Authority delegations, 
Cigarette papers and tubes, Claims, Electronic fund transfer, Excise 
taxes, Labeling, Packaging and containers, Penalties, Reporting 
requirements, Seizures and forfeitures, Surety bonds, Tobacco products.

27 CFR Part 275

    Administrative practice and procedure, Authority delegations, 
Cigarette papers and tubes, Claims, Electronic fund transfer, Customs 
duties and inspection, Excise taxes, Imports, Labeling, Packaging and 
containers, Penalties, Reporting requirements, Seizures and 
forfeitures, Surety bonds, Tobacco products, U.S. possessions, 
Warehouses.

27 CFR Part 295

    Administrative practice and procedure, Authority delegations, 
Cigarette papers and tubes, Excise taxes, Labeling, Packaging and 
containers, Tobacco products.

Authority and Issuance

    Accordingly, title 27 of the Code of Federal Regulations is amended 
as follows:

PART 270--MANUFACTURE OF TOBACCO PRODUCTS AND CIGARETTE PAPERS AND 
TUBES

    Paragraph 1. The authority citation for part 270 continues to read 
as follows:

    Authority: 26 U.S.C. 5142, 5143, 5146, 5701, 5703-5705, 5711-
5713, 5721-5723, 5731, 5741, 5751, 5753, 5761-5763, 6061, 6065, 
6109, 6151, 6301, 6302, 6311, 6313, 6402, 6404, 6423, 6676, 6806, 
7011, 7212, 7325, 7342, 7502, 7503, 7606, 7805, 31 U.S.C. 9301, 
9303, 9304, 9306.


    Par. 2. Section 270.216c is revised to read as follows:


Sec. 270.216c  Package use-up rule.

    (a) A manufacturer must have used such packaging for roll-your-own 
tobacco before January 1, 2000.
    (b) A manufacturer of roll-your-own tobacco may continue to place 
roll-your-own tobacco in packages that do not meet the marking 
requirements of Secs. 270.212 and 270.216b(b) until April 1, 2000.
    (c) A manufacturer of roll-your-tobacco may continue to place roll-
your-tobacco in packages that do not meet the requirements of 
Sec. 270.216b(a) until October 1, 2000.
* * * * *

PART 275--IMPORTATION OF TOBACCO PRODUCTS AND CIGARETTE PAPERS AND 
TUBES

    Par. 4. The authority citation for part 275 continues to read as 
follows:

    Authority: 18 U.S.C. 2342; 26 U.S.C. 5701, 5703-5705, 5708, 
5712, 5713, 5722, 5723, 5741, 5754, 5761-5763, 6301, 6302, 6313, 
6404, 7101, 7212, 7342, 7606, 7652, 7805; 31 U.S.C. 9301, 9303, 
9304, 9306.


    Par. 5. A new section 275.72c is added to read as follows:


Sec. 275.72c  Package use-up rule.

    (a) An importer must have used such packaging for roll-your-own 
tobacco before January 1, 2000.
    (b) An importer of roll-your-own tobacco may continue to place 
roll-your-own tobacco in packages that do not meet the marking 
requirements of Sec. 275.72b(b) until April 1, 2000.
    (c) An importer of roll-your-own tobacco may continue to place 
roll-your-own tobacco in packages that do not meet the requirements of 
Sec. 275.72b(a) until October 1, 2000.
* * * * *

PART 295--REMOVAL OF TOBACCO PRODUCTS AND CIGARETTE PAPERS AND 
TUBES, WITHOUT PAYMENT FOR USE OF THE UNITED STATES

    Par. 6. The authority citation for part 295 continues to read as 
follows:

    Authority: 26 U.S.C. 5703, 5704, 5705, 5723, 5741, 5751, 5762, 
5763, 6313, 7212, 7342, 7606, 7805, 44 U.S.C. 3504(h).


    Par. 7. Section 295.45c is revised to read as follows:


Sec. 295.45c  Package use-up rule.

    (a) A manufacturer must have used such packaging for roll-your-own 
tobacco before January 1, 2000.
    (b) A manufacturer of roll-your-own tobacco, may continue to place 
roll-your-own tobacco in packages that do not meet the marking 
requirements of Secs. 270.212 and 270.216b(b) until April 1, 2000.
    (c) A manufacturer of roll-your-own tobacco may continue to place 
roll-your-own tobacco in packages that do not meet the marking 
requirements of Sec. 270.216b(a) until October 1, 2000.
* * * * *

    Signed: March 28, 2000.
Bradley A. Buckles,
Director.
    Approved: April 26, 2000.
John P. Simpson,
Deputy Assistant Secretary (Regulatory, Tariff and Trade Enforcement).
[FR Doc. 00-16203 Filed 6-28-00; 8:45 am]
BILLING CODE 4810-31-U