[Federal Register Volume 78, Number 24 (Tuesday, February 5, 2013)]
[Rules and Regulations]
[Pages 8016-8018]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2013-02468]


=======================================================================
-----------------------------------------------------------------------

DEPARTMENT OF THE TREASURY

Alcohol and Tobacco Tax and Trade Bureau

27 CFR Part 9

[Docket No. TTB-2012-0005; T.D. TTB-111; Ref: Notice No. 130]
RIN 1513-AB88


Establishment of the Elkton Oregon Viticultural Area

AGENCY: Alcohol and Tobacco Tax and Trade Bureau, Treasury.

ACTION: Final rule; Treasury Decision.

-----------------------------------------------------------------------

SUMMARY: The Alcohol and Tobacco Tax and Trade Bureau (TTB) establishes 
the approximately 74,900-acre ``Elkton Oregon'' viticultural area in 
Douglas County, Oregon. The viticultural area lies totally within the 
Umpqua Valley viticultural area and the multi-county Southern Oregon 
viticultural area. TTB designates viticultural areas to allow vintners 
to better describe the origin of their wines and to allow consumers to 
better identify wines they may purchase.

DATES: Effective March 7, 2013.

FOR FURTHER INFORMATION CONTACT: Karen A. Thornton, Regulations and 
Rulings Division, Alcohol and Tobacco Tax and Trade Bureau, 1310 G 
Street NW., Box 12, Washington, DC 20005; telephone 202-453-1039, ext. 
175.

SUPPLEMENTARY INFORMATION:

Background on Viticultural Areas

TTB Authority

    Section 105(e) of the Federal Alcohol Administration Act (FAA Act), 
27 U.S.C. 205(e), authorizes the Secretary of the Treasury to prescribe 
regulations for the labeling of wine, distilled spirits, and malt 
beverages. The FAA Act provides that these regulations should, among 
other things, prohibit consumer deception and the use of misleading 
statements on labels, and ensure that labels provide the consumer with 
adequate information as to the identity and quality of the product. The 
Alcohol and Tobacco Tax and Trade Bureau (TTB) administers the FAA Act 
pursuant to section 1111(d) of the Homeland Security Act of 2002, 
codified at 6 U.S.C. 531(d). The Secretary has delegated various 
authorities through Treasury Department Order 120-01 (Revised), dated 
January 21, 2003, to the TTB Administrator to perform the functions and 
duties in the administration and enforcement of this law.
    Part 4 of the TTB regulations (27 CFR part 4) allows the 
establishment of definitive viticultural areas and the use of their 
names as appellations of origin on wine labels and in wine 
advertisements. Part 9 of the TTB regulations (27 CFR part 9) contains 
the list of approved American viticultural areas.

Definition

    Section 4.25(e)(1)(i) of the TTB regulations (27 CFR 4.25(e)(1)(i)) 
defines a viticultural area for American wine as a delimited grape-
growing region having distinguishing features as described in part 9 of 
the regulations and a name and a delineated boundary as established in 
part 9 of the regulations. These designations allow vintners and 
consumers to attribute a given quality, reputation, or other 
characteristic of a wine made from grapes grown in an area to its 
geographic origin. The establishment of viticultural areas allows 
vintners to describe more accurately the origin of their wines to 
consumers and helps consumers to identify wines they may purchase. 
Establishment of a viticultural area is neither an approval nor an 
endorsement by TTB of the wine produced in that area.

Requirements

    Section 4.25(e)(2) of the TTB regulations outlines the procedure 
for proposing an American viticultural area and provides that any 
interested party may petition TTB to establish a grape-growing region 
as a viticultural area. Section 9.12 of the TTB regulations (27 CFR 
9.12) prescribes standards for petitions for the establishment or 
modification of American viticultural areas. Such petitions must 
include the following--
     Evidence that the area within the proposed viticultural 
area boundary is locally or nationally known by the viticultural area 
name specified in the petition;
     An explanation of the basis for defining the boundary of 
the proposed viticultural area;
     A narrative description of the features of the proposed 
viticultural area that affect viticulture, such as climate, geology, 
soil, physical features, and elevation, that make the proposed 
viticultural area distinctive and distinguish it from adjacent areas 
outside the proposed viticultural area boundary;
     A copy of the appropriate United States Geological Survey 
(USGS) map(s) showing the location of the proposed viticultural area, 
with the boundary of the proposed viticultural area clearly drawn 
thereon; and
     A detailed narrative description of the proposed 
viticultural area boundary based on USGS map markings.

Elkton Oregon Petition

    TTB received a petition from Michael Landt, on behalf of himself 
and the owners of seven other Elkton area vineyards, proposing the 
establishment of the ``Elkton Oregon'' American viticultural area in 
Douglas County in southwestern Oregon. The proposed viticultural area 
encompasses approximately 74,900 acres, with 12 commercially-producing 
vineyards covering 96.5 acres, according to the petition. The petition 
also included a map indicating that the vineyards are disbursed 
throughout the proposed viticultural area.
    The petition indicated that the proposed Elkton Oregon viticultural 
area is located entirely within the larger Umpqua Valley viticultural 
area (27 CFR 9.89), which, in turn, is located entirely within the 
Southern Oregon

[[Page 8017]]

viticultural area (27 CFR 9.179). The proposed viticultural area covers 
approximately 11 percent of the 689,904-acre Umpqua Valley viticultural 
area and 0.04 percent of the much larger 1,977,298-acre Southern Oregon 
viticultural area. The petition states that the marine influence from 
the Pacific Ocean distinguishes the proposed viticultural area from the 
larger Umpqua Valley.

Notice of Proposed Rulemaking and Comments Received

    TTB published Notice No. 130 in the Federal Register on June 19, 
2012 (77 FR 36433), proposing to establish the Elkton Oregon 
viticultural area. In the notice, TTB summarized the evidence from the 
petition regarding the name, boundary, and distinguishing features for 
the proposed viticultural area. The distinguishing features of the 
proposed viticultural area include climate and topography. The notice 
also compared the distinguishing features of the proposed viticultural 
area to the surrounding areas. The proposed Elkton Oregon viticultural 
area contains approximately 74,900 acres. For a description of the 
evidence relating to the name, boundary, and distinguishing features of 
the proposed viticultural area and a comparison of the distinguishing 
features of the proposed viticultural area to the surrounding areas, 
see Notice No. 130.
    In Notice No. 130, TTB solicited comments on the accuracy of the 
name, boundary, climatic, and other required information submitted in 
support of the petition. In addition, given the proposed viticultural 
area's location within the existing Umpqua Valley and Southern Oregon 
viticultural areas, TTB also solicited comments on whether the evidence 
submitted in the petition regarding the distinguishing features of the 
proposed viticultural area sufficiently differentiates the proposed 
viticultural area from the two existing viticultural areas. TTB also 
asked for comments on whether the geographical features of the proposed 
viticultural area are so distinguishable from the surrounding Umpqua 
Valley or Southern Oregon viticultural areas that the proposed Elkton 
Oregon viticultural area should no longer be part of the two existing 
viticultural areas. The comment period closed on August 20, 2012.
    In response to Notice No. 130, TTB received five comments. The 
commenters were all people who demonstrated their familiarity with the 
region of the proposed viticultural area, including a self-described 
wine writer, local growers and winery owners, and a member of the 
Elkton City Council. All five comments supported the establishment of 
the Elkton Oregon viticultural area. TTB received no comments in 
opposition of the Elkton Oregon viticultural area as proposed. None of 
the comments addressed the question of whether or not the Elkton Oregon 
viticultural area is so distinguishable from the Umpqua Valley and 
Southern Oregon viticultural areas that it should no longer be part of 
either existing viticultural area.

TTB Determination

    After careful review of the petition and the comments received in 
response to Notice No. 130, TTB finds that the evidence provided by the 
petitioner supports the establishment of the approximately 74,900-acre 
Elkton Oregon viticultural area. Accordingly, under the authority of 
the FAA Act, section 1111(d) of the Homeland Security Act of 2002, and 
part 4 of the TTB regulations, TTB establishes the ``Elkton Oregon'' 
viticultural area in Douglas County, Oregon, effective 30 days from the 
publication date of this document. TTB also determines that the land 
within the Elkton Oregon viticultural area will remain part of both the 
Umpqua Valley and Southern Oregon viticultural areas.
    TTB notes that the name ``Elkton OR'' is an equivalent form of the 
petitioned-for name ``Elkton Oregon.'' Although the original petition 
only proposed the name ``Elkton Oregon'' in reference to the proposed 
viticultural area, TTB believes that also allowing the abbreviated 
``Elkton OR'' as an alternative name is appropriate. TTB does not 
believe allowing the abbreviated form as an alternative viticultural 
area name would cause consumer confusion. Therefore, the part 9 
regulatory text set forth in the proposed rule in Notice No. 130 and in 
this final rule specifies both ``Elkton Oregon'' and ``Elkton OR'' as 
names for this proposed viticultural area.

Boundary Description

    See the narrative boundary description of the viticultural area in 
the regulatory text published at the end of this document.

Maps

    The petitioner provided the required maps, and they are listed 
below in the regulatory text.

Impact on Current Wine Labels

    Part 4 of the TTB regulations prohibits any label reference on a 
wine that indicates or implies an origin other than the wine's true 
place of origin. With the establishment of this viticultural area, its 
name, ``Elkton Oregon,'' and the alternative name, ``Elkton OR,'' are 
both recognized as names of viticultural significance under 27 CFR 
4.39(i)(3). The text of the regulation clarifies this point. Once this 
final rule becomes effective, wine bottlers using ``Elkton Oregon'' or 
``Elkton OR'' in a brand name, including a trademark, or in another 
label reference as to the origin of the wine, will have to ensure that 
the product is eligible to use the viticultural area's name as an 
appellation of origin.
    The establishment of the Elkton Oregon viticultural area will not 
affect any existing viticultural area, and any bottlers using ``Umpqua 
Valley'' or ``Southern Oregon'' as an appellation of origin or in a 
brand name for wines made from grapes grown within the Elkton Oregon 
viticultural area will not be affected by the establishment of this new 
viticultural area. The establishment of the Elkton Oregon viticultural 
area will allow vintners to use ``Elkton Oregon,'' ``Elkton OR,'' 
``Umpqua Valley,'' and ``Southern Oregon'' as appellations of origin 
for wines made from grapes grown within the Elkton Oregon viticultural 
area.
    For a wine to be labeled with a viticultural area name or with a 
brand name that includes a viticultural area name or other term 
identified as being viticulturally significant in part 9 of the TTB 
regulations, at least 85 percent of the wine must be derived from 
grapes grown within the area represented by that name or other term, 
and the wine must meet the other conditions listed in 27 CFR 
4.25(e)(3). If the wine is not eligible for labeling with the 
viticultural area name or other viticulturally significant term and 
that name or term appears in the brand name, then the label is not in 
compliance and the bottler must change the brand name and obtain 
approval of a new label. Similarly, if the viticultural area name or 
other viticulturally significant term appears in another reference on 
the label in a misleading manner, the bottler would have to obtain 
approval of a new label.
    Different rules apply if a wine has a brand name containing a 
viticultural area name or other term of viticultural significance that 
was used as a brand name on a label approved before July 7, 1986. See 
27 CFR 4.39(i)(2) for details.

Regulatory Flexibility Act

    TTB certifies that this regulation will not have a significant 
economic impact on a substantial number of small entities. The 
regulation imposes no new reporting, recordkeeping, or other 
administrative requirement. Any benefit derived from the use of a 
viticultural

[[Page 8018]]

area name would be the result of a proprietor's efforts and consumer 
acceptance of wines from that area. Therefore, no regulatory 
flexibility analysis is required.

Executive Order 12866

    This final rule is not a significant regulatory action as defined 
by Executive Order 12866. Therefore, it requires no regulatory 
assessment.

Drafting Information

    Karen A. Thornton of the Regulations and Rulings Division drafted 
this final rule.

List of Subjects in 27 CFR Part 9

    Wine.

Regulatory Amendment

    For the reasons discussed in the preamble, TTB amends title 27, 
chapter I, part 9, Code of Federal Regulations, as follows:

PART 9--AMERICAN VITICULTURAL AREAS

0
1. The authority citation for part 9 continues to read as follows:

    Authority:  27 U.S.C. 205.

Subpart C--Approved American Viticultural Areas

0
2. Subpart C is amended by adding Sec.  9.229 to read as follows:


Sec.  9.229  Elkton Oregon.

    (a) Name. The name of the viticultural area described in this 
section is ``Elkton Oregon''. ``Elkton OR'' may also be used as the 
name of the viticultural area described in this section. For purposes 
of part 4 of this chapter, ``Elkton Oregon'' and ``Elkton OR'' are 
terms of viticultural significance.
    (b) Approved maps. The five United States Geological Survey (USGS) 
1:24,000 scale topographic maps used to determine the boundary of the 
Elkton Oregon viticultural area are titled:
    (1) Kellogg Quadrangle, Oregon-Douglas Co., Provisional Edition 
1990;
    (2) Old Blue Quadrangle, Oregon-Douglas Co., Provisional Edition 
1990;
    (3) Devils Graveyard Quadrangle, Oregon-Douglas Co., Provisional 
Edition 1990;
    (4) Elkton Quadrangle, Oregon-Douglas Co., Provisional Edition 
1990; and
    (5) Yellow Butte, Oregon-Douglas Co., Provisional Edition 1987.
    (c) Boundary. The Elkton Oregon viticultural area is located in 
Douglas County, Oregon. The boundary of the Elkton Oregon viticultural 
area is described as follows:
    (1) The beginning point is on the Kellogg map at the intersection 
of the T23S/T24S and R7W/R8W common lines. From the beginning point, 
proceed northwest in a straight line, crossing onto the Old Blue map, 
to the eastern-most intersection of the T22S/T23S and R8W/R9W common 
lines; then
    (2) Proceed north along the R8W/R9W common line onto the Devils 
Graveyard map, across the Umpqua River, to the intersection of the R8W/
R9W common line with the 1,000-foot elevation line along the western 
boundary of section 30, T21S/R8W; then
    (3) Proceed generally east along the meandering 1,000-elevation 
line, crossing over Patterson Creek, Weatherly Creek headwaters, Cedar 
Creek, and House Creek; continue following the 1,000-foot elevation 
line onto the Elkton map, back to the Devils Graveyard map, returning 
to the Elkton map, and then continuing generally east and southeast 
across Paradise Creek and Little Tom Folley Creek, to the intersection 
of the 1,000-foot elevation line with an unnamed, improved road in the 
southeast quadrant of section 4, T22S/R7W; then
    (4) Proceed south-southwest along the unnamed, improved road to the 
intersection of that road with an unimproved logging road, 
approximately 1.65 miles due north of the Mile 5 marker on Elk Creek, 
section 9, T22S/R7W; then
    (5) Proceed southeast in a straight line, passing through the 
southeast corner of section 9, T22S/R7W, to Elk Creek, section 15, 
T22S/R7W; then
    (6) Proceed generally southeast (downstream) along Elk Creek to the 
State Route 38 bridge at BM 172, section 15, T22S/R7W; then
    (7) Proceed south in a straight line to the intersection of the 
1,000-foot elevation line and the section 22 south boundary line, T22S/
R7W; then
    (8) Proceed generally south, west, and then north along the 
meandering 1,000-foot elevation line, crossing first onto the Kellogg 
map, then crossing back and forth between the Kellogg map and the 
Yellow Butte map, returning to the Yellow Butte map to the intersection 
of the 1,000-foot elevation line with the R7W/R6W common line on Bell 
Ridge, along the section 1 east boundary line, T23S/R7W; then
    (9) Proceed southeast in a straight line to the intersection of the 
line with the 1,000-foot elevation line and an unnamed, unimproved 
road, section 7, T23S/R6W; then
    (10) Proceed south and west along the meandering 1,000-foot 
elevation, crossing back and forth between the Kellogg and Yellow Butte 
maps, and finally returning to the Kellogg map, to the intersection of 
the 1,000-foot elevation line with the T23S/T24S common line along the 
section 3 north boundary line, T24S/R7W; and then
    (11) Proceed west along the T23S/T24S common line to the beginning 
point.

    Dated: November 1, 2012.
John J. Manfreda,
Administrator.
    Approved: November 29, 2012.
Timothy E. Skud,
Deputy Assistant Secretary, (Tax, Trade, and Tariff Policy).
[FR Doc. 2013-02468 Filed 2-4-13; 8:45 am]
BILLING CODE 4810-31-P