[Federal Register Volume 83, Number 227 (Monday, November 26, 2018)]
[Proposed Rules]
[Pages 60562-60693]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2018-24446]



[[Page 60561]]

Vol. 83

Monday,

No. 227

November 26, 2018

Part II





Department of the Treasury





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Alcohol and Tobacco Tax and Trade Bureau





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27 CFR Parts 4, 5, 7, et al.





Modernization of the Labeling and Advertising Regulations for Wine, 
Distilled Spirits, and Malt Beverages; Proposed Rule

  Federal Register / Vol. 83 , No. 227 / Monday, November 26, 2018 / 
Proposed Rules  

[[Page 60562]]


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DEPARTMENT OF THE TREASURY

Alcohol and Tobacco Tax and Trade Bureau

27 CFR Parts 4, 5, 7, 14, and 19

[Docket No. TTB-2018-0007; Notice No. 176]
RIN 1513-AB54


Modernization of the Labeling and Advertising Regulations for 
Wine, Distilled Spirits, and Malt Beverages

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

ACTION: Notice of proposed rulemaking.

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SUMMARY: The Alcohol and Tobacco Tax and Trade Bureau (TTB) is 
proposing to amend its regulations governing the labeling and 
advertising of wine, distilled spirits, and malt beverages. TTB 
proposes to reorganize and recodify these regulations in order to 
simplify and clarify regulatory standards, incorporate guidance 
documents and current policy into the regulations, and reduce the 
regulatory burden on industry members where possible.

DATES: TTB must receive comments on this proposal on or before March 
26, 2019.

ADDRESSES: Please send your comments on this document to one of the 
following addresses:
     Internet: https://www.regulations.gov (via the online 
comment form for this document as posted within Docket No. TTB-2018-
0007 at ``Regulations.gov,'' the Federal e-rulemaking portal);
     U.S. Mail: Director, Regulations and Rulings Division, 
Alcohol and Tobacco Tax and Trade Bureau, 1310 G Street NW, Box 12, 
Washington, DC 20005; or
     Hand delivery/courier in lieu of mail: Alcohol and Tobacco 
Tax and Trade Bureau, 1310 G Street NW, Suite 400, Washington, DC 
20005.
    See the Public Participation section of this document for specific 
instructions and requirements for submitting comments, and for 
information on how to request a public hearing.

FOR FURTHER INFORMATION CONTACT: Christopher M. Thiemann or Kara T. 
Fontaine, Regulations and Rulings Division, Alcohol and Tobacco Tax and 
Trade Bureau, 1310 G Street NW, Box 12, Washington, DC 20005; telephone 
202-453-2265.

SUPPLEMENTARY INFORMATION: 

Table of Contents

I. Background
    A. TTB's Statutory Authority
    B. Current TTB Alcohol Beverage Labeling and Advertising 
Regulations
    C. The Certificate of Label Approval (COLA) Process
    D. Modernization of the Alcohol Beverage Labeling and 
Advertising Regulations
    E. Plain Language Principles
    F. Scope of this Rulemaking
II. Proposed Revisions
    A. General Reorganization of the Parts
    B. Proposed Changes That Apply to Parts 4, 5 and 7
    C. Proposed Changes Specific to 27 CFR Part 4 (Wine)
    D. Proposed Changes Specific to 27 CFR Part 5 (Distilled 
Spirits)
    E. Proposed Changes Specific to 27 CFR Part 7 (Malt Beverages)
    F. Proposed 27 CFR Part 14 (Advertising)
    G. Impact on Public Guidance Documents
    H. Impact on Current Labels
III. Derivation Tables for Proposed Parts 4, 5, 7, and 14
IV. Public Participation
    A. Comments Sought
    B. Submitting Comments
    C. Confidentiality
    D. Public Disclosure
V. Regulatory Analyses and Notices
    A. Regulatory Flexibility Act
    B. Executive Order 12866
    C. Paperwork Reduction Act
VI. Drafting Information
List of Subjects
Authority and Issuance

I. Background

A. TTB's Statutory Authority

    Sections 105(e) and 105(f) of the Federal Alcohol Administration 
Act (FAA Act), 27 U.S.C. 205(e) and 205(f), set forth standards for the 
regulation of the labeling and advertising of wine, distilled spirits, 
and malt beverages. The FAA Act was enacted in 1935 and also contains 
provisions regarding the requirements for basic permits that allow 
people to engage in business as producers, importers, and wholesalers, 
and the regulation of unfair trade practices.
    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 of the Treasury (the 
Secretary) has delegated various authorities to administer and enforce 
this law to the TTB Administrator through Treasury Department Order 
120-01 (dated December 10, 2013, superseding Treasury Order 120-01 
(Revised), ``Alcohol and Tobacco Tax and Trade Bureau,'' dated January 
24, 2003).
1. History of the FAA Act
    After the repeal of Prohibition by the enactment of the Twenty-
First Amendment in 1933, the alcohol beverage industry was subject to 
Federal regulation under the codes of fair competition authorized by 
the National Industrial Recovery Act. By Executive order, the President 
created the Federal Alcohol Control Administration to administer the 
codes of fair competition for the alcohol beverage industry. In 1935, 
the Supreme Court struck down the provisions of the National Industrial 
Recovery Act as unconstitutional. See Schechter Poultry Corp. v. United 
States, 295 U.S. 495 (1935). After that decision, in order to provide 
for the orderly regulation of the alcohol beverage industry, Congress 
enacted the FAA Act in August of 1935.
    The legislative history of the FAA Act provides some insight 
concerning the general purpose of the FAA Act's labeling provisions, 
which authorize TTB to regulate the labeling of alcohol beverage 
products:

    * * * the provisions of this bill show that the purpose was to 
carry that regulation into certain particular fields in which 
control of interstate commerce in liquors was paramount and 
necessary. The purpose was to provide such regulations, not laid 
down in statute, so as to be inflexible, but laid down under the 
guidance of Congress, under general principles, by a body which 
could change them as changes were found necessary. Those regulations 
were intended to insure that the purchaser should get what he 
thought he was getting, that representations both in labels and in 
advertising should be honest and straight-forward and truthful. They 
should not be confined, as the pure-food regulations have been 
confined, to prohibitions of falsity, but they should also provide 
for the information of the consumer, that he should be told what was 
in the bottle, and all the important factors which were of interest 
to him about what was in the bottle. (See Hearings on H.R. 8539 
before the Committee on Ways and Means, House of Representatives, 
74th Cong., 1st Sess. 10 (1935).)
2. Labeling and Advertising Provisions of the FAA Act
    Section 105(e) of the FAA Act, codified in the United States Code 
at 27 U.S.C. 205(e), sets forth requirements for labeling of wine 
(which is defined in the FAA Act to cover only wines that contain at 
least 7 percent alcohol by volume), distilled spirits, and malt 
beverages (collectively referred to as ``alcohol beverages'' throughout 
this document). This section of the FAA Act authorizes the Secretary to 
issue regulations to prevent deception of the consumer, to provide the 
consumer with ``adequate information'' as to the identity and quality 
of the product, to prohibit false or misleading statements, and to 
provide information as to the alcohol content of the product.
3. FAA Act Prohibition of Sale or Shipment of Mislabeled Products
    Section 105(e) of the FAA Act (27 U.S.C. 205(e)) also prohibits the 
sale or

[[Page 60563]]

shipment in interstate or foreign commerce of wine, distilled spirits, 
or malt beverages that are not bottled, packaged, and labeled in 
accordance with regulations issued by the Secretary. Violations of 
section 105(e) are misdemeanors that are punishable by a fine. See 27 
U.S.C. 207.
    The prohibition in section 105(e) applies to any person engaged in 
business as a distiller, brewer, rectifier, blender, or other producer, 
or as an importer or wholesaler of wine, distilled spirits or malt 
beverages, or as a bottler, or warehouseman and bottler, of distilled 
spirits. The law makes it unlawful for such persons, directly or 
indirectly or through an affiliate, to sell or ship, or deliver for 
sale or shipment, or otherwise introduce, in interstate or foreign 
commerce, or to receive therein, or to remove from customs custody for 
consumption, any wine, distilled spirits, or malt beverages in bottles, 
unless the products are bottled, packaged, and labeled in conformity 
with the regulations.
4. Authorization of Labeling Regulations in the FAA Act
    The FAA Act provides specific guidance as to what the labeling 
regulations should cover, but builds in a ``zone of discretion'' for 
TTB to exercise in implementing these regulations. See Center for 
Science in the Public Interest v. Department of the Treasury, 797 F.2d 
995 (D.C. Cir. 1986). The following provides a summary of the statutory 
provisions with regard to the labeling of wine, distilled spirits, and 
malt beverages under section 105(e) of the FAA Act (27 U.S.C. 205(e)).
    a. Prohibition of consumer deception. Section 105(e)(1) of the FAA 
Act (27 U.S.C. 205(e)(1)) authorizes the issuance of regulations that 
prohibit deception of the consumer with respect to such products or the 
quantity thereof, and prohibit, irrespective of falsity, such 
statements relating to age, manufacturing processes, analyses, 
guarantees, and scientific or irrelevant matters that the Secretary 
finds to be likely to be misleading to the consumer. This section 
provides the basis for many of TTB's regulations on prohibited 
practices with respect to labeling statements.
    b. Adequate information as to the identity, quality, and alcohol 
content of products, as well as the net contents and the manufacturer/
bottler/importer. Section 105(e)(2) of the FAA Act (27 U.S.C. 
205(e)(2)) authorizes the issuance of regulations to ensure that labels 
provide the consumer with adequate information as to the identity and 
quality of the product, the alcohol content thereof, the net contents 
of the package, and the manufacturer or bottler or importer of the 
product. This section provides the basis for most of the mandatory 
information requirements in the TTB labeling regulations.
    With regard to alcohol content, section 105(e)(2) sets out 
different requirements for wine, distilled spirits, and malt beverages. 
This section provides the Secretary with the authority to issue 
regulations that require alcohol content statements on labels of 
distilled spirits products and for wines with an alcohol content of 
over 14 percent alcohol by volume, leaving such statements optional for 
wines with an alcohol content at or below 14 percent. Furthermore, the 
FAA Act contains language that specifically prohibits placement of 
alcohol content statements on malt beverage labels, unless required by 
State law. In 1995, that statutory ban was struck down on First 
Amendment grounds by the U.S. Supreme Court in Rubin v. Coors Brewing 
Co., 514 U.S. 476 (1995) (hereinafter referred to as the ``Coors'' 
decision).
    c. Statement of neutral spirits. Section 105(e)(3) of the FAA Act 
(27 U.S.C. 205(e)(3)) authorizes the issuance of regulations that 
require an accurate statement in the case of distilled spirits (other 
than cordials, liqueurs, and specialties) produced by blending or 
rectification, if neutral spirits have been used in the production 
thereof, informing the consumer of the percentage of neutral spirits so 
used and of the name of the commodity from which such neutral spirits 
have been distilled, or in the case of neutral spirits or of gin 
produced by a process of continuous distillation, the name of the 
commodity from which distilled. These very specific statutory 
provisions are incorporated into the TTB distilled spirits labeling 
regulations.
    d. Prohibition of statements that are disparaging, false, 
misleading, obscene, or indecent. Section 105(e)(4) (27 U.S.C. 
205(e)(4)) authorizes the issuance of regulations to prohibit labeling 
statements that are disparaging of a competitor's products or are 
false, misleading, obscene or indecent. This provision is reflected in 
TTB's current regulations on prohibited practices.
    e. Prohibition of implied endorsements that are false or 
misleading. Section 105(e)(5) (27 U.S.C. 205(e)(5)) authorizes the 
issuance of regulations that prevent deception of the consumer by use 
of a trade or brand name that is the name of any living individual of 
public prominence, or existing private or public organization, or is a 
name that is in simulation or an abbreviation thereof, and will prevent 
the use of a graphic, pictorial, or emblematic representation of any 
such individual or organization, if the use of such name or 
representation is likely to falsely lead the consumer to believe that 
the product has been endorsed, made or used by, or produced for, or 
under the supervision of, or in accordance with the specifications of, 
such individual or organization. Certain ``grandfathering'' provisions 
are included in this section. These provisions are incorporated into 
the current regulations on prohibited practices.
5. Prohibition of Alteration, Mutilation, Destruction, Obliteration, or 
Removal of Labels
    Section 105(e) makes it unlawful for any person to alter, mutilate, 
destroy, obliterate, or remove any mark, brand, or label upon wine, 
distilled spirits, or malt beverages held for sale in interstate or 
foreign commerce or after shipment therein. An exception is made where 
the activity is authorized by Federal law. The FAA Act also authorizes 
the Secretary to issue regulations authorizing relabeling for the 
purposes of compliance with the requirements of section 105(e) or of 
State law. These regulations are found in parts 4, 5 and 7 of 27 CFR.
6. Certificate of Label Approval Requirements
    Section 105(e) of the FAA Act sets out very specific requirements 
for the issuance of certificates of label approval (COLAs) by the 
Secretary. The law provides that ``[i]n order to prevent the sale or 
shipment or other introduction of distilled spirits, wine, or malt 
beverages in interstate or foreign commerce, if bottled, packaged, or 
labeled in violation of the requirements of this subsection,'' certain 
persons are required to obtain a COLA prior to bottling distilled 
spirits, wine, or malt beverages.
    The persons covered by this requirement under the law are bottlers 
of distilled spirits; producers, blenders, and wholesalers of wine, and 
proprietors of a bonded wine storeroom; and brewers and wholesalers of 
malt beverages. With regard to imported products, the law provides that 
no person shall remove from customs custody, in bottles, for sale or 
any other commercial purpose, distilled spirits, wine, or malt 
beverages, without first obtaining a COLA. The law provides that such 
COLAs are to be issued in such manner and form as the Secretary shall 
prescribe by regulations.
    The law goes on to allow for the issuance of certificates of 
exemption,

[[Page 60564]]

pursuant to regulations issued by the Secretary, when an applicant has 
shown to the satisfaction of the Secretary that the wine, distilled 
spirits, or malt beverages to be bottled by the applicant are not to be 
sold, or offered for sale, or shipped or delivered for shipment, or 
otherwise introduced, in interstate or foreign commerce. The law 
provides for the issuance of these certificates to bottlers of 
distilled spirits; producers, blenders, or wholesalers of wine, or 
proprietors of a bonded wine storeroom; and brewers and wholesalers of 
malt beverages. However, the law does not authorize the issuance of 
certificates of exemption to persons removing alcohol beverages in 
containers from customs custody, presumably because those products will 
by definition be introduced in interstate or foreign commerce.
7. Advertising Provisions of the FAA Act
    Section 105(f) of the FAA Act (27 U.S.C 205(f)) provides similar 
authority to the Secretary to prescribe regulations with respect to the 
advertising of wine, distilled spirits, and malt beverages.
    The Secretary is authorized to prescribe regulations that will 
prevent deception of the consumer and to prohibit, irrespective of 
falsity, such statements relating to age, manufacturing processes, 
analyses, guarantees, and scientific or irrelevant matters that the 
Secretary finds to be likely to mislead the consumer. See 27 U.S.C. 
205(f)(1). The Secretary is also authorized to prescribe regulations to 
ensure that advertisements provide the consumer with adequate 
information as to the identity and quality of the products advertised, 
the alcohol content thereof, and the person responsible for the 
advertisement. See 27 U.S.C. 205(f)(2). The statute bans alcohol 
content statements on advertisements of both wine and malt beverages; 
this provision was not the subject of the Supreme Court's decision in 
Coors.
    The FAA Act contains advertising provisions that are very similar 
to the labeling provisions with regard to disclosure of neutral spirits 
(27 U.S.C. 205(f)(3)) and the prohibition of statements that are 
disparaging, false, misleading, obscene, or indecent (27 U.S.C. 
205(f)(4)). The FAA Act also authorizes the issuance of regulations to 
prevent advertising statements that are inconsistent with any statement 
on the labeling of the products advertised. (27 U.S.C. 205(f)(5)).
8. Special Rules for Malt Beverages Under the FAA Act
    The statutory requirements for malt beverages under the FAA Act 
differ from the requirements for distilled spirits and wine. Most 
notably for purposes of this document, the labeling provisions of the 
FAA Act apply to the labeling of malt beverages sold or shipped or 
delivered for shipment or otherwise introduced into or received in any 
State from any place outside of that State ``only to the extent that 
the law of such State imposes similar requirements with respect to the 
labeling'' of malt beverages sold within that State. See 27 U.S.C. 
205(f).
    The penultimate paragraph of section 105(f) also provides that the 
advertising provisions of the FAA Act apply to the advertising of malt 
beverages intended to be sold or shipped or delivered for shipment or 
otherwise introduced into or received in any State from any place 
outside of that State, only to the extent that the law of that State 
imposes ``similar requirements'' with respect to the advertising of 
malt beverages to be sold within that State.
9. Alcoholic Beverage Labeling Act (ABLA)
    The Alcoholic Beverage Labeling Act of 1988 (ABLA) requires that a 
specific health warning statement appear on the labels of all 
containers of alcohol beverages for sale or distribution in the United 
States. See 27 U.S.C. 215. This requirement applies to both interstate 
and intrastate sale and distribution of alcoholic beverages. In 
addition, the health warning statement must appear 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.
    The health warning statement required by ABLA advises consumers of 
the risks of birth defects to pregnant women, impairment of the ability 
to operate a car or other machinery, and other potential health 
problems resulting from the consumption of alcoholic beverages. As 
stated in 27 U.S.C. 213:

    The Congress finds that the American public should be informed 
about the health hazards that may result from the consumption or 
abuse of alcoholic beverages, and has determined that it would be 
beneficial to provide a clear, nonconfusing reminder of such 
hazards, and that there is a need for national uniformity in such 
reminders in order to avoid the promulgation of incorrect or 
misleading information * * *.

ABLA provides that no State may require any statement concerning 
alcoholic beverages and health, other than the required health warning 
statement, on any alcoholic beverage container, box, carton, or other 
package that contains such a container. See 27 U.S.C. 216.
    This proposed rule does not affect ABLA labeling requirements.
10. Internal Revenue Code Marking Requirements
    In addition to the FAA Act and ABLA, Chapter 51 of the Internal 
Revenue Code of 1986 (IRC), (26 U.S.C. 5001 et seq.), sets forth 
certain marking requirements for alcohol beverage products. Chapter 51 
of the IRC imposes Federal excise taxes on beer, wine, and distilled 
spirits, and provides for the regulation of alcohol beverages to 
protect the revenue associated with those taxes. The tax rates differ 
depending on the product, and the marking requirements provide for the 
proper determination of tax liability based on the identity of the 
product.
    This proposed rule does not amend IRC labeling requirements. 
However, some IRC labeling regulations require compliance with certain 
FAA Act labeling regulations by cross-referencing labeling provisions 
in 27 CFR parts 4, 5 or 7, as applicable.

B. Current TTB Alcohol Beverage Labeling and Advertising Regulations

1. History
    The first regulations implementing the labeling and advertising 
provisions of the FAA Act were promulgated in 1936 by the Federal 
Alcohol Administration (FAA). Over the next several decades, various 
amendments to these regulations were published by TTB's other 
predecessor agencies, the Internal Revenue Service (IRS), and the 
Bureau of Alcohol, Tobacco and Firearms (ATF). TTB assumed 
responsibility for the enforcement and implementation of these 
regulations in January of 2003, pursuant to the Homeland Security Act 
of 2002.
2. FAA Act-Based Regulations
    The TTB regulations that implement the labeling and advertising 
provisions of the FAA Act, as they relate to wine, distilled spirits, 
and malt beverages, are set forth in chapter I of title 27 of the Code 
of Federal Regulations (27 CFR chapter I). Specifically, these 
regulations are codified in 27 CFR part 4, Labeling and Advertising of 
Wine (27 CFR part 4); 27 CFR part 5, Labeling and Advertising of 
Distilled Spirits (27 CFR part 5); and 27 CFR part 7, Labeling and 
Advertising of Malt Beverages (27 CFR part 7).
    a. Mandatory and prohibited labeling information. The TTB 
regulations

[[Page 60565]]

contained in 27 CFR parts 4, 5, and 7 require that all wine, distilled 
spirits, and malt beverages sold or shipped in, or otherwise introduced 
into, interstate commerce bear labels that contain certain mandatory 
information. The regulations also set conditions on the use of certain 
non-mandatory information and specifically prohibit labeling statements 
that are false or tend to create a misleading impression.
    Provisions in parts 4, 5, and 7 currently require similar mandatory 
information to appear on labels of wine, distilled spirits, and malt 
beverages, with some exceptions and with some notable differences among 
the commodities. The regulations in some circumstances also contain 
provisions regarding the placement of the mandatory information. 
Commodity-specific rules are discussed more fully in later sections of 
this document, but a general description of the current labeling 
requirements is provided here.
    The mandatory information that must appear on alcohol beverage 
labels includes such things as the brand name of the product; a 
statement of the class, type, or other designation of the product; the 
name and address of the bottler or importer; a statement of the net 
contents; and declarations relating to sulfites or added colors in the 
product. Alcohol content statements, expressed as a percentage of 
alcohol by volume, are required for distilled spirits, wine over 14 
percent alcohol by volume, and certain flavored malt beverages. These 
requirements, as well as certain exceptions to these requirements, are 
set forth later in this preamble.
    With regard to the class, type, or other designation, the 
regulations specify and describe 9 ``classes'' of wine, including 
``grape wine'' and ``fruit wine,'' and 12 ``classes'' of distilled 
spirits, including ``whisky'' and ``brandy.'' Some classes are further 
subdivided into ``types.'' For example, types of ``grape wine'' include 
``table wine'' and ``dessert wine,'' while types of whisky include 
``bourbon whisky'' and ``blended whisky.'' For malt beverages, the TTB 
regulations refer to certain classes but do not provide specific 
standards of identity for those classes. Instead, the regulations 
provide that statements of class and type must ``conform to the 
designation of the product as known to the trade.''
    If a wine or distilled spirit does not fall within any class, and 
if a malt beverage is not known to the trade under a particular 
designation, the regulations require that a truthful and adequate 
statement of composition appear on the label as the statement of class 
and type. While the term ``statement of composition'' is not currently 
defined in the regulations, TTB's general policy has been to require 
that such a statement identify the base product and any added flavoring 
or coloring materials. For example, a statement of composition may be 
``grape wine with raspberry flavor added,'' ``a blend of vodka and 
coconut liqueur,'' or ``ale brewed with watermelon juice.''
    As noted above, the ``net contents'' must appear on containers. 
This is required for all three commodities. TTB regulations provide 
standards of fill for wine and distilled spirits products but not for 
malt beverages. This means that the net contents of wine and distilled 
spirits containers must be consistent with specified quantities 
prescribed by the standards of fill requirements (such as 750 
milliliters).
    Certain types of information or representations are prohibited from 
appearing on alcohol beverage labels, and these are set forth in 
regulations entitled ``prohibited practices.'' See current 27 CFR 4.39, 
5.42, and 7.29, for wine, distilled spirits, and malt beverages, 
respectively. Some labeling practices are prohibited outright on 
alcohol beverage labels for any of the commodities. For example, no 
false or obscene statement may appear on any alcohol beverage label or 
container. Other practices are prohibited if presented in a manner that 
is misleading.
    Some practices may be prohibited for just one of the commodities. 
For example, existing regulations prohibit certain uses of the term 
``pure'' on distilled spirits labels. Other labeling practices may be 
used on labels if they comply with certain rules. These include the use 
of a living person's name or likeness and statements making claims 
about whether the product is organic.
    b. Alcohol advertising regulations. TTB also promulgates 
regulations covering the advertising of wine, distilled spirits, and 
malt beverages. These regulations prescribe mandatory information that 
must be included in an advertisement (such as identification of the 
responsible party) and also prohibit certain practices similar to the 
prohibited practices for labels. The advertising regulations are 
currently found in subpart G of part 4, subpart H of part 5, and 
subpart F of part 7.
3. TTB's ABLA-Based Regulations
    As previously noted, all alcohol beverages bottled or imported for 
sale or distribution in the United States must bear the health warning 
statement required by the ABLA, even if the product is not sold in 
interstate commerce. The regulations promulgated under the authority of 
the ABLA are set forth in 27 CFR part 16, Alcoholic Beverage Health 
Warning Statement (27 CFR part 16). As noted above, this proposal does 
not affect ABLA labeling requirements.
4. TTB's IRC Marking Regulations
    Finally, regulations implementing the IRC marking requirements 
appear in 27 CFR parts 19, 24, and 25 (relating to, respectively, 
domestic producers and bottlers of distilled spirits, wines, and beer), 
as well as 27 CFR parts 26, 27, and 28 (relating to distilled spirits, 
wine, and beer that are, respectively, brought into the United States 
from Puerto Rico and the Virgin Islands, imported into the United 
States, and exported from the United States). As noted above, this 
proposal does not affect these IRC-based regulations.

C. The Certificate of Label Approval (COLA) Process

    As noted above, a person who intends to bottle wine, distilled 
spirits, or malt beverages, or remove those products from customs 
custody in bottles, for introduction into interstate or foreign 
commerce must, before doing so, obtain approval of the labels for the 
bottles through a COLA issued by TTB. Currently, each application for a 
COLA is reviewed by a TTB specialist for compliance with the FAA Act 
and TTB regulations. In fiscal year 2015, TTB received over 153,000 
applications for label approval. The time between the date of 
application and final TTB determination on the application averaged 
approximately 24 days.
    In part, the increase in the number of COLA applications is due to 
the growing number of industry members submitting applications and to 
product innovations and expansions in product lines by industry 
members. In addition, because industry members seek to bring products 
to market quickly, they may submit label approval applications early in 
their product development process, before the product and its marketing 
have been finalized. These industry members may submit several 
applications for different potential labels to cover the different 
possible ways that product may eventually be formulated and marketed 
once ready for market.
    To implement the FAA Act provision requiring the issuance of COLAs, 
TTB regulations provide a process through which a person can submit an 
application for approval of a label, along with a copy of the label, 
and obtain TTB approval of the label through the

[[Page 60566]]

issuance by TTB of a COLA. The COLA is evidence that a label has been 
reviewed for compliance with the TTB regulations and approved for use. 
The requirement to obtain a COLA for domestic and imported products is 
set forth in subparts E and F of part 4 (for wine), subparts E and F of 
part 5 (for distilled spirits), and subparts D and E of part 7 (for 
malt beverages). The procedures governing the issuance and revocation 
of COLAs are set forth in 27 CFR part 13, Labeling Proceedings (27 CFR 
part 13).
    The regulations also authorize the issuance of certificates of 
exemption for wine and distilled spirits when the applicant establishes 
that the wine or distilled spirits product is not to be sold, offered 
for sale, or shipped or delivered for shipment, or otherwise introduced 
in interstate or foreign commerce. It should be noted that TTB and its 
predecessor agencies have never issued regulations requiring 
certificates of exemption for malt beverages that will not be sold or 
otherwise introduced in interstate or foreign commerce. Furthermore, 
the regulations do not require malt beverages that will not be sold or 
otherwise introduced in interstate or foreign commerce to be covered by 
a certificate of label approval. See TTB Ruling 2013-1. This issue will 
be discussed later in this preamble.
1. COLA Streamlining Initiatives
    TTB has undertaken several initiatives to streamline the label 
approval process. In 2003, TTB implemented COLAs Online, a system that 
allows industry members to submit electronic applications for label 
approval. Currently, over 90 percent of COLA applications are submitted 
and processed electronically. More recently, in 2013, TTB began 
electronically processing applications that are received on paper.
    On July 5, 2012, TTB published a revised version of TTB Form 
5100.31, ``Application for and Certification/Exemption of Label/Bottle 
Approval.'' The most significant change was to expand the list of items 
that may be changed on an approved alcohol beverage label without 
resubmission of the label for TTB approval. This new policy, which is 
reflected on the form, reduces the number of label applications that 
industry members would otherwise send to TTB. As a result, label 
applications were reduced by 8 percent. In 2014 TTB expanded the list 
of changes that may be made to approved labels without requiring those 
labels to be resubmitted to TTB for review--this expanded list has been 
incorporated into the form (see TTB Industry Circular 2014-02 and TTB F 
5100.31).
    TTB has also been working on additional initiatives to streamline 
label review. These include making processing improvements designed to 
speed up review turnaround times; updating labeling guidance on the TTB 
website (https://www.ttb.gov) to help industry members comply with its 
labeling requirements; and researching industry needs and studying 
other Federal agencies' best practices so that TTB can continue to 
improve its label review process in the future.

D. Modernization of the Alcohol Beverage Labeling and Advertising 
Regulations

    As part of the Department of the Treasury's ``Plan for 
Retrospective Analysis of Existing Rules,'' TTB has been reviewing its 
existing labeling and advertising of wine, distilled spirits, and malt 
beverages regulations. TTB proposes to amend these regulations to 
improve their clarity and readability, to improve compliance, and to 
ease burdens on the regulated industry. The amended regulations will 
take into account modern business practices and contemporary consumer 
understanding in order to modernize the regulations.
    In this proposed rule, TTB intends to clarify, update, and 
consolidate labeling requirements and, where possible, to set forth 
objective standards for meeting those requirements. This effort also 
will help TTB use its limited resources more efficiently, facilitate 
the development and use of more efficient systems for processing 
applications, and reduce the processing time for label applications.
    In preparation for this rulemaking, TTB reviewed its regulations, 
public guidance, and labeling review practices to identify policies and 
interpretations that are relevant but have not yet been codified in the 
regulations, as well as those that are no longer relevant and can be 
eliminated. In all, TTB reviewed 90 rulings and industry circulars, and 
incorporated all or parts of approximately 38 of them into the proposed 
regulations. When these proposed regulations become final, those 
rulings and industry circulars, or parts thereof, will be superseded by 
the regulations. TTB also determined that eight rulings and industry 
circulars were no longer relevant and thus could be superseded without 
being incorporated.
    As a result, the proposed regulations, when finalized, will provide 
industry with a more comprehensive source for the general rules 
applicable to alcohol beverage labeling. In addition, in updating these 
regulations, TTB sought to make the rules applicable to all three 
commodities as consistent as possible, recognizing that some 
differences in treatment are required by statute and others by the 
nature of the commodity or industry practice.

E. Plain Language Principles

    On June 1, 1998, the President issued a memorandum that requires 
Federal agencies to write regulations in ``plain language.'' These 
proposed regulations have been written in the plain language style. The 
proposed regulations:
     Use the active voice in the regulations, whenever 
possible;
     Use shorter sentences, paragraphs, and sections;
     Minimize the use of jargon and unnecessary technical 
terms;
     Clarify and simplify the regulatory requirements;
     Create consistency in the treatment of the three 
commodities, as appropriate;
     Break large sections into smaller, more focused sections 
for better readability; and
     Make it easier for readers to find information through the 
tables of contents.

F. Scope of This Rulemaking

    As mentioned above, TTB is undertaking this modernization effort to 
improve understanding of the regulatory requirements and to make 
compliance easier and less burdensome. In addition, the proposed rule 
will incorporate changes in labeling standards that have come about 
through statutory changes (such as the change to the labeling of wines 
with semi-generic designations) and international agreements (through 
the incorporation of various designations of geographic significance). 
In the case of wine, we are proposing greater flexibility in the use of 
certain appellations of origin and multiple varietal designations, both 
to comply with international commitments and to provide more 
information to consumers through greater flexibility in the use of this 
optional information on labels. For all products, TTB is proposing 
greater flexibility with regard to the placement of mandatory 
information on labels.
    TTB is also reflecting contemporary case law with regard to the 
protection of commercial speech under the First Amendment. In some 
cases, this means codifying longstanding interpretations, such as our 
policy that the prohibition on disparaging statements on labels and in 
advertisements does not prohibit truthful and accurate comparisons with 
a competitor's product.

[[Page 60567]]

    With regard to malt beverages and wine, TTB is updating the alcohol 
content regulations for the first time since the Supreme Court's 
decision in Rubin v. Coors Brewing Company, 514 U.S. 476 (1995), which 
struck down on First Amendment grounds the FAA Act's ban on alcohol 
content statements on malt beverage labels. In 1993, after the district 
court decision in the Coors case but prior to the Supreme Court 
decision, TTB's predecessor agency, the Bureau of Alcohol, Tobacco and 
Firearms (ATF), issued interim regulations allowing optional statements 
of alcohol content on malt beverage labels. See T.D ATF-339 (58 FR 
21228, April 19, 1993). TTB is now proposing to finalize updated 
alcohol content regulations, including, in this document, amendments 
that would modernize the regulations on strength claims to remove 
outdated language, such as the ban on use of the term ``pre-war 
strength,'' which refers to the period before World War I.
    This proposed rule would also incorporate certain proposals 
previously aired for comment by TTB in notices or advance notices of 
proposed rulemaking, including proposals on the use of ``estate grown'' 
on wine labels, and the use of aggregate packaging to satisfy standards 
of fill for distilled spirits and wine containers.
    TTB is also proposing several amendments that would protect 
consumers by providing certain more specific labeling and packaging 
rules. For example, existing regulations require mandatory information 
to appear on opaque packaging of distilled spirits and wine, because 
consumers are unable to see the label on the container without removing 
the container from the packaging. TTB is proposing to extend this 
requirement to malt beverages.
    TTB is also proposing to require mandatory information to appear on 
any ``closed packaging'' of wine, distilled spirits, or malt beverages. 
The proposed amendments define closed packaging to include packaging 
where the mandatory information on the label of the container is not 
visible to the consumer because the container cannot be readily removed 
from the packaging. Packaging is considered closed if the consumer must 
open, rip, untie, unzip, or otherwise manipulate the package to remove 
the container in order to view any of the mandatory information.
    TTB has noted that today's industry increasingly uses terms that 
apply to one commodity on labels of a different commodity. For example, 
TTB sees many wine and malt beverage labels that include distilled 
spirits terms or malt beverage labels that include wine terms. TTB is 
proposing a specific regulatory provision to prohibit the use of such 
terms when they might mislead consumers as to the identity of the 
product, while allowing the non-misleading use of certain terms (such 
as references to aging malt beverages in barrels previously used for 
the storage of distilled spirits or wine).
    TTB solicits comments on whether these proposals will protect 
consumers and whether they will require significant labeling changes by 
industry members. TTB proposes to give all affected parties three years 
to come into compliance with the proposed regulations, should they be 
finalized. This will allow industry members to coordinate new labeling 
requirements with scheduled labeling changes, and to use up existing 
stocks of labeling and packaging.
    There are a number of ongoing rulemaking initiatives related to 
labeling and advertising of alcohol beverages that will be handled 
separately from this proposed rule due to their complexity. For 
example, this document does not deal with ``Serving Facts'' statements, 
an issue that was the subject of a 2007 notice of proposed rulemaking 
(see Notice No. 73, 72 FR 41860, July 31, 2007) and TTB Ruling 2013-2. 
Nor does TTB address its current policy requiring statements of average 
analysis on labels that include nutrient content claims. Industry 
members should continue to rely on TTB's published rulings and other 
guidance documents on these issues. TTB's policy on gluten content 
statements is still an interim one; therefore, that issue is not 
addressed in the proposed rule (see TTB Ruling 2014-2). Substantive 
changes to allergen labeling requirements are not addressed in this 
document. Standards of fill requirements are not addressed in this 
document but TTB plans to address them in a separate rulemaking 
document.
    In addition, this document is not intended to specifically address 
proposals that were submitted to the Department of the Treasury in 
response to a Request for Information (RFI) published in the Federal 
Register (82 FR 27212) on June 14, 2017. The RFI invited members of the 
public to submit views and recommendations for Treasury Department 
regulations that can be eliminated, modified, or streamlined, in order 
to reduce burdens. The comment period for the RFI closed on October 31, 
2017.
    Eight comments on the FAA Act labeling regulations, including 28 
specific recommendations, were submitted in response to the RFI. For 
ease of reference, TTB will post the labeling comments in the docket 
for this rulemaking. We will consider all of the labeling 
recommendations submitted in response to the RFI either as comments to 
this proposed rule or as suggestions for separate agency action, as 
appropriate. We note that our preliminary review of the comments 
submitted in response to the RFI indicates that many of the topics that 
were included in those recommendations are addressed in this proposed 
rule, although our proposals may in some cases differ from those set 
forth in the comments.
    Finally, in this notice TTB proposes to consolidate its alcohol 
beverage advertising regulations in a new part, 27 CFR part 14, 
Advertising of Wine, Distilled Spirits, and Malt Beverages. The 
proposed part 14 contains only those updates needed to conform certain 
regulated practices to the updates being proposed for the labeling 
provisions. Additional updates to the regulations on advertising to 
address contemporary issues, such as social media, are not proposed in 
this rulemaking but may be proposed in future rulemaking initiatives. 
Because this proposed rule deals with such a broad scope of 
modernization changes, TTB will deal with these more specific issues in 
separate rulemaking documents.

II. Proposed Revisions

A. General Reorganization of the Parts

    TTB is proposing to reorganize the contents of 27 CFR parts 4, 5, 
and 7, and to add a new 27 CFR part 14. As proposed, 27 CFR parts 4, 5, 
and 7 continue to contain the labeling regulations for wine, distilled 
spirits, and malt beverages, respectively, while the current subparts 
of parts 4, 5, and 7 that relate to advertising are removed from those 
parts and consolidated into a new part 14. As part of TTB's review of 
the labeling regulations, TTB reviewed the various sections and 
subparts and determined that much of their basic structure needs to be 
amended. Under the current structure, information is not always located 
where a reader would expect to find it. As a result of amendments to 
the regulations over the years, certain provisions that would logically 
be grouped together are instead spread throughout a given part. 
Accordingly, TTB is proposing to group topics together in a more 
logical order, with related provisions, where appropriate, appearing in 
a single subpart.
    The new subparts are restructured in a progressive order starting 
with general provisions, such as defining the terms

[[Page 60568]]

used in that part and specifying who is subject to the regulations in 
that part. The ``general provisions'' subpart is followed by subparts 
setting forth the circumstances under which a certificate of label 
approval (COLA) is required, how to obtain a COLA, and what information 
is required on the labels and where it must appear.
    Proposed parts 4, 5, and 7 of 27 CFR are each structured similarly. 
Furthermore, within each part, regulatory provisions that appear in 
more than one part will have the same number within the part. For 
example, the regulations that set out the mandatory information for 
wine, distilled spirits, and malt beverage labels, respectively, are 
found in proposed Sec. Sec.  4.63, 5.63, and 7.63. TTB believes that 
this revised numbering of the regulations will make it easier for the 
public to find relevant regulations and to compare regulations in the 
three parts.
    The table below shows the organization of the proposed subparts in 
parts 4, 5, and 7.

                                   Proposed Subparts: 27 CFR Parts 4, 5, and 7
----------------------------------------------------------------------------------------------------------------
            Part 4 (Wine)                  Part 5 (Distilled spirits)              Part 7 (Malt beverages)
----------------------------------------------------------------------------------------------------------------
Subpart A--General Provisions         Subpart A--General Provisions         Subpart A--General Provisions
Subpart B--Certificates of Label      Subpart B--Certificates of Label      Subpart B--Certificates of Label
 Approval and Certificates of          Approval and Certificates of          Approval
 Exemption from Label Approval         Exemption from Label Approval
Subpart C--Alteration of Labels,      Subpart C--Alteration of Labels,      Subpart C--Alteration of Labels,
 Relabeling, and Adding Information    Relabeling, and Adding Information    Relabeling, and Adding Information
 to Containers                         to Containers                         to Containers
Subpart D--Label Standards            Subpart D--Label Standards            Subpart D--Label Standards
Subpart E--Mandatory Label            Subpart E--Mandatory Label            Subpart E--Mandatory Label
 Information                           Information                           Information
Subpart F--Restricted Labeling        Subpart F--Restricted Labeling        Subpart F--Restricted Labeling
 Statements                            Statements                            Statements
Subpart G--Prohibited Labeling        Subpart G--Prohibited Labeling        Subpart G--Prohibited Labeling
 Practices                             Practices                             Practices
Subpart H--Labeling Practices That    Subpart H-- Labeling Practices That   Subpart H-- Labeling Practices That
 are Prohibited if They are            are Prohibited if They are            are Prohibited if They are
 Misleading                            Misleading                            Misleading
Subpart I--Standards of Identity for  Subpart I--Standards of Identity for  Subpart I--Classes and Types of Malt
 Wine                                  Distilled Spirits                     Beverages
Subpart J--American Grape Variety     Subpart J--Formulas                   Subpart J--Reserved
 Names
Subpart K--Standards of Fill and      Subpart K--Standards for Fill and     Subpart K--Reserved
 Authorized Container Sizes            Authorized Container Sizes
Subpart L--Recordkeeping and          Subpart L--Recordkeeping and          Subpart L--Recordkeeping and
 Substantiation Requirements           Substantiation Requirements           Substantiation Requirements
Subpart M--Penalties and Compromise   Subpart M--Penalties and Compromise   Subpart M--Penalties and Compromise
 of Liability                          of Liability                          of Liability
Subpart N--Paperwork Reduction Act    Subpart N--Paperwork Reduction Act    Subpart N--Paperwork Reduction Act
----------------------------------------------------------------------------------------------------------------

B. Proposed Changes That Apply to Parts 4, 5 and 7

    As discussed above, in proposing to update its labeling 
regulations, one of TTB's purposes has been to apply the same rules to 
wine, distilled spirits, and malt beverages, to the extent possible, as 
long as different treatment is not required by statute or by the nature 
of the commodity. Therefore, a number of the proposed changes to the 
regulations apply to parts 4, 5 and 7. These proposed changes are 
described below, in the general order in which they appear in the 
proposed regulations. See the discussion in sections II C, II D, and II 
E of this document for provisions specific to wine, distilled spirits, 
and malt beverages, respectively.
1. Subpart A--General Provisions
    a. Definitions. Proposed subpart A includes several sections of 
general applicability. These sections include definitions of terms used 
throughout these regulations, as well as sections cross-referencing 
other regulations that relate to the production and labeling of the 
alcohol beverage products at issue.
    With regard to definitions, TTB is proposing to amend the sections 
in parts 4, 5, and 7 that define the terms used in those parts 
(proposed Sec. Sec.  4.1, 5.1, and 7.1), to add definitions of the 
following terms: ``brand name,'' ``certificate holder,'' ``certificate 
of exemption from label approval,'' ``certificate of label approval 
(COLA),'' ``distinctive or fanciful name,'' and ``net contents.''
    The proposed rule defines the term ``brand name'' as the name under 
which a product or product line is sold. This definition is consistent 
with the current understanding of the term and with guidance provided 
in the Beverage Alcohol Manuals (BAMs), TTB P 5120.3, 5110.7, and 
5130.3, for wine, distilled spirits, and malt beverages, respectively, 
which are guidance documents that provide the public with 
interpretations of some of TTB's labeling regulations.
    The term ``certificate holder'' is used in the proposed text of 
parts 4, 5, and 7 to refer to industry members that have obtained a 
COLA, certificate of exemption from label approval, or distinctive 
liquor bottle approval from TTB. The proposed rule sets forth a 
definition of ``certificate holder'' for parts 4, 5, and 7 that is 
largely consistent with that definition of that term in part 13 of the 
TTB regulations (27 CFR part 13), which governs the issuance, denial, 
and revocation of COLAs. The definition of the term ``certificate of 
exemption from label approval'' is consistent with the definition 
already in part 13 of the TTB regulations.
    The definition of the term ``Certificate of label approval (COLA)'' 
is derived from the definition set forth in part 13 of the TTB 
regulations, but includes some proposed revisions. The proposed 
definition is ``A certificate issued on TTB Form 5100.31 that 
authorizes the bottling of wine, distilled spirits, and malt beverages, 
or the removal of bottled wine, distilled spirits, and malt beverages 
from customs custody for introduction into commerce, as long as the 
product bears labels identical to the labels appearing on the face of 
the certificate, or labels with changes authorized by TTB on the 
certificate or otherwise.'' The current definition in part 13 
recognizes that the COLA form itself authorizes certain allowable 
revisions to a label that may be made by the certificate holder without 
having to obtain TTB approval. The revisions made in the proposed 
definition specifically recognize that TTB may

[[Page 60569]]

authorize revisions in other ways, such as by issuing guidance on the 
TTB website.
    The term ``distinctive or fanciful name'' currently refers to a 
term that must be used on a distilled spirits label, together with a 
truthful and adequate statement of composition, when a distilled 
spirits product does not fall within a class and type that is specified 
in the regulations or on a malt beverage label when a malt beverage is 
not known to the trade under a particular designation. A distinctive or 
fanciful name is optional on other distilled spirits or malt beverage 
products. A distinctive or fanciful name is also optional for a wine, 
whether or not it bears a statement of composition.
    The proposed rule defines the term ``distinctive or fanciful 
name,'' which is used in proposed parts 4, 5, and 7. The term 
``distinctive or fanciful name'' is defined as a descriptive name or 
phrase chosen to identify a product on the label. It does not include a 
brand name, class or type designation, statement of composition, or, in 
part 7 only, a designation known to the trade or consumers.
    The proposed rule adds a definition of ``net contents'' in parts 4, 
5, and 7. The ``net contents'' is the amount, by volume, of wine, 
distilled spirits, or malt beverages, respectively, held in a 
container. The net contents statement is mandatory labeling 
information.
    The proposed regulations also include amendments to several 
definitions that appear in the current regulations. These changes 
reflect current TTB policy and are clarifying in nature.
    The definition of the term ``container'' is amended in parts 4 and 
7 and is added to part 5 to replace the definition of the term 
``bottle.'' The proposed rule defines ``container'' in parts 4 and 7 as 
any can, bottle, box with an internal bladder, cask, keg, barrel, or 
other closed receptacle, in any size or material, that is for use in 
the sale of wine or malt beverages, respectively, at retail. Aside from 
editorial changes, this differs from the current definitions in that it 
specifically incorporates a box with an internal bladder, sometimes 
referred to as a ``bag in a box.''
    The term ``container'' will replace the term ``bottle'' in the part 
5 regulations for distilled spirits and is defined as any can, bottle, 
box used to protect an internal bladder, cask, keg, or other closed 
receptacle, in any size or material, that is for use in the sale of 
distilled spirits at retail. TTB believes that the revised definition 
will make it clearer that containers of distilled spirits may be made 
in a variety of materials and sizes, and that the term is not 
restricted to traditional glass bottles. Because of the restrictions on 
the size of distilled spirits containers, the proposed definition does 
not include references to barrels. Furthermore, because there are 
prescribed standards of fill for both wine and distilled spirits, the 
definitions in parts 4 and 5 include a cross reference to those 
standard of fill regulations, to clarify that containers must be in 
certain sizes.
    The proposed rule amends the definition of the term ``interstate or 
foreign commerce'' in parts 4, 5 and 7 to remove the provision that 
included commerce within any Territory as being interstate or foreign 
commerce. The FAA Act extends to the 50 States, the District of 
Columbia, and Puerto Rico. As set forth in the definitions in the FAA 
Act, the term ``State'' included a Territory and the District of 
Columbia, and the term ``Territory'' meant Alaska, Hawaii, and Puerto 
Rico. See 27 U.S.C. 211(a)(1). Since the enactment of the FAA Act in 
1935, Alaska and Hawaii have become states. Furthermore, Puerto Rico is 
now a Commonwealth, which has affected the status of transactions that 
occur solely within Puerto Rico under the FAA Act. See ATF Ruling 85-5, 
which addressed this issue in the context of the trade practice 
regulations and relied, in part, on Cordova & Simonpietri Insurance 
Agency, Inc. v. Chase Manhattan Bank, 649 F. 2d 36 (1st Cir. 1981). 
Therefore, the proposed rule amends the definition of ``interstate or 
foreign commerce'' to remove the language indicating that commerce 
within Puerto Rico is interstate commerce.
    The proposed rule amends the definition of the term ``person'' in 
all three parts by adding ``limited liability company'' to specifically 
reflect TTB's current position that limited liability companies fall 
under the definition of a ``person.''
    The proposed rule removes the term ``advertisement'' from the 
definition sections in parts 4, 5, and 7, because these parts will no 
longer provide substantive rules regarding advertisements. Instead, the 
proposed rule moves the regulations regarding advertisements to a new 
proposed part 14.
    Finally, in this subsection and throughout parts 4 and 5, the 
proposed rule updates references to the IRC. The existing regulations 
include certain references to terms (such as ``rectifier'' or ``bonded 
wine storeroom'') from previous versions of the IRC. These terms are no 
longer used in the current tax laws. The proposed rule updates these 
references to include terms that are currently used in the IRC.
    b. General requirements and prohibitions under the FAA Act. 
Proposed Sec. Sec.  4.3, 5.3, and 7.3 set out the general requirements 
and prohibitions under the FAA Act. Proposed Sec. Sec.  4.3(a), 5.3(a), 
and 7.3(a) summarize the general requirements regarding COLAs, as set 
forth in greater detail in subpart B. Proposed Sec. Sec.  4.3(b), 
5.3(b), and 7.3(b) similarly summarize the prohibition against 
alteration, mutilation, destruction, obliteration, or removal of 
labels, as set forth in greater detail in subpart C. Proposed 
Sec. Sec.  4.3(c) and (d), 5.3(c) and (d), and 7.3(c) and (d) set out 
the general labeling requirements of this part, as set forth in greater 
detail in subparts D, E, F, G, H, and I. Finally, proposed Sec. Sec.  
4.3(e) and 5.3(e) summarize the general bottling and standards of fill 
requirements, which are set out in subpart K for wine and distilled 
spirits. (Malt beverages are not subject to standard of fill 
requirements.)
    Proposed Sec. Sec.  4.3(d), 5.3(d), and 7.3(d) also set out for the 
first time in the regulations TTB's position that in order to be 
labeled in accordance with the regulations in these parts, a container 
may not contain an adulterated alcohol beverage within the meaning of 
the Federal Food, Drug, and Cosmetic Act. It is TTB's longstanding 
position that adulterated distilled spirits, wines, and malt beverages 
are mislabeled within the meaning of the FAA Act, even if the bottler 
or importer of the product in question has obtained a COLA or an 
approved formula. See Industry Circular 2010-8, dated November 23, 
2010. No adulterated distilled spirits, wines, or malt beverages can 
satisfy the labeling requirements of the FAA Act. Subject to the 
jurisdictional requirements of the FAA Act, mislabeled distilled 
spirits, wines, and malt beverages, including adulterated products, may 
not be sold or shipped, delivered for sale or shipment, or otherwise 
introduced or received in interstate or foreign commerce, or removed 
from customs custody for consumption, by a producer, importer, or 
wholesaler, or other industry member subject to 27 U.S.C. 205(e).
    c. Exports in bond. The current regulations exempting products for 
export from the labeling regulations under the FAA Act are somewhat 
inconsistent. In existing Sec. Sec.  4.80 and 7.60, wine and malt 
beverages ``exported in bond'' are exempted from the requirements of 
those respective parts. However, current Sec.  5.1, which is entitled 
``General,'' provides that part 5 ``does not apply to distilled spirits 
for export.''
    TTB believes that the exemptions in all three parts should be 
consistent and should be restricted to exportations in

[[Page 60570]]

bond. In general, the bottler is required to obtain a COLA prior to 
removal of the product from the premises. Products that are removed 
subject to tax may subsequently be exported or may end up in the 
domestic market, and therefore are not exempted from the labeling 
requirements of the FAA Act.
    Accordingly, proposed Sec. Sec.  4.8, 5.8, and 7.8 provide that 
products exported in bond directly from a bonded wine premises, 
distilled spirits plant, or brewery, respectively, or from customs 
custody, are not subject to the regulations under these parts. The 
amendment clarifies that exportation in bond does not include 
exportation after wine, distilled spirits, or malt beverages have been 
removed for consumption or sale in the United States, with appropriate 
tax determination or payment. This is only a clarifying change in parts 
4 and 7. With regard to part 5, TTB seeks comments on whether this 
proposed change will impact existing practices, and if so, what the 
impact will be.
    d. Compliance with Federal and State requirements. For the first 
time, parts 4, 5, and 7, will make clear that compliance with the 
requirements of the respective parts relating to the labeling and 
bottling of wine, distilled spirits and malt beverages does not relieve 
industry members from responsibility for complying with other 
applicable Federal and State requirements (see proposed Sec. Sec.  4.9, 
5.9, and 7.9).
    These sections also provide that it remains the responsibility of 
the industry member to ensure that any ingredient used in the 
production of alcohol beverages complies fully with all applicable Food 
and Drug Administration (FDA) regulations pertaining to the safety of 
food ingredients and additives and that TTB may at any time request 
documentation to establish such compliance. In addition, these three 
sections provide that it remains the responsibility of the industry 
member to ensure that containers are made of suitable materials that 
comply with all applicable FDA health and safety regulations for the 
packaging of alcohol beverages for consumption and that TTB may at any 
time request documentation to establish such compliance.
    It is TTB's longstanding position that its review of labels and 
formulas does not relieve the industry member from its responsibility 
to ensure compliance with applicable FDA regulations. See, e.g., 
Industry Circular 2010-8, dated November 23, 2010, entitled ``Alcohol 
Beverages Containing Added Caffeine,'' in which TTB reminded industry 
members as follows:

* * * each producer and importer of alcohol beverages is responsible 
for ensuring that the ingredients in its products comply with the 
laws and regulations that FDA administers. TTB's approval of a COLA 
or formula does not imply or otherwise constitute a determination 
that the product complies with the [Federal Food, Drug, and Cosmetic 
Act], including a determination as to whether the product is 
adulterated because it contains an unapproved food additive.

See also Industry Circular 62-33. The instructions on the forms for 
formula approval repeat this message. Now, TTB is proposing to codify 
this position in the regulations.
    e. Cross references to other regulations. Proposed Sec. Sec.  4.10, 
5.10, and 7.10 are derived from current Sec. Sec.  4.5, 5.2, and 7.4 
and include an expanded list of regulations implemented by other 
Federal agencies of which industry members should be aware. While the 
list does not purport to be comprehensive, TTB believes it will be 
helpful to industry members.
2. Subpart B--Certificates of Label Approval (for Wine, Distilled 
Spirits and Malt Beverages) and Certificates of Exemption From Label 
Approval (for Wine and Distilled Spirits)
    a. Certificates of label approval (COLAs) and certificates of 
exemption from label approval. The regulations implementing the 
statutory requirement for (COLAs) (for wine, distilled spirits and malt 
beverages) and certificates of exemption (for wine and distilled 
spirits) are reorganized for clarity. The proposed regulations also set 
forth, for the first time, some of the things that a COLA does not do. 
Specifically, the proposed regulations provide that, among other 
things, a COLA does not confer trademark protection; relieve the 
certificate holder from its responsibility to ensure that all 
ingredients used in the production of wine, distilled spirits, or malt 
beverages comply with applicable requirements of the FDA with regard to 
ingredient safety; or relieve the certificate holder from liability for 
violations of the FAA Act, the ABLA, the IRC, or related regulations 
and rulings.
    The proposed revisions reflect the longstanding policy of TTB and 
its predecessor agencies. Furthermore, the COLA form (TTB Form 5100.31, 
Application for and Certification/Exemption of Label/Bottle Approval), 
currently specifically provides that the issuance of a COLA does not 
confer trademark protection and does not relieve the applicant from 
liability for violations of the FAA Act, the ABLA, the IRC, or related 
regulations and rulings. TTB believes that these revisions will clarify 
this position for the public and industry members.
    b. Certificates of exemption. Proposed Sec. Sec.  4.23 and 5.23 
incorporate current regulatory requirements with regard to the issuance 
of certificates of exemption to bottlers of wine and distilled spirits. 
Consistent with the current regulations, the proposed rule provides 
that the bottler may obtain a certificate of exemption upon 
establishing, to the satisfaction of the appropriate TTB officer, that 
the wine or spirits to be bottled will be offered for sale only within 
the State in which bottled, and that they will not be sold, offered for 
sale, shipped or delivered for shipment, or otherwise introduced, in 
interstate or foreign commerce.
    Consistent with the instructions for Item 18 that currently appear 
on the TTB Form 5100.31, the proposed regulations provide that, as a 
condition for receiving exemption from label approval, the label 
covered by a certificate of exemption must include the statement, ``For 
sale in [name of State] only.'' It should be noted that it is TTB's 
current practice to issue certificates of exemption conditioned on the 
applicant's agreement to add this statement to the container. Under the 
proposed regulations, TTB will require applicants to include this 
statement on a label submitted with the application for a certificate 
of exemption.
    c. COLAs for Imported Wine, Distilled Spirits, and Malt Beverages. 
Consistent with current regulations, proposed Sec. Sec.  4.24, 5.24, 
and 7.24 provide that wine, distilled spirits, and malt beverages, 
imported in containers, are not eligible for release from customs 
custody for consumption unless the person removing the wine, distilled 
spirits, or malt beverages has obtained and is in possession of a COLA. 
The regulations, as amended by the final rule facilitating the use of 
the International Trade Data System (ITDS) (T.D. TTB-145, 81 FR 94186, 
December 22, 2016), require importers who file electronically to file 
with CBP the identification number assigned to the approved COLA. If 
the importer is not filing electronically, the importer must provide a 
copy of the COLA to CBP at the time of entry.
    d. Administrative rules. In proposed subpart B of parts 4, 5, and 
7, several sections are grouped under the heading of ``Administrative 
Rules.'' These sections set forth requirements for presenting COLAs to 
government officials; submitting formulas, samples, and other 
documentation related to obtaining or using COLAs; and applying for and 
obtaining permission to use personalized labels.

[[Page 60571]]

    The requirement that a certificate holder must present a COLA upon 
request by any duly authorized representative of the United States 
Government (at proposed Sec. Sec.  4.27, 5.27, and 7.27) reflects 
current provisions (at current Sec. Sec.  4.51, 5.55(c), and 7.42) but 
adds the provision that the COLA may be the original or a copy 
(including an electronic copy).
    i. Formula requirements. TTB currently has specific formula 
requirements for certain domestic products. These are found in parts 5 
and 19 for distilled spirits, in part 24 for wine, and in part 25 for 
beer. However, TTB often finds it necessary to obtain more specific 
information about a product that is not otherwise subject to the 
formula requirements in connection with the COLA review process.
    For many imported alcohol beverage products, TTB requires a product 
evaluation to determine whether a proposed label identifies the product 
in an adequate and non-misleading way. Pre-COLA product evaluation 
entails a review of a product's ingredients and formulation and also 
may include a laboratory analysis of the product. Laboratory analysis 
involves a chemical analysis of a product. Such pre-COLA product 
evaluations ensure that:
     No alcohol beverage contains a prohibited ingredient.
     Ingredients are used within limitations or restrictions 
prescribed by TTB or another Federal agency, as applicable.
     Appropriate tax and product classifications are made.
     Alcohol beverages labeled without a sulfite declaration 
contain less than 10 parts per million (ppm) of sulfur dioxide.
    The type of pre-COLA product evaluation required for a particular 
product depends on that product's formulation and origin. Industry 
Circular 2007-4, ``Pre-COLA Product Evaluation,'' dated September 11, 
2007, includes a list of the imported products for which TTB currently 
requires formulas and other pre-COLA analyses.
    The Industry Circular also announced that TTB had developed a new 
form that may be submitted in lieu of the various forms and formats 
otherwise prescribed in the regulations for specific products. TTB 
developed the form, TTB F 5100.51, ``Formula and Process for Domestic 
and Imported Alcohol Beverages,'' to simplify the formula submission 
process and to provide a more consistent means of information 
collection across all commodity areas for both imported and domestic 
products. The Circular stated that TTB intended to pursue a regulatory 
change that will make use of this form mandatory, entirely replacing 
the various industry-specific forms and formats currently set forth in 
the TTB regulations. Until such a change occurs, this form may be used 
voluntarily as an alternate procedure. A producer or importer who 
wishes to use TTB F 5100.51 may submit that form in lieu of the forms 
prescribed in the regulations without first requesting approval from 
TTB to do so.
    Current regulations in Sec. Sec.  4.38(h), 5.33(g), and 7.31(d) 
authorize TTB to request more information about the contents of a wine, 
distilled spirits product or malt beverage, but the language in part 7 
is different from the language in parts 4 and 5. Sections 4.38(h) and 
5.33(g) provide that, upon request of the appropriate TTB officer, a 
bottler or importer must submit a full and accurate statement of the 
contents of any container to which labels are to be or have been 
affixed. The regulations in Sec.  7.31(d) state that the appropriate 
TTB officer may require an importer to submit a formula for a malt 
beverage, or a sample of any malt beverage or ingredients used in 
producing a malt beverage, prior to or in conjunction with the filing 
of an application for a COLA.
    TTB is proposing to standardize the regulatory language in parts 4, 
5 and 7 on this issue. Accordingly, proposed Sec. Sec.  4.28, 5.28, and 
7.28 provide that the appropriate TTB officer may require a bottler or 
importer to submit a formula, the results of laboratory testing, and 
samples of the product or ingredients used in the final product, prior 
to or in conjunction with the review of an application for label 
approval. The proposed regulations also provide that TTB may request 
such information after the issuance of a COLA, or in connection with 
any product that is required to be covered by a COLA. The proposed 
regulations also provide that, upon request of the appropriate TTB 
officer, a bottler or importer must submit a full and accurate 
statement of the contents of any container to which labels are to be or 
have been affixed, as well as any other documentation on any issue 
pertaining to whether the wine, distilled spirits, or malt beverage is 
labeled in accordance with the TTB regulations. These amendments 
reflect current TTB policy.
    As noted above, current TTB regulations and industry practice 
involve the submission of alcohol beverage formulas in varying forms 
and formats depending on the type of alcohol beverage and whether the 
product is domestically produced or imported. TTB believes that this 
multiplicity of procedures is unnecessarily complicated and burdensome 
for both the regulated industries and TTB. Accordingly, we propose in 
this document to amend the TTB regulations in parts 4, 5, and 7 to 
provide that a formula may be filed electronically by using Formulas 
Online, or it may be submitted on paper on TTB Form 5100.51. TTB 
anticipates proposing similar revisions to the IRC regulations in the 
near future. TTB notes that many industry members now use Formulas 
Online to submit formulas, and encourages all industry members to 
consider the advantages of online filing.
    ii. Personalized labels. The proposed regulations also set forth, 
for the first time, the process for applicants seeking label approval 
to receive permission from TTB to make certain changes in order to 
personalize labels without having to resubmit the labels for TTB 
approval (see Sec. Sec.  4.29, 5.29, and 7.29). Personalized labels may 
contain a personal message, picture, or other artwork that is specific 
to the consumer who is purchasing the product. For example, a producer 
may offer custom labels to individuals or businesses that commemorate 
an event such as a wedding or grand opening.
    Consistent with current policy, as set forth in TTB G 2011-5 and 
TTB G 2010-1, the proposed regulations provide that label applicants 
who intend to offer personalized labels must submit a template for the 
personalized label with their application for label approval, and note 
on the application a description of the specific personalized 
information that may change. If the application complies with the 
regulations, TTB will issue a COLA with a qualification that allows the 
personalization of labels. The qualification will allow the certificate 
holder to add or change items on the personalized label such as 
salutations, names, graphics, artwork, congratulatory dates and names, 
or event dates, without applying for a new COLA. All of these items on 
personalized labels must comply with the regulations.
    The proposed rule provides that certain changes are not permitted 
on personalized labels. These include the addition of any information 
that discusses either the alcohol beverage or the characteristics of 
the alcohol beverage, as well as information that is inconsistent with 
or in violation of the provisions of the TTB regulations or any other 
applicable law or regulation.
3. Subpart C--Alteration of Labels, Relabeling, and Adding Information 
to Containers
    As previously noted, the COLA requirements of the FAA Act are

[[Page 60572]]

intended to prevent the sale or shipment or other introduction in 
interstate or foreign commerce of distilled spirits, wine, or malt 
beverages that are not bottled, packaged, or labeled in compliance with 
the regulations. To ensure that products with proper labels are not 
altered once such products have been removed from bond, section 105(e) 
of the FAA Act (27 U.S.C. 205(e)) further provides:

    It shall be unlawful for any person to alter, mutilate, destroy, 
obliterate, or remove any mark, brand, or label upon distilled 
spirits, wine, or malt beverages held for sale in interstate or 
foreign commerce or after shipment therein, except as authorized by 
Federal law or except pursuant to regulations of the Secretary of 
the Treasury authorizing relabeling for purposes of compliance with 
the requirements of this subsection or of State law.

    Regulations that implement these provisions of the FAA Act, as they 
relate to wine, distilled spirits, and malt beverages, are set forth in 
parts 4, 5, and 7, respectively. Current Sec. Sec.  4.30 and 7.20 
provide that someone wanting to relabel must receive prior written 
permission from the appropriate TTB officer. Current Sec.  5.31 does 
not require prior written approval for the relabeling of distilled 
spirits, as long as such relabeling is done in accordance with an 
approved COLA.
    In proposed subpart C of parts 4, 5, and 7, TTB proposes conforming 
changes to the regulations that implement this statutory prohibition. 
This subpart also sets forth the situations in which a person must 
apply for and obtain written approval prior to relabeling.
    Proposed Sec. Sec.  4.41(a), 5.41(a), and 7.41(a) set forth the 
statutory prohibition under 27 U.S.C. 205(e) on the alteration of 
labels. The proposed language provides that the prohibition applies to 
any persons, including retailers, holding wine for sale in (or after 
shipment in) interstate or foreign commerce.
    Proposed Sec. Sec.  4.41(b), 5.41(b), and 7.41(b) provide that for 
purposes of the relabeling activities authorized by this subpart, the 
term ``relabel'' includes the alteration, mutilation, destruction, 
obliteration, or removal of any existing mark, brand, or label on the 
container, as well as the addition of a new label (such as a sticker 
that adds information about the product or information engraved on the 
container) to the container, and the replacement of a label with a new 
label bearing identical information.
    Proposed Sec. Sec.  4.41(c), 5.41(c), and 7.41(c) contain new 
language that provides that authorization to relabel in no way 
authorizes the placement of labels on containers that do not accurately 
reflect the brand, bottler, identity, or other characteristics of the 
product; nor does it relieve the person conducting the relabeling 
operations from any obligation to comply with the regulations in this 
part and with State or local law, or to obtain permission from the 
owner of the brand where otherwise required.
    The existing regulations in parts 4 and 7 require persons wishing 
to relabel to obtain written permission from TTB, with certain 
exceptions, while the regulations in part 5 require persons wishing to 
relabel to obtain a COLA from TTB. TTB believes that the regulations in 
parts 4, 5 and 7 should be updated to cover all of the situations in 
which people need to relabel. The existing regulations in part 5 allow 
persons who are eligible to obtain COLAs covering the products, such as 
bottlers and importers, to relabel the products even after they have 
been removed from bottling premises or customs custody, respectively. 
The proposed rule extends this provision to parts 4 and 7. However, the 
language in existing parts 4 and 7 allows persons who are not eligible 
to obtain COLAs, such as retailers, to obtain written permission from 
TTB to relabel products that are in the marketplace when unusual 
circumstances exist. The proposed rule extends this provision to part 
5.
    Accordingly, proposed Sec. Sec.  4.42(a), 5.42(a), and 7.42(a) 
provide that proprietors of bonded wine premises, distilled spirits 
plant premises, and breweries, respectively, may relabel domestically 
bottled products prior to their removal from, and after their return to 
bond at, the bottling premises, with labels covered by a COLA, without 
obtaining separate permission from TTB for the relabeling activity. 
Proposed Sec. Sec.  4.42(b), 5.42(b), and 7.42(b) provide that 
proprietors of bonded wine premises, distilled spirits plant premises, 
and breweries, respectively, may relabel domestically bottled products 
after removal from the bottling premises with labels covered by a COLA, 
without obtaining separate permission from TTB for the relabeling 
activity. This would, for example, allow a brewer to replace damaged 
labels on containers that are being held at a wholesaler's premises, as 
long as the labels are covered by a COLA, without obtaining separate 
permission from TTB to remove the existing labels and replace them with 
either identical or different approved labels.
    Similarly, proposed Sec. Sec.  4.42(c) and (d), 5.42(c) and (d), 
and 7.42(c) and (d) provide that, under the supervision of U.S. customs 
officers, imported wine, distilled spirits, and malt beverages, 
respectively, in containers in customs custody may be relabeled without 
obtaining separate permission from TTB for the relabeling activity. 
Such containers must bear labels covered by a COLA if and when they are 
removed from customs custody for consumption.
    Proposed Sec. Sec.  4.43, 5.43, and 7.43 cover relabeling 
activities that require separate written authorization from TTB. It is 
rare that someone other than the original bottler or importer will need 
to relabel the product, but these situations sometimes occur. For 
example, sometimes unlabeled wine containers are transferred between 
bonded wine premises. While the bottler is required to obtain a COLA to 
cover these containers prior to bottling, the transferee, who is 
labeling the containers, will sometimes want to put additional labels 
on the containers. In this case, the transferee must obtain TTB 
approval to place the new labels on the products and must be in 
possession of the necessary documentation to substantiate any new 
claims that will appear on the labels.
    Thus, the proposed regulations provide that persons who are not 
eligible to obtain a COLA (such as retailers or permittees other than 
the bottler) may obtain written authorization for relabeling if the 
facts show that the relabeling is for the purpose of compliance with 
the requirements of this part or of State law. The written application 
must include copies of the original and proposed new labels; the 
circumstances of the request, including the reason for relabeling; the 
number of containers to be relabeled; the location where the relabeling 
will take place; and the name and address of the person who will be 
conducting the relabeling operations.
    TTB is proposing to add to the malt beverage regulations a 
provision that is already found in slightly different forms in parts 4 
and 5. This provision authorizes, without any requirement for separate 
written permission from TTB, the addition of a label identifying the 
wholesaler, retailer, or consumer as long as the label contains no 
reference to the characteristics of the product, does not violate the 
labeling regulations, and does not obscure any existing labels. The 
proposed regulations will standardize this provision for wine, 
distilled spirits, and malt beverages (see proposed Sec. Sec.  4.44, 
5.44, and 7.44).
    TTB believes that the proposed regulations will enable permittees, 
brewers, and retailers to relabel alcohol beverage containers when 
there is a

[[Page 60573]]

good reason to do so, while still restricting the alteration of labels 
for containers that are in the marketplace. We seek comments from the 
industry on whether the proposed regulations will protect the integrity 
of labels in the marketplace without imposing undue burdens on the 
industry.
4. Subpart D--Label Standards
    The current provisions governing legibility of labels, type size, 
and language requirements are found within one section of parts 4, 5, 
and 7 for wine, distilled spirits, and malt beverages, respectively. 
See current Sec. Sec.  4.38, 5.33, and 7.28. Proposed subpart D 
includes those and other general provisions. These provisions are 
predominantly derived from and consistent with requirements set forth 
in the current regulations.
    TTB is proposing to amend the sections that set forth legibility 
requirements for the mandatory information that is required to be 
placed on labels (proposed Sec. Sec.  4.52, 5.52, and 7.52). These 
sections are derived from current Sec. Sec.  4.38(a), 5.33(a) and (b), 
and 7.28(a).
    The proposed regulations set forth the requirement that mandatory 
information must be ``separate and apart'' from descriptive or 
explanatory information, referred to in the proposed rule as 
``additional information,'' with a few exceptions. First, brand names 
are exempt from this requirement. Second, this provision does not 
preclude the addition of brief optional phrases as part of the class 
and type designation (such as, ``premium malt beverage''), the name and 
address statement (such as, ``Proudly produced and bottled by ABC 
Winemaking Co. in Napa, CA, for over 30 years''), or other information 
required by the regulations, as long as the additional information does 
not detract from the prominence of the mandatory information. Finally, 
the mandatory statements related to disclosure of certain specified 
ingredients (FD&C Yellow No. 5, cochineal extract or carmine, sulfites, 
and aspartame) may not include additional information. It should be 
noted that the aspartame statement, like the health warning statement 
required by part 16, must be separate and apart from all other 
information.
    The proposed regulations expand on the requirement that mandatory 
information must appear on a ``contrasting background'' by adding 
examples of contrasting backgrounds that would satisfy regulatory 
requirements. The color of the container and of the alcohol beverage in 
the container must be taken into account if the label is transparent. 
The text also clarifies that, with one exception (for the required 
aspartame statement), mandatory information may appear in lower case 
letters, capital letters, or both capital and lower-case letters.
    The proposed rule makes changes to current provisions pertaining to 
minimum type size requirements. The current regulations setting forth 
minimum type size requirements (current Sec. Sec.  4.38(b), 5.33(b)(5), 
5.33(b)(6), and 7.28(b)) prescribe specific heights in millimeters for 
mandatory information. The height specification is dependent on the 
size of the container. Among other things, the proposed regulations 
provide that the minimum type size applies to all capital and lowercase 
letters.
    The proposed rule also makes changes to current provisions 
pertaining to maximum type size requirements for the alcohol content 
statement for wine and malt beverages. Current Sec.  4.38(b)(3) 
provides that the alcohol content statement on containers of 5 liters 
or less may not appear in script, type, or printing that is more than 3 
millimeters in height. This section further provides that the alcohol 
content statement on containers of wine may not be set off with a 
border or otherwise accentuated. TTB is retaining the type size 
requirement, but removing the prohibition against accentuating the 
alcohol content statement. This is in keeping with TTB's current 
policy, which allows alcohol content statements to be bolded.
    In general, current Sec.  7.28(b)(3)(ii) provides that all portions 
of the alcohol content statement for malt beverages must be of the same 
size and kind of lettering and of equally conspicuous color, and not 
larger than 3 millimeters for containers of 40 fluid ounces or less, 
and not larger than 4 millimeters for containers larger than 40 fluid 
ounces. TTB is retaining the maximum alcohol content type size 
requirements for wine and malt beverages in Sec. Sec.  4.53 and 7.53, 
respectively.
    TTB is proposing to add sections to all three parts (proposed 
Sec. Sec.  4.54, 5.54, and 7.54) to make it explicit that mandatory 
information may not be obscured in whole or in part. This requirement 
reflects current policy. Although it certainly is a long-standing 
component of ``legibility,'' TTB believes that industry members would 
benefit from the explicit statement of this policy in the regulatory 
text of parts 4, 5, and 7.
    TTB seeks comments on whether the proposed changes to the placement 
and legibility requirements for mandatory information, which are 
intended to provide additional flexibility to industry members, 
adequately protect the consumer by ensuring that mandatory information 
on containers is readily apparent to consumers.
    In proposed Sec. Sec.  4.55, 5.55, and 7.55, TTB is proposing to 
amend the language requirements that are currently found in Sec. Sec.  
4.38(c), 5.33(c), and 7.28(c), to allow all mandatory information to 
appear in Spanish when products are bottled for sale in the 
Commonwealth of Puerto Rico. Consistent with the current regulations, 
the proposed regulations generally require mandatory information, other 
than the brand name, to appear in the English language. The proposed 
regulations also allow for additional statements in a foreign language, 
including translations of mandatory information that appears elsewhere 
in English on the label, to appear on labels and containers, as long as 
those statements do not conflict with, or contradict, the requirements 
of parts 4, 5, and 7. Finally, these sections provide that the country 
of origin may be in a language other than English when allowed by CBP 
regulations.
5. Subpart E--Mandatory Label Information
    Proposed subpart E in parts 4, 5 and 7 sets forth the information 
that is required to appear on alcohol beverage labels (otherwise known 
as ``mandatory information''). This subpart also prescribes where and 
how mandatory information must appear on such labels.
    a. What constitutes a label. TTB is proposing to add regulatory 
text to all three parts to specify what TTB will consider to be the 
``label'' for purposes of mandatory information. Proposed Sec. Sec.  
4.61(a), 5.61(a), and 7.61(a) address different forms that labels take 
(for example, paper, plastic or film labels affixed to the container; 
information etched, engraved, sandblasted, or otherwise carved into the 
surface of the container; and information branded, stenciled, painted, 
printed, or otherwise directly applied to the surface of the 
container). For purposes of the net contents statement and the name and 
address statement only, the term ``label'' includes information blown, 
embossed, or molded into the container as part of the process of 
manufacturing the container.
    Proposed Sec. Sec.  4.61(b), 5.61(b), and 7.61(b) clarify that 
placement of information on certain parts of alcohol beverage 
containers (such as the bottom of the container, caps, corks, or other 
closures [unless authorized to bear mandatory information by the 
appropriate TTB officer], and foil or heat shrink capsules) will not 
meet the

[[Page 60574]]

requirements for mandatory information that must appear on labels. This 
provision is intended to take into account unique types of containers, 
such as pudding or gelatin-type cups, where the mandatory information 
is sometimes authorized to appear on the top of the container. 
Information on these parts of the container are still subject to the 
restrictions and prohibitions set forth in proposed subparts F, G and H 
of parts 4, 5, and 7.
    Proposed Sec. Sec.  4.61(c), 5.61(c), and 7.61(c) further clarify 
longstanding policy that any materials that accompany the container to 
the consumer but are not firmly affixed to the container, including 
booklets, leaflets, and hang tags, are not ``labels'' for purposes of 
proposed parts 4, 5, and 7. Such materials are instead subject to the 
advertising regulations in proposed new part 14 of the TTB regulations. 
This is a clarifying change for parts 4 and 5, consistent with the 
intent of T.D. ATF-180 (49 FR 31667, August 8, 1984), which explained 
in its preamble that ``[l]abels must be firmly affixed to the 
container, hang tags are usually tied or slipped over the neck of the 
bottle. Therefore, when other matter accompanies the container and is 
not firmly affixed as a label, such matter is advertising material and 
must bear the mandatory statements.''
    b. Packaging (including cartons, coverings, and cases). Current 
regulations in Sec. Sec.  4.38a and 5.41 set out rules for the 
placement of information on bottle cartons, booklets, and leaflets. 
Briefly, these regulations provide that individual coverings, cartons, 
or other containers of the bottle used for sale at retail (that is, 
other than a shipping container), as well as any written, printed, 
graphic, or other matter accompanying the bottle to the consumer shall 
not contain any statement, design, device or graphic, pictorial, or 
emblematic representation prohibited by the labeling regulations.
    The current regulations also require the placement of mandatory 
label information on sealed opaque coverings, cartons, or other 
containers used for sale at retail (but not shipping containers). 
Coverings, cartons, or other containers of the bottle used for sale at 
retail that are designed so that the bottle is easily removable may 
display any information that is not in conflict with the label on the 
bottle contained therein. However, any brand names or designations must 
be displayed in their entirety, with any required modifications and/or 
statements of composition.
    Thus, the prohibited practices for labeling set forth in existing 
Sec. Sec.  4.39(a) and 5.42(a) apply to bottles, labels on bottles, any 
individual covering, carton, or other container of such bottles used 
for sale at retail, and any written, printed, graphic, or other matter 
accompanying such bottles to the consumer. Yet, the advertising 
regulations in existing Sec. Sec.  4.61 and 5.62 define the term 
``advertisement,'' in pertinent part, as including any written or 
verbal statement, illustration, or depiction, whether it appears in ``a 
newspaper, magazine, trade booklet, menu, wine card, leaflet, circular, 
mailer, book insert, catalog, promotional material, sales pamphlet, or 
in any written, printed, graphic, or other matter accompanying the 
[container] bottle,'' but excluding ``[a]ny label affixed to any 
[container] bottle * * * or any individual covering, carton, or other 
[wrapper of such container] [container of the bottle] which constitutes 
a part of the labeling'' under the labeling regulations.
    The current labeling regulations in part 7 do not include 
regulations similar to current Sec. Sec.  4.38a and 5.41. However, as 
set forth at current Sec.  7.29(a) and (h), the prohibited practices in 
the labeling regulations for malt beverages apply to containers, any 
labels on such containers, or any cartons, cases, or individual 
coverings of such containers used for sale at retail, as well as to any 
written, printed, graphic, or other material accompanying malt beverage 
containers to the consumer. The current advertising regulations in part 
7, like the advertising regulations in parts 4 and 5, define the term 
``advertisement'' (in current Sec.  7.51) to include, in pertinent 
part, any written or verbal statement, illustration, or depiction, 
whether it appears in ``a newspaper, magazine, trade booklet, menu, 
wine card, leaflet, circular, mailer, book insert, catalog, promotional 
material, sales pamphlet, or in any written, printed, graphic or other 
matter accompanying the container, representations made on cases * * * 
or in any other media;'' but excluding any ``label affixed to any 
container of malt beverages; or any coverings, cartons, or cases of 
containers of malt beverages used for sale at retail which constitute a 
part of the labeling'' under the labeling regulations.
    TTB believes that the existing regulations create some confusion as 
to when a case or hang tag constitutes labeling and when it constitutes 
advertising. Accordingly, TTB is proposing identical regulations in 
proposed Sec. Sec.  4.62, 5.62, and 7.62 to address packaging. The 
proposed regulations provide, consistent with existing regulations in 
parts 4, 5 and 7, that packaging may not include any statements or 
representations prohibited by the labeling regulations from appearing 
on containers or labels. The proposed regulations also provide, 
consistent with existing regulations in parts 4 and 5 but as a new 
requirement for part 7, that closed packaging, including sealed opaque 
coverings, cartons, cases, carriers, or other packaging used for sale 
at retail, must include all mandatory information required to appear on 
the label.
    Furthermore, the proposed regulations provide greater clarity than 
the current provisions about when packaging is considered closed. 
Proposed Sec. Sec.  4.62, 5.62, and 7.62 provide that packaging is 
considered closed if the consumer must open, rip, untie, unzip, or 
otherwise manipulate the package to remove the container in order to 
view any of the mandatory information. Packaging is not considered 
closed if a consumer could view all of the mandatory information on the 
container by merely lifting the container up, or if the packaging is 
transparent or designed in a way that all of the mandatory information 
can easily be read by the consumer without having to open, rip, untie, 
unzip, or otherwise manipulate the package. TTB seeks comment on 
whether TTB should require mandatory or dispelling information to 
appear on open packaging when part of the label is obscured.
    TTB solicits comments on whether the proposed rules will require 
significant change to labels, containers, or packaging materials. We 
also solicit comments on whether the proposed revisions will provide 
better information to the consumer and make it easier to find mandatory 
information on labels, containers, and packages.
    c. Placement rules. Mandatory information includes the brand name, 
the class and type designation, alcohol content, net contents, name and 
address of the responsible party (such as the producer, bottler, or 
importer), and disclosure of certain ingredients and processes. The 
current regulations have placement requirements for mandatory 
information--some mandatory information must appear on the ``brand 
label,'' and other mandatory information may appear on any label. The 
regulations in parts 4 and 7 define the brand label as the label 
carrying, in the usual distinctive design, the brand name. The 
regulations in part 5 define the brand label, in part, as the principal 
display panel that is most likely to be displayed, presented, shown, or 
examined under normal and customary conditions of display for retail 
sale, and any other label appearing on the same

[[Page 60575]]

side of the bottle as the principal display panel.
    TTB proposes to provide more flexibility in the placement of the 
mandatory information for wine, distilled spirits, and malt beverages 
by eliminating the concept of a defined ``brand label.'' The specific 
proposals for locating mandatory information on labels for each 
commodity will be included in the commodity-specific discussions later 
in the preamble. Where placement requirements exist, the proposed rule 
provides more specific terminology. Instead of requiring mandatory 
information to be in ``direct conjunction'' with other mandatory 
information, the proposed regulations clarify when such information 
must be immediately adjacent to other information, and when it may be 
in the same field of vision as other information.
    d. Brand name. Proposed Sec. Sec.  4.64, 5.64, and 7.64 set forth 
requirements for brand names of wine, distilled spirits, and malt 
beverages, respectively. Most of the provisions in these sections are 
commodity specific and are therefore discussed individually later in 
this document.
    However, one proposed change is made in all three parts: TTB is 
proposing to remove a provision for the continued use of certain trade 
names of foreign origin that had been used for at least five years 
immediately preceding August 29, 1935 (the date the FAA Act was 
enacted). Although the law still authorizes the use of these names, TTB 
believes that there is no need to retain this provision in the 
regulations, given that it refers to names that have been used for more 
than 85 years.
    e. Name and address for domestically bottled products. In the 
regulations on the name and address of bottlers and producers of wine, 
distilled spirits, and malt beverages, TTB is making editorial changes 
to existing requirements.
    As previously mentioned, the FAA Act provides that wine, distilled 
spirits, and malt beverage labels must contain certain mandatory 
information, including the name of the manufacturer, bottler, or 
importer of the product. See 27 U.S.C. 205(e)(2). The regulations for 
distilled spirits and malt beverage labels currently provide more 
flexibility than the regulations for wine labels. Most importantly, 
wine labels must show the name of the bottler and the place where 
bottled, while bottlers of distilled spirits and malt beverages have 
the flexibility to list either the place of bottling, every location at 
which the same industry member bottles the product, or, under certain 
circumstances, the principal place of business of the industry member 
that is bottling the product. Bottlers of distilled spirits or malt 
beverages that utilize one of the latter two options must mark the 
labels using a coding system that enables the bottler and TTB to trace 
the actual place of bottling of each container. This both protects the 
revenue and allows for the tracing of containers in the event of an 
adulteration issue.
    TTB is aware that, with the growing number of craft brewers and 
craft distillers in the marketplace, there may be more interest among 
consumers as to where malt beverages are brewed and where distilled 
spirits are distilled. On the other hand, TTB also wishes to provide 
industry members with flexibility in their labeling statements, to 
accommodate the growing number of arrangements where products are 
produced or bottled pursuant to contractual arrangements. One of the 
major reasons for allowing the use of principal places of business and 
multiple addresses on labels is to allow industry members to use a 
single label for their products rather than having to seek approval of 
multiple labels. TTB notes that, under both the existing and proposed 
regulations, industry members are always free to include optional 
statements that provide consumers with more information about their 
production and bottling processes if they wish.
    TTB seeks comments from all interested parties, including industry 
members and consumers, on whether the proposed labeling requirements 
provide adequate information to the consumer while avoiding undue 
burdens on industry members. TTB also seeks comments on whether the 
standards for wine labels should continue to require specific 
information about the place where production and/or bottling operations 
occurred.
    f. Name and address for imported alcohol beverages. The name and 
address inform the consumer of the identity of the importer of the 
alcohol beverage product and the location of the importer's principal 
place of business. The current regulations at Sec.  4.35(b), 5.36(b), 
and 7.25(b) provide that, on labels of imported wines, distilled 
spirits and malt beverages, respectively, the words ``imported by,'' or 
a similar appropriate phrase, must be stated, followed immediately by 
the name of the permittee who is the importer, or exclusive agent, or 
sole distributor, or other person responsible for the importation, 
together with the principal place of business in the United States of 
such person.
    Like the current regulations, the proposed regulations in 
Sec. Sec.  4.68, 5.68, and 7.68 require the name and address of the 
importer when the product is imported in containers. The proposed 
regulations clarify that for purposes of these sections, the importer 
is the holder of an importer's basic permit making the original Customs 
entry into the United States, or is the person for whom such entry is 
made, or the holder of an importer's basic permit who is the agent, 
distributor, or franchise holder for the particular brand of imported 
alcohol beverages and who places the order abroad. These provisions 
mirror the policy set forth in Revenue Ruling 71-535 with regard to the 
name and address requirements applicable to importers, and the ruling 
will be superseded by the proposed rule.
    Proposed Sec. Sec.  4.67, 5.67, and 7.67 address the labeling of 
products bottled after importation. If the product is bottled after 
importation in bulk, by or for the importer thereof, the proposed rules 
require an ``imported and bottled by'' or ``imported by and bottled 
for'' statement, as appropriate.
    The proposed regulations in Sec. Sec.  4.67, 5.67, and 7.67 
specifically address the name and address requirements applicable to 
wine, distilled spirits, and malt beverages that are imported in bulk 
and then subject to further production or blending activities in the 
United States.
    In section 1421 of the Taxpayer Relief Act of 1997, Public Law 105-
34, Congress enacted a new provision in the IRC which permits the 
transfer of beer in bulk containers from customs custody to internal 
revenue bond at a brewery. After transfer to internal revenue bond at a 
brewery, imported beer may be bottled or packed without change or with 
only the addition of water and carbon dioxide, or may be blended with 
domestic or other imported beer and bottled or packed.
    In ATF Procedure 98-1, TTB's predecessor agency provided guidance 
to brewers and bottlers for the labeling of imported malt beverages 
bottled in the United States. This guidance was necessary because the 
existing regulations in part 7 do not address the labeling of imported 
malt beverages that are bottled in the United States, or the labeling 
of imported malt beverages that are blended with other imported malt 
beverages or with domestic malt beverages, and then bottled or packed 
in the United States.
    Section 1422 of The Taxpayer Relief Act of 1997 amended 26 U.S.C 
5364 to allow the importation of wine in bulk to bonded wine premises; 
the law was amended the following year by Public Law 105-206 to 
restrict this privilege to natural wine. However, even prior to

[[Page 60576]]

this amendment, imported taxpaid wine could be brought onto taxpaid 
wine premises and bottled in the United States. Thus, the regulations 
in part 4 already provide for the labeling of wine bottled after 
importation. However, the current regulations do not reflect the fact 
that wine may be subjected to production activities in the United 
States after importation in bulk. ATF Procedure 98-3 provided some 
guidance on this issue.
    Similarly, the current regulations in part 5 provide for the 
labeling of distilled spirits bottled after importation, but do not 
provide rules concerning the labeling of spirits that were subject to 
production activities in the United States after importation.
    Thus, proposed Sec. Sec.  4.67, 5.67, and 7.67 provide rules for 
the labeling of wine, distilled spirits, and malt beverages that are 
imported in bulk and are then blended with wine, distilled spirits, or 
malt beverages, respectively, of a different country of origin, or 
subjected to production activities in the United States that would 
alter the class or type of the product. The proposed rules provide that 
such products must be labeled with a ``bottled by'' statement, rather 
than an ``imported by'' statement. ATF Procedure 98-1 would be 
superseded by the proposed rule, because its provisions on the labeling 
of malt beverages imported in bulk will be incorporated, with 
modifications, into the name and address regulations found in proposed 
Sec.  7.67.
    As further discussed in the next section of this preamble, industry 
members should note that pursuant to CBP regulations at 19 CFR parts 
102 and 134, imported alcohol beverages that are further processed in 
the United States, or that are blended with domestic alcohol beverages 
in the United States, may be subject to a country of origin marking 
requirement, even when the class or type of the product has been 
altered in the United States. See ATF Ruling 2001-2.
    g. Country of origin. Current regulations require a country of 
origin statement on labels of imported distilled spirits, but include 
no such requirement for imported wine or malt beverages. Nonetheless, 
U.S. Customs and Border Protection (CBP) regulations require a country 
of origin statement to appear on containers of all imported alcohol 
beverages, including alcohol beverages that are imported in bulk and 
then subjected to certain production activities or bottling in the 
United States if, pursuant to CBP regulations, the beverage is the 
product of a country other than the United States.
    The existing distilled spirits regulations in Sec.  5.36(e) provide 
as follows: ``On labels of imported distilled spirits there shall be 
stated the country of origin in substantially the following form 
``Product of __'', the blank to be filled in with the name of the 
country of origin.'' TTB's predecessor agency, ATF, was asked to 
clarify this requirement as applied to products that consist of blends 
of spirits produced in more than one country, including mixtures of 
foreign and domestic spirits. ATF determined that when the country of 
origin regulation in Part 5 was originally written, the agency did not 
contemplate that bottlers would blend imported and domestic spirits. 
When written, the regulations assumed that imported spirits would be 
bottled using 100 percent imported spirits. Accordingly, ATF issued ATF 
Ruling 2001-2 to provide that country of origin statements under the 
regulations in part 5 must comply with applicable CBP requirements.
    In ATF Ruling 2001-2, ATF concluded that its country of origin 
requirements under Sec.  5.36(e) will be interpreted in a manner 
consistent with CBP's rules of origin, noting that issuance of separate 
ATF regulations might lead to inconsistencies between CBP and ATF rules 
and result in confusion for the industries affected by those rules. 
Accordingly, the ruling held that for an imported distilled spirit that 
is wholly the product of a single country, the country of origin will 
be stated in substantially the following form, ``Product of __.'' It 
further held that ``substantially the following form'' meant that the 
distilled spirit may, in the alternative, be labeled in conformity with 
CBP country of origin marking requirements. For a product composed of 
spirits produced in more than one country, including mixtures of 
foreign and domestic spirits, ATF held that the regulation would be 
satisfied if the country of origin was determined and marked in 
accordance with CBP regulations. The ruling also noted that an industry 
member could seek a ruling from Customs for a determination of the 
country of origin for its product.
    TTB is proposing to amend Sec.  5.69, and to add new Sec. Sec.  
4.69 and 7.69, to clarify the relationship between TTB and CBP 
regulations on this issue. As noted, ATF stated in ATF Ruling 2001-2 
that issuance of separate ATF regulations on the country of origin 
issue might lead to inconsistencies between CBP and ATF rules and 
result in confusion for the industries affected by those rules. TTB 
shares the concerns expressed by its predecessor agency on this issue. 
Accordingly, the proposed Sec. Sec.  4.69, 5.69 and 7.69 simply contain 
a cross-reference to the CBP regulations at 19 CFR parts 102 and 134 
regarding country of origin statements, rather than independently 
requiring a country of origin statement under TTB regulations. The 
proposed regulations also provide that ``[l]abeling statements with 
regard to the country of origin must be consistent with CBP 
regulations.'' Finally, proposed Sec. Sec.  4.69 and 7.69, as well as 
proposed Sec.  5.69, provide that the determination of the country (or 
countries) of origin, for imported wines, malt beverages, and distilled 
spirits, respectively, as well as for blends of imported products with 
domestically produced beverages, must comply with CBP regulations.
    While this is a new provision in the wine and malt beverage 
regulations, it will not impose any labeling changes, as it simply 
references an existing requirement found in CBP regulations. However, 
TTB believes that the proposed regulation will remind industry members 
who import alcohol beverages in bulk for processing or bottling in the 
United States that they must place a country of origin statement on the 
labels where required to do so by CBP regulations.
    As discussed earlier in this preamble, industry members should note 
that pursuant to CBP regulations at 19 CFR parts 102 and 134, imported 
alcohol beverages that are further processed in the United States, or 
that are blended with domestic alcohol beverages in the United States, 
may nonetheless be subject to a country of origin marking requirement, 
even if the class or type of the product has been altered in the United 
States. See ATF Ruling 2001-2. When TTB issues COLAs for distilled 
spirits, wine, or malt beverage containers that do (or do not) include 
a country of origin statement, it is not making a factual or legal 
determination of whether such a statement is necessary, or whether a 
labeled country of origin would comply with either TTB or CBP rules. In 
fact, the application for label approval typically does not include the 
information that would be necessary to make such a determination. It is 
the responsibility of the industry member to ensure compliance with the 
country of origin marking requirement, both when alcohol beverages are 
imported in containers and when imported alcohol beverages are subject 
to bottling, blending, or production activities in the United States. 
Industry members may seek a ruling from CBP for a determination of the 
country of origin for their product.

[[Page 60577]]

6. Subparts F, G, and H--Statements That Are Restricted, Prohibited, or 
Prohibited if Misleading
    The current regulations include a single section titled 
``Prohibited Practices'' that sets forth a number of prohibited 
practices and also describes certain labeling practices that are 
regulated in various ways. In order to make regulatory provisions 
easier to find, and to improve readability, TTB proposes to divide the 
regulations addressing prohibited practices into three subparts: (1) 
Subpart F, practices that may be used under certain conditions, (2) 
subpart G, practices that are always prohibited, and (3) subpart H, 
practices that are prohibited only if they are used in a misleading 
manner on labels.
    Proposed subparts F, G and H each contain language to clarify that 
the prohibitions in these subparts apply to any label, container, or 
packaging, and define those terms as used in these subparts. 
Specifically, for purposes of proposed subparts F, G, and H, the term 
``label'' includes all labels on alcohol beverage containers on which 
mandatory information may appear, as set forth in proposed Sec. Sec.  
4.61, 5.61, and 7.61, as well as any other label on the container. 
These proposed sections also set out the parts of the container on 
which mandatory information may appear.
    The proposed text defines ``packaging'' for purposes of proposed 
subparts F, G, and H, as any carton, case, carrier, individual covering 
or other packaging of such containers used for sale at retail, but does 
not include shipping cartons or cases that are not intended to 
accompany the container to the consumer. The proposed rule also 
provides that the term ``statement or representation'' as used in those 
subparts, includes any statement, design, device, or representation, 
and includes pictorial or graphic designs or representations as well as 
written ones. It also includes both explicit and implicit statements 
and representations. This provision avoids the need to repeat the 
reference to each type of statement or representation in every section 
in these subparts.
7. Subpart F--Restricted Labeling Statements
    TTB is proposing a new section (see proposed Sec. Sec.  4.85, 5.85, 
and 7.85) on the use of statements relating to environmental and 
sustainability practices, which reflects current TTB policy. The 
proposed rule allows statements related to environmental or sustainable 
agricultural practices, social justice principles, and other similar 
statements (such as, ``Produced using 100% solar energy'' or ``Carbon 
Neutral'') to appear on labels as long as the statements are truthful, 
specific and not misleading. Statements or logos indicating 
environmental, sustainable agricultural, or social justice 
certification (such as, ``Biodyvin,'' ``Salmon-Safe,'' or ``Fair Trade 
Certified'') may appear on labels of products that are actually 
certified by the appropriate organization.
8. Subpart G--Prohibited Labeling Practices
    Subpart G sets forth the prohibited labeling practices. The 
proposed rule provides that the prohibitions set forth in this subpart 
apply to any label, container, or packaging, and then sets out the 
definitions of those terms for purposes of this subpart. The prohibited 
practices include false statements and obscene or indecent depictions. 
The proposed rule restates and reorganizes prohibitions currently found 
in the TTB regulations.
9. Subpart H--Labeling Practices That Are Prohibited if They Are 
Misleading
    Proposed subpart H sets out the general prohibition against any 
statement or representation, irrespective of falsity, that is 
misleading to consumers as to the age, origin, identity, or other 
characteristics of the wine, distilled spirits, or malt beverages, or 
with regard to any other material factor. It also sets out different 
ways in which statements may be misleading. For example, an otherwise 
truthful statement may be misleading because of the omission of 
material information, the disclosure of which is necessary to prevent 
the statement from being misleading. This is not a new policy, but the 
proposed rule sets it out more clearly (see proposed Sec. Sec.  4.122, 
5.122, and 7.122).
    TTB proposes to cancel Rev. Ruling 55-618, which deals with the use 
of the terms ``kosher'' and ``altar'' on wines. TTB believes that it 
should not restrict the approval of products labeled as ``altar wine'' 
to products to be sold only to religious organizations, as the ruling 
required, and proposes to eliminate that provision of the ruling. 
Additionally, the use of the terms ``altar-type'' or ``altar-style'' 
wine are not prohibited from appearing on alcohol beverage products 
because there is no reasonable basis for protecting the terms. However, 
the terms ``kosher style'' and ``kosher type'' will remain restricted 
to only kosher wines because the use of such terms on non-kosher wines 
would be misleading. TTB does not propose specific regulations 
implementing the restriction, but believes it is covered by the general 
prohibition on misleading statements.
    a. Guarantees. Proposed Sec. Sec.  4.123, 5.123 and 7.123 prohibit 
the use of guarantees that are likely to mislead the consumer. Money-
back guarantees are not prohibited. This is a restatement of existing 
policy currently found in Sec. Sec.  4.39(a)(5), 5.42(a)(5), and 
7.39(a)(5), with minor modifications for clarity.
    b. Disparaging statements. Proposed Sec. Sec.  4.124, 5.124 and 
7.124 specifically prohibit the use of false or misleading statements 
that explicitly or implicitly disparage a competitor's product. This 
proposed revision reflects the longstanding ATF and TTB policy (as 
expressed in T.D. ATF-180, 49 FR 31667, August 8, 1984) that a 
competitor's product is disparaged when statements or claims about the 
product, or relating to the product, are false or would tend to mislead 
the consumer. This policy does not preclude additional information such 
as ``puffery'' statements made about one's own product, nor does it 
prohibit truthful, nonmisleading comparative statements or claims that 
place the competitor's product in an unfavorable light.
    In the proposed regulatory text, TTB also introduces examples of 
statements that would be prohibited under this provision. A statement 
of opinion such as ``We think our [product] tastes better than any 
other [product] on the market'' is not prohibited. However, a statement 
such as ``We do not add arsenic to our [product]'', although truthful, 
would be considered to be disparaging because it falsely implies that 
other producers do add arsenic to their products. Furthermore, labels 
may not include statements that disparage their competitor's products 
by making specific allegations, such as ``Brand X is not aged in oak 
barrels,'' when such statements are untrue.
    c. Tests or analyses. Proposed Sec. Sec.  4.125, 5.125 and 7.125 
prohibit statements or representations of, or relating to, analyses, 
standards, or tests, whether or not truthful, that are likely to 
mislead the consumer. These proposed provisions incorporate current 
policy, but also provide new examples of such a misleading statement, 
designed to illustrate the principle that a truthful statement about a 
test or standard may nonetheless be misleading.
    d. Depictions of government symbols. Currently, representations 
relating to the American flag or the U.S. armed forces are prohibited 
from appearing on alcohol beverage labels in order to

[[Page 60578]]

prevent misconceptions that the alcohol beverage is endorsed or 
otherwise supervised by the U.S. government or the armed forces. 
However, the regulations prohibit the use of flags from other countries 
only where it would be misleading. The regulations on U.S. and foreign 
flags are based on the same statutory provision of the FAA Act at 27 
U.S.C. 205(e)(5) that prohibits deception of the consumer by use of a 
name or representation of individuals or organizations when such use 
creates a misleading impression of endorsement.
    Consistent with the statutory prohibition on which these 
regulations are based, it is TTB's current policy to enforce this 
regulatory prohibition only where such representations might tend to 
mislead consumers. Thus, TTB is proposing to amend the regulations to 
remove the blanket prohibition against the use of representations of, 
or relating to, the American flag, the armed forces of the United 
States, or other symbols associated with the American flag or armed 
forces. Instead, proposed Sec. Sec.  4.126, 5.126, and 7.126 retain the 
prohibition against the use of such symbols or images where they create 
the impression that there was some sort of endorsement by, or 
affiliation with, the governmental entity represented. Furthermore, 
each of these proposed sections specifically provides that the section 
does not prohibit the use of a flag as part of a claim of American 
origin or another country of origin.
    e. Depictions simulating government stamps or relating to 
supervision. Proposed Sec. Sec.  4.127, 5.127, and 7.127 retain 
prohibitions against depictions simulating government stamps or 
relating to government supervision but provide that these 
representations are only prohibited if misleading. TTB solicits 
comments on whether there is still a need for regulations on this 
issue.
    f. Cross-category terms on labels of wine, distilled spirits, and 
malt beverages. In proposed Sec. Sec.  4.128, 5.128, and 7.128, TTB 
proposes to adopt a new prohibition on the misleading use of cross-
commodity terms. Terms used to designate the class and type of wine, 
distilled spirits, and malt beverages are unique to each commodity. 
More and more frequently, TTB receives applications for approval of a 
label for one commodity where the label bears a term normally 
associated with a different commodity.
    For malt beverage products, the current TTB regulations at Sec.  
7.29(a)(7) prohibit a label from containing any statement, design, 
device, or representation that tends to create a false or misleading 
impression that the malt beverage contains distilled spirits or is a 
distilled spirits product. (See also 27 CFR 4.39(a)(7), which prohibits 
misleading statements on wine that create the impression that the wine 
contains distilled spirits. This prohibition does not apply to truthful 
statements of composition.) While the current regulations do not 
prohibit the use of wine terms on malt beverage labels or the use of 
wine or malt beverage terms on distilled spirits labels, TTB believes 
that the use of terms normally associated with one commodity may be 
misleading if used on a product of a different commodity.
    For example, if a term that is a class or type designation for wine 
is used on a malt beverage label as the brand name or as a distinctive 
or fanciful name, or is placed on the label in an otherwise prominent 
position, the label may create the misleading impression that the malt 
beverage is produced with the addition of wine. As a result, TTB has 
denied approval of labels bearing such terms when it has determined 
that the labels were misleading. This denial is authorized under TTB's 
general authority to prohibit misleading information on labels, which 
is codified at current Sec. Sec.  4.39(a), 5.42(a), and 7.29(a). 
However, in other cases, TTB has determined that references to other 
commodities on labels do not mislead consumers as to the identity of 
the product. The determination of whether the reference is misleading 
depends on the overall label, and how the information is presented.
    TTB believes that, in order to deal with this issue consistently, 
the regulations should set forth specific rules about the use of 
defined terms for one commodity on labels of another commodity. 
Accordingly, TTB is proposing to amend the regulations to specifically 
provide that no label, container, or packaging may contain a statement, 
design, or device that tends to create the false or misleading 
impression that the product is, or contains, a different commodity. 
Furthermore, the proposed regulations prohibit class or type 
designations (or any homophones or coined words that simulate or 
imitate a class or type designation) that are set forth in the TTB 
regulations for one commodity from appearing on a label for a product 
of a different commodity, if such representation creates a misleading 
impression about the identity of the product.
    Consistent with past practice, the proposed regulation does not 
prohibit a truthful and accurate statement of alcohol content. 
Similarly, it does not prohibit the use of a brand name of a different 
commodity, provided that the overall label or advertisement does not 
create a misleading impression about the identity of the product. The 
proposed rule continues to allow the use of cocktail names as brand 
names or distinctive or fanciful names, provided that the overall label 
or advertisement does not create a misleading impression about the 
identity of the product.
    The proposed rule does not prohibit the use of truthful and 
accurate statements about the production of the product, as part of a 
statement of composition or otherwise, such as ``aged in whisky 
barrels'' for a malt beverage or wine, so long as such statements do 
not create a misleading impression as to the identity of the product. 
Consistent with TTB Ruling 2014-4, while statements about aging malt 
beverages in barrels previously used in the production or storage of 
distilled spirits or wine are not prohibited, statements that imply 
that the product contains distilled spirits (such as ``bourbon flavored 
beer'') are prohibited as misleading.
    Finally, TTB proposes to continue to allow the use of terms that 
compare a product or products of one commodity to a product or products 
of a different commodity (such as, ``This wine doesn't have the hoppy 
taste of beer'') without creating a misleading impression as to the 
identity of the product.
    TTB solicits comments on whether the proposed prohibition and the 
proposed exceptions to the prohibition will adequately protect the 
consumer and whether the proposed regulations will require changes to 
existing labels. TTB particularly solicits comments on whether the use 
of coined terms and homophones in brand names and elsewhere on the 
labels is misleading to consumers when those terms imply similarity to 
class and type designations to which a product is not entitled.
    g. Appearance of endorsement. The current regulations prohibit the 
use of the name of a living person or existing private or public 
organization if the use of that name or a representation misleads the 
consumer to believe that the product has been endorsed, made, or used 
by, or produced for, or under the supervision of, or in accordance with 
the specifications of, such individual or organization. TTB proposes, 
in Sec. Sec.  4.130, 5.130, and 7.130, to maintain that rule, but to 
make more clear that actual endorsements are permitted and that TTB may 
request documentation supporting the claim of endorsement at the time 
the application for label approval is submitted or at a later time.

[[Page 60579]]

10. Subpart I--Classifications
    Subpart I in parts 4, 5, and 7 sets forth rules for the 
classification of wine, distilled spirits, and malt beverages, 
respectively. As noted earlier in this document, wine, distilled 
spirits, and malt beverages are organized into general classes and, 
within the classes, more specific types. These classes and types, in 
the case of wine and distilled spirits, have specific standards listed 
in the regulations; these are known as ``standards of identity.'' For 
malt beverages, the class and type designations are based on 
designations of products as known to the trade. The specific 
classification rules and the changes TTB proposes to make to these 
rules will be discussed below in the part-specific sections of this 
document.
11. Subpart K for Parts 4 and 5, Standards of Fill
    In subpart K of parts 4 and 5, TTB maintains the current 
requirements for specified standards of fill (see Sec. Sec.  4.202 and 
5.202). (TTB plans to propose changes to the standards of fill in a 
separate rulemaking document.) Additionally, TTB proposes to codify its 
existing policies regarding aggregate packaging.
    a. TTB's Current Regulations on Standards of Fill. TTB administers 
regulations setting forth container size and related standards of fill 
for containers of distilled spirits and wine distributed within the 
United States. (There are no standard of fill requirements for malt 
beverages.) The standards of fill appear in the current regulations in 
Sec.  4.72 for wine, and Sec. Sec.  5.47 and 5.47a for distilled 
spirits. Containers conforming to a standard of fill of, for example, 
750 mL--which is a standard of fill prescribed by current regulations 
for both wine and distilled spirits--must have a net contents of 750 mL 
of that product.
    b. Aggregate Packaging to Meet a Standard of Fill. In 1988, TTB's 
predecessor agency started permitting bottlers and importers of wine 
and distilled spirits products to use containers that did not meet a 
standard of fill provided that the non-standard of fill containers were 
banded or wrapped together and sold as a single wine or distilled 
spirits product that, in total, met an approved standard of fill. For 
example, a wine or distilled spirits product sold in a package of 
thirty 25 mL containers to meet an authorized standard of fill of 750 
mL would be an aggregate package under this policy. While this type of 
aggregate packaging has been permitted for some time, TTB's policy has 
not yet been codified in the regulations.
    In Notice No. 872, published in the Federal Register (64 FR 6485) 
on February 9, 1999, ATF proposed to codify standards on this issue. 
According to the preamble of this NPRM, the issue of whether standard 
of fill requirements may be satisfied by aggregate packaging was first 
raised in 1988, when an importer sought permission to import bags 
containing 25 individual 15-mL packages of alcohol beverage for a total 
of 375 mL, an authorized standard of fill. The request was approved, as 
were subsequent requests for other types of containers, such as 
distilled spirits products packaged in packs of thirty 25-mL test tubes 
to meet an authorized standard of fill of 750 mL.
    In the NPRM, ATF stated that it was concerned that the wide array 
of container types and packaging coming onto the market--including, but 
not limited to, aggregate packaging--would have a number of adverse 
impacts including: (1) Confusing consumers as to the quantity and 
nature of the alcohol beverage; (2) contributing to administrative 
difficulty in determining appropriate excise tax for the products; (3) 
making aggregate fill products more easily obtainable by underage 
individuals; and (4) creating problems with State and local alcohol 
beverage controls, either by conflicting with State standard of fill 
provisions or with prohibitions against open containers of alcohol 
beverages. Accordingly, the NPRM proposed regulations prohibiting the 
use of aggregate packaging to meet standard of fill requirements.
    ATF received approximately 100 comments on the NPRM, with 40 
percent of the comments against the proposed regulations and 60 percent 
favoring them. Comments against the proposed regulations came from the 
alcohol beverage industry and related industries, such as packaging 
manufacturers; although one alcohol beverage producer supported the 
proposed regulations. Comments from industry regarding aggregate 
packaging mainly contended that the issue could be addressed with 
labeling requirements and that limiting package sizes was an 
unnecessary overreach by ATF. Comments on the aggregate packaging 
aspect of the proposed regulations came mostly from companies that were 
already using aggregate packaging to meet standard of fill 
requirements. However, most of the comments against the proposed 
regulations were not addressed to aggregate packaging, but to another 
aspect of the NPRM, which proposed regulations relating to packaging 
that appeared similar to packaging for non-alcohol products. The 
comments in favor of the proposed regulations came from consumers, 
parents, substance abuse agencies and consumer advocacy organizations, 
and were mostly general statements of support for the proposed 
regulations that did not specify which aspect of the NPRM (aggregate 
packaging or packaging types) they supported.
    The regulations proposed in Notice No. 872 to prohibit aggregate 
packaging to meet the authorized standards of fill were not finalized, 
and the practice of aggregate packaging continues today. ATF encouraged 
the industry to adopt a number of safeguards to protect against 
consumer deception in the event that aggregate packages were broken 
apart and the single-serving packages sold individually. These 
safeguards included labeling the individual containers as ``not for 
individual sale'' and ``not for children,'' sealing the outer container 
with shrink wrap or other secure methods, and encouraging bottlers to 
bottle the individual units of the package in authorized standards of 
fill (for example, in 50-mL units). TTB continues to allow aggregate 
packaging under the following conditions:
     The applicant submits to TTB, along with the application 
for label approval, a sample of the actual external container and a 
sample of one of the smaller internal containers.
     The external container, as well as each of the smaller 
internal containers, is labeled with all of the mandatory information 
required by parts 4 and 24 for wine and parts 5 and 19 for distilled 
spirits, as well as the health warning statement required by part 16.
     The external container is shrink-wrapped, boxed, or sealed 
in such a manner that the smaller internal containers cannot be easily 
removed.
     Each of the smaller internal containers is labeled ``NOT 
FOR INDIVIDUAL SALE.''
     The external container bears a statement of total net 
contents that clearly shows how the contents of the individual packages 
added together are equivalent to one of the authorized standards of 
fill. (For example, 750 mL = 30 containers of 25 mL each.)
    In recent years, TTB's policy regarding aggregate packaging has 
shifted to allow for non-standard of fill containers to be packaged 
together even when those containers do not hold the same product. For 
example, products of differing standards of identity and differing 
alcohol contents have been permitted to be packaged together as one 
product. TTB has reevaluated this shift in policy and has determined 
that

[[Page 60580]]

it is inconsistent with the original intent of the aggregate packaging 
policy, which was to allow one product to be bottled in non-standard of 
fill containers that would be banded together so that the sum of the 
identical parts would equal a standard of fill for that product.
    c. Proposed Regulatory Amendment. The regulations proposed in this 
rulemaking document provide for aggregate packaging subject to the 
conditions set forth above and with the additional requirements that 
the wine or distilled spirits packaged in the individual non-standard 
of fill containers within an aggregate package must all be of the same 
class and type, alcohol content, and tax class. This is a narrowing of 
the current policy that allows for wines and distilled spirits of 
differing classes, types, and alcohol contents to be packaged together. 
TTB believes that this narrowing of the policy is necessary to maintain 
the original intent of standards of fill requirements, reduce consumer 
confusion when comparing products, and reduce administrative burden 
when calculating the tax liability of an aggregately packaged wine or 
distilled spirits product. The proposed provisions related to aggregate 
packaging appear in Sec. Sec.  4.204 and 5.204.
    If each internal container already complies with an authorized 
standard of fill, then the aggregate standard of fill conditions would 
not apply, and the internal containers would each be subject to label 
approval. The outer packaging would then be subject to the packaging 
regulations proposed at Sec. Sec.  4.62 and 5.62. TTB believes it is 
appropriate to codify the rules related to aggregate packaging, which 
apply to labeling and standards of fill, as part of this modernization 
project.
12. Subpart L--Recordkeeping and Substantiation Requirements
    Subpart L of parts 4, 5, and 7 sets forth rules for recordkeeping 
and substantiation requirements for alcohol beverages. Existing 
regulations (27 CFR 4.51, 5.55, and 7.42) require bottlers holding an 
original or duplicate original of a certificate of label approval 
(COLA) or a certificate of exemption to exhibit such certificates, upon 
demand, to a duly authorized representative of the United States 
Government. Current regulations (27 CFR 4.40, 5.51, and 7.31) also 
require importers to provide a copy of the applicable COLA upon the 
request of the appropriate TTB officer or a customs officer. However, 
these regulations do not state how long industry members should retain 
their COLA. Furthermore, since these regulations were originally 
drafted, TTB has implemented the electronic filing of applications for 
label approval. Now, over 90 percent of new applications for label 
approval are submitted electronically, and the rest are processed 
electronically by TTB. Industry members have asked for clarification as 
to whether they have to retain paper copies of certificates that were 
processed electronically. Finally, because industry members may make 
certain specified revisions to approved labels without obtaining a new 
COLA, it is important that the industry members keep track of which 
label approval they are using when they make such revisions.
    Accordingly, proposed Sec. Sec.  4.211, 5.211, and 7.211 are new to 
the regulations and provide that, upon request by the appropriate TTB 
officer, bottlers and importers must provide evidence of label approval 
for a label that is used on an alcohol beverage container and that is 
subject to the COLA requirements of the applicable part.
    This requirement may be satisfied by providing original 
certificates, photocopies or electronic copies of COLAs, or records 
showing the TTB identification number assigned to the approved COLA. 
Where labels on containers reflect revisions to the approved label that 
have been made in compliance with allowable revisions authorized to be 
made on the COLA form or otherwise authorized by TTB, the bottler or 
importer must be able to identify the COLA covering the product, upon 
request by the appropriate TTB officer. Bottlers and importers must be 
able to provide this information for a period of five years from the 
date the products covered by the COLAs were removed from the bottler's 
premises or from customs custody, as applicable.
    TTB believes that five years is a reasonable period of time for 
record retention because there is a five-year statute of limitations 
for criminal violations of the FAA Act. TTB notes that the proposed 
rule does not require industry members to retain paper copies of each 
certificate; they should simply be able to track a particular removal 
to a particular certificate, and they may rely on electronic copies of 
certificates, including copies contained in the TTB Public COLA 
Registry.
    While the FAA Act does not contain any specific recordkeeping 
requirements in this regard, the labeling regulations have for decades 
required industry members to produce COLAs upon demand. Furthermore, 
such records are necessary to enforce the requirements of the FAA Act 
with regard to COLAs and certificates of exemption. See, e.g., National 
Confectioners Ass'n v. Califano, 569 F.2d 690, 693-94 (D.C. Cir. 1978), 
which upheld the FDA's authority to require records in the absence of a 
specific statutory requirement where records were necessary to help in 
the efficient enforcement of the Federal Food, Drug and Cosmetic Act.
    Similarly, the FAA Act provides TTB with comprehensive authority 
over the labeling of wine, distilled spirits, and malt beverages, and 
the COLA provisions of the FAA Act are specifically designed to 
``prevent the sale or shipment or other introduction of distilled 
spirits, wine, or malt beverages in interstate or foreign commerce, if 
bottled, packaged, or labeled in violation of [27 U.S.C. 205(e)].'' See 
27 U.S.C. 205(e). The law specifically requires a certificate holder to 
have the COLA in its possession at the time of bottling or removal of 
containers from customs custody. Requiring the holder to be able to 
show evidence of label approval after removal is simply a clarification 
of TTB's current requirements. We note that in addition to the 
rulemaking authority provided by 27 U.S.C. 205, TTB has authority under 
section 2(d) of the FAA Act, Public Law 74-401 (1935) ``to prescribe 
such rules and regulations as may be necessary to carry out [its] 
powers and duties'' under the FAA Act.
    Proposed Sec. Sec.  4.212, 5.212, and 7.212 set forth specific 
substantiation requirements, which are new to the regulations, but 
which reflect TTB's current expectations as to the level of evidence 
that industry members should have to support labeling claims. The 
proposed regulations provide that all claims, whether implicit or 
explicit, must have a reasonable basis in fact. Claims that contain 
express or implied statements regarding the amount of support for the 
claim (e.g., ``tests provide,'' or ``studies show'') must have the 
level of substantiation that is claimed.
    Furthermore, the proposed regulations provide for the first time 
that any labeling claim that does not have a reasonable basis in fact, 
or cannot be adequately substantiated upon the request of the 
appropriate TTB officer, will be considered misleading. The regulations 
in subpart H are similarly amended to include the same requirement. TTB 
believes that this provision, which is very similar to the Federal 
Trade Commission's policy on substantiation of advertising claims, will 
clarify that industry members are responsible for ensuring that all 
labeling and advertising claims have adequate substantiation. See ``FTC 
Policy

[[Page 60581]]

Statement Regarding Advertising Substantiation'' (Appended to Thompson 
Medical Co., 104 F.T.C. 648, 839 (1984), aff'd, 791 F.2d 189 (D.C. Cir. 
1986), cert. denied, 479 U.S. 1086 (1987)).
13. Subpart M--Penalties and Compromise of Liability
    In proposed subpart M for parts 4, 5, and 7, TTB proposes simply to 
include references to various provisions of the FAA Act. Proposed 
Sec. Sec.  4.221, 5.221 and 7.221 state that a violation of the 
labeling provisions of 27 U.S.C. 205(e) is punishable as a misdemeanor 
and refer readers to 27 U.S.C. 207 for the statutory provisions 
relating to criminal penalties, consent decrees, and injunctions. 
Proposed Sec. Sec.  4.222, 5.222, and 7.222 provide that basic permits 
are conditioned upon compliance with the provisions of 27 U.S.C. 205, 
including the labeling provisions of parts 4, 5 and 7, and that a 
willful violation of the conditions of a basic permit provides grounds 
for the revocation or suspension of the permit, as applicable, as set 
forth in 27 CFR part 1.
    Proposed Sec. Sec.  4.223, 5.223, and 7.223 set forth TTB's 
authority to compromise liability for a violation of 27 U.S.C. 205 upon 
payment of a sum not in excess of $500 for each offense. This payment 
is to be collected by the appropriate TTB officer and deposited into 
the Treasury as miscellaneous receipts.
    By placing these provisions in the regulations, TTB will make it 
easier for a person to locate the penalties for violating the FAA Act 
and the regulations implementing the FAA Act. These proposed 
regulations will not change the criminal penalty and compromise 
provisions, which are set forth in the statute.
14. Subpart N--Paperwork Reduction Act
    The Office of Management and Budget (OMB) assigns control numbers 
to TTB's information collection requirements. In current parts 4, 5, 
and 7, the OMB control numbers, in some instances, are listed at the 
end of the sections that impose the respective information collection 
requirements. TTB believes that industry members will have an easier 
time locating OMB control numbers for information collection 
requirements if they are listed in one location. Therefore, proposed 
subpart N for parts 4, 5, and 7 contains a listing of those sections of 
proposed part 4, 5, or 7, as the case may be, that impose an 
information collection requirement along with the assigned OMB control 
number.

C. Proposed Changes Specific to 27 CFR Part 4 (Wine)

    In addition to the changes discussed in section II B of this 
document that apply to more than one commodity, TTB is proposing 
additional editorial and substantive changes specific to the wine 
labeling regulations in part 4. This section will not repeat the 
changes already discussed in section II B of this document. 
Accordingly, if a proposed change is not discussed in this section, 
please consult section II B. The substantive changes that are unique to 
part 4 are described below.
1. WWTG Labeling Protocol
    As described below, TTB is proposing to make several liberalizing 
changes to the wine labeling regulations in part 4 to conform to 
international commitments. TTB believes that these changes will 
increase flexibility in labeling for bottlers and importers of wine, 
while providing consumers with more information about the wine that 
they are purchasing.
    The World Wine Trade Group (WWTG), which was founded in 1998, is an 
informal grouping of government and industry representatives from 
Argentina, Australia, Canada, Chile, the Republic of Georgia, New 
Zealand, South Africa, and the United States. The group shares 
information and collaborates on a variety of international issues to 
create new opportunities for wine trade.
    The WWTG Agreement on Requirements for Wine Labeling 
(``Agreement'') was initialed on September 20, 2006, and was signed in 
Canberra, Australia, on January 23, 2007, by the United States and 
other governments. This is an executive agreement and not a treaty. A 
full copy of the agreement can be viewed at http://ita.doc.gov/td/ocg/WWTGlabel.pdf. Negotiations of the Agreement proceeded from the view 
that common labeling requirements would facilitate trade by providing 
industry members with the opportunity to use the same label when 
shipping wine to each of the WWTG member countries.
    To conform to Article 6 of the Agreement, which requires the 
parties to the Agreement to allow information regarding alcohol content 
and certain other common mandatory information to be placed anywhere on 
a label in a ``single field of vision,'' TTB engaged in rulemaking to 
eliminate the requirement in the TTB regulations that alcohol content 
be stated on the brand label. See T.D. TTB 114 (78 FR 34565, June 10, 
2013). After the rulemaking was completed, the United States deposited 
its instrument of acceptance on October 1, 2013, and became a Party to 
the Agreement on November 1, 2013.
    Under the Agreement, the Parties agreed to continue to discuss 
labeling requirements concerning tolerances in alcohol content 
statements, vintage wine, grape variety designations, and wine regions, 
with a view to concluding an additional agreement on labeling. This 
additional agreement--the Labeling Protocol--was signed on March 22, 
2013, by several Governments other than the United States, and entered 
into force on November 1, 2013. A full copy of the Labeling Protocol 
can be found at http://ita.doc.gov/td/ocg/protocol.pdf. Because some of 
the existing labeling regulations in parts 4, 5 and 7 are inconsistent 
with the terms of the Labeling Protocol, TTB must engage in rulemaking 
on some of the issues addressed in the Protocol. We intend to address 
those issues in this proposed rule.
    The Labeling Protocol reflects labeling requirements concerning 
tolerances in alcohol content statements, vintage wine, grape variety 
designations, and wine regions that are consistent with U.S. efforts to 
remove trade barriers. The Labeling Protocol will allow U.S. wine 
producers to export more easily to parties to the Agreement that have 
more restrictive labeling standards than the United States.
    The proposed changes relating to the Labeling Protocol, as well as 
the other substantive changes that are unique to part 4 are described 
below, by subpart.
2. Subpart A--General Provisions
    Proposed subpart A includes several sections that have general 
applicability to part 4, including a revised definitions section, a 
section that defines the territorial extent of the regulations, 
sections that set forth to whom and to which products the regulations 
in part 4 apply, a section that identifies other regulations that 
relate to part 4, and sections that address administrative items such 
as forms and delegations of the Administrator.
    a. Definitions. Proposed Sec.  4.1, which covers definitions of 
terms used in part 4, is consistent with the current regulatory text 
that appears in Sec.  4.10, with some amendments in addition to those 
discussed in section II B of this preamble.
    TTB is proposing to add definitions of the following terms: 
``brix,'' ``county,'' ``fully finished,'' and ``grape wine.'' These 
terms are used throughout part 4.
    The proposed rule defines the term ``brix'' as ``[t]he quantity of 
dissolved solids expressed as grams of sucrose in

[[Page 60582]]

100 grams of solution at 68 degrees Fahrenheit. (20 degrees Celsius) 
(Percent by weight of sugar).'' This definition is derived from and is 
consistent with 27 CFR 24.10, with the exception of changing a 
typographical error currently found in section 24.10 of ``60 degrees'' 
to the correct temperature of ``68 degrees.'' TTB intends to correct 
the definition in Sec.  24.10 in a separate rulemaking document.
    The current and proposed regulatory texts use the term ``county'' 
when providing for authorized appellations of origin. TTB has been 
asked by many industry members if the term ``county'' includes other 
political subdivisions that are equivalent to a county, such as a 
``parish'' in Louisiana. The proposed rule defines the term ``county'' 
to include a county or a political subdivision recognized by the State 
as a county equivalent. This proposed definition will allow the use of 
names of county equivalents as appellations of origin.
    The current and proposed regulatory texts use the term ``fully 
finished'' when setting forth requirements for labeling wine with an 
appellation of origin. For example, one of the conditions in current 
Sec.  4.25(b)(1)(ii) is that ``the wine has been fully finished (except 
for cellar treatment pursuant to Sec.  4.22(c), and blending that does 
not result in an alteration of class or type under Sec.  4.22(b)) in 
one of the labeled appellation States.'' The parenthetical statement 
after ``fully finished'' appears all three times that term is used in 
part 4. Accordingly, TTB is defining the term ``fully finished'' as 
``Ready to be bottled, except that it may be further subject to the 
practices authorized in Sec.  4.154(c) and to blending that does not 
result in an alteration of class or type under Sec.  4.154(b).''
    The proposed regulatory text uses the term ``grape wine'' to 
include still grape wine, sparkling grape wine, and carbonated grape 
wine. The proposed definition reflects the name change of current class 
one grape wine to still grape wine, but allows for use of an umbrella 
term when referring to still grape wine, sparkling grape wine, and 
carbonated grape wine.
    The proposed rule also amends the current definitions of the 
following terms: ``bottler,'' ``pure condensed must,'' ``total 
solids,'' and ``wine.''
    The current definition of the term ``bottler'' reads as ``[a]ny 
person who places wine in containers of four liters or less.'' TTB is 
proposing to remove the size restriction associated with the current 
definition to denote that a person filling containers of any size is 
considered a ``bottler.'' This change will allow industry members to 
use the term ``bottled'' rather than ``packed'' on labels of wine in 
containers larger than 4 liters. For example, the industry member may 
use ``bottled by ABC winery, Sutton, Massachusetts'' rather than 
``packed by ABC winery, Sutton, Massachusetts'' as the mandatory 
address statement for a five-liter container. TTB is also proposing to 
replace the word ``person'' with the phrase ``[a]ny producer or blender 
or wine, proprietor of bonded wine premises, or proprietor of a taxpaid 
wine bottling house'' to better define those who are eligible to bottle 
wine. The proposed rule amends the term ``bottler'' to read as ``[a]ny 
producer or blender of wine, proprietor of bonded wine premises or 
proprietor of a taxpaid wine bottling house, who places wine in 
containers.''
    The proposed rule amends the definition of the term ``pure 
condensed must'' by removing the word ``balling'' and replacing it with 
the word ``brix'' because the word ``brix'' is more commonly used by 
the industry. The terms ``balling'' and ``brix'' are synonymous.
    The proposed rule amends the definition of the term ``total 
solids'' by adding the words ``with water'' at the end of this 
definition to clarify that restoring wine to its original volume must 
be done with water.
    The proposed rule amends the definition of ``wine'' under the FAA 
Act by making clarifying changes, consistent with the definition of 
``wine'' in 27 CFR part 1. This is a technical change and does not 
alter the current meaning of ``wine'' in part 4.
    b. Prohibitions and jurisdictional limits. Proposed Sec.  4.3 sets 
forth the general requirements and prohibitions under 27 U.S.C. 205(e). 
This repeats the essential elements of the prohibitions found in 
current Sec.  4.30, and clarifies that the regulations that prohibit 
the alteration of labels apply to persons holding wine for sale.
    c. Products that are not ``wine'' under the FAA Act. Proposed 
Sec. Sec.  4.5 and 4.6 are new provisions that indicate which wines are 
covered by part 4 and which wine products are not covered by part 4. 
TTB receives many inquiries on this issue, and TTB believes that 
including this information in the regulatory text will be helpful to 
its readers.
    Certain winery products that may be taxed as wine under the IRC do 
not fall within the definition of ``wine'' under the FAA Act, as found 
in 27 U.S.C. 211(a)(6), because of the differences between the two 
statutes. Thus, proposed Sec.  4.5 clarifies that wine under part 4 
contains at least 7 percent and not more than 24 percent alcohol by 
volume. Proposed Sec.  4.6(a) clarifies that part 4 does not cover 
products that would otherwise meet the definition of wine except that 
they contain less than 7 percent alcohol by volume. The proposed rule 
states that bottlers and importers of alcohol beverages that do not 
fall within the definition of malt beverages, wine, or distilled 
spirits under the FAA Act should refer to the applicable labeling 
regulations for foods issued by the FDA. Proposed Sec.  4.6(b) 
clarifies that products that would otherwise meet the definition of 
wine except that they contain more than 24 percent alcohol by volume 
are classified as distilled spirits and must be labeled in accordance 
with 27 CFR part 5.
    Proposed Sec.  4.6 also includes a cross reference to Sec.  4.7, 
which refers to labeling requirements under the ABLA and the IRC.
3. Subpart E--Mandatory Label Information
    a. Brand labels. Currently, the TTB regulations at Sec.  4.32 
require that certain information appear on the brand label of a wine 
container, while other mandatory information, and any additional 
information, may appear on any label. The brand label is defined in 
Sec.  4.10 as ``[t]he label carrying, in the usual distinctive design, 
the brand name of the wine'' and, under current Sec.  4.32, the brand 
name, class or type designation, and statement of the percentage of 
foreign wine in a blend of American and foreign wines (where a 
reference is made to the presence of foreign wine on the label), must 
appear on the brand label. Other mandatory information may appear on 
any label.
    In practice, however, a brand label may wrap nearly or entirely 
around a bottle or other wine container. As a result, mandatory 
information may appear anywhere on certain bottles and containers. 
Furthermore, if the label bearing the brand name is on the back of the 
container, then it is the brand label.
    TTB believes that the current regulations requiring that certain 
mandatory information be placed on the brand label of wine containers 
are unduly restrictive. TTB believes that consumers are used to looking 
at the back and neck labels to find mandatory information on 
containers.
    Accordingly, TTB is proposing to amend the regulations in proposed 
Sec.  4.63 to allow mandatory information to appear on any label on a 
wine container.
    b. Brand names. Proposed Sec.  4.64 consolidates certain existing 
regulations with regard to brand names and puts

[[Page 60583]]

them in one section of the regulations. Current Sec.  4.32 requires 
that a brand name be placed on labels of wine. What may be used as a 
brand name is specified in Sec.  4.33. The current Sec.  4.39(i) 
pertains to geographical brand names. The proposed rule moves these 
provisions to proposed Sec.  4.64(c) without substantive changes.
    TTB believes that placing the provisions pertaining to geographical 
brand names with the other provisions pertaining to brand names will 
enable industry members to find and understand the regulations 
pertaining to brand names more easily.
    c. Alcohol content and the WWTG Labeling Protocol. Under TTB's 
current regulations in Sec.  4.36, the required alcohol content 
statement for wine may be expressed as a percentage of alcohol by 
volume, or as a range, subject to certain requirements. However, the 
percentage of alcohol by volume is not required to be specifically 
listed on the label if the type designation ``table'' or ``light'' wine 
appears on the label. Subject to certain restrictions, a tolerance of 
one percentage point is allowed for alcohol content statements of wines 
containing more than 14 percent alcohol by volume, and a tolerance of 
1.5 percentage points is allowed for wines containing 14 percent or 
less alcohol by volume. One of the current exceptions to the tolerance 
provision states that the alcohol content statement on a wine label 
must correctly indicate both the taxable grade of the wine and the 
class and type of the wine if alcohol content is part of the definition 
of the class and type.
    Pursuant to Article 4.1(b) of the WWTG Labeling Protocol, the 
United States has agreed to accept alcohol content tolerances of up to 
one percentage point, provided that the alcohol content statement must 
correctly indicate the tax category, regardless of tolerance levels. 
This is consistent with current regulations, except that it allows the 
use of a tolerance in cases that cross over minimum and maximum alcohol 
content levels for labeling designations, as long as this would not 
affect the tax category.
    Accordingly, proposed Sec.  4.65 maintains the current tolerance 
levels for alcohol content statements in wine, and maintains the 
current exception to the tolerance levels for alcohol content 
statements related to maximum and minimum alcohol contents for tax 
classifications under 26 U.S.C. 5041. The proposed rule allows the 
tolerance levels to apply to alcohol content statements that might 
affect the correct class and type designation, w unless the class or 
type designation reflects a minimum or maximum alcohol content 
requirement consistent with requirements set forth in a tax class.
    An example of a class or type designation that reflects an alcohol 
content requirement consistent with a requirement set forth in a tax 
classification is ``table wine.'' The class and type designation 
``table wine'' for a still grape wine is a designation that reflects a 
maximum alcohol content of 14 percent alcohol by volume, which is 
consistent with the maximum alcohol content for a tax classification 
for still wine under 26 U.S.C. 5041. Under current and proposed 
regulations, grape wine that is labeled as ``table wine'' need not bear 
a numerical alcohol content statement. Thus, the designation ``table 
wine'' on a label serves two purposes--it reflects the class and type 
designation of the wine, and it reflects the alcohol content for tax 
classification purposes. Accordingly, under the proposed rule, a still 
grape wine that contains 14.2 percent alcohol by volume would not 
receive the benefit of the tolerance to the extent that the wine may 
not be labeled either as a ``table wine'' or with an alcohol content of 
14 percent or less, regardless of the tolerance prescribed in this 
section.
4. Subpart F--Restricted Labeling Statements
    Proposed Subpart F--Restricted Labeling Statements, includes 
specific rules for the use of certain statements on labels, including 
statements regarding allergens, the term ``organic,'' and other 
specific statements. The following discussion sets out some of the more 
important provisions in proposed subpart F that relate specifically to 
wine.
    a. Permit numbers. Current Sec.  4.39(e)(2) sets forth specific 
format rules for stating optional bonded wine cellar and bonded winery 
numbers (for example, ``Bonded Wine Cellar No. __'' or ``B.W. No. 
__''). TTB believes these format rules are unnecessarily restrictive 
and proposes to delete them. However, proposed Sec.  4.86 retains the 
requirement that the permit number appear adjacent to the name and 
address of the person operating the wine cellar or winery.
    b. Use of vineyard, orchard, farm or ranch names. Current Sec.  
4.39(m) provides that the use of vineyard, orchard, farm, or ranch 
names can only be used if 95 percent of the wine is produced from 
primary winemaking material grown on the named vineyard, orchard, farm, 
or ranch. This section further provides that if the name has 
geographical or viticultural significance, it is subject to the rules 
in Sec. Sec.  4.39(i) and 4.39(b), which pertain to names having 
geographical significance.
    Consistent with current policy, TTB is proposing to liberalize the 
current regulations on the use of vineyard, orchard, farm, or ranch 
names to allow the use of those names as part of trade names that are 
found on labels. It has been TTB's policy to allow the use of trade 
names in name and address statements, such as ``Bottled by John Doe 
Vineyards, Seattle, Washington,'' where the wine has not been made from 
grapes grown in the referenced vineyard (or even where there is no 
vineyard with that name). Furthermore, when such a trade name appears 
on the label as part of the bottling address, it may also be used as a 
brand name on the label, without meeting the 95 percent requirement. 
TTB believes that consumers do not see the use of a vineyard, orchard, 
farm or ranch name as part of a trade name as making a claim as to the 
source of the grapes, fruit, or other agricultural products used to 
make the wine.
    Accordingly, the revision to these provisions in proposed Sec.  
4.87 clarifies that the 95 percent rule does not apply to trade names 
or brand names when the vineyard, orchard, farm, or ranch name is shown 
in the mandatory name and address statement on the label. TTB is 
retaining the provision that, when used in a brand name, a vineyard, 
orchard, farm, or ranch name having geographical or viticultural 
significance is subject to the requirements of proposed Sec.  4.64(b) 
and (c).
    c. Appellations of origin. Proposed Sec. Sec.  4.88 through 4.91 
set out the rules for appellations of origin for grape wines. Proposed 
Sec. Sec.  4.96 through 4.98 set out the rules for appellations of 
origin for fruit wines, agricultural wine, and rice wine. As discussed 
in more detail below, TTB is proposing to separate out these rules to 
make it easier to locate all of the rules applicable to grape wine and 
fruit wine, respectively.
    Current Sec.  4.25 sets forth rules governing the minimum 
percentage of fruit or other agricultural products that must be grown 
within a specific geographic area in order to qualify for the use of an 
appellation of origin on a wine label. It also imposes other standards 
for use of an appellation of origin; for example, the wine must 
generally conform to the standards of the named appellation governing 
the composition, method of manufacture, and designation of wines made 
in such place.
    TTB is proposing to include the appellation of origin requirements 
in several sections and incorporate other

[[Page 60584]]

changes as discussed below. In addition to stating what constitutes the 
use of an appellation of origin, proposed Sec.  4.88(d) clarifies that 
an appellation of origin is required when a grape wine is designated 
with a varietal (grape type) designation, a type designation of 
varietal significance, or a semi-generic type designation, or when the 
wine is labeled with a vintage date. These requirements are currently 
found in the class and type regulations in Sec.  4.34.
    Current Sec.  4.25(d) provides that an appellation of origin 
comprising two or no more than three States which are all contiguous 
may be used if: (1) All of the fruit or other agricultural products 
were grown in the States indicated, and the percentage of the wine 
derived from fruit or other agricultural products grown in each State 
is shown on the label, with a tolerance of plus or minus 2 percent; (2) 
the wine has been fully finished (except for cellar treatment pursuant 
to Sec.  4.22(c), and blending which does not result in an alteration 
of class or type under Sec.  4.22(b)) in one of the labeled appellation 
States; and (3) the wine conforms to the laws and regulations governing 
the composition, method of manufacture, and designation of wines in all 
the States listed in the appellation.
    In ATF Ruling 91-1, TTB's predecessor agency held that a multistate 
appellation of origin cannot be used if conflicting State requirements 
preclude conformance with the laws and regulations of all the States 
listed in the appellation of origin. ATF also held that, where a 
multistate appellation of origin appears on the brand label and the 
percentage of the wine derived from grapes grown in each State is 
listed on a label other than the brand label, the States in the 
multistate appellation of origin must be listed in a descending order 
of predominance, according to the percentage of the wine derived from 
grapes grown in each State. Where both the multistate appellation of 
origin and the listing of the percentage of the wine derived from 
grapes grown in each State appear on the brand label, ATF stated that 
it would carefully scrutinize the placement and size and type of the 
label statements, on a case-by-case basis, to ensure that the label 
does not tend to create a misleading impression as to the origin of the 
wine.
    Current Sec.  4.25(d) also provides for imported wines to be 
labeled with an appellation of origin that is comprised of the names of 
two or no more than three states, provinces, territories, or similar 
political subdivisions of a country equivalent to a state, which are 
all contiguous. The appellation may be used if all of the fruit or 
other agricultural products were grown in the states, provinces, 
territories, or similar political subdivisions of a country equivalent 
to a state indicated, and the percentage of the wine derived from fruit 
or other agricultural products grown in each state, province, 
territory, or similar political subdivision of a country equivalent to 
a state is shown on the label with a tolerance of plus or minus 2 
percent. Furthermore, the wine must conform to the requirements of the 
foreign laws and regulations governing the composition, method of 
production, and designation of wines available for consumption within 
the country of origin.
    In accordance with the WWTG Labeling Protocol, discussed earlier in 
this preamble, the proposed rules pertaining to multicounty and 
multistate appellations of origin for both domestic and imported wine 
in proposed Sec.  4.90 would: (1) Remove the requirement that States 
(or political subdivisions for imported wine) be contiguous in order to 
claim that the wine is produced from grapes grown in more than one 
State; (2) reduce the minimum percentage of grapes from 100 percent to 
85 percent for wine to be labeled with such an appellation; (3) remove 
the requirement that the percentage of the wine derived from grapes 
grown in each State (or political subdivisions for imported wine) must 
be shown on the label; (4) add the requirement that the amount of wine 
derived from grapes grown in each State (or political subdivision for 
imported wine) named in the appellation must be greater than the amount 
of wine derived from grapes grown in any State not named in the 
appellation; and (5) add the requirement that States (or political 
subdivisions for imported wine) be listed in descending order according 
to the percentage of wine derived from grapes grown in those States (or 
political subdivisions for imported wine).
    These amendments are liberalizing in several regards. First, they 
would permit the use of such an appellation where at least 85 (rather 
than 100) percent of the wine is derived from grapes grown within the 
areas named in the appellation. Second, they would eliminate the 
requirement to list the percentage of grapes from each State or other 
region, thus allowing greater flexibility in blending for producers. 
TTB notes that this approach is more consistent with regard to the 
rules for single appellations of origin, which may be comprised of not 
less than 75 percent wine made from grapes grown in the labeled region 
(in the case of an appellation that is a State, county, or similar 
political subdivision), or 85 percent (in the case of an appellation 
that is a viticultural area), without any requirements for identifying 
the percentage of grapes coming from outside of the named appellation.
    TTB also notes that the proposed requirements with regard to 
listing States and counties in descending order of predominance are 
largely consistent with the policy set forth in ATF Ruling 91-1, and 
supersedes that ruling. Finally, the proposed requirement will not 
require the listing of each State or county (or foreign equivalent) on 
the label; however, labels may not, for example, selectively include 
States that contributed only a small percentage of grapes while leaving 
out States that contributed a larger percentage of grapes. For example, 
in a case where grapes used to make a wine were grown in 4 States, with 
the first 2 States contributing 45 and 40 percent, respectively, the 
third State contributing 12 percent and the fourth State contributing 3 
percent, the proposed rule requires the listing of the first 2 States, 
in order of predominance, leaving it up to the industry member whether 
it wanted to include a third State. However, the third State listed on 
the label would have to be the State contributing 12 percent, and not 
the State contributing 3 percent, even though in either case, the 
States listed would contribute more than 85 percent of the grapes used 
to make the wine. The industry member could, of course, choose to list 
all 4 States on the label.
    Under the proposed rule, a multistate appellation of origin for 
American wine would continue to be unavailable unless the wine is fully 
finished in one of the labeled appellation States, and the wine 
conforms to the laws and regulations governing the composition, method 
of manufacture, and designation of wines in all of the States listed in 
the appellation, which is consistent with the current regulations.
    In general, the current regulations provide that wine derived from 
fruit or agricultural products grown in the county or State indicated 
on the label may be designated with an appellation of origin. This 
means that appellations of origin are available to grape wine as well 
as citrus wine, fruit wine, and agricultural wine.
    TTB is proposing to separate the appellation of origin requirements 
for grape wine from those requirements for fruit and agricultural wine 
because an appellation of origin becomes mandatory when grape wine is 
labeled with certain type designations or a vintage date. Furthermore, 
an appellation of origin for grape wine

[[Page 60585]]

includes viticultural areas, which have no relevance for fruit or 
agricultural wine. Otherwise, TTB is proposing the same liberalizing 
amendments for wines labeled with appellations of origin, regardless of 
whether the wines are made from grapes, other fruit, or other 
agricultural products.
    d. Estate bottled and estate grown. Proposed Sec. Sec.  4.92 and 
4.93 set out the rules for use of the claims ``estate bottled'' and 
``estate grown.'' While the ``estate bottled'' rules are unchanged, 
except for clarifying changes, the proposed ``estate grown'' regulation 
is new, and represents a change in policy.
    On November 3, 2010, TTB published Notice No. 109, an advance 
notice of proposed rulemaking (ANPRM), that set forth TTB policy 
regarding the use of the term ``estate grown'' on wine labels and 
requested comments (see 75 FR 67666). Specifically, TTB stated that, 
for over twenty years, TTB and its predecessor agency have allowed the 
term ``Estate grown'' to be used as a synonym for the term ``Estate 
bottled.'' The regulations providing for the use of the term ``Estate 
bottled'' are found in current Sec.  4.26 and, in general, allow the 
use of that term only if the wine is labeled with a viticultural area 
appellation of origin and the bottling winery: (1) Is located in the 
labeled viticultural area; (2) grew all of the grapes to make the wine 
on land owned or controlled by the winery within the boundaries of the 
labeled viticultural area; (3) crushed the grapes, fermented the 
resulting must, and finished, aged, and bottled the wine in a 
continuous process (the wine at no time having left the premises of the 
bottling winery).
    Notice No. 109 explained that some industry members had requested 
that TTB permit the use of the words ``Estate grown'' on labels of 
wines that do not meet the ``Estate bottled'' standards in Sec.  4.26. 
TTB invited comments from industry members, consumers, and other 
interested parties on whether TTB should propose to amend the 
regulations to reflect its current policy that ``Estate grown'' may be 
used on a label if the wine meets the requirements for products labeled 
``Estate bottled'' under Sec.  4.26. TTB also asked if it should 
propose a standard for ``Estate grown'' in the regulations that differs 
from that specified for ``Estate bottled'' and, if so, what that 
standard should be.
    TTB received 16 comments in response to its questions pertaining to 
the use of ``Estate grown'' on labels. Only four of the comments were 
in support of TTB's policy that ``Estate grown'' may be used on the 
label only if the wine meets the requirements for products labeled 
``Estate bottled.'' A few of the comments were in support of TTB 
codifying its existing policy, and one commenter stated its belief that 
all aspects of the ``Estate bottled'' requirements should apply to the 
term ``Estate grown,'' except for the requirement of the viticultural 
area. Most of the comments suggested that ``Estate bottled'' and 
``Estate grown'' are not synonymous.
    In this rulemaking document, TTB is proposing to add a section to 
the regulations that will provide for the use of the term ``Estate 
grown'' (see Sec.  4.93) on a label only if all of the following 
conditions are met:
    (1) The wine is labeled with an appellation of origin;
    (2) The producing winery is located within the appellation of 
origin;
    (3) The producing winery grew all of the grapes used to make the 
wine on land owned or controlled by the producing winery within the 
boundaries of the appellation of origin, and fermented 100 percent of 
the wine from those grapes; and
    (4) If the bottling winery is not the producing winery, the label 
must state that the wine was ``estate grown'' by the producing winery, 
and the name and address of both wineries must appear on the label. An 
acceptable labeling statement would be ``Estate grown and produced by 
ABC Winery, Seattle, Washington. Bottled by XYZ Winery, Tacoma, 
Washington.''
    This is a liberalizing change that will allow the use of the term, 
``Estate grown,'' in a way that distinguishes grape growing from 
bottling operations.
    e. Claims on grape wine labels for viticultural practices that 
result in sweet wine. Proposed Sec.  4.94 codifies in the regulations 
for the first time the position that TTB's predecessor agency set out 
in rulings pertaining to viticultural practices that result in sweet 
wine. TTB proposes to supersede ATF Rulings 78-4, 82-4, and 2002-7, by 
incorporating the rulings' holdings in proposed Sec.  4.94.
    Initially, proposed Sec.  4.94(a) sets out the rules for using 
certain terms on grape wine that denote the use of viticultural 
practices resulting in sweet wine. In all such cases, the wine must 
also be labeled with the amount of sugar contained in the grapes at the 
time of harvest and with the amount of residual sugar in the finished 
wine.
    Proposed Sec.  4.94 provides that the term ``ice wine'' may be used 
only to describe wines produced exclusively from grapes that have been 
harvested after they have naturally frozen on the vine. The proposed 
rule provides that wine produced from grapes that were frozen post-
harvest may not be labeled as ``ice wine,'' but may be labeled with a 
statement indicating the wine was made from grapes that were frozen 
post-harvest. It provides that wines labeled with the term ``ice 
wine,'' ``late harvest,'' or ``late picked'' may not be ameliorated, 
concentrated, fortified, or produced from concentrate. Finally, 
proposed Sec.  4.94 provides that wine made from grapes that have been 
infected with the botrytis cinerea mold may be labeled with a term such 
as ``Botrytis Infected,'' ``Pourriture Noble,'' or another name for 
infection by the botrytis cinerea mold.
    f. Vintage dates for grape wine. Proposed Sec.  4.95 sets out the 
rules for the use of vintage dates on wine labels. The current 
regulations prescribing requirements for labeling grape wine with 
vintage dates are found in Sec.  4.27. These regulations characterize 
the vintage date as the year of ``harvest.'' Thus, wine produced from 
grapes that were grown in 2012 but harvested early in 2013 must bear 
the year 2013 as the vintage date.
    However, the WWTG Labeling Protocol provides that ``vintage'' is 
the year of growth or harvest of the grapes used to make the wine, as 
defined in each Party's laws, regulations, or requirements. The current 
definition in TTB's regulations is thus more restrictive than the 
definitions found in the Labeling Protocol.
    TTB recognizes that other countries have different rules for 
vintage dates, based on different growing conditions in different parts 
of the world. For example, in the Southern Hemisphere, the growing 
season may start in September and end in April, and thus includes parts 
of two calendar years. In Australia, the labeling rules provide that 
grapes harvested between September 1 and December 31 of a particular 
calendar year are treated as if they were harvested in the following 
calendar year for purposes of a vintage declaration. This effectively 
treats the entire growing season as a single year. In the Northern 
Hemisphere, the issue is less likely to arise, but does come up with 
regard to grapes that may be harvested in January for an ice wine type 
of product.
    TTB believes that allowing the year of harvest to be determined 
based on the rules of the country of origin will not be misleading to 
consumers. Accordingly, we are proposing to amend the regulations to 
provide that the year of harvest for imported wines will be determined 
in accordance with the country of origin's laws and regulations.
    TTB proposes to remove the requirement that a person who wishes to 
label wine with a vintage date must possess appropriate records from 
the producer substantiating the year of

[[Page 60586]]

vintage and the appellation of origin, because the substantiation 
requirements apply to all label claims, not just vintage dates.
    TTB proposes to liberalize the requirements for imported wines that 
are bottled in the United States, by removing the requirement that such 
wines must have been bottled in containers of 5 liters or less prior to 
importation, or that they be bottled in the United States from the 
original container of the product showing a vintage date. This will 
allow the use of vintage dates on wine imported in bulk containers and 
bottled in the United States, as long as the bottlers have the 
appropriate documentation substantiating that the wine is entitled to 
be labeled with a vintage date.
    The current regulations also provide that wine bearing a vintage 
date must also bear an appellation of origin that is shown in direct 
conjunction with the type designation as required by Sec.  4.32(a)(2). 
As discussed in the grape wine appellation of origin section of this 
preamble, this rule would remove the requirement that the appellation 
of origin be shown in direct conjunction with the type designation. 
Instead, the appellation of origin would have to be shown in the same 
field of vision as the type designation.
    The regulations in current Sec.  4.27 also provide that for a wine 
to be labeled with a ``vintage date,'' it must have been derived from 
grapes harvested in the labeled calendar year. It has been TTB's 
longstanding policy that only one vintage date may appear on a label, 
even if the wine is made from grapes harvested in different years. We 
note that in 1980, in response to a petition, ATF aired a proposal to 
allow multiple vintage dates in an advance notice of proposed 
rulemaking (see Notice No. 357, November 13, 1980, 45 FR 74942). 
Comments on that proposal were evenly divided, and subsequently ATF 
issued a notice of proposed rulemaking setting forth specific proposals 
(Notice No. 378, August 5, 1981, 46 FR 39850). Because only a few 
comments (mainly opposed to allowing multiple vintage dates on labels) 
were received in response to that document, on May 18, 1984, ATF 
published Notice No. 529, which withdrew the proposal (49 FR 21083). We 
do not intend to reopen this issue at the present time. Accordingly, 
TTB proposes to codify this policy in proposed Sec.  4.95.
    g. Appellations of origin for fruit wine, agricultural wine, and 
rice wine. As discussed earlier in this preamble, current Sec.  4.25 
prescribes the rules for use of appellations of origin and allows wine 
produced from ``fruit or agricultural products'' to bear an appellation 
of origin. Proposed Sec. Sec.  4.96 through 4.98 for labeling fruit 
wine, agricultural wine, or rice wine contain the same appellation of 
origin labeling requirements as are proposed elsewhere for labeling 
grape wine. See Sec. Sec.  4.88 through 4.99.
5. Subpart H--Labeling Practices That Are Prohibited if They Are 
Misleading
    Proposed subpart H sets forth certain labeling practices that are 
prohibited if they are used in a misleading way. Most of these subpart 
H provisions restate and reorganize rules currently found in the TTB 
regulations. Some of the proposed revisions are set forth below.
    Proposed Sec.  4.133(a) broadens existing language in current Sec.  
4.39(a)(8) to prohibit the use of terms defined in part 4 in a manner 
that is not consistent with the part 4 definitions. This would include 
optional designations as well as mandatory designations. For example, 
under the proposed rule, a wine that was produced from grapes that were 
not frozen on the vine may not be labeled with the optional claim ``ice 
wine.'' Proposed Sec.  4.133(b) prohibits the use of coined words that 
simulate or imitate any class or type designation set forth in parts 4, 
5 and 7 unless the wine conforms to the requirements prescribed with 
respect to such designation and is in fact so designated on its labels.
    Finally, proposed Sec.  4.133(c) and (d) prohibit certain 
misleading references to grape varieties and statements of harvest 
date, respectively, subject to the provisions of proposed Sec. Sec.  
4.136 and 4.134, respectively, as discussed below.
    In general, proposed Sec.  4.134 restates the existing rules 
prohibiting certain statements of age unless they are made on a label 
that bears a vintage date. It allows certain miscellaneous date 
statements, such as statements about the date on which a business was 
founded. It also specifically states that, subject to certain 
exceptions discussed below, the use of harvest or growth dates is not 
generally authorized for wines other than those labeled with a vintage 
date in accordance with proposed Sec.  4.95.
    Proposed Sec.  4.134 liberalizes current TTB policy prohibiting 
statements relating to the years of harvest of grapes or fruit as 
additional information for wines designated as grape wine or fruit 
wine. Accordingly, the proposed regulations allow the use of additional 
truthful, accurate, and specific information about the year of harvest 
of the grapes or fruit, provided that the label indicates the 
percentage of wine derived from grapes or fruit, as applicable, 
harvested in each year. If applicable, the years of harvest must be 
presented in descending order based on the percentage of wine derived 
from grapes or fruit, as applicable, grown in each year. Examples of 
allowable statements would be as follows: ``60% of the grapes used to 
make this wine were harvested in 2014; the remaining 40% were harvested 
in 2013,'' or ``This wine is a blend of 50% wine made from apples 
harvested in 2012 and 50% wine made from apples harvested in 2011.''
    Proposed Sec.  4.135 is derived from current Sec.  4.39(k) and in 
general, continues to prohibit misleading references to the origin of 
the wine. The proposed section liberalizes TTB's current policy by 
specifically authorizing the use of truthful, accurate, and specific 
information about the origin of the grapes, fruit, or other 
agricultural materials that were used to produce the wine when such 
wine is not labeled with an appellation of origin. The name of the 
place may not appear on the label in a way that creates the misleading 
impression that the wine is entitled to an appellation of origin.
    Under both current and proposed regulations, a wine is entitled to 
the name of a State as an appellation of origin if, among other things, 
at least 75 percent of the wine is derived from fruit or agricultural 
products grown in that State, and it has been fully finished (except 
for certain cellar treatment and blending) within the labeled State or 
an adjacent State. Thus, if a grape wine is made in New York, and 50 
percent of the grapes are grown in New York and the other 50 percent 
are grown in Virginia, the wine would not be entitled to either a New 
York or a Virginia appellation of origin. Furthermore, the wine would 
not be entitled to a multistate appellation of origin, because New York 
and Virginia are not contiguous.
    Under the proposed regulations, the label for such a wine may 
include additional information about where the grapes were grown, even 
though the wine is not entitled to either a New York or a Virginia 
appellation of origin. However, neither state name can stand alone as 
though the wine is entitled to a single state appellation of origin, 
nor can the wine be designated as ``New York/Virginia wine.'' The 
additional information must set forth the origin of 100 percent of the 
grapes, fruit or other agricultural products used to make the wine, in 
descending order of predominance, together with the place where the 
wine was fermented. This will ensure that the consumer is not misled 
into believing that a statement of the origin of the grapes used to 
make a grape wine is the same as an appellation of origin for that 
wine. For example, if

[[Page 60587]]

the wine in question is designated ``red wine,'' the proposed 
regulation would allow the label to include a statement such as ``This 
wine was fermented and bottled in New York from 50 percent grapes grown 
in New York and 50 percent grapes grown in Virginia.''
    Proposed Sec.  4.136(a) and 4.136(b) restate the prohibition in 
current Sec.  4.39(n) on the use of varietal names, type designations 
of varietal significance, semi-generic geographic type designations, or 
geographically distinctive designations, on wines that are not made in 
accordance with the standards set forth in the standards of identity 
for still grape wine, sparkling grape wine, and carbonated grape wine. 
The proposed language also makes it clear that the use of such names on 
a grape wine that does not meet the requirements for use of the 
designation named is prohibited if it tends to create a false or 
misleading impression as to the designation, origin, or identity of the 
wine.
    Proposed Sec.  4.136(c) codifies and supersedes ATF Ruling 85-14, 
which allowed the use of certain information about grape varieties as 
additional information on the labels of certain wines. The proposed 
regulation allows the use of truthful, accurate, and specific 
additional information on the label about the grape varieties used to 
make a still grape wine, sparkling grape wine, or carbonated grape 
wine, provided that the information includes every grape variety used 
to make the wine, listed in descending order of predominance. The 
percentage of each grape variety may be, but is not required to be, 
shown on the label, with a tolerance of two percentage points. When 
shown, percentages must be shown for all grape varieties listed, and 
the total must equal 100 percent.
    As discussed later in this document, TTB is proposing to liberalize 
the rules for use of a designation that includes more than one grape 
variety. Under this proposal, a varietal designation that includes the 
names of two or more varieties may be used without disclosing the 
percentage of the wine derived from each variety, as is currently 
required under Sec.  4.23(d). If this option is available, it is not 
clear whether industry members will still want to include information 
about grape varieties as additional information, rather than labeling 
their wines with a varietal designation that includes two or more grape 
varieties. However, TTB recognizes that many wine labels currently 
include information about grape varieties as additional information; 
thus, we are proposing to continue to allow this practice. TTB seeks 
comments on this proposal.
    TTB is proposing to eliminate the provision in current Sec.  
4.39(j) that inappropriately treats ``product names'' as if they were 
``brand names,'' and thus causes confusion. The current text allows for 
certain ``product names with specific geographical significance'' when 
qualified with the word ``brand,'' even where the geographical name 
does not accurately represent the origin of the wine. [Emphasis added.] 
TTB solicits comments on the proposed revisions with regard to 
representations as to origin. In particular, TTB requests information 
on whether this proposed change may affect current labels.
    TTB is also proposing to eliminate the provision in current Sec.  
4.39(l), which prohibits the use of foreign terms which (1) describe a 
particular condition of the grapes at the time of harvest; or (2) 
denote quality under foreign law on labels of domestically produced 
wine. TTB believes that the misleading use of such foreign terms is 
covered by the general prohibition of misleading statements or 
representations as to the age, origin, identity, or other 
characteristics of the wine (see proposed Sec.  4.122).
6. Subpart I--Standards of Identity for Wine
    a. General overview of the classes and types of wine. The 
regulations governing how wine must be identified on labels and the 
provisions for optional labeling statements are found in current 
subpart C, and are referred to as the ``standards of identity.'' 
Current Sec.  4.21 sets forth the standards of identity for wine and 
prescribes the several classes and types of wine that an industry 
member may use to designate wine. The consistent and accurate 
designation of wine leads to consumer and trade understanding of the 
quality and identity of the wine.
    Current Sec.  4.32 requires a class, type or other designation to 
appear on the brand label. The general rules for class and type 
designations are set forth in current Sec.  4.34. In general, the 
regulations require the class designation to appear on the label; 
however, certain type designations are authorized for use in place of a 
class designation. These other type designations are not specified in 
the current standards of identity but are found elsewhere in the 
regulations in part 4. For example, under current Sec.  4.23, the names 
of one or more grape varieties may be used as a type designation of a 
grape wine, subject to certain conditions. In addition to these 
varietal type designations, current Sec.  4.28 sets forth the 
conditions for use of ``type designations of varietal significance.'' 
Current Sec.  4.24 sets out the rules for ``generic,'' ``semi-
generic,'' and ``non-generic'' designations of geographic significance. 
TTB is proposing to reorganize the standards of identity so that 
proposed Sec.  4.142 includes all of the type designations within the 
class designation ``still grape wine.''
    In addition to the various designations discussed above, a 
statement of composition may be required to accompany certain class and 
type designations. For example, current Sec.  4.21(d), (e), and (f) 
prescribe the standards of identity for citrus wine, fruit wine, and 
wine from other agricultural products, respectively. These standards 
require that an adequate statement of composition be placed on the 
label, along with the appropriate class designation, when the wine is 
produced from more than one type of fruit, citrus fruit, or 
agricultural product, respectively. TTB is proposing to amend the 
regulations to allow a designation (such as ``apple-pear wine'') rather 
than a statement of composition.
    TTB is amending the standards of identity to incorporate all of the 
ways in which an industry member may designate wine in accordance with 
TTB's regulations. By indicating all of the ways an industry member 
must or may designate wine within the standards of identity, the 
proposed regulations provide better guidance on what constitutes a 
class designation or a type designation, and when a type designation 
may be used in place of a class designation.
    b. Production standards. Current Sec.  4.21 refers to numerous 
production standards that impact the way in which a wine may be 
designated. These include amelioration limits, volatile acidity levels, 
and the addition of brandy and alcohol. However, in many cases, these 
standards refer to outdated rules under chapter 51 of the Internal 
Revenue Code.
    Wine that is domestically produced must be made in compliance with 
the production standards set forth in 26 U.S.C. 5381-5387, and 
designated in accordance with 26 U.S.C. 5388. These rules are also 
found in TTB's IRC-based wine regulations in 27 CFR part 24.
    In accordance with part 24, wine that is the product of the juice 
or must of sound, ripe grapes or other sound ripe fruit (including 
berries), made with any cellar treatment authorized by subparts F and L 
of part 24 and containing not more than 21 percent by weight of total 
solids, is deemed to be ``natural wine.'' Classes 1, 2, and 3 of the 
existing regulations in current Sec.  4.21 are grape wine, sparkling 
grape wine, and carbonated grape wine, respectively,

[[Page 60588]]

and are produced by the normal alcoholic fermentation of the juice of 
sound, ripe grapes (including restored or unrestored pure condensed 
grape must), with or without the addition, after fermentation, of pure 
condensed grape must, and with or without added grape brandy or 
alcohol, but without other addition or abstraction except as may occur 
in cellar treatment. As discussed further below, TTB is proposing to 
revise the standards of identity for grape wines and for fruit wines to 
clarify that these wines must be ``natural wines'' in accordance with 
26 U.S.C. 5381-5383.
    c. Natural wine certification. Prior to amendment in 2004, section 
5382 of the IRC, 26 U.S.C. 5382(a), set forth certain standards for the 
proper cellar treatment of ``natural wine.'' That section provided that 
``proper cellar treatment of natural wine constitutes those practices 
and procedures in the United States and elsewhere, whether historical 
or newly developed, of using various methods and materials to correct 
or stabilize the wine, or the fruit juice from which it is made, so as 
to produce a finished product acceptable in good commercial practice.'' 
Section 5382(b) then went on to provide certain practices that were 
specifically recognized, including standards for the amelioration and 
sweetening of natural wine and standards for the addition of wine 
spirits to natural wine.
    Section 2002 of the Miscellaneous Trade and Technical Corrections 
Act of 2004, Public Law 108-429, 118 Stat. 2434 (``the Act''), was 
signed by the President on December 3, 2004. Section 2002 of the Act 
revised section 5382(a) of the IRC. The revision of section 5382(a) 
took effect on January 1, 2005, and involved the following principal 
substantive changes: (1) The addition of a new paragraph (1)(B) to 
provide that, in the case of wine produced and imported subject to an 
international agreement or treaty, proper cellar treatment of natural 
wine includes those practices and procedures acceptable to the United 
States under the agreement or treaty; and (2) the addition of a 
paragraph (3) setting forth a new certification requirement regarding 
production practices and procedures for imported natural wine produced 
after December 31, 2004.
    The new certification provision directs the Secretary of the 
Treasury to accept the practices and procedures used to produce the 
wine if, at the time of importation, one of the following conditions is 
met:
    (1) The Secretary has on file or is provided with a certification 
from the government of the producing country, accompanied by an 
affirmed laboratory analysis, that the practices and procedures used to 
produce the wine constitute proper cellar treatment under regulations 
prescribed by the Secretary;
    (2) The Secretary has on file or is provided with a certification 
required by an international agreement or treaty covering proper cellar 
treatment, or the wine is covered by an international agreement or 
treaty covering proper cellar treatment that does not require a 
certification; or
    (3) In the case of an importer that owns or controls or that has an 
affiliate that owns or controls a winery operating under a basic permit 
issued by the Secretary, the importer certifies that the practices and 
procedures used to produce the wine constitute proper cellar treatment 
under regulations prescribed by the Secretary.
    The certification provision went into effect on January 1, 2005. 
Effective May 28, 2008, TTB adopted a final rule implementing the 
certification requirements regarding production practices and 
procedures for imported natural wine. The regulations implementing this 
statutory requirement are found in 27 CFR 27.140, which states that, 
except as otherwise provided, an importer of natural wine must have an 
original or copy of a certification from the producing country stating 
that the practices and procedures used to produce the imported wine 
constitute proper cellar treatment in part 24. As provided for in the 
law, one exception to this requirement is for natural wines that are 
imported from countries that have an international agreement or treaty 
(enological practices agreement) with the United States specifying that 
the practices and procedures used to produce the wine are acceptable to 
the United States. Currently, 35 countries have enological practices 
agreements with the United States. These agreements exempt certain 
natural grape wines from the natural wine certification requirement.
    d. Proposed changes and questions pertaining to the standards of 
identity for wine. It is clear that the existing standards of identity 
for grape wine (including sparkling grape wine and carbonated grape 
wine), citrus wine, and fruit wine are intended to incorporate the 
standards set forth in the IRC for the sweetening and amelioration of 
natural wine, as well as the standards for the addition of wine 
spirits. However, as set forth in further detail below, because of 
amendments over time to the IRC standards, the existing regulations 
contain a patchwork of inconsistent references to current and prior 
standards.
    TTB is proposing to update these standards to clarify that these 
classes of wine must comply with the standards for ``natural wine'' set 
forth in section 5382 of the IRC. For imported wines, this means that a 
wine designated as a still grape wine, sparkling grape wine, or 
carbonated grape wine must be made in accordance with the standards set 
forth in 26 U.S.C. 5382 and 5383 for natural wine, and a wine 
designated as a fruit wine must be made in accordance with the 
standards set forth in 26 U.S.C. 5382 and 5384 for natural wine. It 
should be noted that imported wines can comply with the standards set 
forth in 26 U.S.C. 5382 if the practices used to make the wine have 
been accepted by the United States in an international agreement or 
treaty. Under the proposed rule, imported wines that are not entitled 
to a grape wine or fruit wine designation because they are not 
``natural wine'' would have to meet the standards of identity for 
another designation set forth in part 4 or be designated with a 
statement of composition.
    Proposed Sec.  4.151 restates the requirements currently found in 
Sec.  4.34(a) with regard to the designation of wines with a truthful 
and adequate statement of composition where the wine does not conform 
to any of the standards of identity found in part 4. As announced in 
the Department of the Treasury's semiannual regulatory agenda 
(available online at https://www.reginfo.gov), TTB plans to publish a 
notice of proposed rulemaking titled ``Proposals Concerning Labeling of 
Flavored Wine,'' in which TTB will propose more specific rules 
regarding the labeling of flavored wine products. Accordingly, proposed 
Sec.  4.151(c) simply states that ``the appropriate TTB officer may 
require a statement of composition to identify the base wine(s), 
including blends of wine or fermentable materials, as well as other 
materials added to the wine before, during, and after fermentation, as 
appropriate, in order to ensure that the label provides adequate 
information about the identity of the product.''
    This proposed language would not change current policy with regard 
to statements of composition on wine labels. Proposed Sec.  4.151(c) 
also sets forth current policy regarding statements of composition for 
a blend of two different types of fruit or agricultural wine. In those 
cases, the statement of composition must include of the names of the 
types of wine (such as, ``blueberry wine and apple wine'' or ``mead/
rhubarb wine'').
    TTB is proposing substantive changes that affect multiple classes 
of wine, as

[[Page 60589]]

well as several substantive changes that affect individual classes of 
wine. These changes are described below:
    i. Amelioration. Pursuant to 26 U.S.C. 5383 and 27 CFR 24.10, 
amelioration is the addition to wine or juice, of water, sugar, or a 
combination of both to reduce or balance high acid content in some 
juice and wines. Amelioration may take place before, during, or after 
fermentation. Current Sec.  4.21(a) provides three amelioration 
standards for grape wine, and current Sec.  4.21(d), (e), (f), and (g) 
provide two amelioration standards each for citrus wine, fruit wine, 
and wine from other agricultural products.
    Current Sec.  4.21(a) allows grape wine to be ameliorated before, 
during, or after fermentation either: (1) By adding, separately or in 
combination, dry sugar, or such an amount of sugar and water solution 
as will not increase the volume of the resulting product more than 35 
percent, as long as the product so ameliorated does not have an alcohol 
content derived by fermentation of more than 13 percent by volume, or a 
natural acid content, if water has been added, of less than five parts 
per thousand, or a total solids content of more than 22 grams per 100 
cubic centimeters; (2) by adding, separately or in combination, not 
more than 20 percent by weight of dry sugar, or not more than 10 
percent by weight of water; or (3) in the case of domestic wine, in 
accordance with 26 U.S.C. 5383.
    In general, the first two amelioration methods date back to the 
late 1930s and could be used for both domestic and imported wines. The 
methods conformed to the provisions of the 1939 IRC at 26 U.S.C. 3036. 
When the IRC of 1954 was enacted, new amelioration provisions were 
added. A specific reference to section 5383 of the 1954 IRC was added 
to Sec.  4.21 through the publication of T.D. 6319 (23 FR 7698) on 
October 4, 1958.
    The amelioration rule in part 24 (27 CFR 24.178) states that ``the 
fixed acid level of the juice or wine may not be less than 5.0 grams 
per liter after the addition of ameliorating material.'' However, this 
requirement only applies in part 4 if water was used as the 
ameliorating material. TTB has found that the difference in methods is 
confusing for industry members, as well as the public at large.
    Furthermore, different terminology relating to amelioration is used 
in current parts 4 and 24. Current part 4 refers to a ``natural acid 
content'' in parts per thousand, while current part 24 refers to a 
``fixed acidity level'' in grams per liter. The difference in 
terminology and units also is confusing for industry members, as well 
as the public at large.
    Accordingly, this proposed rule removes two of the three 
amelioration methods listed in the part 4 regulations. This change is 
made in proposed Sec. Sec.  4.142, 4.145, and 4.146. The proposed rule 
will clarify that grape wines, and fruit wines must all conform to the 
standards for natural wine set forth in the IRC.
    ii. Cellar treatment. The current regulations for classes 1, 4, and 
5 (grape wine, citrus wine, and fruit wine) prohibit the addition or 
abstraction (removal) of substances other than those specified in the 
standard of identity and those provided for as cellar treatment. As 
indicated above, this proposed rule will clarify that grape wine and 
fruit wine must be made according to the standards set forth in 26 
U.S.C. 5382 and 5384 for natural wine under the IRC. Thus, the proposed 
standards of identity for grape wine and fruit wine cross reference the 
statutory cellar treatment provisions for natural wine in sections 5382 
and 5384. This change is made in proposed Sec. Sec.  4.142 and 4.145.
    iii. Added brandy or alcohol. The current regulations concerning 
classes 1, 4, and 5, allow for the addition of grape brandy, citrus 
brandy, or fruit brandy, respectively, or alcohol. Domestically 
produced natural wines may only be produced with the addition of brandy 
or wine spirits that are derived from the same kind of fruit. For 
example, grape wine can be produced with the addition of grape brandy 
or grape wine spirits, and strawberry wine can be produced with the 
addition of strawberry brandy or strawberry wine spirits. With regard 
to imported wines, however, in some cases, the United States has 
recognized fortification practices of the country of origin that allow 
for the use of spirits that are derived from a different source.
    TTB believes that the existing regulation's authorization of the 
addition of ``grape brandy or alcohol'' to grape wine, and the addition 
of ``fruit brandy or alcohol'' to fruit wine may cause confusion and is 
therefore proposing to instead authorize the addition of ``added 
spirits of the type authorized for natural wine under 26 U.S.C. 5382'' 
in proposed Sec. Sec.  4.142 and 4.145. This change will incorporate 
the standards which specify that wine spirits must be derived from the 
same type of fruit, which are found in 26 U.S.C. 5382, but it will also 
provide for the recognition of different standards for certain imported 
wines pursuant to international agreements.
    iv. Dessert wine. Current Sec.  4.21(a), (d), (e), (f), and (g) 
prescribe the standard for designating grape wine, citrus wine, fruit 
wine, and wine from other agricultural products as ``dessert wine.'' 
Dessert wine is defined as wine having an alcoholic content in excess 
of 14 percent but not in excess of 24 percent by volume. TTB is not 
proposing to change this standard, but seeks comments on it, as 
explained below.
    TTB has rejected applications for COLAs for labels that carry the 
term ``dessert wine'' where the wine did not contain more than 14 
percent alcohol by volume. It has been suggested that the trade and 
consumer understanding of the term ``dessert wine'' may no longer be 
consistent with the meaning that the regulations assign to it. TTB has 
approved labels for wines containing no more than 14 percent alcohol by 
volume that include the phrase ``may be served as dessert wine.'' TTB 
believes that consumers may believe that the term ``dessert wine'' 
indicates the level of sweetness that the wine possesses, or may 
attribute some other meaning to the word. Accordingly, TTB is 
interested in receiving comments pertaining to the use of ``dessert 
wine'' as a designation that denotes alcohol content. TTB is also 
interested in receiving comments on whether there is a more appropriate 
term for designating wines that contain more than 14 percent alcohol by 
volume but less than 24 percent alcohol by volume.
    v. Light wine. The current regulations for grape wine allow the 
term ``light'' to be used in two instances. The first is as an 
alternative designation for ``table wine,'' which is defined as ``grape 
wine having an alcoholic content not in excess of 14 percent by 
volume.'' The second instance in which ``light'' may be used for grape 
wine is as a designation that denotes that a ``dessert wine'' that has 
no more than 17 percent alcohol by volume (for sherry) or 18 percent 
alcohol by volume (for angelica, madeira, muscatel, or port). The 
current classes for citrus wine, fruit wine, and wine from other 
agricultural products also allow the designation ``light wine'' in lieu 
of the designation ``table wine.'' TTB is not proposing to change the 
standard for ``light'' wine but is interested in receiving comments as 
to whether the proposed use of the designation ``light'' on wine 
labels, to indicate alcohol content, is consistent with industry and 
consumer understanding of that term.
    vi. Natural wine. Current classes 1, 4, and 5 provide for wine that 
does not contain ``added brandy'' to be designated as ``natural.'' TTB 
has received numerous applications for COLAs which use the designation 
``natural.'' On these proposed labels, the term ``natural'' was 
intended to indicate

[[Page 60590]]

to the consumer that the wine was produced following a certain set of 
production guidelines.
    TTB believes that the designation ``natural'' may no longer have 
the meaning ascribed to it by the regulations. Additionally, the 
definition in the current part 4 is inconsistent with the IRC 
definition. Accordingly, the standards of identity no longer provide 
that grape wine or fruit wine containing no added brandy or alcohol may 
be designated as ``natural.'' TTB is interested in receiving comments 
regarding whether trade and consumer understanding of the term 
``natural,'' when used on a wine label, is that no brandy has been 
added to the wine. TTB is also interested in receiving comments that 
indicate how the industry and consumers interpret the term ``natural'' 
in relation to wine. Finally, commenters should let TTB know if the 
proposed change would impact existing labels.
    vii. Changes pertaining to individual classes or types. In addition 
to the changes affecting multiple classes of wine discussed above, TTB 
is making the following changes affecting certain individual classes of 
wine:
     Champagne ``style'' and ``type:'' Current Sec.  4.21(b)(2) 
recognizes ``champagne'' as a type of sparkling grape wine the 
effervescence of which results solely from the secondary fermentation 
of the wine in glass containers of not greater than one gallon 
capacity. Sparkling wines having the taste, aroma, and characteristics 
generally attributed to champagne but not otherwise conforming to the 
standard for champagne may, in addition to but not instead of the class 
designation ``sparkling wine,'' be further designated as ``champagne 
style'' or ``champagne type'' or as ``champagne'' (along with an 
appellation of origin), and a qualifying term such as ``bulk process,'' 
``fermented outside the bottle,'' ``secondary fermentation outside the 
bottle,'' ``secondary fermentation before bottling,'' ``not fermented 
in the bottle,'' or ``not bottle fermented.'' The term ``charmat 
method'' or ``charmat process'' may be used as additional information.
    The proposed regulations in Sec.  4.173(d) continue to allow the 
use of ``champagne'' with one of the qualifying terms specified above 
on products designated as ``sparkling wine,'' where their effervescence 
results from secondary fermentation in containers with a capacity of 
more than one gallon. The proposed regulations clarify that such wines 
must comply with the rules applicable to the use of ``champagne'' as a 
semi-generic designation, in accordance with proposed Sec.  4.174. 
Thus, a sparkling wine that undergoes secondary fermentation in a tank 
may be designated, for example, as ``Sparkling wine,'' with the further 
designation of ``New York champagne--not fermented in the bottle--
Charmat process,'' or ``California champagne style--bulk process'' as 
long as the use of the term ``champagne'' complies with the 
grandfathering and other rules set forth in proposed Sec.  4.174.
     Fruit wine and citrus wine: The standards of identity 
currently provide for a class, fruit wine, in Sec.  4.21(d) and a 
class, citrus wine, in Sec.  4.21(e). The production requirements, such 
as amelioration and acidity limits, are the same for fruit wine and 
citrus wine. Furthermore, the ways in which fruit wine and citrus wine 
may be designated are consistent. Finally, TTB does not receive many 
applications for COLAs for wines designated as ``citrus wine'' (as 
opposed to applications for COLAs for citrus wines derived wholly from 
one kind of citrus fruit, such as ``orange wine'' or ``grapefruit 
wine''). Eliminating the class ``citrus wine'' would not require a 
change to labels of citrus wines that are made from a single type of 
citrus fruit. For these reasons and because citrus is a type of fruit, 
TTB proposes to eliminate the class of ``citrus wine'' and to include 
any wines made from citrus fruits in the fruit wine class. TTB solicits 
comments on whether this change (in proposed Sec.  4.145) will require 
changes to existing labels.
     Agricultural wine: Current Sec.  4.21(f) provides that 
``wines from other agricultural products'' constitute class 6. This 
class includes wines produced from honey, raisins, dandelions, rice, 
maple syrup, and agave. This class does not include wines produced from 
fruit that is used in the production of grape wine, fruit wine, or 
citrus wine. Currently, wine produced from rice in accordance with the 
commonly accepted method of manufacture of such a wine is designated as 
Sak[eacute], which is a type of ``wine from other agricultural 
products.''
    TTB proposes to move Sak[eacute] from current class 6, and create a 
new class, ``rice wine,'' in order to more clearly describe the 
standards for rice wines, including Sak[eacute] and Gyeongju Beopju. 
Pursuant to Article 2.13.2 of the United States-Korea Free Trade 
Agreement, the United States agreed to recognize Gyeongju Beopju as a 
distinctive product of the Republic of Korea. Gyeongju Beopju was 
recognized in TTB Ruling 2012-3 as a non-generic designation of 
geographic significance, and as a product made in the Republic of Korea 
in accordance with the laws and regulations of the Republic of Korea 
governing the manufacture of this product. Proposed Sec.  4.148(c)(2) 
recognizes Gyeongju Beopju as a type designation, which means that the 
words ``rice wine'' would not have to appear as part of the 
designation. TTB seeks comments on whether this is appropriate, or 
whether the product should be designated as ``Gyeongju Beopju rice 
wine.'' TTB Ruling 2012-3 also recognizes Andong Soju, which is a 
distilled spirit, as a distinctive product of the Republic of Korea. As 
discussed in section II D of the preamble, TTB is proposing to amend 
the distilled spirits regulations to incorporate this holding of the 
ruling, and to supersede TTB Ruling 2012-3 in its entirety.
     Varietal (grape type) labeling: Proposed Sec.  4.156 sets 
out the rules for varietal (grape type) labeling as a type designation 
for grape wine. The proposed rule is largely consistent with the 
current regulation, but sets out some liberalizing changes consistent 
with the WWTG Labeling Protocol, discussed earlier in this preamble.
    The regulation providing for the use of one or more grape varieties 
as the type designation for grape wine is in current Sec.  4.23. In 
addition to other requirements, current Sec.  4.23 requires that a wine 
labeled with a varietal designation also be labeled with an appellation 
of origin.
    Subject to certain exceptions, current Sec.  4.23(b) provides that 
the name of a single grape variety may be used as the type designation 
of a grape wine if not less than 75 percent of the wine is derived from 
grapes of that variety, and if all of that 75 percent is grown in the 
area indicated by the labeled appellation of origin.
    Current Sec.  4.23(d) sets forth the current rules for the use of 
two or more grape varieties as the type designation for a grape wine. 
All of the grapes used to make the wine must be of the varieties shown 
on the label. The percentage of the wine derived from each variety must 
be shown on the label (with a tolerance of plus or minus 2 percentage 
points). Finally, if the wine is labeled with a multicounty appellation 
of origin, the percentage of the wine derived from each variety from 
each county must be shown on the label; and if the wine is labeled with 
a multistate appellation of origin, the percentage of the wine derived 
from each variety from each State must be shown on the label.
    TTB is proposing to make changes consistent with the WWTG Labeling 
Protocol. For wines labeled with more than one grape variety as the 
type designation, these changes would require that not less than 
eighty-five

[[Page 60591]]

percent (instead of 100 percent) of the wine be derived from grapes of 
the labeled varieties. They would also remove the requirement that the 
percentage of the wine derived from each variety must be shown on the 
label. The proposed regulations remove the requirement that, if the 
wine is labeled with a multicounty or multistate appellation of origin, 
the percentage of the wine derived from each county or State must be 
shown on the label. The proposed rule adds a requirement that each 
grape variety listed must be in greater proportion in the wine than any 
variety that is not listed, and requires that the varieties be listed 
in descending order of predominance, based on the percentage of wine 
that is derived from each grape variety. Thus, if a wine is made from 
four different varieties of grapes, with the first representing 50 
percent of the wine, the second representing 40 percent of the wine, 
the third representing seven percent of the wine, and the fourth 
representing three percent of the wine, the bottler would have three 
options under the proposed rule if it wishes to use a varietal 
designation. It could list all four of the varieties, in descending 
order of predominance, or it could list the first three varieties, in 
descending order of predominance, or it could list simply the first two 
varieties, in descending order of predominance. However, the proposed 
rule would not allow the bottler to include the fourth variety 
(representing three percent of the wine) without also including the 
third variety (representing seven percent of the wine).
    As previously noted, proposed Sec.  4.23(b) requires that 75 
percent of the wine must be derived from grapes of the variety listed 
on the label. This allows for some blending with wines made from other 
grapes, which are not required to be listed on the label. TTB believes 
that the proposed rule would provide consumers with adequate 
information about the identity of the product, and encourage the use of 
multiple varietal designations by producers. The proposed regulations 
would afford greater flexibility in the blending of wines.
    Proposed Sec.  4.157 sets forth rules on grape type designations of 
varietal significance. These are largely consistent with current Sec.  
4.28, with the exception of a proposed change relating to the 
designation ``Gamay Beaujolais.'' In 1997, ATF published a final rule 
(T.D. ATF-388, 62 FR 16749) that phased out the use of the designation 
``Gamay Beaujolais'' on American wine labels over a period of 10 years. 
The current regulations at Sec.  4.28(e)(3) set out the rules for the 
use of the designation ``Gamay Beaujolais'' for wines bottled prior to 
April 9, 2007. However, as set forth in current Sec.  4.28(e)(3), the 
designation ``Gamay Beaujolais'' may not be used on labels of American 
wine bottled on or after April 9, 2007. While wines bottled prior to 
that date may still bear the designation in accordance with the 
transitional rule, TTB does not believe that it is necessary or useful 
to keep the transitional rule in the regulations. However, TTB seeks 
comments on whether that provision should be kept in the regulations.
    e. Generic, semi-generic, and nongeneric designations of geographic 
significance. The regulations prescribing requirements for labeling 
wine with terms that have been found to be generic, semi-generic, and 
nongeneric designations of geographic significance are currently found 
in Sec.  4.24. As described in more detail below, these regulations 
have not been updated to reflect amendments to the IRC in 2006 
regarding the use of certain ``semi-generic'' names; thus, we are 
proposing to amend the regulations to reflect those amendments to the 
IRC.
    The general rule, as stated in current Sec.  4.24(c)(1), is that a 
name of geographic significance, which is also the designation of a 
class or type of wine, may be used in the designation of only those 
wines of the origin indicated by such name. Examples of these 
``nongeneric'' names (such as ``Spanish,'' or ``Napa Valley''), are 
listed in Sec.  4.24(c)(2). The exception to this general rule is where 
the Administrator has found a name of geographic significance to be 
either ``generic'' or ``semi-generic.''
    ``Generic'' names are those specified in current Sec.  4.24(a)(2) 
(such as ``Vermouth'' and ``Sak[eacute]''), which are no longer 
considered as having geographic significance but are indicative of a 
class or type of wine. A wine may be labeled with a generic designation 
regardless of the place of origin. ``Semi-generic'' designations (such 
as ``Madeira'' and ``Sherry'') are those names which retain some 
geographic significance but which are also known as the designation of 
a class or type of wine. Current section 4.24(b)(1) provides that semi-
generic names may be used to designate wines of an origin other than 
that indicated by the particular geographic name, provided that the 
designation is accompanied by an appellation of origin indicating the 
true origin of the wine.
    In addition to the general rule set forth above which restricts the 
use of nongeneric names used to designate wines, current Sec.  
4.24(c)(1) provides that the Administrator may find that certain of 
these nongeneric names are also the ``distinctive'' designations of 
specific wines. A name of geographic significance is deemed to be a 
distinctive designation if it is known to the U.S. consumer and trade 
as the designation of a specific wine of a particular place or region, 
distinguishable from all other wines. Current section 4.24(c)(3) states 
that names such as ``Chambertin,'' ``Liebfraumilch,'' and ``Lacryma 
Christi'' are examples of distinctive designations. A list of foreign 
distinctive designations appears in subpart D of part 12. Additional 
examples of foreign nongeneric names that are not distinctive 
designations of wine are listed in subpart C of part 12.
    This proposed rule would codify these provisions in three separate 
sections, proposed sections Sec. Sec.  4.173 through 4.175.
    Proposed Sec.  4.173 defines generic designations of geographical 
significance as ``the name of a class or type of wine that once had 
geographic significance but has been deemed by the Administrator to 
have lost any geographic significance.'' Also, paragraph (b) of 
proposed Sec.  4.173 makes clear that ``vermouth'' and ``Sak[eacute]'' 
comprise the list of generic designations, and are not merely examples 
of such designations.
    As mentioned above, current Sec.  4.24(b) provides that semi-
generic designations may be used to designate wines of an origin other 
than that indicated by the name only if there appears in direct 
conjunction therewith an appropriate appellation of origin disclosing 
the name of the true place of origin of the wine, and if the wine so 
designated conforms to the standards of identity, if any, for such wine 
contained in the regulations in part 4, or, if there is no such 
standard, to the wine trade's understanding of such class or type. 
Examples of semi-generic names that are also type designations for 
grape wines are: Angelica, Burgundy, Claret, Chablis, Champagne, 
Chianti, Malaga, Marsala, Madeira, Moselle, Port, Rhine Wine (or Hock), 
Sauterne, Haut Sauterne, Sherry, and Tokay.
    In proposed Sec.  4.174, TTB is proposing substantive changes to 
the regulations governing the use of semi-generic designations on wine 
labels. These changes are consistent with changes in the law, which in 
turn stem from the 2006 Agreement between the United States and the 
European Union (EU) on Trade in Wine (``the EU Agreement''). The EU 
Agreement addresses a wide range of issues regarding the production, 
labeling, and import requirements for wine that help to

[[Page 60592]]

establish predictable conditions for bilateral wine trade.
    Under section 5388(c) of the Internal Revenue Code of 1986 (IRC), 
26 U.S.C. 5388(c), a name of geographic significance, which is also the 
designation of a class or type of wine, is determined to be semi-
generic only if so found by the Secretary of the Treasury. In the EU 
Agreement, the United States made a commitment to seek to change the 
legal status of those names to restrict their use solely to wines 
originating in the applicable EU Member State, with certain exceptions 
for ``grandfathered'' names. The grandfathered names are: Burgundy, 
Chablis, Champagne, Chianti, Claret, Haut Sauterne, Hock, Madeira, 
Malaga, Marsala, Port, Retsina, Rhine, Sauterne, Sherry, and Tokay.
    Shortly thereafter, section 422 of the Tax Relief and Health Care 
Act of 2006 (Pub. L. 109-432) amended section 5388 of the IRC (26 
U.S.C. 5388) to implement Article 6 of the EU Agreement. The effect of 
this change in law is to restrict use of the semi-generic terms 
pursuant to the EU Agreement.
    Article 6.2 of the EU Agreement and 26 U.S.C. 5388 allow a person 
or his or her successor in interest using one of the grandfathered 
names in the United States before March 10, 2006, to continue using the 
name, provided that the name is only used on labels for wine bearing 
the brand name, or the brand name and distinctive or fanciful name, if 
any, for which the applicable COLA was issued prior to the date of 
signature of the EU Agreement.
    In accordance with the EU Agreement and the relevant changes in 
U.S. law, TTB has imposed restrictions on the use of the semi-generic 
names and the name Retsina. Although Retsina is a class of wine that 
was not previously recognized in the TTB regulations or in 26 U.S.C. 
5388 as a semi-generic name, under the terms of the EU Agreement and 26 
U.S.C. 5388, it is treated the same as the semi-generic names.
    Under the provisions of the ``grandfather'' exception, any person 
or his or her successor in interest may continue to use a semi-generic 
name or Retsina on a wine label, provided the semi-generic name or 
Retsina is used only on labels for wine bearing the same brand name, or 
the same brand name and a distinctive or fanciful name, if any, that 
appear on a COLA issued prior to March 10, 2006. The grandfather clause 
is not available to wines originating in the EU. The proposed 
amendments will implement these provisions in the part 4 labeling 
regulations for the first time.
    Accordingly, proposed Sec.  4.174 defines a semi-generic 
designation as a geographic term which is also the designation of a 
class or type of wine and which has been deemed to have become semi-
generic by the Administrator. It lists the semi-generic names and the 
restrictions on their use, in accordance with the provisions of 26 
U.S.C. 5388. It should be noted that while the law provides the same 
protection to ``Retsina'' as it does to the names that are listed as 
being ``semi-generic,'' it does not specifically provide that 
``Retsina'' is a semi-generic name. TTB believes that this leads to 
confusion. Accordingly, TTB is proposing to amend the regulations to 
recognize ``Retsina'' as a semi-generic name. It should be further 
noted that, while ``Angelica'' is included as a semi-generic name, it 
is not subject to the grandfather provisions under 26 U.S.C. 5388.
    ATF Ruling 73-5 held that Spanish wines bearing labels with semi-
generic designations such as ``Burgundy,'' ``Chablis,'' ``Sauterne,'' 
or ``Rhine'' do not meet the requirements of Sec.  4.25(a)(3). Because 
proposed Sec.  4.174(c) requires that imported wine labeled with a 
semi-generic designation conform to the requirements of the producing 
country, and EU regulations would not allow a wine from Spain to be 
called a ``Burgundy,'' ``Chablis,'' ``Sauterne'' or ``Rhine,'' the 
proposed rule would supersede ATF Ruling 73-5.
    Proposed Sec.  4.175 defines a nongeneric designation as a name of 
geographic significance that has not been found by the Administrator to 
be generic or semi-generic. The proposed regulation also states that, 
``A nongeneric name of geographic significance may be deemed to be the 
distinctive designation of a wine if the Administrator finds that it is 
known to the consumer and to the trade as the designation of a specific 
wine of a particular place or region, distinguishable from all other 
wines.'' Other than these clarifying provisions, the changes in 
proposed Sec.  4.175 are editorial in nature.
7. Subpart J--American Grape Variety Names
    Proposed subpart J of part 4 includes the list of approved names of 
American grape varietals, the list of alternate names of American grape 
varietals, and the approval processes for grape varietal names.
    As previously mentioned, proposed Sec.  4.157 provides the rules 
for using the name of one or more grape varieties as a type designation 
for a grape wine. Proposed Sec.  4.157(e) provides that the name of a 
grape variety may be used in a type designation for an American wine 
only if that name has been approved by the Administrator. A list of 
approved grape variety names appears in proposed subpart J.
    Proposed Sec.  4.191 states how to petition the Administrator for 
approval of a grape variety name. This is largely consistent with 
existing Sec.  4.93. However, TTB is proposing a change in proposed 
Sec.  4.191(e) to codify TTB's current policy with regard to the 
administrative approval of grape variety names pending future 
rulemaking.
    Current Sec.  4.93 provides that the TTB Administrator will publish 
the list of approved grape variety names in the Federal Register 
annually. TTB is proposing to revise this provision in proposed Sec.  
4.191 to eliminate the provision for publishing the names in the 
Federal Register. Instead, a complete list of grape variety names 
(including those listed in regulations and those temporarily approved 
by the Administrator) may be found on the TTB website, at https://www.ttb.gov.
    While neither the proposed nor the existing regulations require TTB 
to engage in rulemaking before approving the use of a grape variety 
name to designate an American wine, it is TTB's preference to go 
through rulemaking in order to solicit comments on the use of proposed 
varietal names. However, rulemaking takes time, and TTB does not wish 
to delay the use of newly approved grape varietal names on American 
wine labels. Accordingly, it is TTB's practice to issue an 
``administrative approval'' for new grape variety names that meet the 
criteria set forth in the regulations. An administrative approval is 
temporary in nature, and means that TTB will allow the use of the grape 
variety name as a type designation on a wine label pending rulemaking. 
An administrative approval may be revoked as a result of subsequent 
rulemaking concerning the grape variety name.
    Current Sec.  4.92 provides a list of alternative grape variety 
names that may be used on a temporary basis, in lieu of the prime name 
of the grape variety that is shown in the list. These alternative grape 
variety names may be used for wine bottled before a specified date, 
which varies from 1997 to 2012. The alternative grape variety names in 
the list for wine bottled prior to 1997 and the names in the list for 
wine bottled prior to 1999 are not included in proposed Sec.  4.192. 
Though absent from the list in the regulations, the alternative names 
authorized for wines bottled prior to 1997 and 1999 will still be 
authorized. However, TTB no longer believes it is necessary to include 
this

[[Page 60593]]

transitional rule in the codified regulations.

D. Proposed Changes Specific to 27 CFR Part 5 (Distilled Spirits)

    In addition to the changes discussed in section II B of this 
document that apply to more than one commodity, TTB is proposing 
editorial and substantive changes specific to the distilled spirits 
labeling regulations in part 5. This section will not repeat the 
changes already discussed in section II B of this document. 
Accordingly, if a proposed change is not discussed in this section, 
please consult section II B. The substantive changes that are unique to 
part 5 are described below, by subpart.
1. Subpart A--General Provisions
    Proposed subpart A includes several sections that have general 
applicability to part 5, including a revised definitions section, a 
section that defines the territorial extent of the regulations, 
sections that set forth to whom and to which products the regulations 
in part 5 apply, a section that identifies other regulations that 
relate to part 5, and sections addressing administrative items such as 
forms and delegations of the Administrator.
    Proposed Sec.  5.1, which provides definitions of terms used in 
part 5, has some changes from the regulatory text that appears in 
current Sec.  5.10. In addition to the proposed amendments discussed 
above in section II B of this document, TTB proposes to modify the 
definition of ``age'' to simplify it and to make clear that spirits are 
only aged when stored in or with oak. The wood contact creates chemical 
changes in the spirits, which is the aging process. Thus, for example, 
spirits stored in oak barrels lined with paraffin are not ``aged.''
    Additionally, TTB proposes to add a definition of ``American 
proof,'' which cross references the definition of ``proof.'' The term 
``American proof'' is used in some circumstances to clarify that the 
proof listed on a certificate should be calculated using the standards 
in the part 5 regulations, not under another country's standards.
    TTB proposes to amend the definition of ``distilled spirits'' to 
codify its longstanding position that products containing less than 0.5 
percent alcohol by volume are not regulated as ``distilled spirits'' 
under the FAA Act.
    TTB also proposes to add a definition of ``grain,'' which would 
define the term to include cereal grains as well as the seeds of the 
pseudocereal grains: amaranth, buckwheat, and quinoa. TTB has received 
a number of applications for labels for products using pseudocereals, 
and TTB also notes that the FDA has proposed draft guidance allowing 
the seeds of pseudocereals to be identified as ``whole grains'' on 
labels (see 71 FR 8597, February 17, 2006).
    Finally, TTB proposes to define the term ``oak barrel,'' which is 
used with regard to the storage of certain bulk spirits. TTB and its 
predecessor agencies have traditionally considered a ``new oak 
container,'' as used in the current regulations, to refer to a standard 
whiskey barrel of approximately 50 gallons capacity. Accordingly, TTB 
proposes to define an oak barrel as a ``cylindrical oak drum of 
approximately 50 gallons capacity used to age bulk spirits.'' However, 
TTB seeks comment on whether smaller barrels or non-cylindrical shaped 
barrels should be acceptable for storing distilled spirits where the 
standard of identity requires storage in oak barrels.
2. Subpart B--Certificates of Label Approval and Certificates of 
Exemption of Label Approval, Subpart C--Alteration of Labels, Adding 
Information to Containers, and Relabeling, and Subpart D--Label 
Standards
    Proposed subparts B, C, and D are updated for clarity and contain 
substantive changes as described in section II B of this preamble. The 
rules found in proposed Sec. Sec.  5.42--5.44 regarding relabeling 
incorporate portions of, and would supersede, ATF Ruling 54-592, which 
deals with relabeling of distilled spirits with labels with different 
trade names, and ATF Ruling 62-224, which deals with labeling by 
wholesalers.
3. Subpart E--Mandatory Label Information
    Proposed subpart E of part 5 sets forth the information that is 
required to appear on a label and prescribes how that information must 
appear on the label. The current regulations governing mandatory label 
requirements are found in subpart D of part 5. Proposed subpart E is 
generally structured similarly to the corresponding sections in the 
current regulations.
    TTB is proposing to clarify where mandatory information must appear 
on a container. The proposed amendments will have the effect of 
increasing flexibility for placing such information on a distilled 
spirits container. Current Sec.  5.32(a) requires that the following 
appear on the ``brand label'': The brand name, the class and type of 
the distilled spirits, the alcohol content, and, on containers that do 
not meet a standard of fill, net contents. The term ``brand label'' is 
defined in current Sec.  5.11 generally as the principal display panel 
that is most likely to be displayed, presented, shown, or examined 
under normal retail display conditions. Further, the definition states 
that ``[t]he principal display panel appearing on a cylindrical surface 
is that 40 percent of the circumference which is most likely to be 
displayed, presented, shown, or examined under normal and customary 
conditions of display for retail sale.''
    TTB believes that the information that currently must appear 
together on the brand label (or ``principal display panel'') is closely 
related information that, taken together, conveys important facts to 
consumers about the identity of the product. TTB is proposing, in 
proposed Sec.  5.63(a), to allow this mandatory information to appear 
anywhere on the labels, as long as it is within the same field of 
vision, which means a single side of a container (which for a 
cylindrical container is 40 percent of the circumference) where all 
pieces of information can be viewed simultaneously without the need to 
turn the container. TTB believes that requiring that this information 
appear in the same field of vision, rather than on the display panel 
``most likely to be displayed, presented, shown, or examined'' at 
retail, is a more objective and understandable standard, particularly 
as applied to cylindrical bottles. This amendment also eliminates the 
requirement that mandatory information appear parallel to the base of 
the container.
    Paragraph (b) of current Sec.  5.32 specifies that mandatory 
information other than that listed in paragraph (a) must appear either 
on the brand label or on a back label, in effect allowing this 
information to appear anywhere on the container. Paragraph (b) of the 
proposed Sec.  5.63 in effect makes no change in this requirement by 
providing that the mandatory information set forth in that paragraph 
must appear ``on a label or labels anywhere on the container'' of each 
distilled spirits container.
    Also with respect to the mandatory information, TTB proposes to 
clarify the existing requirement that, if the alcohol content is listed 
in terms of using degrees of proof, it must appear in direct 
conjunction with the mandatory alcohol content statement. The proposed 
rule provides that the statement of proof must appear immediately 
adjacent to the mandatory alcohol content statement.
    The proposed rule still provides that the mandatory alcohol content 
statement must be stated on the label as a percentage of alcohol by 
volume. The proof statement may, but need not,

[[Page 60594]]

appear on the label. In ATF Ruling 88-1, TTB's predecessor agency 
clarified that the proof must appear in direct conjunction only once on 
the label or in an advertisement, specifically, in the place where the 
alcohol by volume statement is serving as the mandatory alcohol content 
statement. Accordingly, the proposed rule clarifies that additional 
statements of proof need not be accompanied by the alcohol by volume 
statement.
    TTB also proposes in Sec.  5.65(c) to provide for an expanded 
tolerance for labeling of alcohol content. The current regulations in 
27 CFR 5.37(b) provide a tolerance for a drop in alcohol content only, 
of 0.15 percent alcohol by volume for most distilled spirits and of 
0.25 percent for spirits with a high solids content or for spirits 
bottled in small bottle sizes. The tolerance was established to allow 
for variations in alcohol content that occur due to losses in alcohol 
content during the bottling process.
    Industry members have expressed concern that while improvements in 
analytical equipment have made measuring alcohol content more precise, 
the volatility of ethyl alcohol makes it challenging during bottling to 
control alcohol content within the narrow parameters that are currently 
authorized. For example, many distilled spirits products have a minimum 
bottling alcohol content of 40 percent alcohol by volume. In some 
cases, distillers may target their alcohol content slightly higher than 
40 percent, expecting evaporation of alcohol during the bottling 
process. However, in some instances, the alcohol content does not drop 
to the desired 40 percent during the bottling process. Current TTB 
regulations would not allow a product with, for example, an actual 
alcohol content of 40.15 percent alcohol by volume to be labeled with 
an alcohol content of 40 percent alcohol by volume.
    The proposed rule amends the alcohol content regulations in part 5 
to allow for an expanded alcohol content tolerance. TTB proposes to 
expand the alcohol content tolerance to 0.3 percent alcohol by volume 
above or below the labeled alcohol content.
    TTB also proposes to make a similar amendment to the alcohol 
content regulations found in 27 CFR 19.356. The regulations in part 19 
apply to the operations of distilled spirits plants. Section 19.356 
sets forth tolerances for alcohol content and fill for bottling 
operations, and TTB proposes to expand the alcohol content tolerances 
in this section to mirror those in the proposed Sec.  5.65(c). Because 
this alcohol content tolerance is larger than the previously allowed 
0.25 percent for high solids content or for small bottles, we also 
propose to eliminate the stepped tolerance scheme and provide for the 
same tolerance for all distilled spirits.
    TTB believes that this proposal would allow greater flexibility and 
business efficiencies for bottlers. We note that while taxes on 
distilled spirits are generally determined on the basis of the labeled 
alcohol content of the product, we believe that the proposal does not 
present risks to the revenue because there likely will be both 
overproof and underproof bottles and there is no economic incentive for 
intentionally overproofing bottles. We invite comments on this issue.
    The current regulations in 27 CFR 27 CFR 5.36 allow for various 
statements as part of the name and address. The phrase ``bottled by'' 
is simple to understand--it may be used by the bottler of the spirits. 
Similarly, the phrase ``distilled by'' may be used only by the original 
distiller of the distilled spirits.
    Currently, section 5.36(a)(4) allows a variety of terms, as 
appropriate, to be used by a rectifier of distilled spirits, including 
``blended by,'' ``made by,'' ``prepared by,'' ``manufactured by,'' or 
``produced by.'' Because there is no longer a rectification tax on 
distilled spirits, and thus these terms have lost their significance 
under the IRC, some industry members and consumers are confused as to 
when the use of those terms is appropriate. TTB proposes to clarify in 
proposed Sec.  5.66(b)(2) the meaning of those terms. For example, the 
term ``produced by,'' when applied to distilled spirits, does not refer 
to the original distillation of the spirits, but instead indicates a 
processing operation (formerly known as rectification) that involves a 
change in the class or type of the product through the addition of 
flavors or some other processing activity. TTB solicits comments on 
whether the proposed definitions of these terms are consistent with 
trade and consumer understanding.
    TTB has received several inquiries about its existing regulations 
on labeling certain whisky products with a State where distillation 
occurs. Current Sec.  5.36(d) require the State of distillation to be 
listed on the label if it is not included in the mandatory name and 
address statement. However, because the name and address statement may 
be satisfied with a bottling statement, there is no way to know, simply 
by reviewing a proposed label, whether distillation actually occurred 
in the same State as the bottling location.
    Accordingly, proposed Sec.  5.66(f) would provide that the State of 
original distillation for certain whisky products must be shown on the 
label in at least one of the following ways:
     By including a ``distilled by'' (or ``distilled and 
bottled by'' or any other phrase including the word ``distilled'') 
statement as part of the mandatory name and address statement, followed 
by a single location. This means that a principal place of business or 
a list with multiple locations would not suffice;
     By including the name of the State in which original 
distillation occurred immediately adjacent to the class or type 
designation (such as ``Kentucky Bourbon whisky''), as long as 
distillation and any required aging occurred in that State; or
     By including a separate statement, such as ``Distilled in 
[name of State].''
    The TTB regulations set forth certain rules for how age statements 
may appear on labels. TTB proposes to update the rule, currently found 
in Sec.  5.40(d), which states that age, maturity, or similar 
statements may not appear on neutral spirits (except for grain 
spirits), gin, liqueurs, cordials, cocktails, highballs, bitters, 
flavored brandy, flavored gin, flavored rum, flavored vodka, flavored 
whisky, and specialties, because such statements are misleading. TTB 
has seen recent growth in the number of distilled spirits products, 
such as gin, being stored in oak containers. However, the prohibition 
in the current regulations means that a producer cannot use age 
statements to inform the public how long its product has been stored in 
oak containers, and TTB has approved labels using terms such as 
``finished'' or ``rested'' for these types of products. TTB believes 
that consumers should be able to make their own determinations on how 
the aging would affect the product, and that age statements would 
provide truthful information to consumers. Accordingly, TTB proposes to 
allow age statements on all spirits except for neutral spirits (other 
than grain spirits, which may contain an age statement). The revision 
appears at proposed Sec.  5.74(e). Proposed Sec.  5.74 incorporates and 
supersedes ATF Ruling 93-3, which exempts grappa from the mandatory age 
statement for brandies aged less than four years. Finally, TTB proposes 
to supersede Revenue Ruling 69-58, which deals with rules for age 
statements that have been incorporated in the regulations.

[[Page 60595]]

4. Subparts F, G and H--Restricted and Prohibited Labeling Practices, 
and Labeling Practices That Are Prohibited if They Are Misleading
    As described in section II B of this document, the current 
regulations set forth the prohibited labeling practices in a single 
section, Sec.  5.42. In order to make it easier to find the relevant 
regulation and to improve readability, TTB proposes to separate these 
practices into three subparts--one for practices for which there are 
certain rules, one for practices that are prohibited in all instances, 
and one for practices that are prohibited only if misleading.
    In addition to changes in provisions that apply to all three of the 
commodities, which are discussed in section II B of this preamble, 
proposed Sec.  5.87 prescribes rules for the use of the terms ``barrel 
proof,'' ``cask strength,'' ``original proof,'' ``original barrel 
proof,'' ``original cask strength,'' and ``entry proof'' on distilled 
spirits labels. The proposed text incorporates the holding, set forth 
in ATF Ruling 79-9 that the terms ``original proof,'' ``original barrel 
proof,'' and ``entry proof,'' when appearing on a distilled spirits 
product label, indicate that the proof of the spirits entered into the 
barrel and the proof of the bottled spirits are the same.
    The ruling further held that the term ``barrel proof'' appearing on 
a distilled spirits label indicates that the bottling proof is not more 
than two degrees lower than the proof established at the time the 
spirits were gauged for tax determination. The proposed regulations 
update the description of the term ``barrel proof'' to take into 
account changes in the operation of distilled spirits plants because of 
the Distilled Spirits Tax Revision Act of 1979. The reference to the 
time of tax determination is no longer the applicable standard under 
the current tax determination system. Since the term ``barrel proof'' 
is intended to indicate that the spirit is approximately the same proof 
as when it is dumped from the barrel, the proposed regulations state 
that the term may be used on a label when the bottling alcohol content 
(proof) of distilled spirits is not more than two degrees of proof 
lower than the proof of the spirit when the spirit was dumped from the 
barrel. TTB notes that it rarely sees such terms on distilled spirits 
labels and specifically seeks comments on whether they still have 
relevance and provide meaningful information to the consumer and 
whether TTB should regulate their use on labels.
    Proposed Sec.  5.88 sets forth rules for the use of the terms 
``bottled in bond,'' ``bond,'' ``bonded,'' or ``aged in bond,'' or 
other phrases containing these or synonymous terms. The use of these 
terms was originally restricted to certain products under the Bottled 
in Bond Act of 1897 (29 Stat. 626). The Bottled in Bond Act was 
intended to provide standards for certain spirits that would inform 
consumers that the spirits were not adulterated. Treasury Department 
officers monitored bonded distilled spirits plants. The Bottled in Bond 
Act was repealed by the Distilled Spirits Tax Revision Act of 1979 (see 
title VIII, subtitle A, Public Law 96-39, 93 Stat. 273). TTB's 
predecessor agency, ATF, decided to maintain the rules concerning 
``bottled in bond'' and similar terms, because consumers continued to 
place value on these terms on labels. Proposed Sec.  5.88 maintains the 
requirements for the use of ``bottled in bond'' and similar terms and 
reorganizes them for clarity. Imported spirits may use ``bottled in 
bond'' and similar terms on labels when the imported spirits are 
produced under the same rules that would apply to domestic spirits.
    In order to maintain parity between whisky that is aged and vodka 
and gin, which do not undergo traditional aging, vodka and gin are 
required to be stored in wooden containers in order to use ``bond'' or 
similar terms, but the wood containers must be coated or lined with 
paraffin or another substance to prevent the vodka or gin from coming 
into contact with the wood. TTB seeks comment on whether it should 
eliminate the requirement that bonded vodka or gin be stored in wooden 
containers. TTB rarely sees ``bonded'' vodka or gin; ``bond'' and 
similar terms are most frequently used on labels of whisky. Commenters 
may also wish to opine on whether TTB should maintain any special 
standards for the use of ``bonded'' or similar terms, since all 
domestic distilled spirits products are now bottled on bonded premises.
    In addition, proposed Sec.  5.89 would set forth new rules for the 
use of multiple distillation claims, such as ``double distilled'' or 
``triple distilled.'' Current regulations, at Sec.  5.42(b)(6), provide 
that such claims are allowable if they are truthful statements of fact 
and further provide that the terms ``double distilled'' or ``triple 
distilled'' shall not be permitted on labels of distilled spirits if 
the second or third distillation is ``a necessary process for 
production of the product.'' TTB is regularly asked for guidance on the 
meaning of this regulation and responds on a case-by-case basis 
depending on the relevant specific facts. Although TTB policy is clear 
that the distillation steps necessary to meet a product's standard of 
identity would be considered the first distillation, TTB has not set 
forth a policy on how additional distillations may be claimed or 
counted where an industry member intends to use a multiple distillation 
claim. TTB is proposing in this rulemaking, at proposed Sec.  5.89, to 
define a distillation as a single run through a pot still or one run 
through a single distillation column of a column (reflux) still. TTB 
believes that this definition is consistent with what consumers 
understand the terms to mean and also believes that this meaning most 
fully informs consumers as to the identity and quality of the distilled 
spirits product. TTB specifically seeks comment on this proposed 
meaning of distillation and proposed method for counting multiple 
distillations.
    Proposed Sec.  5.90 sets forth rules for the use on distilled 
spirits labels of terms related to Scotland. Such rules currently 
appear only in the regulatory sections related to product standards of 
identity and class and type, at current Sec. Sec.  5.22(k)(4) and 5.35, 
respectively. The proposed provision retains the current rule set forth 
at current Sec.  5.22(k)(4), that the words ``Scotch,'' ``Scots,'' 
``Highland,'' or ``Highlands'' and similar words connoting, indicating, 
or commonly associated with, Scotland may be used only on a product 
wholly produced in Scotland, but moves this rule to the provisions on 
restricted labeling practices in the new subpart F. However, regardless 
of where the finished products are produced, the term ``Scotch Whisky'' 
would not be prohibited from appearing on the label in the statement of 
composition for distilled spirits specialty products that use Scotch 
Whisky or in the statement of composition on the label of Flavored 
Scotch Whisky. (However, even though the finished product may be 
produced anywhere, the Scotch Whisky component must continue to be made 
in Scotland under the rules of the United Kingdom.) In addition, 
proposed Sec.  5.90(b) clarifies (in accordance with current 
regulations as well as proposed Sec.  5.127) that phrases related to 
government supervision may be allowed only if required or specifically 
authorized by the regulations of the United Kingdom, and supersedes 
Revenue Ruling 61-15, which applied that rule to specific language on 
labels of Scotch whisky bottled in the United States. If this proposed 
provision is included in the final rule, the 1961 ruling would be 
superseded in its entirety.
    Proposed Sec.  5.91 sets forth rules for the use of the term 
``pure'' on distilled

[[Page 60596]]

spirits labels, containers, and packaging. This rule currently appears 
in Sec.  5.42(b)(5) and provides that the term ``pure'' may not be used 
unless it is a truthful representation about a particular ingredient, 
it is part of the name of a permittee or retailer for whom the spirits 
are bottled, or it is part of the name of the permittee who bottled the 
spirits.
5. Subpart I--Standards of Identity for Distilled Spirits
    TTB is proposing amendments to the standards of identity for 
distilled spirits that are intended to clarify the classes and types of 
distilled spirits. TTB also is proposing to insert charts into the 
regulatory text to make the relationship between classes and types, and 
the standards for each, easier to understand and apply. Throughout the 
standards of identity, TTB proposes to identify alcohol content in 
terms of alcohol by volume as opposed to degrees of proof.
    TTB proposes to clarify, in Sec.  5.141, that the standards of 
identity apply to a finished product without regard to whether an 
intermediate product is used in the manufacturing process. This means 
that the intermediate product is treated as a mixture for the 
convenience of the manufacturer, but determinations as to the 
classification and labeling of the product will be made without regard 
to the fact that the elements of the intermediate product were first 
mixed together in the intermediate product. In the case of distilled 
spirits specialty products, TTB currently treats intermediate products 
as ``natural flavoring materials'' when they are blended into a 
product, for the purpose of disclosure as part of a truthful and 
adequate statement of composition. TTB has seen changes in the alcohol 
beverage industry and in various formulas and believes that treating 
intermediate products as natural flavoring materials does not provide 
adequate information to consumers, as required by the FAA Act. 
Accordingly, TTB proposes to clarify that blending components such as 
distilled spirits and wines together first in an ``intermediate 
product'' is the same as adding the ingredients separately for purposes 
of determining the standard of identity of the finished product. 
Additionally, TTB proposes to change its policy with regard to 
statements of composition for specialties to require the disclosure of 
elements of the intermediate product (including spirits, wines, 
flavoring materials, or other components) as part of the statement of 
composition.
    Some distilled spirits products may conform to the standards of 
identity for more than one class. Consistent with longstanding policy, 
TTB proposes to clarify, in Sec.  5.141(b)(3), that such a product may 
be designated with any class designation to which the product conforms. 
For example, a vodka with added natural orange flavor and sugar bottled 
at 45 percent alcohol by volume may meet the standard of identity for a 
flavored spirit or for a liqueur. Accordingly, the product may be 
designated as ``orange flavored vodka'' or ``orange liqueur'' at the 
option of the bottler or importer. Under current policy, TTB would not 
allow a product to be designated on a single label as both ``orange 
flavored vodka'' and ``orange liqueur,'' because TTB views it as 
misleading for a label to bear two different class designations. TTB 
seeks comments on whether the TTB regulations should permit a distilled 
spirits label to bear more than one class designation if the product 
conforms to the standards of identity for more than one class.
    The following proposed provisions relate to the standards of 
identity for distilled spirits products:
    Proposed Sec.  5.142 sets forth the standards for neutral spirits. 
Current Sec.  5.22(a) states that neutral spirits are distilled spirits 
produced from any material at or above 190[deg] proof and, if bottled, 
bottled at not less than 80[ordm] proof. Further, ``vodka'' is a 
neutral spirit so distilled, or so treated after distillation with 
charcoal or other materials, as to be without distinctive character, 
aroma, taste, or color. Proposed Sec.  5.142 would clarify several 
factors related to designating a neutral spirits product, factors that 
typically have been taken into account on a case-by-case basis. First, 
TTB is proposing to provide that the source material of the neutral 
spirits may be specifically included in the designation on the label of 
the product. Thus, the bottler would have the option of labeling a 
product as ``Apple Neutral Spirits'' (in addition to ``neutral spirits 
distilled from apples'' as the required commodity statement) or ``Grape 
Vodka,'' (in addition to ``vodka distilled from fruit'' as the required 
commodity statement) as long as such statements accurately describe the 
source materials.
    TTB also is proposing to codify the holding set forth in Revenue 
Ruling 55-740, that neutral spirits, other than grain spirits, that are 
stored in wood barrels become specialty products and must be labeled in 
accordance with the appropriate rules for such products set forth in 
proposed Sec.  5.156. Because storage in wood barrels renders the 
spirits not neutral, TTB's predecessor agency determined that consumers 
would be misled if spirits, other than grain spirits, were stored in 
wood barrels and then labeled as neutral spirits or vodka. Finally, the 
proposed regulations include allowable designations for neutral spirits 
labels.
    TTB also is proposing to amend the standard of identity for vodka, 
a type of neutral spirit, to codify the holdings in several past 
rulings: Ruling 55-552, which holds that vodka may not be stored in 
wood; Ruling 76-3, which explains that vodka treated with charcoal may 
be labeled as ``charcoal filtered''; and Ruling 56-98 and Ruling 97-1, 
which allow treatment with 2 grams per liter of sugar and trace amounts 
(1 gram per million) of citric acid and sugar. In addition, TTB is 
specifically seeking comment on whether the requirement that vodka be 
without distinctive character, aroma, taste, or color should be 
retained and, if this requirement is no longer appropriate, what the 
appropriate standards should be for distinguishing vodka from other 
neutral spirits.
    Proposed Sec.  5.143 sets forth the standards for whiskies. TTB 
proposes to clarify that the word whisky may be spelled ``whisky'' or 
``whiskey.'' TTB also proposes to require that, where a whisky meets 
the standard for one of the types of whiskies, it must be designated 
with that type name, except that Tennessee Whisky may be labeled as 
Tennessee Whisky even if it meets the standards for one of the type 
designations. Currently, TTB allows the term ``Tennessee Whisky'' to 
appear on labels, even if the product meets a more specific standard of 
identity, such as for bourbon whisky.
    In the current regulations, when a whisky meets the standard for a 
type of whisky, it is unclear whether the label must use that type 
designation or may use the general class ``whisky'' on the label. TTB 
believes that consumers expect that the type designation will appear on 
the container when it applies. Additionally, historical documents 
indicate that TTB's predecessor agencies classified whiskies with the 
type designation that applied, and required that type to be the label 
designation. For example, in January of 1937, the Federal Alcohol 
Administration stated that ``Where a product conforms to the standard 
of identity for `Straight Bourbon Whiskey' it must be so designated and 
it may not be designated simply as `Whiskey.''' See FA-91, ``A Digest 
of Interpretations of Regulations No. 5 Relating to Labeling and 
Advertising of Distilled Spirits,'' p. 5.
    In order to make the types of whiskies easier to understand, TTB 
proposes inserting a chart in the regulations that would set forth the 
types of whisky that

[[Page 60597]]

are not distinctive products of other countries, the source material 
from which the whisky may be produced, whether storage is required, the 
proof at which the whisky may be stored, and whether neutral spirits 
and harmless, coloring, flavoring, or blending materials may be used. 
Among other things, the proposed rule will codify in the regulations 
for the first time TTB's current policy, as set forth in the Distilled 
Spirits Beverage Alcohol Manual (TTB P 5110.7), that coloring, 
flavoring, or blending materials may not be added to products 
designated as ``bourbon whisky.''
    TTB also proposes to provide for a new type designation of ``white 
whisky or unaged whisky.'' TTB has seen a marked increase in the number 
of products on the market that are distilled from grain but are unaged 
or that are aged for very short periods of time. Under current 
regulations, unaged products would not be eligible for a whisky 
designation (other than corn whisky) and would have to be labeled with 
a distinctive or fanciful name, along with a statement of composition. 
In order to provide guidance for these products, TTB proposes that 
products that are either unaged (so they are colorless) or aged and 
then filtered to remove color should be designated as ``white whisky'' 
or ``unaged whisky,'' respectively. This proposal represents a change 
in policy, because currently all whiskies (except corn whisky) must be 
aged, although there is no minimum time requirement for such aging. TTB 
believes that currently some distillers may be using a barrel for a 
very short aging process solely for the purpose of meeting the 
requirement to age for a minimal time. Consequently, TTB is proposing 
the new type designation of ``white whisky or unaged whisky'' and 
specifically requests comments on this new type and its standards.
    In addition, TTB proposes to maintain the definitions for Scotch 
Whisky, Canadian Whisky, and Irish Whisky without change, but seeks 
comment on whether these standards should be clarified to indicate that 
certain standards for these types may differ from U.S. standards for 
whisky. For example, Scotch Whisky is whisky produced in Scotland in 
accordance with United Kingdom laws and regulations, which do not 
require that whisky be aged in new charred oak barrels. TTB policy is 
to allow whisky labeled as Scotch whisky to be produced under United 
Kingdom standards, and TTB seeks comment on whether, and what, 
additional clarifications in the regulations would improve 
understanding of the TTB labeling regulations.
    Proposed Sec.  5.144 generally restates the current standards for 
gin, but, in order to make the use of other aromatics optional, would 
change the requirement that gin be made with juniper berries and other 
aromatics. Also, TTB proposes to remove the designation ``Geneva gin 
(Hollands gin)'' from the list of ``distilled gin'' designations 
because that designation usually refers to gin that has been stored in 
wooden containers, which is not necessarily synonymous with the 
description ``distilled gin.''
    Proposed Sec.  5.145 sets out the standards for brandy, with minor 
clarifying changes. One of the proposed amendments would allow the use 
of the terms ``Slivovitz'' and ``Kirschwasser'' as optional 
designations for plum brandy and cherry brandy, respectively. 
Additionally, TTB proposes to incorporate Armagnac, Brandy de Jerez, 
and Calvados into the regulations as types of brandy. These products 
are distinctive products of France, Spain, and France, respectively, 
and they are recognized by TTB under current policy.
    Proposed Sec.  5.148 is a new section that provides for a class 
called ``agave spirits.'' Currently, spirits that are distilled from 
agave are considered distilled spirits specialties, and the labels of 
the products must contain a statement of composition, such as ``Spirits 
Distilled from Agave.'' Because TTB's standards of identity are 
generally distinguished by agricultural commodity, TTB believes it 
would be useful for consumers and for industry members if TTB created a 
class of spirits for spirits that are distilled from agave. TTB 
proposes that the mash for agave spirits be comprised of at least 51 
percent agave and that it may contain up to 49 percent sugar (weight 
before the addition of water). As proposed, Tequila, which currently 
appears as a class of distilled spirits in the TTB regulations and 
Mezcal, which does not currently appear in the TTB regulations but 
which is protected under the North American Free Trade Agreement, would 
be types of agave spirits produced in Mexico in accordance with the 
laws and regulations of Mexico. This would not require a change of 
labels of Tequila or Mezcal because these type designations may appear 
alone on the label without the class name ``agave spirits.''
    Proposed Sec.  5.149 sets forth a new standard of identity for 
Absinthe (or Absinth). Absinthe products are distilled spirits products 
produced with herbs, including wormwood, fennel, and anise. Under 
Industry Circular 2007-5, certain absinthe-type products are now 
allowed in the U.S. market, but are generally classified as distilled 
spirits specialty products or liqueurs (if they meet the standard of 
identity for a liqueur). Under current TTB policy, the word 
``Absinthe'' may not stand alone on the label; therefore, labels use 
multi-word names that include the word ``Absinthe'' (such as ``Absinthe 
Vert'' or ``Absinthe Superieure''). TTB believes that consumers 
understand what absinthe is and that it is appropriate to set out a 
standard of identity for absinthe. The proposed standard reminds the 
reader that the products must be thujone-free under FDA regulations. 
Based on current limits of detection, a product is considered 
``thujone-free'' if it contains less than 10 parts per million of 
thujone. Finally, TTB proposes to supersede Industry Circular 2007-5 in 
its entirety, without incorporating the requirement that all wormwood-
containing products undergo analysis by TTB's laboratory before 
approval. TTB will verify compliance with FDA limitations on thujone 
through marketplace review and distilled spirits plant investigations, 
where necessary.
    Proposed Sec.  5.150 sets out the standards for cordials and 
liqueurs. Among other changes, TTB proposes to incorporate into this 
section the holding in Revenue Ruling 61-71, which prohibits the terms 
``distilled,'' ``compound,'' or ``straight'' from appearing on labels 
for cordials and liqueurs. These terms imply original distillation; 
thus, they are deemed to be misleading on labels for cordials and 
liqueurs.
    Certain cordials or liqueurs may be designated with a name known to 
consumers as referring to a cordial or liqueur and therefore need not 
use the word ``cordial'' or ``liqueur'' as part of their designation. 
Thus, pursuant to TTB's Beverage Alcohol Manual (TTB P 5110.7), several 
cordials and liqueurs--specifically, Kummel, Ouzo, Anise, Anisette, 
Sambuca, Peppermint Schnapps, Triple Sec, Cura[ccedil]ao, Goldwasser, 
and Cr[egrave]me de [predominant flavor]--currently may be designated 
by those names on the labels of those products. TTB proposes to codify 
this policy by adding these names as type designations under proposed 
Sec.  5.150.
    Proposed Sec.  5.151 would establish ``flavored spirits'' as a 
revised and expanded class of distilled spirits consisting of spirits 
conforming to one of the standards of identity (the ``base spirits'') 
to which have been added nonbeverage flavors, wine, or nonalcoholic 
natural flavoring

[[Page 60598]]

materials, with or without the addition of sugar, and bottled at not 
less than 30 percent alcohol by volume (60 proof). This is a 
clarification of current TTB policy, which is that you may not add 
additional spirits to a base spirit in a flavored spirits product, even 
if the additional spirits are mixed into an intermediate product.
    The TTB regulations currently list flavored brandy, flavored gin, 
flavored rum, flavored vodka, and flavored whisky as the class 
designations under Class 9. Other types or classes of distilled spirits 
that are flavored currently are treated as distilled spirits specialty 
products and the labels for such products must contain a statement of 
composition. While TTB allows for any spirit to appear as part of a 
truthful statement of composition, TTB does not believe that consumers 
perceive a distinction between, for example ``Orange Flavored 
Tequila''--which is how a flavored spirit would be designated under the 
proposed rule--and ``Tequila with Orange Flavor''--which is how the 
statement of composition would appear for a distilled spirits specialty 
product. TTB therefore believes it should allow any type of base spirit 
to be flavored in accordance with the flavored spirits standard instead 
of just brandy, gin, rum, vodka, and whisky, as permitted by the 
current regulations. Accordingly, proposed Sec.  5.151 provides a class 
of flavored spirits that would allow any base spirit to be flavored 
when made in accordance with the standards of identity set forth in the 
regulation. TTB proposes to maintain a minimum alcohol content at 
bottling of 30 percent (60[deg] proof) for this revised and expanded 
class. Flavored spirits may contain added wine. TTB proposes to 
maintain the requirement that wine content above 2\1/2\ percent (or 
12\1/2\ percent for brandy) must be disclosed on a label.
    One new provision that TTB addresses in the proposed text regarding 
standards of identity is the use of the term ``diluted.'' As set forth 
in ATF Ruling 75-32, TTB currently requires that distilled spirits 
bottled at below the specified alcohol content for that particular 
class be designated on the label as ``diluted'' in direct conjunction 
with the statement of class and type to which it refers. For example, 
under the standard of identity for vodka set forth at current Sec.  
5.22(a), vodka must be bottled at ``not less than 80 proof.'' As a 
result, a vodka bottled at 60 proof must bear the statement ``diluted 
vodka'' on the label. TTB proposes, in Sec.  5.153, to incorporate this 
policy into the regulations by establishing a class of spirits known as 
``diluted spirits.'' This applies to products that would otherwise meet 
one of the class or type designations specified in subpart I except 
that it does not meet the minimum alcohol content, usually because of 
reduction of proof through the addition of water. Although the ruling 
states that the word ``diluted'' must be readily legible and as 
conspicuous as the statement of class to which it refers and in no case 
smaller than 8-point Gothic caps (except on small bottles), TTB 
proposes to require that the word ``diluted'' appear in readily legible 
type at least half the size of the class and type designation to which 
it refers. For example, but for the fact that a product is 70 proof, it 
would be eligible to be designated as ``Vodka.'' Instead it must be 
designated as ``Diluted Vodka''.
    Certain geographical designations may be used on distilled spirits 
as, or as part of, the designation on the label. In proposed Sec.  
5.154, TTB proposes to change the rules for geographical designations 
currently found in Sec.  5.22(k) and (l). Specifically, TTB proposes to 
provide that geographical names that are not generic may be used on 
products made outside of the place indicated by the name, if TTB 
determines that the name represents a type of distilled spirits and if 
the designation includes a qualifier such as ``type'' or ``style'' or a 
statement indicating the true place of production.
    For example, Oj[eacute]n is a town in Spain, and ``Aguardiente de 
Oj[eacute]n'' is a distilled spirits product associated with Spain. 
Thus, the current and proposed regulations provide that ``Ojen'' is an 
example of a distinctive type of distilled spirits with a geographical 
name that has not become generic. If Ojen were made in the United 
States, it could be designated as ``Ojen type'' or ``American Ojen'' or 
with another similar phrase.
    TTB also proposes to list specific products that are associated 
with a particular place that have become generic. These products could 
be manufactured in any place, and the label would not be required to 
bear a qualifier such as ``type'' or ``style'' or any other dispelling 
statement. An example of a name that continues to be considered generic 
is ``Aquavit.'' Although this name was traditionally associated with 
the Scandinavian countries, TTB believes that by usage and common 
knowledge, this name has lost its geographical significance to the 
extent that it has become generic. Thus, TTB proposes to list Aquavit, 
along with Zubrovka, Arrack, Kummel, Amaretto, and Ouzo, as examples in 
this category.
    Pursuant to Article 2.13.2 of the United States-Korea Free Trade 
Agreement, the United States agreed to recognize Andong Soju as a 
distinctive product of the Republic of Korea. See TTB Ruling 2012-3. 
Accordingly, TTB is proposing to add Andong Soju to the list of 
geographic names that have not become generic and that may not be used 
on distilled spirits made in any place outside the particular place or 
region indicated in the name. TTB is proposing to supersede TTB Ruling 
2012-3.
    In addition, TTB proposes to list Habanero, Sambuca, and Goldwasser 
as a category of designations that have not become generic, and could 
only be used on products produced outside of the places indicated by 
the names if the label contains a phrase clearly indicating the place 
of production. Examples of this usage include ``American Sambuca'' and 
``Sambuca--Product of the United States.'' This proposal is not 
intended to change policy; current regulations in Sec.  5.22(l)(2) 
provide Habanero as an example of a name for distilled spirits that are 
a distinctive product of a particular place, and the Distilled Spirits 
Beverage Alcohol Manual (TTB P 5110.7) recognizes Sambuca and 
Goldwasser as distinctive designations. TTB solicits comments 
addressing whether or not these terms should still be recognized as 
being distinctive of a particular geographical origin.
    Under the current Sec.  5.35(a), products that do not meet the 
definition of one of the specified classes or types of distilled 
spirits must be designated in accordance with trade and consumer 
understanding or, if no such understanding exists, by a distinctive or 
fanciful name followed by a truthful and adequate statement of 
composition. Proposed Sec.  5.156 sets forth a new specific designation 
for a class of spirits called ``distilled spirits specialty products.'' 
By setting forth this new class, TTB intends to clarify the treatment 
of distilled spirits specialty products and the labeling requirements 
that apply to such products. Products within this class are not 
required to be labeled with the designation ``distilled spirits 
specialty product.'' Instead, the distinctive or fanciful name together 
with the statement of composition acts as the product designation on 
the label.
    This classification would not make any substantive change except 
for labeling requirements for cocktails, highballs, and similar 
specialty products. The proposal would eliminate the rule allowing for 
a limited statement of composition consisting of only the spirits used 
in the manufacture of such

[[Page 60599]]

products. Over the years, TTB has seen an increase of cocktails 
recognized in bartenders' recipe books as the industry continued to 
innovate. Consumers are not fully informed when a label has only a 
cocktail name and the component spirit(s) because of the vast array of 
cocktails. Accordingly, TTB proposes to require a full statement of 
composition on such specialty products, and proposes to clarify that a 
cocktail name may be used as the distinctive or fanciful name on a 
distilled spirits specialty product.
    Certain ingredients or processes can change the class and type of a 
distilled spirit. Proposed Sec.  5.155 sets forth the rule for 
alteration of class and type as well as exceptions to the general rule 
regarding alteration. Much of this section is found in the current 27 
CFR 5.23, but TTB proposes to add wine, when used in Canadian whisky in 
accordance with Canadian law, as an exception to the general rule to 
make it clear that Canadian producers may add more than 2 and one half 
of one percent wine without altering the class from whisky. TTB has 
also had a number of requests from industry members for guidance on 
labeling products that are stored in two different types of barrels. 
For example, whisky must be stored in oak containers, in accordance 
with the standard of identity. When a producer stores the whisky in oak 
containers and then stores it in a different type of container, such as 
a maple barrel, the spirit becomes a distilled spirits specialty 
product and must be labeled with a statement of composition, such as 
``Bourbon Whisky finished in maple barrels.'' TTB proposes, in Sec.  
5.155(c), to add this requirement to the regulations.
    Proposed Sec.  5.166 sets forth the rules for the statement of 
composition as discussed in section II B of this document.
6. Subpart J--Formulas
    The current regulations in subpart C of part 5 set forth 
requirements for formulas for distilled spirits. In the present 
rulemaking, TTB proposes to maintain the formula requirements with 
minor changes to reflect current policy as set forth in TTB Industry 
Circular 2007-4. However, TTB believes there may be formula 
requirements that no longer serve a labeling purpose. TTB seeks 
specific comments on whether certain formula requirements should be 
eliminated and the rationale for such a change. TTB may address these 
issues in the final rule or in a separate rulemaking document.
7. Subpart K--Standards of Fill and Authorized Container Sizes
    Distilled spirits containers must be filled with certain specified 
amounts of the product. Additionally, the current regulations prescribe 
a maximum headspace for bottles so that consumers are not misled with 
regard to the quantity of spirits in the bottle. Over the years, 
alcohol beverage producers have greatly increased the number of brands 
and packages in the marketplace. TTB believes that if a product is 
bottled in a container that conforms to a standard of fill and is 
clearly marked with the net contents, the consumer is provided with 
sufficient information as to the amount of spirits in the bottle.
    Currently, Sec.  5.46(b) imposes a headspace requirement that 
applies to standard liquor bottles, and Sec.  5.46(c) provides design 
requirements for standard liquor bottles. Pursuant to Sec.  5.46(d), 
distinctive liquor bottles may be exempted from these requirements. A 
bottler or importer who intends to use a distinctive liquor bottle is 
currently required to apply for and obtain authorization for such use. 
Proposed Sec.  5.202 incorporates these provision without substantive 
change.
    TTB seeks comments on whether it should eliminate the current 
headspace and certain design requirements. TTB believes that 
eliminating the application requirement for distinctive liquor bottles 
would create efficiencies for both TTB and industry members by reducing 
application and review requirements. However, TTB is specifically 
interested in comments regarding any deleterious effect that 
eliminating the requirement might have on consumers.

E. Proposed Changes Specific to 27 CFR Part 7 (Malt Beverages)

    In addition to the changes discussed above that apply to all 
commodities, TTB is proposing additional editorial and substantive 
changes specific to the malt beverage labeling regulations in 27 CFR 
part 7. This section will not repeat the changes already discussed in 
section II B of this preamble. Accordingly, if a proposed change is not 
discussed in this section, please consult section II B. The substantive 
changes that are unique to part 7 are described below, by subpart.
1. Subpart A--General Provisions
    Proposed subpart A includes several sections that have general 
applicability to part 7, including a revised definitions section, a 
section that defines the territorial extent of the regulations, 
sections that set forth to whom and which products the regulations in 
part 7 apply, a section that identifies other regulations that relate 
to part 7, and sections addressing administrative items such as forms 
and delegations of the Administrator.
    a. Definitions. Proposed Sec.  7.1, which covers definitions of 
terms used in part 7, is largely consistent with the current regulatory 
text that appears in Sec.  7.10, with some amendments in addition to 
those discussed in section II B of this preamble (relating to parts 4, 
5 and 7).
    The proposed text adds definitions for the terms ``keg collar'' and 
``tap cover'' consistent with a proposed amendment, discussed later in 
this document, to allow mandatory label information to appear on keg 
collars and tap covers, subject to certain conditions. The proposed 
text amends the definition of the term ``bottler'' and removes the 
definition of ``packer,'' consistent with proposed amendments that 
would remove any distinction in name and address statements between 
``bottling'' in containers of a capacity of one gallon or less and 
``packing'' in containers in excess of one gallon.
    The proposed text retains the current definition of ``malt 
beverage,'' which is based on the statutory definition set forth in the 
FAA Act at 27 U.S.C. 211(a)(7), and updates the cross reference to 
standards applying to the use of processing methods and flavors.
    Prior to the issuance of TTB Ruling 2008-3, TTB and its predecessor 
agency had provided guidance on the minimum quantities of malted barley 
and hops required to be used in the production of malt beverages. In 
1994, the Bureau of Alcohol, Tobacco and Firearms (ATF) issued ATF 
Compliance Matters 94-1, which provided that beers fermented from at 
least 25 percent malted barley (calculated as the percentage of malt, 
by weight, compared to the total dry weight of all ingredients 
contributing fermentable extract to the base product) and made with at 
least 7\1/2\ pounds of hops (or the equivalent thereof in hop extracts 
or hop oils) per 100 barrels were ``malt beverages'' under the FAA Act.
    In TTB Ruling 2008-3, TTB announced that it was reconsidering this 
prior guidance, based on the fact that neither the FAA Act nor the 
implementing regulations in 27 CFR part 7 prescribed minimum standards 
for the amount of malted barley used in production of a malt beverage. 
The ruling also noted that TTB had determined that a beer containing a 
much lower amount of malted barley (one percent of the total dry weight 
of all ingredients contributing fermentable extract to the product) 
conformed to the definition of a ``malt beverage.'' The ruling stated 
that brewers and importers

[[Page 60600]]

should contact TTB's Advertising, Labeling, and Formulation Division 
with questions as to whether a particular product falls within the 
definition of a ``malt beverage'' and therefore is subject to the COLA 
and other requirements of the FAA Act.
    In this rulemaking document, TTB is not proposing to set forth any 
minimum standards for the quantity of malted barley or hops used in the 
production of malt beverages. TTB solicits comments from all interested 
parties on whether the regulations in part 7 should address this issue.
    b. Prohibitions and jurisdictional limits of the FAA Act. Proposed 
Sec.  7.3, which sets forth the general requirements and prohibitions 
under 27 U.S.C. 205(e), repeats the essential elements of the 
prohibitions found in current Sec.  7.20 and the misbranding provisions 
found in current Sec.  7.21. Because the term ``misbranding'' is not 
used consistently in current part 7, proposed Sec.  7.3 would replace 
that term with the requirement that malt beverage containers be labeled 
in accordance with the regulations in part 7.
    Proposed Sec.  7.4 sets forth the jurisdictional limits found in 27 
U.S.C. 205. As referenced earlier, the first prohibition in 27 U.S.C. 
205(e) applies to any persons engaged in business as a brewer, an 
importer, or a wholesaler of malt beverages, and it prohibits the sale 
or shipment or delivery for sale or shipment, or other introduction in 
interstate or foreign commerce, or receipt therein, or removal from 
customs custody for consumption, of any malt beverages in bottles, 
unless such products are bottled, packaged, and labeled in conformity 
with regulations issued by the Secretary of the Treasury with respect 
to the packaging, marking, branding, labeling, and size and fill of 
container. The penultimate paragraph of 27 U.S.C. 205 further limits 
this application, by providing that the provisions of section 205(e) 
``shall apply to the labeling of malt beverages sold or shipped or 
delivered for shipment or otherwise introduced into or received in any 
State from any place outside thereof * * * only to the extent that the 
law of such State imposes similar requirements with respect to the 
labeling * * * of malt beverages not sold or shipped or delivered for 
shipment or otherwise introduced into or received in such State from 
any place outside thereof.''
    Consistent with the language of current Sec.  7.20(a) and (b), 
proposed Sec.  7.4 sets out these jurisdictional limits. Paragraph 
(a)(1) essentially restates the provisions of the penultimate paragraph 
of 27 U.S.C. 205(f). Paragraph (a)(2) sets out the longstanding Bureau 
interpretation of what is ``similar'' State law, by stating that if the 
label in question does not violate the laws of the State or States into 
which the malt beverages are being shipped, it does not violate part 7. 
Finally, paragraph (a)(3) clarifies that the regulations in part 7 do 
not apply to domestically bottled malt beverages that are not and will 
not be sold or shipped, or delivered for sale or shipment, or otherwise 
introduced in interstate or foreign commerce.
    c. Ingredients and processes. Proposed Sec.  7.5 is derived from 
current Sec.  7.11, and no substantive changes have been made. It 
should be noted that the current regulation authorizes the use of 
``flavors and other nonbeverage ingredients containing alcohol'' in the 
production of malt beverages, subject to certain limitations. In the 
proposed regulation, the word ``nonbeverage'' has been inserted in 
front of the term ``flavors,'' simply to clarify that the regulation is 
intended to authorize only the use of nonbeverage flavors containing 
alcohol.
    d. Brewery products that are not malt beverages. For the first 
time, TTB is proposing to include regulations in part 7 that explicitly 
refer readers to the regulations in part 4 for sak[eacute] and similar 
products that meet the definition of ``wine'' under the FAA Act, and to 
the FDA food labeling regulations for alcohol beverage products that do 
not fall under the definition of malt beverages, wine, or distilled 
spirits under the FAA Act. TTB receives many inquiries about such 
products, and TTB believes that including this information in the 
regulatory text will be helpful.
    Consistent with the guidance found in TTB Ruling 2008-3, proposed 
Sec.  7.6 is a new provision that clarifies that certain brewery 
products are not subject to the labeling requirements of part 7 because 
they do not fall under the definition of a ``malt beverage'' under the 
FAA Act. As set forth in greater detail in the ruling, certain brewed 
products that are classified as ``beer'' under the IRC definition in 26 
U.S.C. 5052(a) do not fall within the definition of a ``malt beverage'' 
in the FAA Act, as found in 27 U.S.C. 211(a)(7). The major differences 
between the terms are set forth as follows in the ruling:

    As indicated above, the definition of a ``beer'' under the IRC 
differs from the definition of a ``malt beverage'' under the FAA Act 
in several significant respects. First, the IRC does not require 
beer to be fermented from malted barley; instead, a beer may be 
brewed or produced from malt or ``from any substitute therefor.'' 
Second, the IRC does not require the use of hops in the production 
of beer. Third, the definition of ``beer'' in the IRC provides that 
the product must contain one-half of one percent or more of alcohol 
by volume, whereas there is no minimum alcohol content for a ``malt 
beverage'' under the FAA Act.
    Accordingly, a fermented beverage that is brewed from a 
substitute for malt (such as rice or corn) but without any malted 
barley may constitute a ``beer'' under the IRC but does not fall 
within the definition of a '' malt beverage'' under the FAA Act. 
Similarly, a fermented beverage that is not brewed with hops may 
fall within the IRC definition of ``beer'' but also falls outside of 
the definition of a ``malt beverage'' under the FAA Act.
    It should be noted that sak[eacute] and similar products are 
included within the definition of ``beer'' under the IRC. See 26 
U.S.C. 5052(a). However, sak[eacute] is also included within the 
definition of a wine under the FAA Act, which, among other things, 
covers only wines with an alcohol content of at least seven percent 
alcohol by volume. See 27 U.S.C. 211(a)(6). Thus, sak[eacute] and 
similar products with an alcohol content of at least seven percent 
alcohol by volume are subject to the labeling and other requirements 
of the FAA Act.

The ruling thus held that in cases where a brewery product (other than 
sak[eacute] and similar products) failed to meet the definition of a 
``malt beverage'' under the FAA Act, the product will be subject to 
ingredient and other labeling requirements administered by the FDA.
2. Subpart B--Certificates of Label Approval
    As mentioned previously, TTB is proposing to consolidate the 
regulations related to applying for label approval in a revised subpart 
B. In addition to the changes already discussed, TTB is proposing to 
clarify the COLA requirements as they apply to brewers that are selling 
their domestically bottled malt beverages exclusively in the State in 
which the malt beverages were bottled. In TTB Ruling 2013-1, TTB issued 
guidance on this issue. TTB now proposes to make the regulations more 
clear and specific.
    In proposed Sec.  7.21(a), the regulations set forth the general 
requirement for a COLA. In proposed Sec.  7.21(b), the regulations 
clarify that a COLA is required for malt beverages shipped into a State 
from outside of the State only where the laws or regulations of the 
State require that all malt beverages sold or otherwise disposed of in 
such State be labeled in conformity with the requirements of subparts D 
through I of part 7. This is consistent with the language in current 
Sec.  7.40, with conforming changes to reflect the reorganization of 
part 7. Proposed Sec.  7.21(b) goes on to explain that this requirement 
applies where the State has either adopted subparts D through I in 
their entirety or has adopted

[[Page 60601]]

requirements identical to those set forth in subparts D through I. This 
is consistent with the longstanding policy of TTB and its predecessor 
agencies.
    Consistent with longstanding policy, proposed Sec.  7.21(b) also 
notes that malt beverages that are not subject to the COLA requirements 
of current Sec.  7.21 may still be subject to the substantive labeling 
provisions of subparts D through I, to the extent that the State into 
which the malt beverages are being shipped has similar State law or 
regulations. This is because a State may have certain State laws or 
regulations that are similar to the labeling regulations in part 7, but 
are not identical. In such a case, while the COLA requirement would not 
apply to malt beverages in containers that are shipped into that State, 
the substantive labeling provisions may apply to the extent that the 
state in question has similar state law.
    As noted earlier, the FAA Act requires any brewer or wholesaler who 
bottles malt beverages to obtain a COLA prior to bottling. The FAA Act 
then goes on to state that malt beverages, like wines and distilled 
spirits, are exempt from the COLA requirements if, upon application to 
the Secretary, the bottler shows that the malt beverages to be bottled 
by the applicant are not to be sold, or offered for sale, or shipped or 
delivered for shipment, or otherwise introduced, in interstate or 
foreign commerce. TTB's predecessor agencies implemented this exemption 
for distilled spirits and wines by allowing for the issuance of a 
certificate of exemption for these products. However, with respect to 
malt beverages, the regulations did not require a COLA for products 
that were not to be entered in interstate commerce.
    Prior to the issuance of TTB Ruling 2013-1, TTB received several 
inquiries from brewers who were not sure how the COLA requirements 
applied to their products. Accordingly, proposed Sec.  7.21(c) 
specifically clarifies that persons bottling malt beverages that will 
not be shipped, or delivered for sale or shipment, in interstate or 
foreign commerce, are not required to obtain a COLA or a certificate of 
exemption from label approval, along with a note explaining what a 
certificate of exemption from label approval is.
    The proposed regulations are thus consistent with current 
regulations in that they do not require a certificate of exemption for 
malt beverages that will not be shipped or otherwise introduced in 
interstate or foreign commerce. TTB believes that this is consistent 
with its overall goal of minimizing burdens on industry members. 
However, TTB recognizes that sometimes intrastate brewers need some 
type of certificate from TTB in order to satisfy State requirements. We 
solicit comments on whether the issuance of a certificate of exemption 
in such circumstances (for products that will not be sold outside of 
the State of the bottling brewery) would be useful, and whether the 
regulations should allow a certificate of exemption for such products.
3. Subpart D--Label Standards
    Proposed subpart D contains regulations that govern the placement 
and other requirements applicable to mandatory information and 
additional information on labels and containers. As previously 
mentioned, TTB is proposing a new regulation for keg labels. Proposed 
Sec.  7.51(a) provides, consistent with current regulations, that any 
label that is not an integral part of the container must be affixed to 
the container in such a way that it cannot be removed without thorough 
application of water or other solvents. However, proposed Sec.  7.51(b) 
provides that a label on a keg with a capacity of 10 gallons or more 
that is in the form of a keg collar or a tap cover is not required to 
be firmly affixed, provided that the name of the brewer of the malt 
beverage is permanently or semi-permanently stated on the keg in the 
form of embossing, engraving, or stamping, or through the use of a 
sticker or ink jet method.
    Brewers have asked for such an exception, asserting that the 
current requirement for firmly affixed labels is unduly burdensome when 
it comes to kegs. Because kegs are intended to be reused, brewers have 
argued that it takes considerable time and effort to scrape off the 
label each time a keg is to be reused. For this reason, brewers have 
requested permission to use a keg collar that is not firmly affixed to 
the keg, or a tap cover, to bear mandatory labeling information.
    TTB believes that additional flexibility can be afforded with 
regard to the labeling of kegs without sacrificing consumer protection. 
For this reason, the proposed rule requires the name of the brewer to 
be permanently or semi-permanently stated on the keg in the form of 
embossing, engraving, or stamping, or through the use of a sticker or 
ink jet method. TTB notes that its IRC-based regulations in current 27 
CFR 25.141 already require the name of the brewer to be permanently 
marked on each barrel or keg. TTB also notes that the proposed 
regulatory text specifically states that this exemption in no way 
affects the requirements in 27 CFR part 16 regarding the mandatory 
health warning statement, which would not be permitted to appear on a 
tap cover or on a keg collar that was not firmly affixed to the keg. 
TTB seeks comments from the public on whether the proposed rule would 
reduce burdens on brewers, and whether it could create any consumer 
protection issues.
4. Subpart E--Mandatory Label Information
    a. Brand labels. Current Sec.  7.22 requires that certain mandatory 
information appear on the brand label of a malt beverage, while other 
mandatory information, and any additional information, may appear on a 
label anywhere on the container. The brand label is defined in current 
Sec.  7.10 as ``[t]he label carrying, in the usual distinctive design, 
the brand name of the malt beverage'' and, under current Sec.  7.22, 
the brand name, class, name and address, net contents (except when 
blown, branded, or burned, on the container), and alcohol content (when 
required for certain malt beverages produced with flavors or other 
nonbeverage ingredients containing alcohol) are required to appear on 
the brand label.
    In practice, however, a brand label may be a label that wraps 
entirely around a can or bottle. As a result, mandatory information may 
appear anywhere on certain cans or bottles. Such cans and bottles are 
common containers of malt beverages. Furthermore, if the label bearing 
the brand name is on the back of the container, then it is the brand 
label.
    TTB believes that the current regulations requiring that certain 
mandatory information be placed on the brand label of malt beverage 
containers are unduly restrictive. Furthermore, the prevalence of 
wraparound labels significantly reduces the consumer protection 
otherwise provided by this rule. Finally, TTB believes that consumers 
are used to looking at the back and neck labels to find mandatory 
information on containers.
    Accordingly, TTB is proposing, in proposed Sec.  7.63, to amend the 
regulations to allow mandatory information to appear on any label on 
the malt beverage container.
    b. Alcohol content. As previously noted, the FAA Act, which was 
enacted in 1935, prohibited alcohol content statements on malt beverage 
labels unless required by State law. See 27 U.S.C. 205(e)(2). That 
prohibition was overturned in 1995 by the U.S. Supreme Court in Rubin 
v. Coors Brewing Company, 514 U.S. 476 (1995).
    Prior to the Supreme Court's decision in Coors, the malt beverage 
regulations

[[Page 60602]]

in Sec.  7.26 reflected the statutory prohibition against alcohol 
content statements. After a ruling by the United States District Court 
for the District of Colorado in the Coors litigation, TTB's predecessor 
agency, ATF, issued an interim rule indefinitely suspending those 
regulations as of April 19, 1993. See T.D. ATF-339 (58 FR 21232, April 
19, 1993). That interim rule also implemented new alcohol content 
regulations by adding current Sec.  7.71, which allows alcohol content 
statements unless prohibited by State law. When the alcohol content is 
stated, and the manner of the statement is not required under State 
law, the provisions of current Sec.  7.71 prescribe how the alcohol 
content may be stated. The 1993 regulations were issued as an interim 
rule and they have not been finalized.
    In 2005, in T.D. TTB-21 (70 FR 194, January 3, 2005), TTB issued a 
final rule requiring alcohol content statements for those malt 
beverages that contain alcohol derived from added flavors or other 
added nonbeverage ingredients (other than hops extract) containing 
alcohol. TTB is retaining this provision in the proposed regulations, 
and TTB is proposing to finalize the interim alcohol content 
regulations in this rulemaking. In this proposed rule, current Sec.  
7.26 is removed, and the provisions of current Sec.  7.71 are 
incorporated in proposed Sec.  7.65 with some editorial changes for 
clarity, including a list of the acceptable ways to present an alcohol 
content statement on a label. Also, several substantive changes are 
proposed, as set forth below.
    Proposed Sec.  7.65(b)(1) specifically provides that statements 
other than a percentage of alcohol by volume, such as statements of 
alcohol by weight, may appear on the label if they are truthful, 
accurate, and specific factual representations of alcohol content, and 
if they appear together with, and as part of, the statement of alcohol 
content as a percentage of alcohol by volume. Among other things, this 
proposal is consistent with the policy adopted in TTB Ruling 2013-2, in 
which TTB allowed the use of voluntary Serving Facts statements on 
labels and in advertisements. A Serving Facts statement includes 
nutrient information and may, on an optional basis, also include 
alcohol content information. In the ruling, TTB held that if alcohol 
content is expressed as a percentage of alcohol by volume, the Serving 
Facts statement may also include a statement of the fluid ounces of 
pure ethyl alcohol per serving (rounded to the nearest tenth) as part 
of the alcohol by volume statement.
    With regard to statements of alcohol content by weight, some States 
require alcohol content statements to be expressed in this form. The 
regulations have always allowed alcohol content statements to be made 
in accordance with State requirements, and will continue to do so. 
However, some brewers would like to put alcohol content as both a 
percentage of alcohol by volume and as a percentage of alcohol by 
weight on labels of products sold in all States, so that they can use 
the same label in the States that require alcohol content as a 
percentage of alcohol by weight and in other States that neither 
require nor prohibit alcohol content statements as a percentage of 
alcohol by weight.
    TTB is proposing to allow this, but it solicits comments on whether 
allowing this information on labels would be confusing to consumers, or 
whether it would provide consumers with useful additional information. 
In particular, TTB seeks comments on whether permitting both formats on 
labels might confuse consumers as to the meaning of the different ways 
of expressing alcohol content. If so, does requiring the statements to 
appear together, as part of the same alcohol content statement, negate 
any potential confusion?
    In addition, in proposed Sec.  7.65(c), TTB proposes to expand the 
tolerance for alcohol content on malt beverage labels. Currently, for 
most malt beverages, the regulations allow a tolerance of 0.3 
percentage points above or below the labeled alcohol content. TTB 
proposes to expand this tolerance to one percentage point above or 
below the labeled alcohol content. Some brewers, especially small 
brewers, have avoided putting an optional alcohol content statement on 
malt beverage labels because they have difficulty maintaining a precise 
alcohol content from batch to batch. TTB believes that increasing the 
tolerance level will encourage more brewers to include this important 
information on labels. Furthermore, TTB does not believe that a one 
percentage point variation from the labeled alcohol content will 
significantly impact consumers. We note that the wine regulations 
allow, with certain exceptions, tolerances of one percentage point for 
wines above 14 percent alcohol by volume and 1.5 percentage points for 
wines with an alcohol content of no more than 14 percent alcohol by 
volume.
    Exceptions to the tolerance are maintained without change. For 
example, if a malt beverage label states that the beverage has an 
alcohol content above 0.5 percent, the actual content may not be below 
0.5 percent, regardless of any tolerance that would otherwise be 
allowed.
    Finally, this document does not propose to make alcohol content 
statements on malt beverage labels mandatory. In Notice No. 73 (72 FR 
41860, July 31, 2007) TTB proposed requiring alcohol content statements 
for all malt beverage labels, but no final rule on that issue has been 
published. TTB is not proposing to address mandatory alcohol content 
statements for malt beverage containers in this rulemaking; TTB will 
address that issue in a separate rulemaking procedure.
    c. Name and place where bottled on labels of domestically bottled 
malt beverages. The name and place where bottled informs the consumer 
as to who bottled the malt beverage, and where the bottling took place 
or where the bottler's principal place of business is. Proposed Sec.  
7.66 is derived from current Sec.  7.25(a) and (c) and prescribes how 
the name and place where malt beverages are bottled must appear on 
containers of domestically bottled malt beverages. The proposed 
regulations differ from the current regulations in a few key ways.
    First, the proposed regulations reflect agency policy stated in the 
Beverage Alcohol Manual for Malt Beverages (TTB P 5130.3), that a 
listing of all the brewer's locations may be provided on a label under 
certain conditions. This language is also consistent with labeling 
requirements for beer under TTB's IRC-based regulations in 27 CFR 
25.142.
    Second, the proposed regulations provide more guidance with regard 
to what is required when malt beverages are brewed and bottled for 
another person. For example, the proposed regulations provide that, if 
the same brand of malt beverages is brewed and bottled by two breweries 
that are not of the same ownership, the label for each brewery may set 
forth both locations where bottling takes place, as long as the label 
uses the actual locations (and not the principal place of business) and 
as long as the nature of the agreement is clearly set forth. Examples 
are provided in the regulatory text.
    Third, the proposed regulations provide that the place of bottling 
and the address of the principal place of business of a brewer must be 
consistent with the city and State of the address reflected on the 
brewers notice. This change reflects TTB's current policy as stated in 
the Beverage Alcohol Manual.
    d. Net contents. The current regulations allow for the use of U.S. 
standard measures but do not address whether metric contents may also 
be displayed. However, it is current TTB policy to allow net contents 
to be expressed in both formats. Proposed

[[Page 60603]]

Sec.  7.70 allows for the statement of net contents of metric 
measurements in addition to, but not in lieu of, the U.S. standard 
measures.
5. Subpart F--Restricted Labeling Statements; Use of the Term ``Draft''
    The proposed regulations also address the use of the term ``draft'' 
on malt beverage labels. Longstanding Bureau policy is set forth in 
Industry Circular 65-1, which sets out standards for the use of the 
word ``draft'' on malt beverage labels. Proposed Sec.  7.87 reflects 
this policy and provides that any malt beverage in a container of one 
gallon or more that dispenses through a tap, spigot, faucet, or similar 
device may be described as ``draft.'' Malt beverages packaged in 
customary bottles and cans may also be described as ``draft'' if they 
are unpasteurized and require refrigeration for preservation, or if the 
unpasteurized beverage has been sterile filtered and aseptically 
filled. Finally, the ruling provides that malt beverages packaged in 
customary bottles or cans that have been pasteurized may be described 
as ``draft brewed'', ``draft beer flavor'', ``old time on tap taste'' 
or with another similar phrase, only if the word ``pasteurized'' 
appears on the label.
    As a matter of internal policy, TTB started to approve certain 
labels of pasteurized malt beverages using the term ``draft'' standing 
alone, if the word ``pasteurized'' also appears on the label. TTB is 
soliciting comments on whether this practice is misleading and should 
be changed. TTB is interested in comments specifically on whether it 
should continue to allow the use of any such terms on labels of 
pasteurized malt beverages. Please let TTB know if a change in these 
policies would impact existing labels.
6. Subpart H--Labeling Practices That Are Prohibited if They Are 
Misleading
    a. Use of the term ``bonded.'' One currently prohibited practice is 
the use on malt beverage labels of the term ``bonded'' or similar terms 
that may imply governmental supervision over the production, bottling, 
or packing of the product. TTB believes that this implication (that 
such terms imply governmental supervision) is related to the use of 
those terms with regard to distilled spirits, and that such terms were 
historically prohibited because their use on malt beverage labels would 
mislead consumers by causing them to believe that the malt beverage was 
actually a distilled spirit. The text, at proposed Sec.  7.131, does 
not differ from the text currently prohibiting such terms (in Sec.  
7.29(c)). However, TTB is requesting comments on whether such terms are 
likely to mislead consumers into believing a product was made under 
governmental supervision or into believing a malt beverage is a 
distilled spirit, and, as a result, whether TTB should continue to 
prohibit their use on malt beverage labels.
    b. Strength claims. As previously mentioned, the FAA Act prohibits 
both statements of alcohol content and statements likely to be 
considered as statements of alcohol content from appearing on malt 
beverage labels, unless required by State law. See 27 U.S.C. 205(e)(2). 
Current Sec. Sec.  7.29(f) and 7.29(g) both implement the statutory ban 
on statements that are likely to be considered statements of alcohol 
content on malt beverage labels. Current Sec.  7.29(f) prohibits the 
use of the words ``strong,'' ``full strength,'' ``extra strength,'' 
``high test,'' ``high proof,'' ``pre-war strength,'' ``full oldtime 
alcoholic strength,'' and similar words or statements that are likely 
to be considered as statements of alcohol content on labels of malt 
beverages. The proposed rule modernizes the language of these 
provisions by removing some terms (such as ``pre-war strength'' and 
``full oldtime alcoholic strength'') that are not likely to be used by 
today's brewers.
7. Subpart I--Classes and Types of Malt Beverages
    Part 7 does not prescribe standards of identity for malt beverages. 
Instead, current Sec.  7.24(a) provides that statements of class and 
type for malt beverages shall conform to the designation of the product 
as known to the trade. If the product is not known to the trade under a 
particular designation, a distinctive or fanciful name, together with 
an adequate and truthful statement of composition of the product, shall 
be stated, and such statement is treated as a statement of class and 
type for purposes of part 7.
    Current Section 7.24(d) states that no product containing less than 
one-half of one percent alcohol by volume shall bear the class 
designation ``beer,'' ``lager beer,'' ``lager,'' ``ale,'' ``porter,'' 
or ``stout.'' Further, current Sec.  7.24(e) provides that no product 
other than a malt beverage fermented at comparatively high temperature, 
possessing the characteristics generally attributed to ``ale,'' 
``porter,'' or ``stout'' and produced without the use of coloring or 
flavoring materials (other than those recognized in standard practices) 
shall bear any of those class designations.
    In 1993, ATF, TTB's predecessor agency, sought comments on 
standards of identity for malt beverages, in particular malt liquors, 
in an advance notice of proposed rulemaking. See Notice No. 771 (58 FR. 
21126, April 19, 1993). However, the regulations were not amended to 
include such standards. In Notice No. 771, ATF stated that its 
predecessor agency, the Federal Alcohol Administration (FAA), issued 
proposed regulations regarding standards of identity for malt beverages 
in 1935, but noted that there were differences of opinion in the 
brewing industry regarding the standards and definitions for certain 
designations. The FAA issued regulations in 1936 providing that 
products containing less than 5 percent alcohol by volume could not be 
designated as ale, porter, or stout. See Regulations No. 7, section 24 
(1 FR 2013, November 21, 1936). The regulations were premised, in part, 
on the public perception that ale, porter, and stout were higher in 
alcohol content than beer. After more hearings, the FAA amended the 
regulations in 1938 to eliminate the list of classes and the minimum 
alcohol content requirements for ale, porter, and stout.
    TTB does not propose now to include specific standards of identity. 
Proposed Sec.  7.141 is derived from 27 CFR 7.24(a) and sets out 
standards for class and type designations on malt beverages. This 
section explains that the class of the malt beverage must be stated on 
the label. The type may optionally be stated. Statements of class and 
type must conform to the designation of the product as known to the 
trade. If the product is not known to the trade, the product must 
contain a distinctive or fanciful name as well as a statement of 
composition.
    Proposed Sec.  7.141 differs from the current regulations in that 
it proposes to define a ``malt beverage specialty'' as a malt beverage 
that does not fall under any of the class designations set forth in 
part 7 and is not known to the trade under a particular designation, 
usually because of the addition of ingredients such as colorings, 
flavorings, or food materials, or the use of certain types of 
production processes. Such beverages will not be designated as ``malt 
beverage specialties'' on the label, but the term reflects current 
usage and is a convenient way to refer to such products in the 
regulations.
    Proposed Sec.  7.142 sets out class designations. Any malt beverage 
may be designated simply as a ``malt beverage.'' The designations 
``beer'', ``ale'', ``porter'', ``stout'', ``lager'', and ``malt 
liquor'' may be used to designate malt beverages that contain at least 
0.5 percent alcohol by volume and that conform to the trade's 
understanding of those designations. TTB proposes to

[[Page 60604]]

allow these designations to be preceded or followed by descriptions of 
the color of the product (such as brown, red, or golden).
    Proposed Sec.  7.143 is largely consistent with existing 
regulations on class and type designations. There are new proposed 
provisions for ``ice beer,'' ``wheat beer,'' ``rye beer,'' and ``barley 
wine ale,'' consistent with existing TTB policy.
    The proposed regulations in proposed Sec. Sec.  7.143(h) and 7.144 
reflect changes adopted in TTB Ruling 2014-4 with respect to the 
labeling of malt beverage products fermented or flavored with honey, 
certain fruits, and certain spices. Prior to the issuance of this 
ruling, the Brewers Association, a trade association representing small 
brewers, petitioned TTB to exempt certain malt beverages from the 
formula requirements under part 25, and to liberalize the labeling 
rules applicable to these products. The Brewers Association stated that 
``[W]ell-known and widely-distributed products such as fruit beers and 
spiced beers'' were ``well known to the trade and consumers by their 
flavor designations: e.g., fruit beers, spiced ales, honey porters, and 
so forth. Required statements of composition such as `ale brewed with 
raspberry juice' or `porter brewed with honey' simply are unnecessary, 
clutter labels, and provide no more information to the consumer than 
the readily-understood designations of `raspberry ale' or 'honey 
porter.' ''
    The petition also suggested that TTB abandon the distinction 
between fruit beers made with added fruits or juices and those 
fermented with such substances, but, instead, should allow brewers to 
make this distinction on their labels if they wish.
    In TTB Ruling 2014-4, TTB adopted these changes for certain malt 
beverages designated in accordance with trade understanding. We are now 
proposing to codify these standards in the regulations. TTB seeks 
comments on whether additional ingredients should be recognized as 
traditional ingredients in the production of a fermented beverage 
designated as ``beer,'' ``ale,'' ``porter'', ``stout,'' ``lager,'' or 
``malt liquor.''
    The TTB regulations also provide for special rules for certain 
classes and types; these are currently found in Sec.  7.24(b) through 
(e). TTB proposes, in Sec. Sec.  7.143 and 7.144, to incorporate and 
partially supersede Ruling 94-3, which held that ice beer is not 
considered concentrated when it is produced by removing less than 0.5 
percent of the volume of the beer in the form of ice crystals and 
retains beer characteristics. TTB also proposes to incorporate and 
supersede Ruling 76-13, which sets forth standards for cereal 
beverages, which are malt beverages that contain less than 0.5 percent 
alcohol by volume, and confirms that such beverages fall under the 
authority of the FAA Act.
    Proposed Sec.  7.146 sets forth the requirements for geographical 
names currently found in section 27 CFR 7.24(f) through (h) with 
clarifying changes. TTB proposes to clarify that distinctive names may 
be used in addition to, but not in lieu of a class designation. For 
example, Vienna Beer or Bavarian Stout may appear as designations.
    Malt beverages that are not ``known to the trade'' are required to 
be labeled with a statement of composition. Proposed Sec.  7.147 sets 
forth provisions for statements of composition on malt beverages. These 
provisions are new to the regulations and reflect current policy. 
Specifically, a statement of composition is required to appear on the 
label for malt beverage specialty products, as defined in proposed 
Sec.  7.141(b), which are not known to the trade under a particular 
designation. For example, the addition of flavoring materials, colors, 
or artificial sweeteners may change the class and type of the malt 
beverage. The statement of composition along with a distinctive or 
fanciful name serves as the class and type designation for these 
products.
F. Proposed 27 CFR Part 14 (Advertising)
    Currently the regulatory provisions that address the advertising of 
wine, distilled spirits, and malt beverages are set forth in parts 4, 
5, and 7, respectively. As noted above, TTB proposes to add a new 27 
CFR part 14, Advertising of Wine, Distilled Spirits, and Malt 
Beverages, to consolidate these provisions into one part. In general, 
the advertising regulations require that advertisements, like labels, 
are truthful, accurate, and not misleading. Where possible, TTB seeks 
to treat advertisements for wine, distilled spirits, and malt beverages 
consistently. TTB proposes to delete the advertisement regulations for 
wine, distilled and malt beverages from parts 4, 5, and 7, 
respectively, and consolidate them into the new part 14. Additionally, 
the proposed regulations are updated for clarity and to reflect changes 
in prohibited practices that mirror those proposed in the labeling 
regulations, where appropriate.
    In the definitions section for part 14, TTB proposes to include 
several definitions that apply to advertising that currently appear in 
parts 4, 5, and 7, and to add definitions for ``consumer specialty 
item,'' and ``responsible advertiser.'' TTB also proposes to amend the 
definition of ``advertisement'' that is currently found in Sec. Sec.  
4.61, 5.62, and 7.51. Certain statements on container coverings, 
cartons, cases, carriers, or other packaging have traditionally been 
treated as advertising materials. As discussed in section II B of this 
preamble, TTB proposes to amend the labeling regulations, in proposed 
Sec. Sec.  4.62, 5.62, and 7.62, to clarify that certain information 
must appear on packaging materials. These items would not be considered 
advertisements. However, items such as hang tags that accompany the 
bottle would continue to be considered advertisements and would be 
subject to the rules in part 14.
    In proposed Sec.  14.4, TTB sets forth the general requirement that 
advertisements must be in conformity with the TTB regulations found in 
part 14. TTB proposes to add a substantiation requirement to the 
regulation that mirrors the substantiation requirement for claims made 
on labels. Accordingly, industry members will be required to 
substantiate any claim made on an advertisement and a claim that cannot 
be adequately substantiated will be considered misleading. TTB also 
proposes to require that the responsible advertiser provide 
substantiation upon request for a period of five years from the time 
the advertisement was disseminated or published.
    Certain information is required to appear on alcohol beverage 
advertisements. Specifically, the responsible advertiser's name and 
contact information must appear on the advertisement. Currently, the 
regulations require the name and address to appear on the 
advertisement. TTB proposes to liberalize that requirement so that any 
type of contact information may be used, such as a telephone number, 
website, or email address. Additionally, the class, class and type, or 
other designation for the product advertised must appear on the 
advertisement. The mandatory statements are prescribed in the proposed 
Sec.  14.6.
    In the current and proposed regulations, if an advertisement refers 
to a general alcohol beverage product line, the only information 
required is the name and address (or contact information, in the 
proposed rule) of the responsible advertiser. In some cases, TTB finds 
that a ``product line'' contains only two types of products, and it 
also finds administrative difficulty when enforcing the mandatory 
statements requirements on internet sites. TTB

[[Page 60605]]

seeks comments on whether TTB should modify this requirement and, if it 
does, how the public might be better informed when an internet site or 
other advertisement refers to more than one type of product.
    The prohibited practices for advertisements contain a number of 
rules and prohibitions that conform to the rules for labels found in 
parts 4, 5, and 7. Generally, a statement or representation that is 
prohibited from appearing on a label is also prohibited from appearing 
on an advertisement. TTB proposes to set forth the rules that apply to 
alcohol beverage advertisements in subpart A. Sections 14.11 through 
14.14 set forth the rules that apply to all alcohol beverage products. 
These are organized into sections that include related topics, in a 
similar organization to rules in parts 4, 5, and 7: Restricted 
practices, prohibited practices, and misleading statements or 
representations.
    TTB proposes, in Sec.  14.14(f) to prohibit statements or 
representations that create an impression that a product is a different 
commodity. For example, a malt beverage advertisement could not have a 
representation that leads the viewer to believe that the product is 
wine. This prohibition is similar to that proposed in the labeling 
regulations in parts 4, 5, and 7. As noted above, TTB is not proposing 
substantive changes to the rules on health-related statements on 
labels, and TTB similarly does not propose changes for such statements 
on advertisements at this time.
    Sections 14.15, 14.16, and 14.17 set forth the rules specific to 
advertisements for wine, distilled spirits, and malt beverages, 
respectively. In Sec.  14.16, TTB proposes to incorporate the modified 
rules for the use of ``double distilled,'' ``triple distilled,'' and 
similar terms, to conform to the updated rules for using the terms on 
labels of distilled spirits, as described above. TTB also proposes, in 
Sec.  14.17, to update the rules on strength claims on malt beverages, 
so that strength claims are only prohibited if the claims imply that 
products should be purchased on the basis of alcohol strength. 
Consistent with current policy, TTB proposes to remove the existing 
restrictions on alcohol content statements in advertisements for wine 
and malt beverages, in light of the Supreme Court's decision in Coors, 
which was discussed earlier in this document. Although the Coors 
decision related to labels, not advertisements, TTB does not believe 
that the advertising regulations should prohibit truthful, specific and 
numerical claims about the alcohol content of those products.
    In subpart C, TTB proposes to include references to various 
provisions of the FAA Act. Proposed Sec.  14.21 states that a violation 
of the advertising provisions of 27 U.S.C. 205(e) is punishable as a 
misdemeanor and refers readers to 27 U.S.C. 207 for the statutory 
provisions relating to criminal penalties, consent decrees, and 
injunctions. Proposed Sec.  14.22 provides that basic permits are 
conditioned upon compliance with the provisions of 27 U.S.C. 205, 
including the advertising provisions of part 14, and that a willful 
violation of the conditions of a basic permit provides grounds for the 
revocation or suspension of the permit, as applicable, as set forth in 
27 CFR part 1. Proposed Sec.  14.23 sets forth TTB's authority to 
compromise liability for a violation of 27 U.S.C. 205 upon payment of a 
sum not in excess of $500 for each offense. This sum is to be collected 
by the appropriate TTB officer and deposited into the Treasury as 
miscellaneous receipts.
    By proposing to place these provisions in the regulations, TTB is 
making it easier for a person to locate the penalties for violating the 
FAA Act and the regulations implementing the FAA Act. These proposed 
regulations will not change the criminal penalty and compromise 
provisions, which are set forth in the statute.
    The Office of Management and Budget (OMB) assigns control numbers 
to TTB's information collection requirements. In subpart D, TTB 
proposes to list those sections that impose an information collection 
requirement along with the assigned OMB control number. TTB believes 
that industry members will have an easier time locating OMB control 
numbers for information collection requirements if they are listed in 
one location.

G. Impact on Public Guidance Documents

    The chart below describes the impact of this proposed rule on 
rulings, industry circulars, and other public guidance documents issued 
over the years by TTB and its various predecessor agencies. The 
following public guidance documents will be superseded by the 
publication of a final rule:

----------------------------------------------------------------------------------------------------------------
                 Document No.                          Subject           Incorporated into proposed sections at:
----------------------------------------------------------------------------------------------------------------
                                                  Cross Cutting
----------------------------------------------------------------------------------------------------------------
Industry Circular 1963-23....................  Use of Disparaging       Not incorporated.
                                                Themes or References
                                                in Alcoholic Beverage
                                                Advertising is
                                                Prohibited.
TTB Guidance 2011-5..........................  Personalized Labels....  Sec.  Sec.   4.29, 5.29, and 7.29.
TTB Ruling 2012-3............................  Recognition of Andong    Sec.  Sec.   4.148 and 5.154.
                                                Soju and Gyeongju
                                                Beopju as Distinctive
                                                Products of Korea.
----------------------------------------------------------------------------------------------------------------
                                                      Wine
----------------------------------------------------------------------------------------------------------------
Revenue Ruling 54-250........................  Vintage Date...........  Sec.   4.95.
Revenue Ruling 54-418........................  Aperitif Wine..........  Sec.   4.147.
Revenue Ruling 55-618........................  Wine Labels............  Not incorporated.
Revenue Ruling 71-535........................  Labels on Imported       Sec.   4.68.
                                                Alcohol Beverages.
ATF Ruling 73-5..............................  Spanish Wines Labeled    Sec.   4.174.
                                                with Semi-generic
                                                Designations.
ATF Ruling 73-6..............................  Spanish Wines Labeled    Not incorporated.
                                                with Grape Type
                                                Designations.
ATF Ruling 78-4..............................  Use of Descriptive       Sec.   4.94.
                                                Terms on Wine Labels.
ATF Ruling 82-4..............................  Use of Descriptive       Sec.   4.94.
                                                Terms on Wine Labels.
ATF Ruling 85-14.............................  Labeling of Wine         Not incorporated.
                                                Bearing Generic or
                                                Semi-generic
                                                Designation.
ATF Ruling 91-1..............................  Multistate Appellations  Sec.   4.90.
                                                of Origin for
                                                Contiguous States.
ATF Ruling 2002-7............................  Wine made from grapes    Sec.   4.94.
                                                frozen after harvest
                                                may not be labeled
                                                with the term ``ice
                                                wine'' or any
                                                variation thereof, and
                                                if the wine is labeled
                                                to suggest it was made
                                                from frozen grapes,
                                                the label must be
                                                qualified to show that
                                                the grapes were frozen
                                                post-harvest.

[[Page 60606]]

 
TTB Ruling 2008-1............................  Standards of Identity    Sec.   4.174.
                                                and the Use of Semi-
                                                generic Designations
                                                and Retsina on Certain
                                                European Wines
                                                Imported into the
                                                United States.
----------------------------------------------------------------------------------------------------------------
                                                Distilled Spirits
----------------------------------------------------------------------------------------------------------------
Revenue Ruling 54-592........................  Relabeling Tax Paid      Sec.   5.42.
                                                Distilled Spirits.
Revenue Ruling 55-399........................  Straight Whiskey.......  Not Incorporated.
Revenue Ruling 55-552........................  Grain Neutral Spirits    Sec.   5.142.
                                                Stored in Wood may not
                                                be Labeled as Vodka.
Revenue Ruling 55-740........................  Neutral Spirits          Sec.   5.142.
                                                Subjected to Vodka
                                                Process but Stored in
                                                Reused Whiskey Barrels
                                                may not be Designated
                                                or Labeled as Vodka.
Revenue Ruling 56-98.........................  Flavored Vodka.........  Sec.   5.142.
Revenue Ruling 59-408........................  Addition of Caramel....  Sec.   5.156.
Revenue Ruling 61-15.........................  Labeling of Scotch       Sec.   5.90(b).
                                                Whisky.
Revenue Ruling 61-25.........................  Distilled Spirits        Sec.  Sec.   5.141 and 5.143.
                                                Labeling.
Revenue Ruling 61-71.........................  Use of the Word          Sec.   5.150(a).
                                                Straight in Labeling
                                                and Advertising of
                                                Liqueurs or Cordials.
Revenue Ruling 62-224........................  Relabeling by Wholesale  Sec.   5.42.
                                                Liquor Dealer.
Revenue Ruling 68-502........................  Light Whisky from        Sec.   5.66(f)(3).
                                                Kentucky.
Revenue Ruling 69-58.........................  Age statements.........  Not Incorporated.
Revenue Ruling 71-188........................  Whisky Classification    Sec.   5.113.
                                                as White.
Revenue Ruling 71-535........................  Labels on Imported       Sec.   5.68.
                                                Alcohol Beverages.
ATF Ruling 75-32.............................  Labeling of Diluted      Sec.   5.153.
                                                Spirits.
ATF Ruling 76-3..............................  Labeling of Vodka        Sec.   5.142.
                                                Treated with Activated
                                                Carbon as ``Charcoal
                                                Filtered''.
ATF Ruling 79-9..............................  Distilled Spirits        Sec.   5.67.
                                                Labels.
ATF Ruling 88-1..............................  Alcohol Content on       Sec.   5.44(b)(5).
                                                Labels and in
                                                Advertisements of
                                                Distilled Spirits.
ATF Ruling 93-3..............................  Age Statements on        Sec.   5.74(c).
                                                Grappa Brandy.
ATF Ruling 94-5..............................  Geographical Names.....  Sec.   5.143 and Sec.   5.145(c)(2)-(5).
ATF Ruling 97-1..............................  Use of a ``Trace         Sec.   5.142.
                                                Amount'' of Citric
                                                Acid in the Production
                                                of Vodka without
                                                Changing its
                                                Designation as Vodka.
ATF Ruling 2001-2............................  Country of Origin        Sec.   5.69.
                                                Statements on
                                                Distilled Spirits
                                                Labels.
Industry Circular 1971-7.....................  Protection of Names of   Sec.  Sec.   5.143 and 5.145.
                                                Bourbon Whiskey and
                                                Certain French
                                                Brandies.
Industry Circular 76-28......................  Production of New        Not Incorporated.
                                                Charred Barrels using
                                                Used Heads.
Industry Circular 2007-5.....................  Use of the Term          Sec.   5.149.
                                                Absinthe for Distilled
                                                Spirits.
----------------------------------------------------------------------------------------------------------------
                                                 Malt Beverages
----------------------------------------------------------------------------------------------------------------
Revenue Ruling 54-513........................  Labeling and             Not incorporated.
                                                Advertising of Malt
                                                Beverages.
Revenue Ruling 71-535........................  Labels on Imported       Sec.   7.68.
                                                Alcohol Beverages.
ATF Ruling 76-13.............................  Malt Beverages of Less   Sec.   7.145.
                                                Than \1/2\ of 1%
                                                Alcohol by Volume
                                                Subject to FAA Act.
ATF Ruling 94-3 (superseded only with respect  Ice Beer...............  Sec.   7.143.
 to the provisions related to part 7. The
 part 25 provisions remain in effect.).
ATF Procedure 98-1...........................  Labeling of Imported     Sec.  Sec.   7.67 and 7.69.
                                                Malt Beverages Bottled
                                                or Packed in the
                                                United States, and
                                                Labeling of Blends of
                                                Imported and Domestic
                                                Malt Beverages Bottled
                                                or Packed in the
                                                United States.
TTB Ruling 2008-3............................  Classification of        Sec.   7.6.
                                                Brewed Products.
TTB Ruling 2013-1............................  Malt Beverages Sold      Sec.  Sec.   7.4 and 7.21.
                                                Exclusively in
                                                Intrastate Commerce.
TTB Ruling 2015-1............................  Ingredients and          Sec.  Sec.   7.143 and 7.144.
                                                Processes Used in the
                                                Production of Beer Not
                                                Subject to Formula
                                                Requirements.
Industry Circular 1965-1.....................  Use of the Term ``Draft  Sec.   7.87.
                                                Beer'' on Labels and
                                                in Advertising of Beer.
----------------------------------------------------------------------------------------------------------------

III. Derivation Tables for Proposed Parts 4, 5, 7, and 14

------------------------------------------------------------------------
                              27 CFR Part 4
-------------------------------------------------------------------------
                                              Are derived from current
       Requirements in new section:                   section:
------------------------------------------------------------------------
4.0.......................................  4.1.
------------------------------------------------------------------------
                      Subpart A--General Provisions
------------------------------------------------------------------------
4.1.......................................  4.10.
4.2.......................................  4.2.
4.3.......................................  4.30(a) and New.
4.4.......................................  Reserved.
4.5.......................................  New.
4.6.......................................  New.
4.7.......................................  New.
4.8.......................................  4.80.
4.9.......................................  New.
4.10......................................  4.5.
4.11......................................  4.3.
4.12......................................  4.4.
------------------------------------------------------------------------
 Subpart B--Certificates of Label Approval and Certificates of Exemption
                            of Label Approval
------------------------------------------------------------------------
4.21......................................  4.50(a) and (b).
4.22......................................  New.
4.23......................................  4.50(b).
4.24......................................  4.40.
4.25......................................  New.
4.27......................................  4.51.
4.28......................................  4.38(h) and New.
4.29......................................  New.
4.30......................................  4.45.
------------------------------------------------------------------------
 Subpart C--Alteration of Labels, Relabeling, and Adding Information to
                               Containers
------------------------------------------------------------------------
4.41......................................  4.30(b).

[[Page 60607]]

 
4.42......................................  4.30(b).
4.43......................................  4.30(b).
4.44......................................  4.30(b) and New.
------------------------------------------------------------------------
                       Subpart D--Label Standards
------------------------------------------------------------------------
4.51......................................  4.38(e).
4.52......................................  4.38(a).
4.53......................................  4.38(b).
4.54......................................  New.
4.55......................................  4.38(c).
4.56......................................  4.38(f).
------------------------------------------------------------------------
                 Subpart E--Mandatory Label Information
------------------------------------------------------------------------
4.61......................................  New.
4.62......................................  4.38a and New.
4.63......................................  4.32.
4.64......................................  4.33; 4.39(i) and (j).
4.65......................................  4.36.
4.66......................................  4.35(a) and (c); New.
4.67......................................  4.35(b) and (c).
4.68......................................  4.35.
4.69......................................  New.
4.70......................................  4.37.
------------------------------------------------------------------------
                Subpart F--Restricted Labeling Statements
------------------------------------------------------------------------
4.81......................................  New.
4.82......................................  4.32a.
4.83......................................  4.32b.
4.84......................................  4.101.
4.85......................................  New.
4.86......................................  4.39(e)(2).
4.87......................................  4.39(m).
4.88......................................  4.25(a).
4.89......................................  4.25(b).
4.90......................................  4.25(c) and (d).
4.91......................................  4.25(e).
4.92......................................  4.26.
4.93......................................  New.
4.94......................................  New.
4.95......................................  4.27.
4.96......................................  4.25(a).
4.97......................................  4.25(b).
4.98......................................  4.25(c) and (d).
------------------------------------------------------------------------
                Subpart G--Prohibited Labeling Practices
------------------------------------------------------------------------
4.101.....................................  New.
4.102.....................................  4.39(a)(1).
4.103.....................................  4.39(a)(3).
4.104.....................................  4.39(a)(7).
------------------------------------------------------------------------
Subpart H--Labeling Practices That Are Prohibited if They Are Misleading
------------------------------------------------------------------------
4.121.....................................  New.
4.122.....................................  4.39(a)(1).
4.123.....................................  4.39(a)(5).
4.124.....................................  4.39(a)(2).
4.125.....................................  4.39(a)(4).
4.126.....................................  4.39(g).
4.127.....................................  4.39(e).
4.128.....................................  4.39(a)(7).
4.129.....................................  4.39(h).
4.130.....................................  4.39(a)(6).
4.131.....................................  4.39(f).
4.132 Reserved............................  N/A.
4.133.....................................  4.39(a)(8).
4.134.....................................  4.39(b)-(d).
4.135.....................................  4.39(k).
4.136.....................................  4.39(n).
------------------------------------------------------------------------
              Subpart I--The Standards of Identity for Wine
------------------------------------------------------------------------
4.141.....................................  4.20 and 4.34.
4.142.....................................  4.21(a).
4.143.....................................  4.21(b).
4.144.....................................  4.21(c).
4.145.....................................  4.21(d) and (e).
4.146.....................................  4.21(f).
4.147.....................................  4.21(g).
4.148.....................................  (New).
4.149.....................................  4.21(i).
4.150.....................................  4.21(h).
4.151.....................................  New.
4.152 & 4.153 Reserved....................  N/A.
4.154.....................................  4.22.
4.155 Reserved............................  N/A.
4.156.....................................  4.23.
4.157.....................................  4.28.
4.158-4.172 Reserved......................  N/A.
4.173.....................................  4.24(a).
4.174.....................................  4.24(b).
4.175.....................................  4.24(c)(1)-(c)(2).
------------------------------------------------------------------------
                 Subpart J--American Grape Variety Names
------------------------------------------------------------------------
4.191.....................................  4.93.
4.192.....................................  4.91.
4.193.....................................  4.92.
------------------------------------------------------------------------
 Subpart K--Standards for Wine Containers and Authorized Container Sizes
------------------------------------------------------------------------
4.201.....................................  4.70.
4.202.....................................  4.71.
4.203.....................................  4.72.
4.204.....................................  New.
------------------------------------------------------------------------
        Subpart L--Recordkeeping and Substantiation Requirements
------------------------------------------------------------------------
4.211.....................................  New.
4.212.....................................  New.
------------------------------------------------------------------------
            Subpart M--Penalties and Compromise of Liability
------------------------------------------------------------------------
4.221.....................................  New.
4.222.....................................  New.
4.224.....................................  New.
------------------------------------------------------------------------
                   Subpart N--Paperwork Reduction Act
------------------------------------------------------------------------
4.231.....................................  New.
------------------------------------------------------------------------


------------------------------------------------------------------------
                              27 CFR Part 5
-------------------------------------------------------------------------
                                              Are derived from current
       Requirements of new section:                   section:
------------------------------------------------------------------------
5.0.......................................  5.1.
------------------------------------------------------------------------
                      Subpart A--General Provisions
------------------------------------------------------------------------
5.1.......................................  5.11.
5.2.......................................  5.1.
5.3.......................................  New.
5.4.......................................  [reserved].
5.5.......................................  [reserved].
5.6.......................................  [reserved].
5.7.......................................  New.
5.8.......................................  New.
5.9.......................................  New.
5.10......................................  5.2.
5.11......................................  5.3.
5.12......................................  5.4.
------------------------------------------------------------------------
 Subpart B--Certificates of Label Approval and Certificates of Exemption
                           From Label Approval
------------------------------------------------------------------------
5.21......................................  5.31(a).
5.22......................................  5.55.
5.23......................................  5.55(b).
5.24......................................  5.51(a).
5.25......................................  5.51.
5.27......................................  5.51 and 5.55.
5.28......................................  5.33(g).
5.29......................................  New.
5.30......................................  5.52.
------------------------------------------------------------------------
  Subpart C--Alteration of Labels, Relabeling and Adding Information to
                               Containers
------------------------------------------------------------------------
5.41......................................  5.31(b).
5.42......................................  5.31(b).
5.43......................................  ............................
------------------------------------------------------------------------
                       Subpart D--Label Standards
------------------------------------------------------------------------
5.51......................................  5.33(e).
5.52......................................  5.33(a).
5.53......................................  5.33(b)(5) and (6).
5.54......................................  New.
5.55......................................  5.33(c).
5.56......................................  5.33(f).
------------------------------------------------------------------------
                 Subpart E--Mandatory Label Information
------------------------------------------------------------------------
5.61......................................  New.
5.62......................................  5.41 and New.
5.63......................................  5.32.
5.64......................................  5.34.
5.65......................................  5.37.
5.66......................................  5.36.
5.67......................................  5.36.
5.68......................................  5.36.
5.69......................................  5.36(e).
5.70......................................  5.38.
5.71......................................  5.39(a).
5.72......................................  5.39(b).
5.73......................................  5.39(c).
5.74......................................  5.40.
------------------------------------------------------------------------
                Subpart F--Restricted Labeling Statements
------------------------------------------------------------------------
5.81......................................  New.
5.82......................................  5.32a.
5.83......................................  5.32b.
5.84......................................  5.71.
5.85......................................  New.
5.86......................................  Reserved.
5.87......................................  New.
5.88......................................  5.42(b)(4).
5.89......................................  5.42(b)(6).
5.90......................................  5.22(k)(4).

[[Page 60608]]

 
5.91......................................  5.42(b)(5).
------------------------------------------------------------------------
                Subpart G--Prohibited Labeling Practices
------------------------------------------------------------------------
5.101.....................................  New.
5.102.....................................  5.42(a)(1).
5.103.....................................  5.42(a)(3).
------------------------------------------------------------------------
Subpart H--Labeling Practices That Are Prohibited if They Are Misleading
------------------------------------------------------------------------
5.121.....................................  New.
5.122.....................................  5.42(a)(1).
5.123.....................................  5.42(a)(5).
5.124.....................................  5.42(a)(2).
5.125.....................................  5.42(a)(4).
5.126.....................................  5.42(b)(7).
5.127.....................................  5.42.
5.128.....................................  New.
5.129.....................................  5.42(b)(8).
5.130.....................................  5.42(a)(6).
------------------------------------------------------------------------
       Subpart I--The Standards of Identity for Distilled Spirits
------------------------------------------------------------------------
5.141.....................................  5.22.
5.142.....................................  5.22(a).
5.143.....................................  5.22(b) and 5.35(c).
5.144.....................................  5.22(c).
5.145.....................................  5.22(d).
5.146.....................................  5.22(e).
5.147.....................................  5.22(f).
5.148.....................................  New.
5.149.....................................  New.
5.150.....................................  5.22(h).
5.151.....................................  5.22(i).
5.152.....................................  5.22(j).
5.153.....................................  New.
5.154.....................................  5.22(k) and (l).
5.156.....................................  5.23.
5.166.....................................  New.
------------------------------------------------------------------------
                           Subpart J--Formulas
------------------------------------------------------------------------
5.191.....................................  5.25.
5.192.....................................  5.26.
5.193.....................................  5.27.
5.194.....................................  5.28.
------------------------------------------------------------------------
 Subpart K--Distilled Spirits Containers and Authorized Container Sizes
------------------------------------------------------------------------
5.201.....................................  5.45.
5.202.....................................  5.46.
5.203.....................................  5.47a.
5.204.....................................  New.
5.205.....................................  New.
------------------------------------------------------------------------
        Subpart L--Recordkeeping and Substantiation Requirements
------------------------------------------------------------------------
5.211.....................................  New.
5.212.....................................  New.
5.213.....................................  5.33(g).
------------------------------------------------------------------------
            Subpart M--Penalties and Compromise of Liability
------------------------------------------------------------------------
5.221.....................................  New.
5.222.....................................  New.
5.223.....................................  New.
------------------------------------------------------------------------
                   Subpart N--Paperwork Reduction Act
------------------------------------------------------------------------
5.231.....................................  New.
------------------------------------------------------------------------


------------------------------------------------------------------------
                              27 CFR Part 7
-------------------------------------------------------------------------
                                              Are derived from current
       Requirements of new section:                   section:
------------------------------------------------------------------------
7.0.......................................  7.1.
------------------------------------------------------------------------
                      Subpart A--General Provisions
------------------------------------------------------------------------
7.1.......................................  7.10.
7.2.......................................  7.2.
7.3.......................................  7.20(b) and (c).
7.4.......................................  7.20(a) and New.
7.5.......................................  New.
7.6.......................................  New.
7.7.......................................  New.
7.8.......................................  7.60.
7.9.......................................  New.
7.10......................................  7.4.
7.11......................................  7.3.
7.12......................................  7.5.
------------------------------------------------------------------------
                Subpart B--Certificates of Label Approval
------------------------------------------------------------------------
7.21......................................  7.20(b), 7.40 and 7.41.
7.22......................................  7.40 and 7.41.
7.23......................................  [reserved].
7.24......................................  7.30 and 7.31(b).
7.25......................................  7.30 and 7.31.
7.27......................................  7.42.
7.28......................................  7.31(d).
7.29......................................  New.
------------------------------------------------------------------------
 Subpart C--Alteration of Labels, Relabeling, and Adding Information to
                               Containers
------------------------------------------------------------------------
7.41......................................  7.20(c)(1).
7.42......................................  7.20(c)(2).
7.43......................................  New.
7.44......................................  New.
------------------------------------------------------------------------
                       Subpart D--Label Standards
------------------------------------------------------------------------
7.51......................................  7.28(d).
7.52......................................  7.28(a).
7.53......................................  7.28(b).
7.54......................................  New.
7.55......................................  7.28(c).
7.56......................................  7.28(e).
------------------------------------------------------------------------
                 Subpart E--Mandatory Label Information
------------------------------------------------------------------------
7.61......................................  New.
7.62......................................  New.
7.63......................................  7.22.
7.64......................................  7.23.
7.65......................................  7.71.
7.66......................................  7.25(a) and (c).
7.67......................................  7.25(b).
7.68......................................  7.25.
7.69......................................  7.New.
7.70......................................  7.27.
------------------------------------------------------------------------
                Subpart F--Restricted Labeling Statements
------------------------------------------------------------------------
7.81......................................  New.
7.82......................................  7.22a.
7.83......................................  7.22b.
7.84......................................  7.81.
7.85......................................  New.
7.86......................................  Reserved.
7.87......................................  New.
------------------------------------------------------------------------
                Subpart G--Prohibited Labeling Practices
------------------------------------------------------------------------
7.101.....................................  New.
7.102.....................................  7.29(a)(1).
7.103.....................................  7.29(a)(3).
------------------------------------------------------------------------
Subpart H--Labeling Practices That Are Prohibited if They Are Misleading
------------------------------------------------------------------------
7.121.....................................  New.
7.122.....................................  7.29(a)(1) and New.
7.123.....................................  7.29(a)(5).
7.124.....................................  7.29(a)(2).
7.125.....................................  7.29(a)(4).
7.126.....................................  7.29(d).
7.127.....................................  7.29(b).
7.129.....................................  7.29(e).
7.130.....................................  7.29(a)(6).
7.131.....................................  7.29(c).
7.132.....................................  7.29(f).
------------------------------------------------------------------------
             Subpart I--Classes and Types of Malt beverages
------------------------------------------------------------------------
7.141.....................................  7.24(a).
7.142.....................................  7.24(e).
7.143.....................................  7.24(b) and New.
7.144.....................................  New.
7.145.....................................  7.24(d).
7.146.....................................  7.24(g), (f), and (h).
7.147.....................................  New.
------------------------------------------------------------------------
        Subpart L--Recordkeeping and Substantiation Requirements
------------------------------------------------------------------------
7.211.....................................  New.
7.212.....................................  New.
------------------------------------------------------------------------
            Subpart M--Penalties and Compromise of Liability
------------------------------------------------------------------------
7.221.....................................  New.
7.222.....................................  New.
7.223.....................................  New.
------------------------------------------------------------------------
                   Subpart N--Paperwork Reduction Act
------------------------------------------------------------------------
7.231.....................................  New.
------------------------------------------------------------------------


------------------------------------------------------------------------
                             27 CFR Part 14
-------------------------------------------------------------------------
                                              Are derived from current
       Requirements of new section:                   section:
------------------------------------------------------------------------
14.0......................................  New and 7.50.
------------------------------------------------------------------------
                      Subpart A--General Provisions
------------------------------------------------------------------------
14.1......................................  4.11, 4.61, 5.11, 5.61,
                                             7.11, 7.51.
14.2......................................  4.2, 5.1, 7.2.

[[Page 60609]]

 
14.3......................................  4.4, 5.4, 7.5.
14.4......................................  4.60, 5.61, 7.50.
14.5......................................  4.62, 5.63, 7.52.
14.6......................................  4.63, 5.64, 7.53.
------------------------------------------------------------------------
    Subpart B--Rules Related to Specific Practices in Advertisements
------------------------------------------------------------------------
14.11.....................................  New.
14.12.....................................  4.64(b), 4.65, 5.65(b),
                                             5.66, 7.54(b), 7.55.
14.13.....................................  4.64, 5.65, 7.54.
14.14.....................................  4.64, 5.65, 7.54, and New.
14.15.....................................  4.64.
14.16.....................................  5.65.
14.17.....................................  7.54.
------------------------------------------------------------------------
            Subpart C--Penalties and Compromise of Liability
------------------------------------------------------------------------
14.21.....................................  New.
14.22.....................................  New.
14.23.....................................  New.
------------------------------------------------------------------------
                   Subpart D--Paperwork Reduction Act
------------------------------------------------------------------------
14.31.....................................  New.
------------------------------------------------------------------------

IV. Public Participation

A. Comments Sought

    TTB requests comments from the public and all interested parties on 
the regulatory proposals contained in this document. TTB is 
particularly interested in comments that address whether the proposed 
revisions to the labeling and advertising regulations will continue to 
protect the consumer by prohibiting false or misleading statements and 
requiring that labels provide the consumer with adequate information 
about the identity and quality of the product. Where TTB proposes 
substantive changes, TTB seeks comments on the proposals for further 
appropriate improvements. With respect to the few proposed changes that 
may require changes in current labeling or advertising practices, TTB 
seeks comments on the impact that the proposed changes will have on 
industry members and any suggestions as to how to minimize any negative 
impact.
    TTB also seeks comments on whether more significant changes to the 
label approval process, such as expanding the categories of optional 
information that may be revised without TTB approval or limiting the 
scope of TTB's prior review of labels to certain mandatory information, 
should be considered. As noted earlier in this document, the FAA Act 
generally requires the submission of applications for label approval 
before bottlers or importers introduce their products into interstate 
commerce. As part of its label review process, TTB reviews both 
optional and mandatory information on labels. With regard to optional 
information, TTB's main goal is to ensure that such information does 
not mislead consumers.
    TTB also solicits comments from consumers, industry members, and 
the public on whether such changes would adequately protect consumers. 
Any regulatory proposals put forward by TTB on this issue would, of 
course, have to be consistent with the statutory requirements of the 
FAA Act.

B. Submitting Comments

    You may submit comments on the proposals contained in this document 
by using one of the following three methods:
     Federal e-Rulemaking Portal: You may send comments via the 
online comment form posted with this document within Docket No. TTB-
2018-0007 on ``Regulations.gov,'' the Federal e-rulemaking portal, at 
https://www.regulations.gov. A direct link to that docket is available 
under Notice No. 176 on the TTB website at https://www.ttb.gov/regulations_laws/all_rulemaking.shtml. Supplemental files may be 
attached to comments submitted via Regulations.gov. For complete 
instructions on how to use Regulations.gov, visit the site and click on 
the ``Help'' tab.
     U.S. Mail: You may send comments via postal mail to the 
Director, Regulations and Rulings Division, Alcohol and Tobacco Tax and 
Trade Bureau, 1310 G Street NW, Box 12, Washington, DC 20005.
     Hand Delivery/Courier: You may hand-carry your comments or 
have them hand-carried to the Alcohol and Tobacco Tax and Trade Bureau, 
1310 G Street NW, Suite 400, Washington, DC 20005.
    Please submit your comments by the closing date shown above in this 
document. Your comments must reference Notice No. 176 and include your 
name and mailing address. Your comments also must be made in English, 
be legible, and be written in language acceptable for public 
disclosure. TTB does not acknowledge receipt of comments, and TTB 
considers all comments as originals.
    In your comment, please clearly state if you are commenting for 
yourself or on behalf of an association, business, or other entity. If 
you are commenting on behalf of an entity, your comment must include 
the entity's name as well as your name and position title. If you 
comment via Regulations.gov, please enter the entity's name in the 
``Organization'' blank of the online comment form. If you comment via 
postal mail or hand delivery/courier, please submit your entity's 
comment on letterhead.
    You may also write to the Administrator before the comment closing 
date to ask for a public hearing. The Administrator reserves the right 
to determine whether to hold a public hearing.

C. Confidentiality

    All submitted comments and attachments are part of the public 
record and are subject to disclosure. Do not enclose any material in 
your comments that you consider to be confidential or inappropriate for 
public disclosure.

D. Public Disclosure

    TTB will post, and you may view, copies of this document, selected 
supporting materials, and any online, mailed, or hand-delivered 
comments received about this proposal within Docket No. TTB-2018-0007 
on the Federal e-rulemaking portal, Regulations.gov, at https://www.regulations.gov. A direct link to that docket is available on the 
TTB website at https://www.ttb.gov/regulations_laws/all_rulemaking.shtml under Notice No. 176. You may also reach the 
relevant docket through the Regulations.gov search page at https://www.regulations.gov. For information on how to use Regulations.gov, 
click on the site's ``Help'' tab.
    All posted comments will display the commenter's name, organization 
(if any), city, and State, and, in the case of mailed comments, all 
address information, including email addresses. TTB may omit voluminous 
attachments or material that the Bureau considers unsuitable for 
posting.
    You may also view copies of this document, all supporting 
materials, and any online, mailed, or hand-delivered comments that TTB 
receives about this proposal by appointment at the TTB Information 
Resource Center, 1310 G Street NW, Washington, DC 20005. You may also 
obtain copies at 20 cents per 8.5 x 11-inch page. Contact TTB's Federal 
Register liaision officer at the above address or by telephone at 202-
453-2135 to schedule an appointment or to request copies of comments or 
other materials.

V. Regulatory Analysis and Notices

A. Regulatory Flexibility Act

    In accordance with the Regulatory Flexibility Act (5 U.S.C. 601 et 
seq.), TTB has analyzed the potential economic effects of this action 
on small

[[Page 60610]]

entities. In lieu of the initial regulatory flexibility analysis 
required to accompany proposed rules under 5 U.S.C. 603, section 605 
allows the head of an agency to certify that a rule will not, if 
promulgated, have a significant economic impact on a substantial number 
of small entities. The following analysis provides the factual basis 
for TTB's certification under section 605.
1. Small Businesses in the Alcohol Beverage Industry
    TTB recognizes that the vast majority of producers, bottlers, and 
importers of alcohol beverages are small entities. The Small Business 
Administration (SBA) sets out size standards based on the North 
American Industry Classification System (NAICS) under which an entity 
can be considered small for the purposes of Regulatory Flexibility Act 
analysis.\1\ Breweries and wineries are considered small if they have 
fewer than 500 employees; distillers are considered small if they have 
fewer than 750 employees.
---------------------------------------------------------------------------

    \1\ See http://www.sba.gov/content/small-business-size-standards.
---------------------------------------------------------------------------

    The U.S. Census Bureau's Statistics of U.S. Businesses data include 
data on employment among establishments within NAICS codes. The most 
recent data are from 2011. TTB used these data to calculate what 
proportion of entities classified within each relevant NAICS code could 
be considered small. TTB also looked at the data from 2005 to try to 
find changes over time.

 Small-Entity Size Standards for Potentially Affected Industries and Proportions of Small Entities Within Those
                                                   Industries
----------------------------------------------------------------------------------------------------------------
                                       Small-entity size         Proportion of small       Proportion of small
      Industry (NAICS code)                 standard               entities (2005)           entities (2011)
----------------------------------------------------------------------------------------------------------------
Breweries (NAICS 312120).........  Fewer than 500 employees.  92.3 percent (352 small   95.6 percent (696 small
                                                               entities of 381 total     entities of 728 total
                                                               establishments).          establishments).
Wineries (NAICS 312130)..........  Fewer than 500 employees.  95.2 percent (1559 of     97.0 percent (2613 of
                                                               1637).                    2694).
Distilleries (NAICS 312140)......  Fewer than 750 employees.  77.0 percent (57 of 74)   91.0 percent (193 of
                                                               \1\.                      212).\1\
----------------------------------------------------------------------------------------------------------------
\1\ This is the proportion of entities with under 500 employees; the Statistics of U.S. Businesses data do not
  include employment at the 750-employee threshold. The true percentage and number of small entities are thus
  potentially higher than those listed here.
Source: SBA standards, Statistics of U.S. Businesses (see https://www.census.gov/econ/susb/).

2. Effect of the Proposed Rule
    The vast majority of businesses subject to the proposed rule are 
small businesses, but the changes proposed in this document will not 
have a significant impact on those small entities. The production, 
bottling, importation, and distribution of alcohol beverages is an 
industry subject to extensive Federal, State, and local regulation. As 
mentioned earlier in this document, the labeling and advertising 
regulations under the FAA Act have been in place since 1936. The 
proposed rule thus largely restates existing requirements, but 
clarifies and updates these regulations to make them easier to 
understand and to incorporate agency policies. The proposed regulations 
take into account modern business practices and contemporary consumer 
understanding in order to modernize the regulations, and TTB is seeking 
comments from all interested parties on ways in which the regulations 
may be improved.
    The changes in the proposed rule can be divided into three classes 
with respect to their impact on small entities: (1) Clarifying changes 
that do not allow or prohibit any new conduct but improve the clarity 
and organization of TTB's FAA Act requirements; (2) liberalizing 
changes that will potentially give regulated entities new options to 
fulfill requirements; and (3) changes that impose new requirements or 
require changes to current labels.
    a. Clarifying changes: Many of the changes in this proposal are 
clarifying in nature. They are designed to make TTB's requirements for 
alcohol beverage labeling easier to read and use. These proposed 
changes would not have any impact on small businesses, other than 
making it easier for them to understand the existing requirements of 
the regulation. Examples of clarifying changes include the following:
     Adding examples in the regulations of how certain 
requirements may be satisfied;
     Adding to the regulations guidance that had previously 
been provided in rulings, Industry Circulars, or other documents 
separate from the regulations;
     Addressing questions the public frequently asks TTB;
     Making definitions, organization, numbering of sections, 
and phrasing of requirements within the regulations consistent across 
27 CFR parts 4, 5, and 7 to the extent possible;
     Breaking large subparts and large sections into small 
subparts and small sections to increase readability; and
     Providing more cross references in the regulations to 
relevant regulations and statutes.
    These changes benefit all regulated entities, especially small 
entities, which typically do not have as many resources for complying 
with the regulations as larger entities. In addition to these proposed 
changes, TTB would also add some requirements to the regulations that 
reflect TTB policy by:
     Making it explicit that mandatory information may not be 
obscured in whole or in part;
     Codifying various TTB policies regarding statements of 
composition;
     Codifying TTB policy on using aggregate packaging to 
satisfy standards of fill for wine and distilled spirits;
     Changing the definition of a certificate of label approval 
(COLA) to incorporate TTB's current policy of expanding the allowable 
revisions that may be made to already approved labels through the 
issuance of guidance documents;
     Codifying TTB's current policy that any wines, distilled 
spirits, or malt beverages that are adulterated under the Federal Food, 
Drug, and Cosmetic Act are mislabeled under the FAA Act;
     Codifying TTB's current policy that compliance with the 
labeling regulations issued under the FAA Act does not relieve industry 
members of their responsibility to comply with FDA regulations 
regarding the safety of additives and ingredients, as well as FDA 
regulations regarding the safe use of materials in containers;
     Codifying TTB's current policy, as stated on the label 
application form, that the issuance of a COLA does not confer trademark 
protection or relieve the certificate holder from liability for 
violations of the FAA Act, the IRC, ABLA, or related regulations, and 
that products covered by a COLA may still

[[Page 60611]]

be mislabeled if the label contains statements that are false or 
misleading when applied to the beverage in the container;
     Codifying in the regulations the current requirement that 
containers covered by a certificate of exemption must bear a labeling 
statement that the product is ``For sale in [name of State] only'';
     Codifying current TTB guidance with respect to the use of 
a COLA by an importer other than the permittee to whom the COLA was 
issued;
     Codifying TTB's current policy with respect to the 
approval of the use of ``personalized labels'' by bottlers without 
having to resubmit applications for label approval;
     Amending the regulations on the use of semi-generic 
designations for consistency with amendments made to the IRC in 2006;
     Codifying current policy with respect to the required name 
and address statement on labels for wines, distilled spirits, and malt 
beverages that have been subject to certain production activities after 
importation in bulk;
     Codifying current policy with respect to the allowed use 
of certain non-misleading labeling claims about environmental and 
sustainability practices;
     Codifying current policy that allows truthful and non-
misleading comparisons on labels and in advertisements without 
violating the prohibition against ``disparaging'' statements;
     Providing that the prohibition against the use of flags 
and other symbols of a government applies whenever the label may create 
a misleading impression that the product is endorsed by, or otherwise 
affiliated with, that government;
     Removing outdated provisions in the tax laws from the 
labeling regulations;
     Providing that certain alcohol beverage products do not 
meet the definition of a wine, distilled spirit, or malt beverage under 
the FAA Act, and must accordingly be labeled in accordance with FDA 
labeling regulations for food;
     Codifying longstanding policy that products containing 
less than 0.5 percent alcohol by volume are not distilled spirits under 
the FAA Act;
     Specifying how the FAA Act applies to the labeling of malt 
beverages under the penultimate paragraph of 27 U.S.C. 205(f); and
     For purposes of aging distilled spirits, defining an oak 
barrel as a cylindrical oak drum of approximately 50 gallons used to 
age bulk spirits.
    These provisions reflect current TTB policy, and thus no existing 
labels should need to be changed to come into compliance with these 
requirements.
    b. Liberalizing changes: Liberalizing changes will not require 
entities that are currently in compliance with the regulations to make 
any changes, but may provide regulated entities with additional options 
they can choose to use. Any effect on small entities from these changes 
is likely to be positive. Key examples include:
     Allowing greater flexibility in the placement of mandatory 
information on labels by eliminating the requirement that mandatory 
information appear on the ``brand label'';
     Liberalizing the requirements for the use of a type 
designation consisting of multiple grape varieties, thus allowing 
greater flexibility in the blending of wines;
     Allowing the use of truthful, accurate, specific, and non-
misleading. additional information on the label about the grape 
varieties used to make a still grape wine, sparkling grape wine, or 
carbonated grape wine, provided that the information includes every 
grape variety used to make the wine, listed in descending order of 
predominance;
     Liberalizing the requirements for the use of multicounty 
or multistate appellations on wine labels, thus allowing more producers 
and importers to claim an appellation of origin for these wines;
     Allowing the use of vintage dates on wines bottled in the 
United States that had been imported in bulk containers under certain 
conditions;
     Allowing the use of ``estate grown'' on labels of grape 
wines that do not meet all of the requirements for an ``estate 
bottled'' claim, but where the producing winery grew all of the grapes 
used to make the wine on land owned or controlled by the producing 
winery, and met certain other conditions;
     Allowing certain statements of alcohol content, other than 
alcohol as a percentage of alcohol by volume, as additional information 
on labels already containing a mandatory alcohol content statement;
     Superseding the Industry Circular that required pre-
approval laboratory testing for products containing wormwood;
     Modifying the standard of identity for whisky to provide 
for ``white whisky'' and ``unaged whisky,'' in response to market 
demand for these types of products;
     Adding ``agave spirits'' as a class of distilled spirits 
and recognizing ``Mezcal'' as a type within that class;
     Expanding the allowable alcohol content tolerance for 
distilled spirits;
     Allowing wholesalers and retailers to relabel distilled 
spirits when necessary and when approved by TTB;
     Incorporating Ruling 2015-1 by allowing the use of 
designations in accordance with trade understanding, rather than 
statements of composition, in the labeling of malt beverage specialty 
products that are flavored or fermented with ingredients that TTB has 
determined are generally recognized as traditional ingredients in the 
production of a fermented beverage designated as ``beer,'' ``ale,'' 
``porter,'' ``stout,'' ``lager,'' or ``malt liquor'';
     Allowing certain mandatory information to appear on the 
keg collar or tap cover of malt beverage kegs with a capacity of 10 
gallons or more, subject to certain requirements; and
     Allowing the use of alternate contact information (such as 
the telephone number, website, or email address) together with the name 
of the responsible advertiser in advertisements.
    c. Potentially restrictive changes: Potentially restrictive 
proposed changes may require some industry members to either change the 
labeling of their products or to change the formulation of the product 
to avoid labeling changes. TTB believes that most of these proposed 
changes will not impact many products, but solicits comments on the 
impact that the proposed changes will have. These changes include:
     Adopting consistent language with regard to what type of 
products intended for exportation are exempt from the labeling 
requirements of parts 4, 5, and 7.
     Cross-referencing CBP regulations that require a country 
of origin statement on labels of imported wines and malt beverages. 
Such a statement is required for distilled spirits under current TTB 
regulations. TTB does not believe this will impact many labels, as such 
a statement is already required for imported wines and malt beverages 
under CBP regulations, and TTB's proposed regulation is simply a cross-
reference to existing CBP requirements.
     Specifying that statements of composition and standards of 
identity for distilled spirits products must be determined based on the 
finished product itself, without regard to whether components are added 
to the product directly or through intermediates. This may require the 
relabeling of certain specialty products to disclose the use of wine 
and spirits that were used in the formulation of intermediate products, 
but will ensure that consumers have truthful and

[[Page 60612]]

adequate information about the identity of the product.
     Prohibiting the use of labeling and advertising statements 
and representations that create a misleading impression that the 
product is a different commodity. This may require the relabeling of 
certain products that are marketed using terms associated with 
different commodities, if such terms create a misleading impression as 
to the identity of the product. TTB believes that this will protect 
consumers from misleading representations as to the identity of the 
product.
     Eliminating the ``citrus wine'' designation, which TTB 
believes is rarely used on wine labels.
     Codifying in the regulations that grape wine and fruit 
wine must meet the standards for ``natural wine'' under the IRC.
     Defining a distillation as a single run through a pot 
still or one run through a single distillation column of a column 
(reflux) still. Although this change is clarifying in nature, it may 
impact labels that currently claim that the spirits have been distilled 
for a certain number of times, but use a different definition of 
``distillation.''
     Revising the current requirement that certain whisky 
products distilled in the United States must include the State of 
distillation on the label by providing that a bottling address within 
the State does not suffice unless it includes a representation as to 
distillation;
     Requiring that statements of composition for distilled 
spirits list the spirits or wine used in the manufacture of the 
distilled spirits in order of predominance. This may require changes to 
some labels, but will provide consumers with more clear information 
about the composition of distilled spirits specialty products.
     Requiring distilled spirits cocktails to bear a full 
statement of composition instead of an abbreviated one that just lists 
the types of spirits used in the manufacture of the cocktail. This may 
require changes to some labels, but will provide consumers with better 
information about the identity of the product.
     Requiring whisky (other than Tennessee Whisky) that meets 
the standard for a type of whisky to be designated with that type name, 
rather than as ``whisky.'' TTB does not believe that this will impact 
many products, but some labels may have to be changed.
3. Delayed Compliance Date
    As mentioned earlier in this document, TTB is proposing to give all 
regulated entities three years to come into compliance with the 
proposed regulations, should they be finalized.
    The label redesign, printing, and administrative costs associated 
with making a labeling change are on a ``stock-keeping unit'' (or 
``SKU'') basis rather than a formulation basis. To examine costs 
associated with label redesign, TTB referred to the FDA's Labeling Cost 
Model,\2\ which incorporates assumptions about the proportion of SKUs 
that would be changed together with a scheduled label change.
---------------------------------------------------------------------------

    \2\ http://www.fda.gov/ohrms/dockets/dockets/04n0382/04n-0382-bkg0001-Tab-05-01-vol1.pdf.
---------------------------------------------------------------------------

    Under the FDA's Labeling Cost Model, the longer the implementation 
period, the more likely it is that affected industry members can 
coordinate new labeling requirements with scheduled labeling changes. 
This leads to cost estimates that fall significantly as the time 
allowed for the new labeling requirements increases. In other words, 
the longer the period of time industry is given to comply with the new 
labeling requirements, the lower the costs.
    As previously mentioned, TTB does not believe that the changes 
proposed by this notice would have a significant impact on many 
industry members. To the extent that some labels may have to be revised 
to comply with the proposed changes, TTB believes that the vast 
majority of industry members that would be affected by these changes 
would be able to coordinate labeling changes as a result of the 
proposed regulatory requirements with their scheduled labeling changes.
    The FDA model assumes that for a three-year delayed compliance 
date, required modifications to 100 percent of brand name product 
labels and 67 percent of private product labels can be coordinated with 
regularly scheduled label changes. Thus, according to this model, there 
would be no additional costs for branded products; however there may be 
incremental relabeling, printing, and administrative costs for 33 
percent of the private label SKUs because their producers may not be 
able to coordinate the required changes with their regularly scheduled 
labeling changes.
    TTB does not know how many entities, large or small, would be 
affected by the proposed changes to labeling requirements. However, the 
Bureau estimates that these changes will affect only a small percentage 
of current labels. Thus, TTB expects that the proposed changes would 
not affect many labels, and also that the three-year delayed compliance 
date would allow most affected entities to come into compliance with 
the changes in conjunction with regularly scheduled label changes.
4. Other Changes
    TTB is also proposing to clarify and somewhat expand existing 
requirements with regard to ``packaging'' of wine, distilled spirits, 
and malt beverage containers. This includes coverings, cartons, cases, 
carriers, and other packaging used for sale at retail, but does not 
include shipping cartons or cases not intended to accompany the 
container to the consumer.
    Existing regulations already prohibit certain false or misleading 
representations on packaging, and the existing wine and distilled 
spirits regulations already require certain mandatory information on 
closed ``opaque'' individual coverings or containers. For the reasons 
set forth in the preamble, the proposed rule expands this requirement 
to include malt beverages and to require that ``closed packaging'' of 
wine, distilled spirits, and malt beverages bear all the mandatory 
information required on the label. The term ``closed packaging'' would 
include sealed opaque coverings and cases. Packaging is not considered 
closed if the consumer could view all the mandatory information on the 
label by merely lifting the container up, or if the packaging is 
transparent or designed in a way that the mandatory information on the 
label can be easily read by the consumer without having to open, rip, 
untie, unzip or otherwise manipulate the package. This requirement 
would also be subject to the three-year delayed compliance date.
    TTB believes that alcohol beverage producers who use outer 
packaging update their packaging more than once every three years, 
similar to labels. The three-year delayed compliance date will give 
producers the opportunity to use up existing stocks of packaging. In 
addition, outer packaging is typically large enough to accommodate the 
mandatory information. TTB solicits comments on the impact that this 
proposed change would have on existing packaging materials.
5. Recordkeeping
    TTB is proposing to provide further details in the proposed 
labeling and advertising regulations regarding recordkeeping and 
substantiation requirements under the FAA Act for bottlers and 
importers. Current regulations (27 CFR 4.51, 5.55, and 7.42) require 
bottlers holding an original or duplicate original of a COLA or a 
certificate of exemption to exhibit such certificates, upon demand, to 
a duly

[[Page 60613]]

authorized representative of the United States Government. Current 
regulations (27 CFR 4.40, 5.51, and 7.31) also require importers to 
provide a copy of the applicable COLA upon the request of the 
appropriate TTB officer or a customs officer. However, these 
regulations do not state how long industry members should retain their 
COLAs. Furthermore, since these regulations were originally drafted, 
TTB has implemented the electronic filing of applications for label 
approval. Now, over 90 percent of new applications for label approval 
are submitted electronically, and the rest are processed electronically 
by TTB. Industry members have asked for clarification as to whether 
they have to retain paper copies of certificates that were processed 
electronically. Finally, because industry members may make certain 
specified revisions to approved labels without obtaining a new COLA, it 
is important that the industry members keep track of which label 
approval they are using when they make such revisions.
    Accordingly, the proposed regulations provide that, upon request by 
the appropriate TTB officer, bottlers and importers must provide 
evidence of label approval for a label used on an alcohol beverage 
container that is subject to the COLA requirements of the applicable 
part. This requirement may be satisfied by providing original COLAs, 
photocopies or electronic copies of COLAs, or records identifying the 
TTB identification number assigned to the COLA. Where labels on 
containers reflect revisions to the approved label that have been made 
in compliance with allowable revisions authorized on the COLA form or 
otherwise authorized by TTB, the bottler or importer must be able to 
identify the COLA covering the product, upon request by the appropriate 
TTB officer. Bottlers and importers must be able to provide this 
information for a period of five years from the date the products 
covered by the COLAs were removed from the bottler's premises or from 
customs custody, as applicable.
    TTB believes that five years is a reasonable period of time for 
record retention because there is a five-year statute of limitations 
for criminal violations of the FAA Act. TTB notes that the proposed 
rule does not require industry members to retain paper copies of each 
COLA; they should simply be able to track a particular removal to a 
particular COLA, and they may rely on electronic copies of COLAs, 
including copies contained in the TTB Public COLA Registry. TTB 
believes that industry members already retain records in this manner in 
the ordinary course of their business, but seeks comments on the impact 
of this proposal.
    The proposed regulations also set forth specific substantiation 
requirements, which are new to the regulations, but which reflect TTB's 
current expectations as to the level of evidence industry members 
should have to support labeling claims. The proposed regulations 
provide that all claims, whether implicit or explicit, must have a 
reasonable basis in fact. Claims that contain express or implied 
statements regarding the amount of support for the claim (e.g., ``tests 
provide,'' or ``studies show'') must have the level of substantiation 
that is claimed.
    Furthermore, the proposed regulations provide for the first time 
that any labeling claim that does not have a reasonable basis in fact, 
or cannot be adequately substantiated upon the request of the 
appropriate TTB officer, will be considered misleading. The regulations 
in subpart H are similarly amended to include the same requirement. TTB 
believes that this provision, which is very similar to the Federal 
Trade Commission's policy on substantiation of advertising claims, will 
clarify that industry members are responsible for ensuring that all 
labeling and advertising claims have adequate substantiation. See ``FTC 
Policy Statement Regarding Advertising Substantiation'' (Appended to 
Thompson Medical Co., 104 F.T.C. 648, 839 (1984), aff'd, 791 F.2d 189 
(D.C. Cir. 1986), cert. denied, 479 U.S. 1086 (1987)). TTB also 
believes that the records necessary to substantiate label and 
advertising claims are already retained by industry members in the 
ordinary course of business.
    TTB also proposes to require the use of TTB Form 5100.51 for the 
submission of formulas under parts 4, 5, and 7, rather than allowing 
other forms or letterhead statements. Because of the growing use of 
online formula submissions and because industry members may find that 
use of this form is easier than submitting letterhead applications, TTB 
believes that this will assist in the standardization of formula 
information.
    Finally, TTB is also asking for comments on several issues that are 
discussed in the proposal but that are not the subject of any specific 
proposed regulatory changes. TTB especially welcomes comments from 
small entities on these issues. Small entities may have found market 
niches making products that could be affected by these changes. They 
may also have fewer resources to change existing products, labels, or 
advertisements in response to changes to the regulations. TTB will 
carefully consider all comments on these issues before proceeding with 
any changes.
    In conclusion, while the industries affected by the proposed rule 
include a substantial number of small entities, the effects of the 
changes in this proposed rule are likely to be small and positive. 
Making the regulations easier to understand and comply with will 
promote compliance, and liberalizing changes will give all regulated 
parties additional options for complying with the regulations or 
undertaking new lines of business. Most of the restrictive changes TTB 
is proposing apply to labels, and TTB expects that small entities will 
be able to comply with them in the course of their normal business 
cycle. Producers of alcohol beverages must already keep records in the 
ordinary course of business; the proposed rule would clarify what 
recordkeeping TTB expects from regulated entities, and the proposed 
recordkeeping requirements do not go beyond what could reasonably be 
expected based on the statute of limitations for criminal enforcement 
of the FAA Act.
6. Certification
    In accordance with the Regulatory Flexibility Act (5 U.S.C. 601 et 
seq.), TTB certifies that this proposed rule, if promulgated, will not 
have a significant economic impact on a substantial number of small 
entities. The proposed rule will not impose, or otherwise cause, a 
significant increase in reporting, recordkeeping, or other compliance 
burdens on a substantial number of small entities. The proposed rule is 
not expected to have significant secondary or incidental effects on a 
substantial number of small entities. Accordingly, a regulatory 
flexibility analysis is not required. Pursuant to 26 U.S.C. 7805(f), 
TTB will submit the proposed regulations to the Chief Counsel for 
Advocacy of the Small Business Administration for comment on the impact 
of the proposed regulations on small businesses.

B. Executive Order 12866

    It has been determined that this notice is not a significant 
regulatory action as defined in Executive Order 12866 of September 30, 
1993. Therefore a regulatory assessment is not necessary.

C. Paperwork Reduction Act

    This proposed rule contains ten information collections, old and 
new. Nine of the collections of information contained in the regulatory 
sections affected by this proposed rule have been

[[Page 60614]]

previously reviewed and approved by the Office of Management and Budget 
(OMB) in accordance with the Paperwork Reduction Act of 1995 (PRA, 44 
U.S.C. 3507) and assigned control numbers 1513-0020, 1513-0046, 1513--
0064, 1513-0084, 1513-0085, 1513-0087, 1513-0111, 1513-0121 and 1513-
0122. The specific regulatory sections in this proposed rule that 
contain approved collections of information are Sec. Sec.  4.21-4.28, 
4.30, 4.62, 4.63, 4.81-4.98, 4.121-4.136, 5.21-5.27, 5.28, 5.30, 5.62, 
5.63, 5.81-5.90, 5.121-5.130, 5.192-5.194, 7.21, 7.22, 7.24-7.27, 7.28, 
7.63, 7.66, 7.67, 7.81-7.85, 7.87, 7.121-7.132, 14.6, 14.12, 14.14, 
14.15, 14.16, and 14.17. In this proposed rule, TTB is not proposing 
any changes to eight of the nine current information collection or 
recordkeeping requirements of, or burdens associated with, these 
existing information collections.
    TTB is amending OMB control number 1513-0087 to include proposed 
regulations in Sec. Sec.  4.62, 5.62, and 7.62, which provide that 
closed packaging, including sealed opaque coverings, cartons, cases, 
carriers, or other packaging used for sale at retail, must include all 
mandatory information required to appear on the label. This proposed 
requirement is consistent with existing regulations in Sec. Sec.  4.38a 
and 5.41 for wine and distilled spirits, respectively, but is new in 
part 7 for malt beverages. TTB believes this requirement is necessary 
to protect the consumer. TTB does not believe that this proposal will 
increase the estimated burden of this information collection because 
the required information is already collected and disclosed for the 
purposes of labeling under OMB control number 1513-0087. TTB also 
believes that most malt beverage industry members currently place all 
mandatory information that is required to appear on the label on closed 
packages. Thus, TTB believes that the current burden hours for OMB 
control number 1513-0087, which are set forth below, will not change.
    Estimated number of respondents: 9,552.
    Estimated average total annual burden hours: 9,552.
    In this proposed rule, TTB also is proposing new recordkeeping 
requirements, and TTB is seeking OMB approval of these requirements 
under one OMB control number. An agency may not conduct or sponsor, and 
a person is not required to respond to, a collection of information 
unless it displays a valid OMB control number. The proposed new 
recordkeeping requirements are contained in proposed Sec. Sec.  4.211, 
4.212, 5.211, 5.212, 7.211, 7.212, and 14.4.
    The new recordkeeping requirement in proposed Sec. Sec.  4.211, 
5.211, and 7.211 provides that, upon request by the appropriate TTB 
officer, bottlers and importers must provide evidence of label approval 
for a label used on an alcohol beverage container that is subject to 
the COLA requirements of the applicable part. This requirement may be 
satisfied by providing original COLAs, photocopies or electronic copies 
of COLAs, or records identifying the TTB identification number assigned 
to the COLA. Where labels on containers reflect revisions to the 
approved label that have been made in compliance with allowable 
revisions authorized on the COLA form or otherwise authorized by TTB, 
the bottler or importer must be able to identify the COLA covering the 
product. Bottlers and importers are required to keep records 
identifying each COLA for a period of five years from the date the 
products covered by the COLA were removed from the bottler's premises 
or from customs custody, as applicable.
    The new recordkeeping requirement in proposed Sec. Sec.  4.212, 
5.212, 7.212, and 14.4 sets forth specific substantiation requirements 
that apply to any claim made on any label or container subject to the 
requirements of part 4, 5, or 7, or any claim made in an advertisement 
subject to part 14. These substantiation requirements are new to the 
regulations, but they reflect TTB's current expectations as to the 
level of evidence that industry members should have to support labeling 
claims. Proposed Sec. Sec.  4.212, 5.212, and 7.212 provide that the 
appropriate TTB officer may request that bottlers and importers provide 
evidence that labeling claims are adequately substantiated at any time 
within five years from the time the alcohol beverage was removed from 
the bottling premises or from customs custody, as applicable. Proposed 
Sec.  14.4(c) provides that the appropriate TTB officer may request 
that the responsible advertiser provide evidence that advertising 
claims are adequately substantiated at any time within a period of five 
years from the time the advertisement was last disseminated or 
published.
    TTB believes that these COLA use and label and advertising claim 
substantiation records are necessary to ensure that:
     Importers using a COLA that was not issued to them have 
received authorization to use the COLA from the person to whom the COLA 
was issued (certificate holder);
     Labels applied to alcohol beverage containers are covered 
by a COLA; and
     Claims made on the labels of alcohol beverage containers 
and claims made in advertisements for alcohol beverages are truthful, 
accurate, and not misleading and do not contain any prohibited 
practices.
    The retention requirement for records the certificate holder must 
maintain of other importers authorized to use its COLA is five years 
from the date of the authorization. The retention requirement for 
records identifying each COLA is five years after the COLA is last used 
to remove a product from the bottler's premises or from customs 
custody, as applicable. The retention requirement for records 
substantiating claims made in advertisements is five years from the 
time the advertisement was last disseminated or published. TTB believes 
that all these records are currently maintained during the usual and 
customary course of business.
    Estimated number of respondents: 10,982.
    Estimated average total annual burden hours: 1 (one).
    The new and revised recordkeeping requirements have been submitted 
to the OMB for review. Comments on these new and revised recordkeeping 
requirements should be sent to OMB at Office of Management and Budget, 
Attention: Desk Officer for the Department of the Treasury, Office of 
Information and Regulatory Affairs, Washington, DC 20503 or by email to 
[email protected]. A copy should also be sent to TTB by any 
of the methods previously described. Comments on the information 
collections should be submitted no later than January 25, 2019.
    TTB specifically requests comments concerning:
     Whether the proposed recordkeeping collections are 
necessary for the proper performance of the functions of TTB, including 
whether the information will have practical utility;
     How to enhance the quality, utility, and clarity of the 
information to be collected;
     How to minimize the burden of complying with the 
collections of information; and
    Estimates of capital and start-up costs and costs of operation, 
maintenance, and purchase of services to maintain records.

VI. Drafting Information

    Christopher M. Thiemann and Kara T. Fontaine of the Regulations and 
Rulings Division drafted this document, along with several other 
employees of the

[[Page 60615]]

Alcohol and Tobacco Tax and Trade Bureau.

List of Subjects

27 CFR Part 4

    Advertising, Alcohol and alcoholic beverages, Customs duties and 
inspection, Food additives, Imports, International agreements, 
Labeling, Packaging and containers, Reporting and recordkeeping 
requirements, Trade practices, Wine.

27 CFR Part 5

    Advertising, Alcohol and alcoholic beverages, Customs duties and 
inspection, Food additives, Grains, Imports, International agreements, 
Labeling, Liquors, Packaging and containers, Reporting and 
recordkeeping requirements, Trade practices.

27 CFR Part 7

    Advertising, Alcohol and alcoholic beverages, Beer, Customs duties 
and inspection, Food additives, Imports, Labeling, Packaging and 
containers, Reporting and recordkeeping requirements, Trade practices.

27 CFR Part 14

    Advertising, Alcohol and alcoholic beverages, Beer, Consumer 
protection, Liquors, Packaging and containers, Trade practices, Wine.

27 CFR Part 19

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

Authority and Issuance

    For the reasons discussed in the preamble, TTB proposes to amend 27 
CFR, chapter I as follows:

0
1. Revise part 4 to read as follows:

PART 4--LABELING OF WINE

Sec.
4.0 Scope.
Subpart A--General Provisions
4.1 Definitions.
4.2 Territorial extent.
4.3 General requirements and prohibitions under the FAA Act.
4.4 [Reserved]
4.5 Wines covered by this part.
4.6 Products produced as wine that are not covered by this part.
4.7 Other TTB labeling regulations that apply to wine.
4.8 Wine for export.
4.9 Compliance with Federal and State requirements.
4.10 Other related regulations.
4.11 Forms.
4.12 Delegations of the Administrator.
Subpart B--Certificates of Label Approval and Certificates of Exemption 
From Label Approval

Requirements for Wine Bottled in the United States

4.21 Requirement for certificate of label approval (COLAs) for wine 
bottled in the United States.
4.22 Rules regarding certificates of label approval (COLAs) for wine 
bottled in the United States.
4.23 Application for exemption from label approval for wines bottled 
in the United States.

Requirements for Wine Imported in Containers

4.24 Certificates of label approval (COLAs) for wine imported in 
containers.
4.25 Rules regarding certificates of label approval (COLAs) for wine 
imported in containers.

Administrative Rules

4.27 Presenting Certificates of Label Approval (COLAs) to Government 
officials.
4.28 Formulas, samples, and documentation.
4.29 Personalized labels.
4.30 Certificates of origin, identity, and proper cellar treatment 
of wine.
Subpart C--Alteration of Labels, Relabeling, and Adding Information to 
Containers
4.41 Alteration of labels.
4.42 Authorized relabeling activities by proprietors of bonded wine 
premises and importers.
4.43 Relabeling activities that require separate written 
authorization from TTB.
4.44 Adding a label or other information to a container that 
identifies the wholesaler, retailer, or consumer.
Subpart D--Label Standards
4.51 Firmly affixed requirements.
4.52 Legibility and other requirements for mandatory information on 
labels.
4.53 Type size of mandatory information.
4.54 Visibility of mandatory information.
4.55 Language requirements.
4.56 Additional information.
Subpart E--Mandatory Label Information
4.61 What constitutes a label for purposes of mandatory information.
4.62 Packaging (cartons, coverings, and cases).
4.63 Mandatory label information.
4.64 Brand name.
4.65 Alcohol content.
4.66 Name and address for domestically bottled wine that was wholly 
fermented in the United States.
4.67 Name and address for domestically bottled wine that was bottled 
after importation.
4.68 Name and address for wine that was imported in a container.
4.69 Country of origin.
4.70 Net contents.
Subpart F--Restricted Labeling Statements
4.81 General.

Food Allergen Labeling

4.82 Voluntary disclosure of major food allergens.
4.83 Petitions for exemption from major food allergen labeling.

Production Claims

4.84 Use of the term ``organic.''
4.85 Environmental, sustainability, and similar statements.
4.86 Use of TTB permit numbers on labels.
4.87 Use of vineyard, orchard, farm, or ranch name as additional 
information.

Appellations of Origin for Grape Wine

4.88 Appellations of origin for grape wine in general.
4.89 Eligibility for the use of an appellation of origin for grape 
wine.
4.90 Multicounty and multistate appellations of origin for grape 
wine.
4.91 Viticultural areas.

Claims About Grape Wine

4.92 Estate bottled.
4.93 Estate grown.
4.94 Claims on grape wine labels for viticultural practices that 
result in sweet wine.
4.95 Vintage date.

Appellations of Origin for Fruit Wine, Agricultural Wine, and Rice Wine

4.96 Appellations of origin for fruit wine, agricultural wine, and 
rice wine in general.
4.97 Eligibility requirements for use of an appellation of origin 
for fruit wine, agricultural wine, and rice wine.
4.98 Multicounty and multistate appellations of origin for fruit 
wine, agricultural wine, and rice wine.
Subpart G--Prohibited Labeling Practices
4.101 General.
4.102 False or untrue statements.
4.103 Obscene or indecent depictions.
Subpart H--Labeling Practices That Are Prohibited If They Are 
Misleading
4.121 General.
4.122 Misleading statements or representations.
4.123 Guarantees.
4.124 Disparaging statements.
4.125 Tests or analyses.
4.126 Depictions of government symbols.
4.127 Depictions simulating government stamps or relating to 
supervision.
4.128 Claims related to distilled spirits or malt beverages.
4.129 Health-related statements.
4.130 Appearance of endorsement.
4.131 Use of the word ``importer'' or similar words.
4.132 [Reserved]
4.133 Claims regarding terms defined or authorized by this part.

[[Page 60616]]

4.134 Statements related to dates or ages.
4.135 Indications of origin.
4.136 Use of a varietal name, type designation of varietal 
significance, semi-generic name, or geographic distinctive 
designation.
4.137 Terms relating to intoxicating qualities.
Subpart I--The Standards of Identity for Wine
4.141 The standards of identity in general.
4.142 Still grape wine--class and type designation.
4.143 Sparkling grape wine--class and type designation.
4.144 Carbonated grape wine--class and type designation.
4.145 Fruit wine--class and type designation.
4.146 Agricultural wine--class and type designation.
4.147 Aperitif--class and type designation.
4.148 Rice wine--class and type designation.
4.149 Retsina wine--designation.
4.150 Imitation and substandard or other than standard wine--
designation.
4.151 Statements of composition.
4.152-4.153 [Reserved]

Cellar Treatment and Alteration of Class and Type

4.154 Cellar treatment and alteration of class or type.
4.155 [Reserved]

Grape Type Labeling

4.156 Varietal (grape type) labeling as type designations.
4.157 Type designations of varietal significance for American wines.
4.158 [Reserved]

Generic, Semi-Generic, and Non-Generic Designations of Geographic 
Significance

4.173 Generic designations of geographic significance.
4.174 Semi-generic designations of geographic significance.
4.175 Nongeneric designation of geographic significance and 
nongeneric designations that are distinctive designations of 
specific grape wines.
4.176-4.177 [Reserved]
Subpart J--American Grape Variety Names
4.191 Approval of grape variety names.
4.192 List of approved names.
4.193 Alternative names permitted for temporary use.
Subpart K--Standards of Fill and Authorized Container Sizes
4.201 General.
4.202 Standard wine containers.
4.203 Standards of fill (container sizes).
4.204 Aggregate packaging to meet standard of fill requirements.
Subpart L--Recordkeeping and Substantiation Requirements
4.211 Recordkeeping requirements--certificates.
4.212 Substantiation requirements.
Subpart M--Penalties and Compromise of Liability
4.221 Criminal penalties.
4.222 Conditions of basic permit.
4.223 Compromise.
Subpart N--Paperwork Reduction Act
4.231 OMB control numbers assigned under the Paperwork Reduction 
Act.

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


Sec.  4.04.0  Scope.

    This part sets forth requirements that apply to the labeling and 
packaging of wines in containers, including requirements for label 
approval and rules regarding mandatory, regulated, and prohibited 
labeling statements.

Subpart A--General Provisions


Sec.  4.14.1  Definitions.

    When used in this part and on forms prescribed under this part, the 
following terms have the meaning assigned to them in this section, 
unless the terms appear in a context that requires a different meaning. 
Any other term defined in the Federal Alcohol Administration Act (FAA 
Act) and used in this part has the same meaning assigned to it by the 
FAA Act.
    Administrator. The Administrator, Alcohol and Tobacco Tax and Trade 
Bureau, Department of the Treasury.
    American. A descriptive term referring to the 50 States of the 
United States, the District of Columbia, and the Commonwealth of Puerto 
Rico.
    Appropriate TTB officer. An officer or employee of the Alcohol and 
Tobacco Tax and Trade Bureau (TTB) authorized to perform any function 
relating to the administration or enforcement of this part by the 
current version of TTB Order 1135.4, Delegation of the Administrator's 
Authorities, in 27 CFR part 4, Labeling of Wine.
    Bottler. Any producer or blender of wine, proprietor of bonded wine 
premises, or proprietor of a taxpaid wine bottling house, who places 
wine in containers.
    Brand name. The name under which a wine or line of wine is sold.
    Brix. The quantity of dissolved solids expressed as grams of 
sucrose in 100 grams of solution (percent by weight of sugar) at 68 
degrees Fahrenheit (20 degrees Celsius).
    Certificate holder. The permittee or brewer whose name, address, 
and basic permit number, plant registry number, or brewer's notice 
number appears on an approved TTB Form 5100.31.
    Certificate of exemption from label approval. A certificate issued 
on TTB Form 5100.31, which authorizes the bottling of wine or distilled 
spirits, under the condition that the product will under no 
circumstances be sold, offered for sale, shipped, delivered for 
shipment, or otherwise introduced by the applicant, directly or 
indirectly, into interstate or foreign commerce.
    Certificate of label approval (COLA). A certificate issued on TTB 
Form 5100.31 that authorizes the bottling of wine, distilled spirits, 
and malt beverages, or the removal of bottled wine, distilled spirits, 
and malt beverages from customs custody for introduction into commerce, 
as long as the product bears labels identical to the labels appearing 
on the face of the certificate, or labels with changes authorized by 
TTB on the certificate or otherwise.
    Container. Any can, bottle, box with an internal bladder, cask, 
keg, barrel, or other closed receptacle, in any size or material, that 
is for use in the sale of wine at retail. See subpart K of this part 
for rules regarding authorized standards of fill for containers.
    County. Includes a county or a political subdivision recognized by 
the State as a county equivalent.
    Customs officer. An officer of U.S. Customs and Border Protection 
(CBP) or any agent or other person authorized by law to perform the 
duties of such an officer.
    Distinctive or fanciful name. A descriptive name or phrase chosen 
to identify a wine product on the label. It does not include a brand 
name, class or type designation, or statement of composition.
    FAA Act. The Federal Alcohol Administration Act.
    Fully finished. Ready to be bottled, except that it may be further 
subject to the practices authorized in Sec.  4.154(c) and blending that 
does not result in an alteration of class or type under Sec.  4.154(b).
    Gallon. A U.S. gallon of 231 cubic inches at 60 degrees Fahrenheit.
    Grape wine. When used without further modification, the term 
``grape wine'' includes still grape wine, sparkling grape wine, and 
carbonated grape wine. As set forth in Sec.  4.142, however, the term 
``grape wine'' by itself may be used to designate only still grape 
wine.
    Interstate or foreign commerce. Commerce between any State and any 
place outside of that State or commerce within the District of Columbia 
or commerce between points within the same State but through any place 
outside of that State.
    Liter or litre. A metric unit of capacity equal to 1,000 cubic 
centimeters or 1,000 milliliters (mL) of wine at 20 degrees Celsius (68 
degrees Fahrenheit),

[[Page 60617]]

and equivalent to 33.814 U.S. fluid ounces.
    Net contents. The amount, by volume, of wine held in a container.
    Permittee. Any person holding a basic permit under the FAA Act.
    Person. Any individual, corporation, partnership, association, 
joint-stock company, business trust, limited liability company, or 
other form of business enterprise, including a receiver, trustee, or 
liquidating agent and including an officer or employee of any agency of 
a State or political subdivision of a State.
    Pure condensed must. The dehydrated juice or must of sound, ripe 
grapes, or other fruit or agricultural products, concentrated to not 
more than 80[deg] brix, the composition thereof remaining unaltered 
except for removal of water.
    Restored pure condensed must. Pure condensed must to which has been 
added an amount of water not exceeding the amount removed in the 
dehydration process.
    State. One of the 50 States of the United States, the District of 
Columbia, or the Commonwealth of Puerto Rico.
    Total solids. The degrees Brix of the dealcoholized wine restored 
to its original volume with water.
    TTB. The Alcohol and Tobacco Tax and Trade Bureau of the Department 
of the Treasury.
    United States (U.S.). The 50 States, the District of Columbia, and 
the Commonwealth of Puerto Rico.
    Wine. Section 117(a) of the Federal Alcohol Administration Act (27 
U.S.C. 211(a)) defines ``wine'' as any of the following products for 
nonindustrial use that contain not less than 7 percent and not more 
than 24 percent alcohol by volume:
    (1) Wine as defined in section 610 and section 617 of the Revenue 
Act of 1918 (26 U.S.C. 5381-5392); and
    (2) Other alcoholic beverages not so defined, but made in the 
manner of wine, including sparkling and carbonated wine, wine made from 
condensed grape must, wine made from other agricultural products than 
the juice of sound, ripe grapes, imitation wine, compounds sold as 
wine, vermouth, cider, perry, and sak[eacute].


Sec.  4.24.2  Territorial extent.

    The provisions of this part apply to the 50 States, the District of 
Columbia, and the Commonwealth of Puerto Rico.


Sec.  4.34.3  General requirements and prohibitions under the FAA Act.

    (a) Certificates of label approval (COLAs). Subject to the 
requirements and exceptions set forth in the regulations in subpart B 
of this part, any bottler of wine, and any person who removes wine in 
containers from customs custody for sale or any other commercial 
purpose, is required to first obtain from TTB a COLA covering the 
label(s) on each container.
    (b) Alteration, mutilation, destruction, obliteration, or removal 
of labels. Subject to the requirements and exceptions set forth in the 
regulations in subpart C of this part, it is unlawful to alter, 
mutilate, destroy, obliterate, or remove labels on wine containers. 
This prohibition applies to any person, including retailers, holding 
wine for sale in interstate or foreign commerce or any person holding 
wine for sale after shipment in interstate or foreign commerce.
    (c) Labeling requirements for wine. It is unlawful for any person 
engaged in business as a producer, blender, importer, or wholesaler of 
wine, directly or indirectly, or through an affiliate, to sell or ship, 
or deliver for sale or shipment, or otherwise introduce or receive, in 
interstate or foreign commerce, or remove from customs custody, any 
wine in containers, unless the wine is bottled in containers, and the 
containers are marked, branded, and labeled, in conformity with the 
regulations in this part.
    (d) Labeled in accordance with this part. In order to be labeled in 
accordance with the regulations in this part, a container of wine must 
be in compliance with the following requirements:
    (1) It must bear one or more labels meeting the standards for 
``labels'' set forth in subpart D of this part;
    (2) One or more of the labels on a container must include the 
mandatory information set forth in subpart E of this part;
    (3) Claims on any label(s), container, or packaging (as defined in 
Sec.  4.81) must comply with the rules for regulated label statements, 
as applicable, set forth in subpart F of this part;
    (4) Statements or any other representations on any wine label, 
container, or packaging (as defined in Sec. Sec.  4.101 and 4.121) may 
not violate the regulations in subparts G and H of this part regarding 
certain practices on labeling of wine;
    (5) The class and type designation on the label(s), as well as any 
designation appearing on containers or packaging, must comply with the 
standards of identity set forth in subpart I of this part; and
    (6) The wine in the container must not be adulterated within the 
meaning of the Federal Food, Drug, and Cosmetic Act.
    (e) Bottled in accordance with this part. In order to be bottled in 
accordance with the regulations in this part, the wine must be bottled 
in authorized standards of fill in containers that meet the 
requirements of subpart K.


Sec.  4.44.4  [Reserved]


Sec.  4.54.5  Wines covered by this part.

    The regulations in this part apply to wine containing not less than 
7 percent and not more than 24 percent alcohol by volume.


Sec.  4.64.6  Products produced as wine that are not covered by this 
part.

    Certain wine products do not fall within the definition of a 
``wine'' under the FAA Act and are thus not subject to this part. See 
Sec.  4.7 for related TTB regulations that may apply to these products. 
See Sec. Sec.  24.10 and 27.11 of this chapter for the definition of 
``wine'' under the Internal Revenue Code.
    (a) Products containing less than 7 percent alcohol by volume. The 
regulations in this part do not cover products that would otherwise 
meet the definition of wine except that they contain less than 7 
percent alcohol by volume. Bottlers and importers of alcohol beverages 
that do not fall within the definition of malt beverages, wine, or 
distilled spirits under the FAA Act should refer to the applicable 
labeling regulations for foods issued by the U.S. Food and Drug 
Administration. See 21 CFR part 101.
    (b) Products containing more than 24 percent alcohol by volume. 
Products that would otherwise meet the definition of wine except that 
they contain more than 24 percent alcohol by volume are classified as 
distilled spirits and must be labeled in accordance with part 5 of this 
chapter.


Sec.  4.74.7  Other TTB labeling regulations that apply to wine.

    In addition to the regulations in this part, wine must also comply 
with the TTB labeling regulations in paragraphs (a) and (b) of this 
section:
    (a) Health warning statement. Alcoholic beverages, including wine, 
that contain at least one-half of one percent alcohol by volume, must 
be labeled with a health warning statement in accordance with the 
Alcoholic Beverage Labeling Act of 1988 (ABLA). The regulations 
implementing the ABLA are contained in 27 CFR part 16.
    (b) Internal Revenue Code requirements. The labeling and marking 
requirements for wine under the Internal Revenue Code are found in 27 
CFR part 24, subpart L (for domestic

[[Page 60618]]

wine premises) and 27 CFR part 27, subpart E (for imports).


Sec.  4.84.8  Wine for export.

    Wine that is exported in bond without payment of tax directly from 
a bonded wine premises or from customs custody is not subject to this 
part. For purposes of this section, direct exportation in bond does not 
include exportation after wine has been removed for consumption or sale 
in the United States, with appropriate tax determination or payment.


Sec.  4.94.9  Compliance with Federal and State requirements.

    (a) General. Compliance with the requirements of this part relating 
to the labeling and bottling of wine does not relieve industry members 
from responsibility for complying with other applicable Federal and 
State requirements, including but not limited to those highlighted in 
paragraphs (b) and (c) of this section.
    (b) Ingredient safety. While it remains the responsibility of the 
industry member to ensure that any ingredient used in production of 
wine complies fully with all applicable U.S. Food and Drug 
Administration (FDA) regulations pertaining to the safety of food 
ingredients and additives, the appropriate TTB officer may at any time 
request documentation to establish such compliance. As set forth in 
Sec.  4.3(d), wines that are adulterated under the Federal Food, Drug, 
and Cosmetic Act are not labeled in accordance with this part.
    (c) Containers. While it remains the responsibility of the industry 
member to ensure that containers are made of suitable materials that 
comply with all applicable FDA health and safety regulations for the 
packaging of beverages for consumption, the appropriate TTB officer may 
at any time request documentation to establish such compliance.


Sec.  4.10   Other related regulations.

    (a) TTB regulations. Other TTB regulations that relate to wine are 
listed in paragraphs (a)(1) through (11) of this section:
    (1) 27 CFR Part 1--Basic Permit Requirements Under the Federal 
Alcohol Administration Act, Nonindustrial Use of Distilled Spirits and 
Wine, Bulk Sales and Bottling of Distilled Spirits;
    (2) 27 CFR Part 9--American Viticultural Areas;
    (3) 27 CFR Part 12--Foreign Nongeneric Names of Geographic 
Significance Used in the Designation of Wines;
    (4) 27 CFR Part 13--Labeling Proceedings;
    (5) 27 CFR Part 14--Advertising of Alcohol Beverage Products;
    (6) 27 CFR Part 16--Alcoholic Beverage Health Warning Statement;
    (7) 27 CFR Part 24--Wine;
    (8) 27 CFR Part 26--Liquors and Articles From Puerto Rico and the 
Virgin Islands;
    (9) 27 CFR Part 27--Importation of Distilled Spirits, Wines, and 
Beer;
    (10) 27 CFR Part 28--Exportation of Alcohol; and
    (11) 27 CFR Part 71--Rules of Practice in Permit Proceedings.
    (b) Other Federal regulations. The regulations listed in paragraphs 
(b)(1) through (9) of this section issued by other Federal agencies 
also may apply:
    (1) 7 CFR Part 205--National Organic Program;
    (2) 19 CFR Part 11--Packing and Stamping; Marking;
    (3) 19 CFR Part 102--Rules of Origin;
    (4) 19 CFR Part 134--Country of Origin Marking;
    (5) 21 CFR Part 1--General Enforcement Provisions, Subpart H, 
Registration of Food Facilities, and Subpart I, Prior Notice of 
Imported Food;
    (6) 21 CFR Parts 70-82, which pertain to food and color additives;
    (7) 21 CFR Part 101--Food Labeling;
    (8) 21 CFR Part 110--Current Good Manufacturing Practice in 
Manufacturing Packing, or Holding Human Food; and
    (9) 21 CFR Parts 170-189, which pertain to food additives and 
secondary direct food additives.


Sec.  4.11   Forms.

    (a) General. TTB prescribes and makes available all forms required 
by this part. Any person completing a form must provide all of the 
information required by each form as indicated by the headings on the 
form and the instructions for the form. Each form must be filed in 
accordance with this part and the instructions for the form.
    (b) Electronically filing forms. The forms required by this part 
can be filed electronically by using TTB's online filing systems: COLAs 
Online and Formulas Online. Anyone who intends to use one of these 
online filing systems must first register to use the system by 
accessing the TTB website at https://www.ttb.gov.
    (c) Obtaining paper forms. Forms required by this part are 
available for printing through the TTB website (https://www.ttb.gov) or 
by mailing a request to the Alcohol and Tobacco Tax and Trade Bureau, 
National Revenue Center, 550 Main Street, Room 8002, Cincinnati, OH 
45202.


Sec.  4.12   Delegations of the Administrator.

    Most of the regulatory authorities of the Administrator contained 
in this part are delegated to ``appropriate TTB officers.'' To find out 
which officers have been delegated specific authorities, see the 
current version of TTB Order 1135.4, Delegation of the Administrator's 
Authorities in 27 CFR part 4, Labeling of Wine. Copies of this order 
can be obtained by accessing the TTB website (https://www.ttb.gov) or 
by mailing a request to the Alcohol and Tobacco Tax and Trade Bureau, 
National Revenue Center, 550 Main Street, Room 8002, Cincinnati, OH 
45202.

Subpart B--Certificates of Label Approval and Certificates of 
Exemption From Label Approval

Requirements for Wine Bottled in the United States


Sec.  4.21   Requirement for certificates of label approval (COLAs) for 
wine bottled in the United States.

    (a) This section applies to wine bottled in the United States, 
outside of customs custody.
    (b) No person may bottle wine without first applying for and 
obtaining a certificate of label approval issued by the appropriate TTB 
officer. This requirement applies to wine produced and bottled in the 
United States and to wine imported in bulk and bottled in the United 
States. Bottlers may obtain an exemption from this requirement only if 
they satisfy the conditions set forth in Sec.  4.23.


Sec.  4.22   Rules regarding certificates of label approval (COLAs) for 
wine bottled in the United States.

    (a) What a COLA authorizes. An approved TTB Form 5100.31 authorizes 
the bottling of a wine covered by the COLA as long as the container 
bears labels identical to the labels appearing on the face of the COLA, 
or labels with changes authorized by TTB on the COLA or otherwise. The 
list of allowable changes can be found at https://www.ttb.gov.
    (b) What a COLA does not do. Among other things, the issuance of a 
COLA does not:
    (1) Confer trademark protection;
    (2) Relieve the certificate holder from its responsibility to 
ensure that all ingredients used in the production of the wine comply 
with applicable requirements of the U.S. Food and Drug Administration 
with regard to ingredient safety; or
    (3) Relieve the certificate holder from liability for violations of 
the FAA Act, the Alcoholic Beverage Labeling Act,

[[Page 60619]]

the Internal Revenue Code, or related regulations and rulings.
    (i) The issuance of a COLA does not mean that TTB has verified the 
accuracy of any representations or claims made on the label with 
respect to the product in the container. It is the responsibility of 
the applicant to ensure that all information on the application is true 
and correct, and that all labeling representations and claims are 
truthful, accurate, and not misleading with respect to the product in 
the container.
    (ii) A wine may be mislabeled even when the label is covered by a 
COLA. For example, if the label on the container contains 
representations that are false or misleading when applied to the 
product in the container, the wine is not labeled in accordance with 
the regulations in this part, even if it is covered by a COLA.
    (c) When to obtain a COLA. The COLA must be obtained prior to 
bottling. No producer or blender of wine, proprietor of bonded wine 
premises or proprietor of a taxpaid wine bottling house may bottle 
wine, or remove wine from the premises where bottled, unless a COLA has 
been obtained.
    (d) Application for a COLA. The bottler may apply for a COLA by 
submitting an application to TTB on Form 5100.31, in accordance with 
the instructions on the form. The bottler may apply for a COLA either 
electronically by accessing TTB's online system, COLAs Online, at TTB's 
website (https://www.ttb.gov) or by submitting the paper form. For 
procedures regarding the issuance of COLAs, see part 13 of this 
chapter.


Sec.  4.23   Application for exemption from label approval for wines 
bottled in the United States.

    (a) Exemption. A producer or blender of wine, proprietor of bonded 
wine premises, or proprietor of a taxpaid wine bottling house may apply 
for exemption from the labeling requirements of this part, if the 
bottler shows, to the satisfaction of the appropriate TTB officer, that 
the wine to be bottled will be offered for sale only within the State 
in which it is bottled and will not be sold, offered for sale, or 
shipped or delivered for shipment, or otherwise introduced, in 
interstate or foreign commerce.
    (b) Application required. The bottler must file an application on 
TTB Form 5100.31 for exemption from label approval before bottling the 
wine. The bottler may apply for a certificate of exemption from label 
approval either electronically, by accessing TTB's online system, COLAs 
Online, at https://www.ttb.gov, or by using the paper form. For 
procedures regarding the issuance of certificates of exemption from 
label approval, see part 13 of this chapter.
    (c) Labeling of wines covered by certificate of exemption. The 
application for a certificate of exemption from label approval requires 
that the applicant identify the State in which the product will be 
sold. As a condition of receiving exemption from label approval, the 
label covered by an approved certificate of exemption must include the 
statement ``For sale in [name of State] only.'' See Sec.  24.257 of 
this chapter for additional labeling rules that apply to wines covered 
by a certificate of exemption.

Requirements for Wine Imported in Containers


Sec.  4.24   Certificates of label approval (COLAs) for wine imported 
in containers.

    (a) Application requirement. Any person removing wine in containers 
from customs custody for consumption must first apply for and obtain a 
COLA covering the wine from the appropriate TTB officer.
    (b) Release of wine from customs custody. Wine imported in 
containers is not eligible for release from customs custody for 
consumption, and no person may remove such wine from customs custody 
for consumption, unless the person removing the wine has obtained and 
is in possession of a COLA covering the wine.
    (c) Filling requirements. If filing electronically, the importer 
must file with U.S. Customs and Border Protection (CBP), at the time of 
filing the customs entry, the TTB-assigned identification number of the 
valid COLA that corresponds to the label on the brand or lot of wine to 
be imported. If the importer is not filing electronically, the importer 
must provide a copy of the COLA to CBP at the time of entry. In 
addition, the importer must provide a copy of the applicable COLA, and 
proof of the certificate holder's authorization if applicable, upon 
request by the appropriate TTB officer or a customs officer.
    (d) Scope of this section. The COLA requirement imposed by this 
section applies only to wine that is removed for sale or any other 
commercial purpose. Wine that is imported in containers is not eligible 
for a certificate of exemption from label approval. See 27 CFR 27.49, 
27.74, and 27.75 for labeling exemptions applicable to certain imported 
samples of wine.
    (e) Relabeling in customs custody. Containers of wine in customs 
custody that are required to be covered by a COLA but are not labeled 
in conformity with a COLA must be relabeled, under the supervision and 
direction of customs officers, prior to their removal from customs 
custody for consumption.


Sec.  4.25   Rules regarding certificates of label approval (COLAs) for 
wine imported in containers.

    (a) What a COLA authorizes. An approved TTB Form 5100.31 authorizes 
the use of the labels covered by the COLA on containers of wine, as 
long as the container bears labels identical to the labels appearing on 
the face of the COLA, or labels with changes authorized by the form or 
otherwise authorized by TTB.
    (b) What a COLA does not do. Among other things, the issuance of a 
COLA does not:
    (1) Confer trademark protection;
    (2) Relieve the certificate holder from its responsibility to 
ensure that all ingredients used in the production of the wine comply 
with applicable requirements of the U.S. Food and Drug Administration 
with regard to ingredient safety; or
    (3) Relieve the certificate holder from liability for violations of 
the FAA Act, the Alcoholic Beverage Labeling Act, the Internal Revenue 
Code, or related regulations and rulings.
    (i) The issuance of a COLA does not mean that TTB has verified the 
accuracy of any representations or claims made on the label with 
respect to the product in the container. It is the responsibility of 
the applicant to ensure that all information on the application is true 
and correct and that all labeling representations and claims are 
truthful, accurate, and not misleading with respect to the product in 
the container.
    (ii) A wine may be mislabeled even when the label is covered by a 
COLA. For example, if the label on the container contains 
representations that are false or misleading when applied to the 
product in the container, the wine is not labeled in accordance with 
the regulations in this part, even if it is covered by a COLA.
    (c) When to obtain a COLA. The COLA must be obtained prior to the 
removal of wine in containers from customs custody for consumption.
    (d) Application for a COLA. The person responsible for the 
importation of wine must obtain approval of the labels by submitting an 
application to TTB on Form 5100.31. A person may apply for a COLA 
either electronically by accessing TTB's online system, COLAs Online, 
at TTB's website (https://www.ttb.gov) or by submitting the paper form. 
For procedures

[[Page 60620]]

regarding the issuance of COLAs, see part 13 of this chapter.

Administrative Rules


Sec.  4.27   Presenting Certificates of Label Approval (COLAs) to 
Government officials.

    A certificate holder must present the original or a paper or 
electronic copy of the appropriate COLA upon the request of any duly 
authorized representative of the United States Government.


Sec.  4.28   Formulas, samples, and documentation.

    (a) Prior to or in conjunction with the review of an application 
for a COLA on TTB Form 5100.31, the appropriate TTB officer may require 
a bottler or importer to submit a formula, the results of laboratory 
testing of the wine, or a sample of any wine or ingredients used in 
producing a wine. The appropriate TTB officer also may request such 
information or samples after the issuance of such COLA, or in 
connection with any wine that is required to be covered by a COLA. A 
formula may be filed electronically by using Formulas Online, or it may 
be submitted on paper on Form 5100.51. See Sec.  4.11 for more 
information on forms and Formulas Online.
    (b) Upon request of the appropriate TTB officer, a bottler or 
importer must submit a full and accurate statement of the contents of 
any container to which labels are to be or have been affixed, as well 
as any other documentation on any issue pertaining to whether the wine 
is labeled in accordance with this part.


Sec.  4.29   Personalized labels.

    (a) General. Applicants for label approval may obtain permission 
from TTB to make certain changes in order to personalize labels without 
having to resubmit labels for TTB approval. Personalized labels may 
contain a personal message, picture, or other artwork that is specific 
to the consumer who is purchasing the product. For example, a winery 
may offer individual or corporate customers labels that commemorate an 
event such as a wedding or grand opening.
    (b) Application. Any person who intends to offer personalized 
labels must submit a template for the personalized label with the 
application for label approval, and must note on the application a 
description of the specific personalized information that may change.
    (c) Approval of personalized label. If the application complies 
with the regulations, TTB will issue a certificate of label approval 
(COLA) with a qualification allowing the personalization of labels. The 
qualification will allow the certificate holder to add or change items 
on the personalized label such as salutations, names, graphics, 
artwork, congratulatory dates and names, or event dates without 
applying for a new COLA. All of these items on personalized labels must 
comply with the regulations of this part.
    (d) Changes not allowed to personalized labels. Approval of an 
application to personalize labels does not authorize the addition of 
any information that discusses either the alcohol beverage or 
characteristics of the alcohol beverage or that is inconsistent with or 
in violation of the provisions of this part or any other applicable 
provision of law or regulations.


Sec.  4.30   Certificates of origin, identity, and proper cellar 
treatment of wine.

    (a) Certificate of origin and identity. Wine imported in containers 
is not eligible for release from customs custody for consumption, and 
no person may remove such wine from customs custody for consumption, 
unless that person has obtained and is in possession of an invoice 
accompanied by a certificate of origin issued by an official duly 
authorized by the appropriate foreign government, if that country 
requires the issuance of such a certificate for wine exported from that 
country. The certificate must certify as to the identity of the wine 
and that the wine has been produced in compliance with the laws of the 
foreign country regulating the production of the wine for home 
consumption.
    (b) Certification of proper cellar treatment of natural wine--(1) 
General. An importer of wine may be required to have in its possession 
at the time of release of the wine from customs custody a 
certification, or may have to comply with other conditions prescribed 
in Sec.  27.140 of this chapter, regarding proper cellar treatment. If 
certification is required for imported wine under Sec.  27.140 of this 
chapter, the importer must provide a copy of that certification to TTB 
as follows:
    (i) The importer must include a copy of the certification with the 
application for a certificate of label approval (COLA) for the wine 
that is submitted under Sec.  13.21 of this chapter; or
    (ii) If a certification for the wine in question was not available 
when the importer submitted the application for label approval, the 
importer must submit a copy of the certification to the appropriate TTB 
officer before the first shipment of the wine is released from customs 
custody.
    (2) Validity of certification. A certification submitted under 
paragraph (b)(1) of this section is valid for multiple shipments of 
imported wine as long as the wine is of the same brand and class or 
type; was made by the same producer; was subjected to the same cellar 
treatment; and conforms to the statements made on the certification. 
Accordingly, if the cellar treatment applied to the wine changes and a 
new certification under Sec.  27.140 of this chapter is required, the 
importer must submit a new certification to TTB even if a new COLA is 
not required.
    (3) Use of certification. TTB may use the information from a 
certification for purposes of verifying the appropriate class and type 
designation of the wine under the labeling provisions of this part. TTB 
will make certifications submitted under paragraph (b)(1) of this 
section available to the public on the TTB website at https://www.ttb.gov.
    (c) Retention of certificates--wine imported in containers. The 
importer of wine imported in containers must retain for five years 
following the date of the removal of the bottled wine from customs 
custody copies of the certificates (and accompanying invoices, if 
required) required by paragraphs (a) and (b) of this section, and must 
provide them upon request of the appropriate TTB officer or a customs 
officer.
    (d) Wine imported in bulk for bottling in the United States. Wine 
that would be required under paragraphs (a) and (b) of this section to 
be covered by a certificate of origin and identity and/or a 
certification of proper cellar treatment and that is imported in bulk 
for bottling in the United States may be removed from the premises 
where bottled only if the bottler possesses a certificate of origin and 
identity and/or a certification of proper cellar treatment of natural 
wine applicable to the wine, issued by the appropriate entity as set 
forth in paragraphs (a) and (b) of this section and Sec.  27.140 of 
this chapter respectively, applicable to the wine that provides the 
same information as a certificate required under paragraphs (a) and (b) 
of this section and Sec.  27.140 of this chapter, would provide for 
like wine imported in bottles.
    (e) Retention of wine certificates--wine in bulk. The bottler of 
wine imported in bulk must retain, for five years following the removal 
of such wine from the premises where bottled, copies of the 
certificates required by paragraphs (a) and (b) of this section, and 
must provide them upon request of the appropriate TTB officer.

[[Page 60621]]

Subpart C--Alteration of Labels, Relabeling, and Adding Information 
to Containers


Sec.  4.41   Alteration of labels.

    (a) Prohibition. It is unlawful for any person to alter, mutilate, 
destroy, obliterate or remove any mark, brand, or label on wine in 
containers held for sale in interstate or foreign commerce, or held for 
sale after shipment in interstate or foreign commerce, except as 
authorized by Sec.  4.42, Sec.  4.43, or Sec.  4.44, or as otherwise 
authorized by Federal law.
    (b) Authorized relabeling. For purposes of the relabeling 
activities authorized by this subpart, the term ``relabel'' includes 
the alteration, mutilation, destruction, obliteration, or removal of 
any existing mark, brand, or label on the container, as well as the 
addition of a new label (such as a sticker that adds information about 
the product or information engraved on the container) to the container, 
and the replacement of a label with a new label bearing identical 
information.
    (c) Obligation to comply with other requirements. Authorization to 
relabel under this subpart in no way authorizes the placement of labels 
on containers that do not accurately reflect the brand, bottler, 
identity, or other characteristics of the product; nor does it relieve 
the person conducting the relabeling operations from any obligation to 
comply the regulations in this part and with State or local law, or to 
obtain permission from the owner of the brand where otherwise required.


Sec.  4.42   Authorized relabeling activities by proprietors of bonded 
wine premises and importers.

    (a) Relabeling at bonded wine premises. Proprietors of bonded wine 
premises may relabel domestically bottled wine prior to removal from, 
and after return to bond at, the bonded wine premises, with labels 
covered by a certificate of label approval (COLA) without obtaining 
separate permission from TTB for the relabeling activity.
    (b) Relabeling after removal from bonded wine premises. Proprietors 
of bonded wine premises may relabel domestically bottled wine after 
removal from bonded wine premises with labels covered by a COLA, 
without obtaining separate permission from TTB for the relabeling 
activity.
    (c) Relabeling in customs custody. Under the supervision of customs 
officers, imported wine in containers in customs custody may be 
relabeled without obtaining separate permission from TTB for the 
relabeling activity. Such containers must bear labels covered by a COLA 
upon their removal from customs custody for consumption. See Sec.  
4.24(b).
    (d) Relabeling after removal from customs custody. Imported wine in 
containers may be relabeled by the importer thereof after removal from 
customs custody without obtaining separate permission from TTB for the 
relabeling activity, as long as the labels are covered by a COLA.


Sec.  4.43   Relabeling activities that require separate written 
authorization from TTB.

    Any persons holding wine for sale who need to relabel the 
containers but are not eligible to obtain a certificate of label 
approval to cover the labels that they wish to affix to the containers 
may apply for written permission for the relabeling of wine containers. 
The appropriate TTB officer may permit relabeling of wine in containers 
if the facts show that the relabeling is for the purpose of compliance 
with the requirements of this part or State law. The written 
application must include copies of the original and proposed new 
labels; the circumstances of the request, including the reason for 
relabeling; the number of containers to be relabeled; the location 
where the relabeling will take place; and the name and address of the 
person who will be conducting the relabeling operations.


Sec.  4.44   Adding a label or other information to a container that 
identifies the wholesaler, retailer, or consumer.

    Any label or other information that identifies the wholesaler, 
retailer, or consumer of the wine may be added to containers (by the 
addition of stickers, engraving, stenciling, etc.) without prior 
approval from TTB and without being covered by a certificate of label 
approval or certificate of exemption from label approval. Such 
information may be added before or after the containers have been 
removed from bonded wine premises or released from customs custody. The 
information added:
    (a) May not violate the provisions of subpart F, G, or H of this 
part;
    (b) May not contain any reference to the characteristics of the 
product; and
    (c) May not be added to the container in such a way that it 
obscures any other labels on the container.

Subpart D--Label Standards


Sec.  4.51   Firmly affixed requirements.

    Any label that is not an integral part of the container must be 
affixed to the container in such a way that it cannot be removed 
without thorough application of water or other solvents.


Sec.  4.52   Legibility and other requirements for mandatory 
information on labels.

    (a) Readily legible. Mandatory information on labels must be 
readily legible to potential consumers under ordinary conditions.
    (b) Separate and apart. Mandatory information on labels, except 
brand names, must be separate and apart from any additional 
information. This does not preclude the addition of brief optional 
phrases of additional information as part of the class or type 
designation (such as, ``premium wine''), the name and address statement 
(such as, ``Proudly produced and bottled by ABC Winemaking Co. in Napa, 
CA, for over 30 years'') or other information required by Sec.  4.63(a) 
and (b), as long as the additional information does not detract from 
the prominence of the mandatory information. The statements required by 
Sec.  4.63(c) may not include additional information.
    (c) Contrasting background. Mandatory information must appear in a 
color that contrasts with the background on which it appears, except 
that if the net contents are blown into a glass container, they need 
not be contrasting. The color of the container and of the wine must be 
taken into account if the label is transparent or if mandatory label 
information is etched, engraved, sandblasted, or otherwise carved into 
the surface of the container or is branded, stenciled, painted, 
printed, or otherwise directly applied on to the surface of the 
container. Examples of acceptable contrasts are:
    (1) Black lettering appearing on a white or cream background; or
    (2) White or cream lettering appearing on a black background.
    (d) Capitalization. Except for the aspartame statement when 
required by Sec.  4.63(b)(4), which must appear in all capital letters, 
mandatory information prescribed by this part may appear in all capital 
letters, in all lower-case letters, or in mixed-case using both capital 
and lower-case letters.


Sec.  4.53   Type size of mandatory information.

    All capital and lowercase letters in statements of mandatory 
information on labels must meet the following type size requirements:
    (a) Minimum type size--(1) Containers of more than 187 milliliters. 
All mandatory information (including the alcohol content statement) 
must be in script, type, or printing that is at least two millimeters 
in height.
    (2) Containers of 187 milliliters or less. All mandatory 
information (including the alcohol content statement) must be in 
script, type, or

[[Page 60622]]

printing that is at least one millimeter in height.
    (b) Maximum type size for alcohol content statement. The alcohol 
content statement on containers of five liters or less may not appear 
in script, type, or printing that is more than three millimeters in 
height.


Sec.  4.54   Visibility of mandatory information.

    Mandatory information on a label must be readily visible and may 
not be covered or obscured in whole or in part. See Sec.  4.62 for 
rules regarding packaging of containers (including cartons, coverings, 
and cases). See part 14 of this chapter for regulations pertaining to 
advertising materials.


Sec.  4.55   Language requirements.

    (a) General. Mandatory information must appear in the English 
language, with the exception of the brand name and except as provided 
in paragraphs (c) and (d) of this section.
    (b) Foreign languages. Additional statements in a foreign language, 
including translations of mandatory information that appears elsewhere 
in English on the label, are allowed on labels and containers as long 
as they do not in any way conflict with, or contradict, the 
requirements of this part.
    (c) Wine for consumption in the Commonwealth of Puerto Rico. 
Mandatory information may be stated solely in the Spanish language on 
labels of wine bottled for consumption within the Commonwealth of 
Puerto Rico.
    (d) Exception for country of origin. The country or countries of 
origin may appear in a language other than English when allowed by U.S. 
Customs and Border Protection regulations.


Sec.  4.56  Additional information.

    Information (other than mandatory information) that is truthful, 
accurate, and specific, and that does not violate subpart F, G, or H of 
this part, may appear on labels. Such additional information may not 
conflict with, modify, qualify or restrict mandatory information in any 
manner.

Subpart E--Mandatory Label Information


Sec.  4.61   What constitutes a label for purposes of mandatory 
information.

    (a) Label. Certain information as outlined in Sec.  4.63, must 
appear on a label. When used in this part for purposes of determining 
where mandatory information must appear, the term ``label'' includes:
    (1) Material affixed to the container, whether made of paper, 
plastic film, or other matter;
    (2) For purposes of the net contents statement and the name and 
address statement only, information blown, embossed, or molded into the 
container as part of the process of manufacturing the container;
    (3) Information etched, engraved, sandblasted, or otherwise carved 
into the surface of the container; and
    (4) Information branded, stenciled, painted, printed, or otherwise 
directly applied onto the surface of the container.
    (b) Information appearing elsewhere on the container. Information 
appearing on the following parts of the container is subject to all of 
the restrictions and prohibitions set forth in subparts F, G, and H of 
this part, but will not satisfy any requirements for mandatory 
information that must appear on labels in this part:
    (1) Material affixed to, or information appearing on, the bottom 
surface of the container;
    (2) Caps, corks, or other closures unless authorized to bear 
mandatory information by the appropriate TTB officer; and
    (3) Foil or heat shrink bottle capsules.
    (c) Materials not firmly affixed to the container. Any materials 
that accompany the container to the consumer but are not firmly affixed 
to the container, including booklets, leaflets, and hang tags, are not 
``labels'' for purposes of this part. Such materials are instead 
subject to the advertising regulations in part 14 of this chapter.


Sec.  4.62   Packaging (cartons, coverings, and cases).

    (a) General. The term ``packaging'' includes any covering, carton, 
case, carrier, or other packaging of wine containers used for sale at 
retail, but does not include shipping cartons or cases that are not 
intended to accompany the container to the consumer.
    (b) Prohibition. Any packaging of wine containers may not contain 
any statement, design, device, or graphic, pictorial, or emblematic 
representation that violates the provisions of subpart F, G, or H of 
this part.
    (c) Requirements for closed packaging. If containers are enclosed 
in closed packaging, including sealed opaque coverings, cartons, cases, 
carriers, or other packaging used for sale at retail, such packaging 
must bear all mandatory label information required on the label under 
Sec.  4.63.
    (1) Packaging is considered closed if the consumer must open, rip, 
untie, unzip, or otherwise manipulate the package to remove the 
container in order to view any of the mandatory information.
    (2) Packaging is not considered closed if a consumer could view all 
of the mandatory information on the container by merely lifting the 
container up, or if the packaging is transparent or designed in a way 
that all of the mandatory information can be easily read by the 
consumer without having to open, rip, untie, unzip, or otherwise 
manipulate the package.
    (d) Packaging that is not closed. The following requirements apply 
to packaging that is not closed.
    (1) The packaging may display any information that is not in 
conflict with the label on the container that is inside the packaging.
    (2) If the packaging displays a brand name, it must display the 
brand name in its entirety. For example, if a brand name is required to 
be modified with additional information on the container, the packaging 
must also display the same modifying language.
    (3) If the packaging displays a class or type designation, it must 
be identical to the class or type designation appearing on the 
container. For example, if the packaging displays a class or type 
designation for a specialty product for which a statement of 
composition is required on the container, the packaging must include 
the statement of composition as well.
    (e) Labeling of containers within the packaging. The container 
within the packaging is subject to all labeling requirements of this 
part, including mandatory labeling information requirements, regardless 
of whether the packaging bears such information.


Sec.  4.63   Mandatory label information.

    (a) Mandatory information. Wine containers must bear a label or 
labels (as defined in Sec.  4.61(a)) containing the following 
information:
    (1) Brand name in accordance with Sec.  4.64;
    (2) Class, type, or other designation, in accordance with subpart I 
of this part;
    (3) Alcohol content, in accordance with Sec.  4.65;
    (4) A statement of the origin and percentage by volume of imported 
wine on blends of American and imported wine, if any reference is made 
to the presence of imported wine on the container;
    (5) Name and address of the bottler or importer, in accordance with 
Sec.  4.66, Sec.  4.67, or Sec.  4.68 as applicable; and
    (6) Net contents (which may be blown, embossed, or molded into the 
container as part of the process of manufacturing the container) in 
accordance with Sec.  4.70.

[[Page 60623]]

    (b) Appellations of origin. An appellation of origin in accordance 
with Sec. Sec.  4.88 through 4.91 of this part must be stated on the 
label of each container in the same field of vision as the class, type, 
or other designation prescribed by paragraph (a)(2) of this section if:
    (1) A grape wine is labeled with a class, type or other designation 
pursuant to Sec.  4.62(a)(2) that is:
    (i) A varietal (grape type), as provided for in Sec.  4.156;
    (ii) A type designation of varietal significance, as provided in 
Sec.  4.157;
    (iii) A semi-generic type designation, as provided in Sec.  4.184; 
or
    (2) The wine is labeled with a vintage date, pursuant to Sec.  
4.95.
    (c) Disclosure of certain ingredients. Certain ingredients must be 
declared on a label, without the inclusion of any additional 
information as part of the statement, as follows:
    (1) FD&C Yellow No. 5. If a wine contains the coloring material 
FD&C Yellow No. 5, the label must include a statement to that effect, 
such as ``''FD&C Yellow No. 5'' or ``Contains FD&C Yellow No. 5.''
    (2) Cochineal extract or carmine. If a wine contains the color 
additive cochineal extract or the color additive carmine, the label 
must include a statement to that effect, using the respective common or 
usual name (such as, ``contains cochineal extract'' or ``contains 
carmine''). This requirement applies to labels when either of the 
coloring materials is used in wine that is removed from bottling 
premises or from customs custody on or after April 16, 2013.
    (3) Sulfites. If a wine contains 10 or more parts per million of 
sulfur dioxide or other sulfiting agent measured as total sulfur 
dioxide, the label must include a statement to that effect. Examples of 
acceptable statements are ``Contains sulfites'' or ``Contains (a) 
sulfiting agent(s)'' or a statement identifying the specific sulfiting 
agent. The alternative terms ``sulphites'' or ``sulphiting'' may be 
used.
    (4) Aspartame. If the wine contains aspartame, the label must 
include the following statement, in capital letters, separate and apart 
from all other information: ``PHENYLKETONURICS: CONTAINS 
PHENYLALANINE.''


Sec.  4.64   Brand name.

    (a) Requirement. The wine label must include a brand name. If the 
wine is not sold under a brand name, the name of the bottler or 
importer, as applicable, appearing in the name and address statement is 
treated as the brand name.
    (b) Misleading brand names. Labels may not include any misleading 
brand names. A brand name is misleading if it creates (by itself or in 
association with other printed or graphic matter) any erroneous 
impression or inference as to the age, origin, identity, or other 
characteristics of the wine. A brand name may be found to be misleading 
by itself or in association with other printed or graphic matter. With 
the exception of geographic brand names discussed in paragraph (c) of 
this section, a brand name that would otherwise be misleading may be 
qualified with the word ``brand'' or with some other qualification that 
adequately dispels any misleading impression that might otherwise be 
created.
    (c) Geographic brand names. (1) Except as otherwise provided in 
paragraph (c)(2) of this section, a wine container may not bear a brand 
name of viticultural significance unless the wine meets the appellation 
of origin requirements for the geographic area named. (See Sec. Sec.  
4.88-4.91 and Sec. Sec.  4.96-4.98 for the appellation of origin 
requirements.)
    (2) For brand names of viticultural significance used in COLAs 
issued prior to July 7, 1986, such a brand name may appear on a wine 
container if:
    (i) The wine meets the appellation of origin requirements for the 
geographic area named;
    (ii) The wine is labeled with an appellation of origin, in 
accordance with Sec. Sec.  4.88-4.91 and Sec. Sec.  4.96-4.98, that is:
    (A) A county or a viticultural area, if the brand name bears the 
name of a geographic area smaller than a State; or
    (B) A State, county, or a viticultural area, if the brand name 
bears a State name; or
    (iii) The wine is labeled with some other statement that the 
appropriate TTB officer finds to be sufficient to dispel the impression 
that the geographic area suggested by the brand name is indicative of 
the origin of the wine.
    (3) A name has viticultural significance when it is the name of a 
State or county (or of the foreign equivalent of a State or county), 
when it is approved as the name of a viticultural area under part 9 of 
this chapter, when it is approved by a foreign government, or when it 
is found to have viticultural significance by the appropriate TTB 
officer. Unless determined otherwise by the appropriate TTB officer, a 
name that is a county name will be considered to have viticultural 
significance only when the word ``county'' follows the name. For 
example, while ``Clark County'' has viticultural significance, the word 
``Clark'' does not.


Sec.  4.65   Alcohol content.

    (a) General. In the case of wine containing 14 percent or less of 
alcohol by volume, the percentage of alcohol by volume must be stated 
unless the type designation ``table'' wine (or ``light'' wine) appears 
on the label. In the case of wines containing more than 14 percent of 
alcohol by volume, the percentage of alcohol by volume must be stated. 
Mandatory and optional statements of alcohol content as a percentage of 
alcohol by volume must be made as prescribed in paragraph (b) or (c) of 
this section. Other truthful, accurate, and specific factual 
representations of alcohol content, such as alcohol by weight, may be 
made, as long as they appear together with, and as part of, the 
statement of alcohol content as a percentage of alcohol by volume.
    (b) Format of the alcohol content statement--(1) General. Except as 
provided in paragraph (c) of this section, the alcohol by volume 
statement must be expressed in one of the following formats:
    (i) ``Alcohol __ percent by volume'';
    (ii) ``__ percent alcohol by volume''; or
    (iii) ``Alcohol by volume: __ percent''.
    (2) Formatting rules. Any of the words or symbols may be enclosed 
in parentheses and authorized abbreviations may be used with or without 
a period. The alcohol content statement does not have to appear with 
quotation marks.
    (3) Optional abbreviations. The statements listed in paragraph (b) 
of this section must appear as shown, except that the following 
abbreviations may be used: Alcohol may be abbreviated as ``alc''; 
percent may be represented by the percent symbol ``%''; alcohol and 
volume may be separated by a slash ``/'' in lieu of the word ``by''; 
and volume may be abbreviated as ``vol.''
    (4) Examples. The following are examples of alcohol content 
statements that comply with the requirements of this part:

    (i) ``13.2% alc/vol'';
    (ii) ``Alc. 13.0 percent by vol.'';
    (iii) ``Alc 13% by vol''; and
    (iv) ``15.0% Alcohol by Volume.''

    (c) Use of a range as the alcohol content statement--(1) General. 
The alcohol content statement may be expressed as a range in accordance 
with the provisions of paragraph (c)(2) of this section. For wine 
containing 14 percent alcohol by volume or less, the alcohol content 
may be stated as a range of three percentage points. For wine 
containing more than 14 percent alcohol by volume

[[Page 60624]]

the alcohol content may be stated as a range of two percentage points.
    (2) Format of the alcohol content statement using a range. If the 
alcohol content statement is expressed as a range, it must be made in 
one of the following formats:
    (i) Alcohol __ percent to __ percent by volume,
    (ii) __ to __ percent alcohol by volume, or
    (iii) Alcohol by volume: __ to __ percent.
    (3) Optional marks. Any of the words or symbols may be enclosed in 
parentheses, and authorized abbreviations may be used with or without a 
period.
    (4) Optional abbreviations. Alcohol may be abbreviated as ``alc''; 
percent may be represented by the percent symbol ``%''; alcohol and 
volume may be separated by a slash ``/'' in lieu of the word ``by''; 
the two alcohol content numbers may be separated by a dash ``-'' 
instead of the word ``to''; and volume may be abbreviated by ``vol''.
    (5) Examples. The following are examples of alcohol content 
statements that comply with the requirements of this part: ``10 to 12 
percent alcohol by volume,'' ``10-12% (alc) by volume,'' and ``10 to 12 
percent alc./vol.''
    (d) Tolerances for wine containing no more than 14 percent alcohol 
by volume. For specific statements of alcohol content for wines 
containing no more than 14 percent alcohol by volume, except as 
provided for in paragraph (f) of this section, the alcohol by volume 
statement on the label must be within 1.5 percentage points above or 
below the actual alcohol content. For example, an alcohol beverage with 
an actual alcohol content of 10 percent alcohol by volume would comply 
with this tolerance if it were labeled with an alcohol content 
statement between 8.5 and 11.5 percent alcohol by volume.
    (e) Alcohol content statement tolerances for wine containing more 
than 14 percent alcohol by volume. For specific numeric statements of 
alcohol content for wines containing more than 14 percent alcohol by 
volume, except as provided for in paragraph (f) of this section, the 
alcohol by volume statement on the label must be within one percentage 
point above or below the actual alcohol content. For example, an 
alcohol beverage with an actual alcohol content of 16 percent alcohol 
by volume would comply with this tolerance if it were labeled with an 
alcohol content statement between 15 and 17 percent alcohol by volume.
    (f) Tolerances must not cut across tax classes--(1) General. 
Regardless of the type of statement used and regardless of tolerances 
normally permitted in direct statements, and ranges normally permitted 
in maximum and minimum statements, alcohol content statements must 
correctly indicate the tax class of the wine so labeled. Nothing in 
this section shall be construed as authorizing the appearance upon the 
labels of any wine of an alcohol content statement in terms of maximum 
and minimum percentages that overlaps a prescribed limitation on the 
alcohol content of any tax class.
    (2) Tax classes and certain class and type designations. The 
tolerances set forth in this section shall not apply where a minimum or 
maximum alcohol content requirement is set forth in either a tax 
classification of the product (found in 26 U.S.C. 5041) or a class or 
type designation in this part that reflects a minimum or maximum 
alcohol content requirement consistent with limits set forth in a tax 
class. For example, the class designation for ``table wine'' in this 
part includes a maximum alcohol content of 14 percent alcohol by 
volume, which is consistent with the maximum alcohol content for a 
class of still wines under 26 U.S.C. 5041(b)(1). Thus, a still grape 
wine that contains 14.2 percent alcohol by volume may not be labeled as 
either a ``table wine'' or with an alcohol content of 14 percent or 
less, regardless of the tolerance prescribed in this section.


Sec.  4.66   Name and address for domestically bottled wine that was 
wholly fermented in the United States.

    (a) General. Domestically bottled wine that was wholly fermented in 
the United States and contains no imported wine must be labeled in 
accordance with this section. (See Sec. Sec.  4.67 and 4.68 for name 
and address requirements applicable to wine that is not wholly 
fermented in the United States.)
    (b) Mandatory statement. The label on containers must state the 
name of the bottler and the city and State where bottled, preceded by 
the phrases ``bottled by,'' ``canned by,'' ``packed by,'' or ``filled 
by,'' followed by the name of the bottler and the place where bottled.
    (c) Optional statements. In addition to the statement required by 
paragraph (b) of this section, the label may also:
    (1) State the name and address of any other person for whom the 
wine was bottled, immediately preceded by the words ``bottled for'' 
``canned for,'' ``packed for,'' or ``filled for'' or ``distributed 
by'';
    (2) Contain additional words, as specified and defined in 
paragraphs (d) through (f) of this section. The use of two or more of 
these words with the conjunction ``and'' and the use of any of these 
words with the words ``bottled by'' ``canned by,'' ``packed by,'' or 
``filled by'' is permissible only if the same person performed the 
defined operation at the same address. More than one name statement 
must appear if the defined operation was performed by a person other 
than the bottler, and more than one address statement must appear if 
the defined operation was performed at a different address.
    (d) Produced or Made. The terms ``Produced'' or ``Made'' mean that 
the named winery:
    (1) Fermented not less than 75 percent of the wine at the stated 
address, or
    (2) Changed the class or type of the wine by addition of wine 
spirits, brandy, flavors, colors, or artificial carbonation at the 
stated address, or
    (3) Produced sparkling wine by secondary fermentation at the stated 
address,
    (e) Blended. The term ``Blended'' means that the named winery mixed 
the wine with other wines of the same class and type at the stated 
address,
    (f) Cellared, Vinted, and Prepared. The terms ``Cellared,'' 
``Vinted'' and ``Prepared'' mean that the named winery, at the stated 
address, subjected the wine to cellar treatment in accordance with 
Sec.  4.154(c) of this part.
    (g) Use of trade name. (1) A trade name that appears on the basic 
permit or other qualifying documentation may be used only if the use of 
that name would not create a misleading impression as to the age, 
origin, or identity of the product. For example, when a bottler 
authorizes the use of its trade name by another bottler that is not 
under the same ownership, that trade name may not be used on a label in 
a way that tends to mislead consumers as to the identity or location of 
the bottler.
    (2) If the same brand of wine is bottled by two bottlers that are 
not under the same ownership, and each has adopted the same trade name 
on its basic permit pursuant to a contractual arrangement, the name and 
address statement must be worded in such a way that the label does not 
create a misleading impression as to the identity or location of the 
bottling winery or taxpaid wine bottling house.
    (h) Form of address. (1) The address consists of the city and State 
where the referenced activity occurred, and must be consistent with the 
address reflected on the basic permit or other qualifying documentation 
of the premises where the activity occurred. Addresses may, but are not 
required to, include additional information such as street names, 
counties, zip codes, phone numbers, and website addresses.

[[Page 60625]]

    (2) The address for each activity that is designated on the label 
must also be shown. An example for a wine produced in the United States 
would be ``Produced at Gilroy, California, and bottled at San Mateo, 
California, by XYZ Winery.''
    (3) No additional places or addresses may be stated for the same 
person unless:
    (i) That person is actively engaged in the conduct of an additional 
bona fide and actual alcohol beverage business at such additional place 
or address, and
    (ii) The label also contains immediately adjacent to the address 
appropriate descriptive material indicating the function occurring at 
each additional place or address in connection with the particular 
product.
    (4) The postal abbreviation of the State name may be used; for 
example, California may be abbreviated as CA.


Sec.  4.67   Name and address for domestically bottled wine that was 
bottled after importation.

    (a) General. This section applies to domestically bottled wine that 
was bottled after importation. See Sec.  4.68 for name and address 
requirements applicable to imported wine that is imported in a 
container. See 19 CFR parts 102 and 134 for U.S. Customs and Border 
Protection country of origin marking requirements.
    (b) Domestically bottled wine that was produced, made, or blended 
in the United States. Domestically bottled wine that was produced, 
made, or blended (in accordance with the definitions set forth in Sec.  
4.66) in the United States after the wine (or a wine in a blend of 
wines) was imported must be labeled in accordance with the rules set 
forth in Sec.  4.66 regarding mandatory and optional labeling 
statements.
    (c) Wine bottled after importation without blending or production 
activities. The label on wine that is bottled in the United States 
after importation without being produced, made or blended (in 
accordance with the definitions set forth in Sec.  4.66) in the United 
States after the wine was imported must state must state the words 
``imported by'' or a similar appropriate phrase, followed by the name 
and address of the importer. The label must also state the words 
``bottled by'' or ``packed by,'' followed by the name and address of 
the bottler, except that the following phrases are acceptable in lieu 
of the name and address of the bottler under the circumstances set 
forth below:
    (1) If the wine was bottled for the person responsible for the 
importation, the words ``imported by and bottled (canned, packed, or 
filled) in the United States for'' (or a similar appropriate phrase) 
followed by the name and address of the principal place of business in 
the United States of the person responsible for the importation; or
    (2) If the wine was bottled by the person responsible for the 
importation, the words ``imported and bottled by'' followed by the name 
and address of the principal place of business in the United States of 
the person responsible for the importation.
    (3) In the situations set forth in paragraphs (c)(1) and (2) of 
this section, the address shown on the label may be that of the 
principal place of business of the importer who is also the bottler, 
provided that the address shown is a location where bottling takes 
place.
    (d) Use of trade name. (1) A trade name that appears on the basic 
permit or other qualifying documentation may be used only if the use of 
that name would not create a misleading impression as to the age, 
origin, or identity of the product. For example, when a bottler 
authorizes the use of its trade name by another bottler that is not 
under the same ownership, that trade name may not be used on a label in 
a way that tends to mislead consumers as to the identity or location of 
the bottler.
    (2) If the same brand of wine is bottled by two bottlers that are 
not under the same ownership, and each has adopted the same trade name 
on its basic permit pursuant to a contractual arrangement, the name and 
address statement must be worded in such a way that the label does not 
create a misleading impression as to the identity or location of the 
bottling winery or taxpaid wine bottling house.
    (e) Form of address. (1) The address consists of the city and State 
where the referenced activity occurred, and must be consistent with the 
address reflected on the basic permit or other qualifying documentation 
of the premises where the activity occurred. Addresses may, but are not 
required to, include additional information such as street names, 
counties, zip codes, phone numbers, and website addresses.
    (2) The postal abbreviation of the State name may be used; for 
example, California may be abbreviated as CA.


Sec.  4.68   Name and address for wine that was imported in a 
container.

    (a) General. This section applies to wine that is imported in a 
container, as defined in Sec.  4.1 of this part. See Sec.  4.67 for 
rules regarding name and address requirements applicable to wine that 
is domestically bottled after importation. See 19 CFR parts 102 and 134 
for U.S. Customs and Border Protection country of origin marking 
requirements.
    (b) Mandatory labeling statement. The labels on wines imported in 
containers, as defined in Sec.  4.1, must state the words ``imported 
by'' or a similar appropriate phrase and, immediately thereafter, the 
name and address of the importer.
    (1) For purposes of this section, the importer is the holder of the 
importer's basic permit that either makes the original Customs entry or 
is the person for which such entry is made, or the holder of the 
importer's basic permit that is the agent, distributor, or franchise 
holder for the particular brand of imported alcohol beverages and that 
places the order abroad.
    (2) The address of the importer must be stated as the city and 
State of the principal place of business and must be consistent with 
the address reflected on the importer's basic permit. Addresses may, 
but are not required to, include additional information such as street 
names, counties, zip codes, phone numbers, and website addresses. The 
postal abbreviation of the State name may be used; for example, 
California may be abbreviated as CA.
    (c) Wine bottled in a foreign country other than the country of 
origin. If the wine was blended, bottled or packed in a foreign country 
other than the country of origin, and the label identifies the country 
of origin, the label must state ``blended by,'' ``bottled by,'' or 
other appropriate statement, followed by the name of the blender or 
bottler and the place where the wine was blended, bottled or packed.
    (d) Optional statements. In addition to the statements required by 
paragraph (a)(1) of this section, the label may also state the name and 
address of the principal place of business of the foreign producer. 
Other words, or their English-language equivalents, denoting winemaking 
operations may be used in accordance with the requirements of the 
country of origin, for wines sold within the country of origin for home 
consumption.
    (e) Form of address. The ``place'' stated must be the city and 
State, shown on the basic permit or other qualifying document, of the 
premises at which the operations took place; and the place for each 
operation that is designated on the label must be shown.
    (2) The postal abbreviation of the State name may be used; for 
example, California may be abbreviated as CA.
    (f) Trade or operating names. A trade name may be used if the trade 
name is listed on the basic permit or other qualifying documentation 
and if its use on the label would not create any

[[Page 60626]]

misleading impression as to the age, origin, or identity of the 
product.


Sec.  4.69   Country of origin.

    (a) Pursuant to U.S. Customs and Border Protection (CBP) 
regulations at 19 CFR parts 102 and 134, a country of origin statement 
must appear on the container of wine imported in containers or bottled 
in the United States after importation. Labeling statements with regard 
to the country of origin must be consistent with CBP regulations. The 
determination of the country (or countries) of origin, for imported 
wines, as well as for blends of imported wine with domestically 
fermented wine, must comply with CBP regulations.
    (b) It is the responsibility of the importer or bottler, as 
appropriate, to ensure compliance with the country of origin marking 
requirement, both when wine is imported in containers and when imported 
wines are subject to bottling, blending, or production activities in 
the United States. Industry members may seek a ruling from CBP for a 
determination of the country of origin for their product.


Sec.  4.70   Net contents.

    The requirements of this section apply to the net contents 
statement required by Sec.  4.63.
    (a) Standard containers. The net contents for wine for which a 
standard of fill is prescribed in Sec.  4.203 must be stated in the 
same manner and form as specified in the standard of fill.
    (b) Aggregately packaged containers--(1) External containers. The 
net contents of the external container for wine packaged in an 
aggregate package under the provisions of Sec.  4.214 must be stated in 
accordance with that section.
    (2) Internal containers. The net contents for the internal 
containers of an aggregate package must be stated in milliliters.
    (c) Wine not subject to standards of fill. The net contents of wine 
that is not subject to standards of fill prescribed in Sec.  4.203, 
under the rules set forth in Sec.  4.201(b), must be stated as follows:
    (1) If the container has a capacity of more than one liter, the net 
contents must be stated in liters and in decimal portions of a liter 
accurate to the nearest one-hundredth of a liter; and
    (2) If the container has a capacity of less than one liter, the net 
contents shall be stated in milliliters.
    (d) Optional statement of U.S. equivalent net contents. Net 
contents in U.S. equivalents may appear on a label along with the 
required metric net contents statement. If used, the U.S. equivalent 
volume must be shown as follows:

    (1) For the metric standards of fill:
    (i) 3 liters (101 fl. oz.);
    (ii) 1.5 liters (50.7 fl. oz.);
    (iii) 1 liter (33.8 fl. oz.);
    (iv) 750 mL (25.4 fl. oz.);
    (v) 500 mL (16.9 fl. oz.);
    (vi) 375 mL (12.7 fl. oz.);
    (vii) 187 mL (6.3 fl. oz.);
    (viii) 100 mL (3.4 fl. oz.); and
    (ix) 50 mL (1.7 fl. oz.).

    (2) If the container is exempt from a standard of fill as described 
in paragraph (c) of this section:
    (i) Equivalent volumes of less than 100 fluid ounces must be stated 
in fluid ounces, accurate to the nearest one-tenth of a fluid ounce, 
for example: 600 mL (20.3 fl. oz.); and
    (ii) Equivalent volumes of 100 fluid ounces or more must be stated 
in fluid ounces only, accurate to the nearest whole fluid ounce, for 
example: 6 liters (203 fl. oz.).
    (e) Tolerances. A statement of net contents must indicate the exact 
volume of wine in the container, except that the following tolerances 
shall be allowed:
    (1) Discrepancies due exclusively to errors in measuring that occur 
in filling conducted in compliance with good commercial practice;
    (2) Discrepancies due exclusively to differences in the capacity of 
containers, resulting solely from unavoidable difficulties in 
manufacturing the containers so as to be of uniform capacity, provided 
that the discrepancy does not result from a bottle design that prevents 
the manufacture of bottles of an approximately uniform capacity; and
    (3) Discrepancies in measure due to differences in atmospheric 
conditions in various places, including discrepancies resulting from 
the ordinary and customary exposure of alcohol beverages in containers 
to evaporation, provided that the discrepancy is determined to be 
reasonable on a case-by-case basis.

Subpart F--Restricted Labeling Statements


Sec.  4.81   General.

    (a) Application. The labeling practices, statements, and 
representations in this subpart may be used on wine labels only when 
used in compliance with this subpart. In addition, if any of the 
practices, statements, or representations in this subpart are used 
elsewhere on containers or in packaging, they must comply with the 
requirements of this subpart. For purposes of this subpart:
    (1) The term ``label'' includes all labels on wine containers on 
which mandatory information may appear, as set forth in Sec.  4.61(a), 
as well as any other label on the container.
    (2) The term ``container'' includes all parts of the wine 
container, including any part of a wine container on which mandatory 
information may appear, as well as those parts of the container on 
which information does not satisfy mandatory labeling requirements, as 
set forth in Sec.  4.61(b).
    (3) The term ``packaging'' includes any carton, case, carrier, 
individual covering or other packaging of such containers used for sale 
at retail, but does not include shipping cartons or cases that are not 
intended to accompany the container to the consumer.
    (b) Statement or representation. For purposes of this subpart, the 
term ``statement or representation'' includes any statement, design, 
device, or representation, and includes pictorial or graphic designs or 
representations as well as written ones. The term ``statement or 
representation'' includes explicit and implicit statements and 
representations.

Food Allergen Labeling


Sec.  4.82   Voluntary disclosure of major food allergens.

    (a) Definitions. For purposes of this section, the following terms 
or phrases have the meanings indicated.
    (1) Major food allergen means any of the following:
    (i) Milk, egg, fish (for example, bass, flounder, or cod), 
Crustacean shellfish (for example, crab, lobster, or shrimp), tree nuts 
(for example, almonds, pecans, or walnuts), wheat, peanuts, and 
soybeans; or
    (ii) A food ingredient that contains protein derived from a food 
specified in paragraph (a)(1)(i) of this section, except:
    (A) Any highly refined oil derived from a food specified in 
paragraph (a)(1)(i) of this section and any ingredient derived from 
such highly refined oil; or
    (B) A food ingredient that is exempt from major food allergen 
labeling requirements pursuant to a petition for exemption approved by 
the Food and Drug Administration (FDA) under 21 U.S.C. 343(w)(6) or 
pursuant to a notice submitted to the FDA under 21 U.S.C. 343(w)(7), 
provided that the food ingredient meets the terms or conditions, if 
any, specified for that exemption.
    (2) Name of the food source from which each major food allergen is 
derived. ``Name of the food source from which each major food allergen 
is

[[Page 60627]]

derived'' means the name of the food as listed in paragraph (a)(1)(i) 
of this section, except that:
    (i) In the case of a tree nut, it means the name of the specific 
type of nut (for example, almonds, pecans, or walnuts);
    (ii) In the case of Crustacean shellfish, it means the name of the 
species of Crustacean shellfish (for example, crab, lobster, or 
shrimp); and
    (iii) The names ``egg'' and ``peanuts,'' as well as the names of 
the different types of tree nuts, may be expressed in either the 
singular or plural form, and the names ``soy,'' ``soybean,'' or 
``soya'' may be used instead of ``soybeans.''
    (b) Voluntary labeling standards. Major food allergens used in the 
production of a wine product may, on a voluntary basis, be declared on 
a label or container. However, if any one major food allergen is 
voluntarily declared, all major food allergens used in production of 
the wine product, including major food allergens used as fining or 
processing agents, must be declared, except when covered by a petition 
for exemption approved by the appropriate TTB officer under Sec.  4.83. 
The major food allergens declaration must consist of the word 
``Contains'' followed by a colon and the name of the food source from 
which each major food allergen is derived (for example, ``Contains: 
egg'').
    (c) Cross reference. For mandatory labeling requirements applicable 
to wine products containing FD&C Yellow No. 5, sulfites, aspartame, and 
cochineal extract or carmine, see Sec.  4.63(b).


Sec.  4.83   Petitions for exemption from major food allergen labeling.

    (a) Submission of petition. Any person may petition the appropriate 
TTB officer to exempt a particular product or class of products from 
the labeling requirements of Sec.  4.82. The burden is on the 
petitioner to provide scientific evidence (as well as the analytical 
method used to produce the evidence) that demonstrates that the 
finished product or class of products, as derived by the method 
specified in the petition, either:
    (1) Does not cause an allergic response that poses a risk to human 
health; or
    (2) Does not contain allergenic protein derived from one of the 
foods identified in Sec.  4.82(a)(1)(i), even though a major food 
allergen was used in production.
    (b) Decision on petition. TTB will approve or deny a petition for 
exemption submitted under paragraph (a) of this section in writing 
within 180 days of receipt of the petition. If TTB does not provide a 
written response to the petitioner within that 180-day period, the 
petition will be deemed denied, unless an extension of time for 
decision is mutually agreed upon by the appropriate TTB officer and the 
petitioner. TTB may confer with the Food and Drug Administration (FDA) 
on petitions for exemption, as appropriate and as FDA resources permit. 
TTB may require the submission of product samples and other additional 
information in support of a petition; however, unless required by TTB, 
the submission of samples or additional information by the petitioner 
after submission of the petition will be treated as the withdrawal of 
the initial petition and the submission of a new petition. An approval 
or denial under this section will constitute final agency action.
    (c) Resubmission of a petition. After a petition for exemption is 
denied under this section, the petitioner may resubmit the petition 
along with supporting materials for reconsideration at any time. TTB 
will treat this submission as a new petition.
    (d) Availability of information--(1) General. TTB will promptly 
post to its website, https://www.ttb.gov, all petitions received under 
this section, as well as TTB's responses to those petitions. Any 
information submitted in support of the petition that is not posted to 
the TTB website will be available to the public pursuant to the Freedom 
of Information Act (5 U.S.C. 552), except where a request for 
confidential treatment is granted under paragraph (d)(2) of this 
section.
    (2) Requests for confidential treatment of business information. A 
person who provides trade secrets or other commercial or financial 
information in connection with a petition for exemption under this 
section may request that TTB give confidential treatment to that 
information. A failure to request confidential treatment at the time 
the information in question is submitted to TTB will constitute a 
waiver of confidential treatment. A request for confidential treatment 
of information under this section must conform to the following 
standards:
    (i) The request must be in writing;
    (ii) The request must clearly identify the information to be kept 
confidential;
    (iii) The request must relate to information that constitutes trade 
secrets or other confidential commercial or financial information 
regarding the business transactions of an interested person, the 
disclosure of which would cause substantial harm to the competitive 
position of that person;
    (iv) The request must set forth the reasons why the information 
should not be disclosed, including the reasons the disclosure of the 
information would prejudice the competitive position of the interested 
person; and
    (v) The request must be supported by a signed statement by the 
interested person, or by an authorized officer or employee of that 
person, certifying that the information in question is a trade secret 
or other confidential commercial or financial information and that the 
information is not already in the public domain.

Production Claims


Sec.  4.84   Use of the term ``organic.''

    Use of the term ``organic'' is permitted if any such use complies 
with United States Department of Agriculture (USDA) National Organic 
Program rules (7 CFR part 205), as interpreted by the USDA.


Sec.  4.85   Environmental, sustainability, and similar statements.

    Statements related to environmental or sustainable agricultural 
practices, social justice principles, and other similar statements 
(such as, ``Produced using 100% solar energy'' or ``Carbon Neutral'') 
may appear as long as the statements are truthful, specific, and not 
misleading. Statements or logos indicating environmental, sustainable 
agricultural, or social justice certification (such as, ``Biodyvin,'' 
``Salmon-Safe,'' or ``Fair Trade Certified'') may appear on wines that 
are actually certified by the appropriate organization.


Sec.  4.86   Use of TTB permit numbers on labels.

    Wine labels, containers, and packaging may bear TTB issued permit 
numbers as long as those permit numbers are located immediately 
adjacent to the name and address of the person operating the bonded 
wine cellar or winery. No additional reference may be made that may 
convey the impression that the wine was made or matured under 
government supervision or in accordance with government standards.


Sec.  4.87   Use of vineyard, orchard, farm, or ranch name as a claim 
or as additional information.

    (a) General. Except as provided in paragraph (b) of this section, 
the name of a vineyard, orchard, farm, or ranch may not appear on a 
wine label, container, or packaging unless 95 percent of the wine in 
the container is produced from primary winemaking material grown on the 
named vineyard, orchard, farm, or ranch.
    (b) Exception. (1) A vineyard, orchard, farm, or ranch name may be 
used without complying with the

[[Page 60628]]

requirements of paragraph (a) of this section if the vineyard, orchard, 
farm, or ranch name is part of an operating name or trade name that 
appears in the mandatory name and address statement. In such a case, 
the vineyard, orchard, farm, or ranch name that appears in the name and 
address statement may also appear in the brand name, as long as use of 
the name does not make a claim as to the origin of the winemaking 
materials.
    (2) Vineyard, orchard, farm, or ranch name having geographic 
significance. When used in a brand name, a vineyard, orchard, farm, or 
ranch name having geographical or viticultural significance is subject 
to the requirements of Sec.  4.64(b) and (c).

Appellations of Origin for Grape Wine


Sec.  4.88   Appellations of origin for grape wine in general.

    (a) General. An appellation of origin for grape wine is the name of 
a place where grapes used to produce a specified minimum percentage of 
wine for still grape wine, sparkling grape wine, and carbonated grape 
wine were grown. The requirements in this section and Sec. Sec.  4.89 
through 4.91 apply to the use of appellations of origin. All parts of 
the appellation must be in the same type size and immediately adjacent 
to each other.
    (b) Definition of ``appellation of origin'' for American wine. An 
American appellation of origin is the name (or names) of:
    (1) (The) United States or America (American);
    (2) A State;
    (3) Two or three States;
    (4) A county (which must be identified with the word ``county'' or 
other appropriate term for a county equivalent, where applicable, 
printed in the same font and type size as the name of the county);
    (5) Two or three counties in the same State; or
    (6) A viticultural area (as defined in Sec.  4.91).
    (c) Definition of appellation of origin for imported wine. An 
appellation of origin for imported wine is the name (or names) of:
    (1) A country;
    (2) A state, province, territory, or similar political subdivision 
of a country equivalent to a state or county;
    (3) Two or three states, provinces, territories, or similar 
political subdivisions of a country equivalent to a state;
    (4) Two or three counties; or
    (5) A viticultural area (as defined in Sec.  4.91).
    (d) When an appellation of origin must be used. An appellation of 
origin in accordance with Sec. Sec.  4.88 through 4.91, disclosing the 
true place of origin of the wine, must appear if:
    (1) A varietal (grape type) designation is used as provided in 
Sec.  4.156;
    (2) A type designation of varietal significance is used as provided 
in Sec.  4.157;
    (3) A semi-generic type designation is used as the class and type 
designation of the wine, as provided in Sec.  4.174;
    (6) The wine is labeled with a vintage date, and otherwise conforms 
with the provisions of Sec.  4.95.


Sec.  4.89   Eligibility for the use of an appellation of origin for 
grape wine.

    (a) Appellations of origin for American wine. An American wine is 
entitled to use the name of a single county, State, or country (the 
United States or America[n]) as an appellation of origin if:
    (1) At least 75 percent of the volume of wine is derived from 
grapes grown in the named county, State or country;
    (2) The wine has been fully finished (as defined in Sec.  4.1):
    (i) In the United States, if labeled ``[the] United States'' or 
``America[n]'';
    (ii) Within the labeled State or an adjacent State if labeled with 
a State appellation; or
    (iii) Within the State in which the labeled county is located, if 
labeled with a county appellation; and
    (3) The wine conforms to the laws and regulations of the named 
appellation area that govern the composition, method of production, and 
designation of wines made in such area.
    (b) Appellations of origin for imported wine. An imported wine is 
entitled to use the name of a single country or a single State, 
province, territory, or similar political subdivision of a country 
equivalent to a state or county as an appellation of origin if:
    (1) At least 75 percent of the volume of the wine is derived from 
grapes grown in the area indicated by the appellation of origin; and
    (2) The wine conforms to the requirements of the foreign laws and 
regulations that govern the composition, method of production, and 
designation of wines available for consumption within the country of 
origin.


Sec.  4.90   Multicounty and multistate appellations of origin for 
grape wine.

    (a) Multicounty appellations of origin for American wine. An 
appellation of origin comprising the names of two or three counties in 
the same State may be used if:
    (1) At least 85 percent of the volume of the wine is derived from 
grapes grown in the counties included in the appellation;
    (2) The wine derived from grapes grown in each county included in 
the appellation is in greater proportion than wine derived from grapes 
grown in any county that is not listed; and
    (3) The counties must be listed in descending order of 
predominance, based on the percentage of wine derived from grapes grown 
in each county.
    (b) Multicounty appellations of origin for imported wine. An 
appellation of origin comprising the names of two or three states, 
provinces, territories, or similar political subdivisions of a country 
equivalent to a county, all of which are in the same country, may be 
used if:
    (1) At least 85 percent of the volume of the wine is derived from 
grapes grown in the counties included in the appellation;
    (2) The wine derived from grapes grown in each county included in 
the appellation is in greater proportion than wine derived from grapes 
grown in any county that is not listed;
    (3) The counties must be listed in descending order of 
predominance, based on the percentage of wine derived from grapes grown 
in each county; and
    (4) The wine conforms to the requirements of the foreign laws and 
regulations that govern the composition, method of production, and 
designation of wines available for consumption within the country of 
origin.
    (c) Multistate appellations of origin for American wine. An 
appellation of origin comprising the names of two or three States may 
be used if:
    (1) At least 85 percent of the volume of the wine is derived from 
grapes grown in the States included in the appellation;
    (2) The wine derived from grapes grown in each State included in 
the appellation is in greater proportion than wine derived from grapes 
grown in any State that is not listed;
    (3) The States are listed in a descending order of predominance, 
based on the percentage of wine derived from grapes grown in each 
State;
    (4) The wine has been fully finished (as defined in Sec.  4.1) in 
one of the labeled States; and
    (5) The wine conforms to the laws and regulations that govern the 
composition, method of manufacture, and designation of wines in all of 
the States listed in the appellation.
    (d) Multistate appellations of origin for imported wine. An 
appellation of origin comprising the names of two or three states, 
provinces, territories, or similar political subdivisions of a country 
equivalent to a state, all of

[[Page 60629]]

which are in the same country, may be used if:
    (1) At least 85 percent of the volume of the wine is derived from 
grapes grown in the states, provinces, territories, or similar 
political subdivisions of a country equivalent to a state that are 
included in the appellation;
    (2) The wine derived from grapes grown in each state, province, 
territory, or similar political subdivision included in the appellation 
is in greater proportion than wine derived from grapes grown in any 
such area not listed on the label;
    (3) The states, provinces, territories, or similar political 
subdivisions are listed in a descending order of predominance, based on 
the percentage of wine derived from grapes grown in each; and
    (4) The wine conforms to the requirements of the foreign laws and 
regulations that govern the composition, method of production, and 
designation of wines available for consumption within the country of 
origin.


Sec.  4.91   Viticultural areas.

    (a) Definition of viticultural area for American wine. An American 
viticultural area is a delimited grape-growing region having a name, 
distinguishing features, and a delineated boundary as established in 
part 9 of this chapter.
    (b) Definition of viticultural area for imported wine. A 
viticultural area for imported wine is a delimited place or region 
(other than a place or region (such as a county or state) defined in 
Sec.  4.88(c)(1), (2), or (3)) the boundaries of which have been 
recognized and defined by the country of origin for use on labels of 
wine available for consumption within the country of origin.
    (c) Establishment of American viticultural areas. A petition for 
the establishment of an American viticultural area may be submitted by 
any interested party, pursuant to part 9 and Sec.  70.701(c) of this 
chapter. The petition must be made in written form and must contain the 
information specified in Sec.  9.12 of this chapter.
    (d) Requirements for use. A wine may be labeled with the name of a 
viticultural area if:
    (1) The appellation has been approved under part 9 of this chapter 
in the case of domestic wine or by the appropriate foreign government 
in the case of imported wine;
    (2) Not less than 85 percent of the wine is derived from grapes 
grown within the boundaries of the viticultural area;
    (3) In the case of foreign wine, it conforms to the requirements of 
the foreign laws and regulations that govern the composition, method of 
production, and designation of wines available for consumption within 
the country of origin; and
    (4) In the case of American wine, it has been fully finished (as 
defined in Sec.  4.1) within the State, or one of the States, within 
which the labeled viticultural area is located.
    (e) More than one viticultural area. A wine may be labeled with 
more than one viticultural area if:
    (1) The indicated viticultural areas overlap; and
    (2) Not less than 85 percent of the volume of the wine is derived 
from grapes grown in the overlapping area.

Claims About Grape Wine


Sec.  4.92   Estate bottled.

    (a) Conditions for use. The term ``Estate bottled'' may appear on a 
wine label only if the wine is labeled with a viticultural area 
appellation of origin and the bottling winery:
    (1) Is located within the labeled viticultural area;
    (2) Grew all of the grapes used to make the wine on land owned or 
controlled by the winery within the boundaries of the labeled 
viticultural area; and
    (3) Crushed the grapes, fermented the resulting must, and fully 
finished, aged, and bottled the wine in a continuous process (the wine 
at no time having left the premises of the bottling winery).
    (b) Special rule for cooperatives. Grapes grown by the members of a 
single cooperative bottling winery are considered to be grown by the 
bottling winery.
    (c) Use of other terms. No term other than ``Estate bottled'' may 
appear on a label to indicate combined growing and bottling conditions.
    (d) Definitions. For purposes of this section, land controlled by 
the winery refers to property on which the producing winery has the 
legal right to perform, and does perform, all of the acts common to 
viticulture under the terms of a lease or similar agreement of at least 
three years duration.


Sec.  4.93   Estate grown.

    (a) Conditions for use. The term ``Estate(s) grown'' may appear on 
a wine label only if all of the following conditions are met:
    (1) The wine is labeled with an appellation of origin;
    (2) The producing winery is located within the appellation of 
origin;
    (3) The producing winery grew all of the grapes used to make the 
wine on land owned or controlled by the producing winery within the 
boundaries of the appellation of origin, and fermented 100 percent of 
the wine from those grapes; and
    (4) If the bottling winery is not the producing winery, the label 
must clarify that the wine was ``estate grown'' by the producing 
winery, and the name and address of both wineries must appear on the 
label. An acceptable labeling statement would be ``Estate grown and 
produced by ABC Winery, Seattle, Washington. Bottled by XYZ Winery, 
Tacoma, Washington.''
    (b) Special rule for cooperatives. Grapes grown by the members of a 
single cooperative bottling winery are considered to be grown by the 
bottling winery.
    (c) Definition. For purposes of this section, land controlled by 
the winery refers to property on which the producing winery has the 
legal right to perform, and does perform, all of the acts common to 
viticulture under the terms of a lease or similar agreement of at least 
3 years duration.


Sec.  4.94   Claims on grape wine labels for viticultural practices 
that result in sweet wine.

    (a) General. The claims set forth in paragraphs (b) through (d) of 
this section about viticultural practices that result in sweet wine may 
be used on labels of grape wine subject to the rules set forth in this 
section. In all such cases, the wine must also be labeled with the 
amount of sugar contained in the grapes at the time of harvest and the 
amount of residual sugar in the finished wine. The amount of sugar may 
be stated in degrees Brix, percent by weight, grams per 100 mL or grams 
per liter. Harvest or picking dates may not be stated on the label 
unless the wine is labeled with a vintage date in accordance with Sec.  
4.95.
    (b) Ice wine. The term ``ice wine'' (or ``icewine,'' or ``ice-
wine'') may be used only to describe wines produced exclusively from 
grapes that have been harvested after they have naturally frozen on the 
vine. Wine that is ameliorated, concentrated, fortified, or produced 
from concentrate may not be labeled as ``ice wine.'' Wine produced from 
grapes that were frozen post-harvest may not be labeled as ``ice wine'' 
but may be labeled with a statement such as ``made from grapes frozen 
post-harvest.''
    (c) Late harvest or late picked. The term ``late harvest'' or 
``late picked'' may not be used on the label of a wine that is 
ameliorated, concentrated, fortified, or produced from concentrate.

[[Page 60630]]

    (d) Botrytis Infected or Pourriture Noble. Grape wine produced from 
grapes that have been infected with the botrytis cinerea mold may be 
labeled with a term such as ``Botrytis Infected,'' ``Pourriture 
Noble,'' or another name for infection by the botrytis cinerea mold.


Sec.  4.95   Vintage date.

    (a) General. Grape wine may be labeled with the vintage date (which 
is the calendar year in which the grapes used to make the wine were 
harvested) only if the wine is also labeled with an appellation of 
origin as defined in Sec.  4.88. The requirements in paragraphs (a)(1) 
through (3) of this section apply to the use of vintage dates on 
American and imported wines:
    (1) If wine is labeled with a viticultural area as defined in Sec.  
4.91, at least 95 percent of the wine must have been derived from 
grapes harvested in the labeled calendar year.
    (2) If a wine is labeled with an appellation of origin other than a 
viticultural area, at least 85 percent of the wine must have been 
derived from grapes harvested in the labeled calendar year.
    (3) A wine may be labeled with only one vintage date.
    (b) Imported wine. Imported wine may bear a vintage date if all of 
the following conditions are met:
    (1) The wine is made in compliance with the production standards 
referenced in paragraph (a) of this section, except that the year of 
harvest for an imported wine will be determined in accordance with the 
laws and regulations governing vintage date labeling of wines available 
for consumption within the country of origin.
    (2) The wine is of the vintage shown, the laws of the country of 
origin regulate the appearance of vintage dates upon the labels of wine 
produced for consumption within the country of origin, the wine has 
been produced in conformity with those laws, and the wine would be 
entitled to bear the vintage date if it had been sold within the 
country of origin. The importer of the wine imported in bottles or the 
domestic bottler of wine imported in bulk and bottled in the United 
States must be able to demonstrate, upon request by the appropriate TTB 
officer or a customs officer, that the wine is entitled to be labeled 
with the vintage date.

Appellations of Origin for Fruit Wine, Agricultural Wine, and Rice Wine


Sec.  4.96   Appellations of origin for fruit wine, agricultural wine, 
and rice wine in general.

    (a) General. An appellation of origin for fruit wine, agricultural 
wine, or rice wine is the name of a place where the fruit (other than 
grapes), agricultural products, or rice, respectively, used to produce 
a specified minimum percentage of the fruit wine, agricultural wine, or 
rice wine, as prescribed in subpart I of this part, are grown. In the 
case of honey wine, eligibility for use of an appellation of origin is 
based on the place where the source plants for the honey were grown. 
The requirements in this section and Sec. Sec.  4.97 and 4.98, apply to 
the use of appellations of origin. All parts of the appellation must be 
in the same type size and immediately adjacent to each other.
    (b) Definition of ``appellation of origin'' for American wine. An 
American appellation of origin is the name (or names) of:
    (1) (The) United States or America (American);
    (2) A State (including the District of Columbia and the 
Commonwealth of Puerto Rico);
    (3) Two or no more than three States;
    (4) A county (which must be identified with the word ``county'' or 
other appropriate term for a county equivalent, where applicable, 
printed in the same font and type size as the name of the county); or
    (5) Two or no more than three counties in the same State.
    (c) Definition of appellation of origin for imported wine. An 
appellation of origin for imported wine is the name (or names) of:
    (1) A country;
    (2) A state, province, territory, or similar political subdivision 
of a country equivalent to a state or county; or
    (3) Two or three states, provinces, territories, or similar 
political subdivisions of a country equivalent to a state.


Sec.  4.97   Eligibility for use of an appellation of origin for fruit 
wine, agricultural wine, and rice wine.

    (a) Appellations of origin for American wine. An American fruit, 
agricultural, or rice wine is entitled to use the name of a single 
county, State, or country (the United States or America[n]) as an 
appellation of origin if:
    (1) At least 75 percent of the volume of wine is derived from fruit 
or agricultural products grown in the stated appellation of origin;
    (2) The wine has been fully finished (as defined in Sec.  4.1):
    (i) In the United States, if labeled ``[the] United States'' or 
``America[n]'';
    (ii) Within the labeled State or an adjacent State if labeled with 
a State appellation; or
    (iii) Within the State in which the labeled county is located, if 
labeled with a county appellation; and
    (3) The wine conforms to the laws and regulations of the named 
appellation area that govern the composition, method of production, and 
designation of wines made in such place.
    (b) Appellations of origin for imported wine. An imported wine is 
entitled to use the name of a single country or a single State, 
province, territory, or similar political subdivision of a country 
equivalent to a state or county as an appellation of origin if:
    (1) At least 75 percent of the volume of the wine is derived from 
fruit or other agricultural products grown in the area indicated by the 
appellation of origin; and
    (2) The wine conforms to the requirements of the foreign laws and 
regulations that govern the composition, method of production, and 
designation of wines available for consumption within the country of 
origin.


Sec.  4.98   Multicounty and multistate appellations of origin for 
fruit wine, agricultural wine, and rice wine.

    (a) Multicounty appellations of origin. An appellation of origin 
comprising the names of two or three counties in the same State may be 
used if:
    (1) At least 85 percent of the volume of the wine is derived from 
fruit or other agricultural products grown in the counties included in 
the appellation;
    (2) The wine derived from fruit or other agricultural products 
grown in each county included in the appellation is in greater 
proportion than wine derived from fruit or other agricultural products 
grown in any county that is not listed; and
    (3) The counties are listed in descending order of predominance, 
based on the percentage of wine derived from fruit or other 
agricultural products grown or harvested in each county.
    (b) Multistate appellations for American wine. An appellation of 
origin comprising the names of two or three States may be used, if:
    (1) At least 85 percent of the volume of the wine is derived from 
fruit or other agricultural products grown in the States indicated;
    (2) The wine derived from fruit or other agricultural products 
grown or harvested in each State listed on the label is in greater 
proportion than wine

[[Page 60631]]

derived from fruit or other agricultural products grown in any State 
that is not listed;
    (3) The States must be listed in a descending order of 
predominance, based on the percentage of wine derived from fruit or 
other agricultural products grown or harvested in each State;
    (4) The wine has been fully finished (as defined in Sec.  4.1) in 
one of the labeled States; and
    (5) The wine conforms to the laws and regulations that govern the 
composition, method of manufacture, and designation of wines in all of 
the States listed in the appellation.
    (c) Multistate appellations of origin for imported wine. An 
appellation of origin comprising the names of two or three states, 
provinces, territories, or similar political subdivisions of a country 
equivalent to a state, all of which are in the same country, may be 
used if:
    (1) At least 85 percent of the volume of the wine is derived from 
fruit or other agricultural products grown or harvested in the states, 
provinces, territories, or similar political subdivisions of a country 
equivalent to a state that are included in the appellation;
    (2) The wine derived from fruit or agricultural products grown or 
harvested in each named state, province, territory, or similar 
political subdivisions must be listed in a descending order of 
predominance, based on the percentage of wine derived from fruit or 
other agricultural products grown or harvested in each;
    (3) The wine derived from fruit or other agricultural products 
grown or harvested in each state, province, territory, or similar 
political subdivision must be in greater proportion than wine derived 
from fruit or other agricultural products grown or harvested in any 
such area not listed on the label; and
    (4) The wine conforms to the requirements of the foreign laws and 
regulations that govern the composition, method of production, and 
designation of wines available for consumption within the country of 
origin.

Subpart G--Prohibited Labeling Practices


Sec.  4.101   General.

    (a) Application. The prohibitions set forth in this subpart apply 
to any wine label, container, or packaging. For purposes of this 
subpart:
    (1) The term ``label'' includes all labels on wine containers on 
which mandatory information may appear, as set forth in Sec.  4.61(a), 
as well as any other label on the container;
    (2) The term ``container'' includes all parts of the wine 
container, including any part of a wine container on which mandatory 
information may appear, as well as those parts of the container on 
which information does not satisfy mandatory labeling requirements, as 
set forth in Sec.  4.61(b); and
    (3) The term ``packaging'' includes any carton, case, carrier, 
individual covering or other packaging of such containers used for sale 
at retail, but does not include shipping cartons or cases that are not 
intended to accompany the container to the consumer.
    (b) Statement or representation. For purposes of the prohibited 
practices in this subpart, the term ``statement or representation'' 
includes any statement, design, device, or representation, and includes 
pictorial or graphic designs or representations as well as written 
ones. The term ``statement or representation'' includes explicit and 
implicit statements and representations.


Sec.  4.102   False or untrue statements.

    Wine labels, containers, or packaging may not contain any statement 
or representation that is false or untrue in any particular.


Sec.  4.103   Obscene or indecent depictions.

    Wine labels, containers, or packaging may not contain any statement 
or representation that is obscene or indecent.

Subpart H--Labeling Practices That Are Prohibited If They Are 
Misleading


Sec.  4.121   General.

    (a) Application. The labeling practices that are prohibited if 
misleading set forth in this subpart apply to any wine label, 
container, or packaging. For purposes of this subpart:
    (1) The term ``label'' includes all labels on wine containers on 
which mandatory information may appear, as set forth in Sec.  4.61(a), 
as well as any other label on the container;
    (2) The term ``container'' includes all parts of the wine 
container, including any part of a wine container on which mandatory 
information may appear, as well as those parts of the container on 
which information does not satisfy mandatory labeling requirements, as 
set forth in Sec.  4.61(b); and
    (3) The term ``packaging'' includes any carton, case, carrier, 
individual covering or other packaging of such containers used for sale 
at retail, but does not include shipping cartons or cases that are not 
intended to accompany the container to the consumer.
    (b) Statement or representation. For purposes of this subpart, the 
term ``statement or representation'' includes any statement, design, 
device, or representation, and includes pictorial or graphic designs or 
representations as well as written ones. The term ``statement or 
representation'' includes explicit and implicit statements and 
representations.


Sec.  4.122   Misleading statements or representations.

    (a) General prohibition. Wine labels, containers, or packaging may 
not contain any statement or representation, irrespective of falsity, 
that is misleading to consumers as to the age, origin, identity, or 
other characteristics of the wine, or with regard to any other material 
factor.
    (b) Ways in which statements or representations may be misleading. 
(1) A statement or representation is prohibited, irrespective of 
falsity, if it directly creates a misleading impression, or if it does 
so indirectly through ambiguity, omission, inference, or by the 
addition of irrelevant, scientific, or technical matter. For example, 
an otherwise truthful statement may be misleading because of the 
omission of material information, the disclosure of which is necessary 
to prevent the statement from being misleading.
    (2) As set forth in Sec.  4.212(b), all claims, whether implicit or 
explicit, must have a reasonable basis in fact. Any claim on wine 
labels, containers, or packaging that does not have a reasonable basis 
in fact, or cannot be adequately substantiated upon the request of the 
appropriate TTB officer, is considered misleading.


Sec.  4.123   Guarantees.

    Wine labels, containers, or packaging may not contain any statement 
relating to guarantees if the appropriate TTB officer finds it is 
likely to mislead the consumer. However, money-back guarantees are not 
prohibited.


Sec.  4.124   Disparaging statements.

    (a) General. Wine labels, containers, or packaging may not contain 
any false or misleading statement that explicitly or implicitly 
disparages a competitor's product.
    (b) Examples. (1) An example of an explicit statement that falsely 
disparages a competitor's product is, ``Brand X is not aged in oak 
barrels,'' when such statement is not true.
    (2) An example of an implicit statement that disparages 
competitors' products in a misleading fashion is, ``We do not add 
arsenic to our wine,''

[[Page 60632]]

where such a claim is true but it may lead consumers to falsely believe 
that other winemakers do add arsenic to their wine.
    (c) Truthful and accurate comparisons. This section does not 
prevent truthful and accurate comparisons between products (such as, 
``Our wine contains more grapes than Brand X'') or statements of 
opinion (such as, ``We think our wine tastes better than any other wine 
on the market'').


Sec.  4.125   Tests or analyses.

    Wine labels, containers, or packaging may not contain any statement 
or representation of or relating to analyses, standards, or tests, 
whether or not it is true, that is likely to mislead the consumer. An 
example of such a misleading statement is ``tested and approved by our 
research laboratories'' if the testing and approval does not in fact 
have any significance.


Sec.  4.126   Depictions of government symbols.

    (a) Representations of the armed forces and flags. Wine labels, 
containers, or packaging may not show an image of any government's flag 
or any representation related to the armed forces of the United States 
if the representation, standing alone or considered together with any 
additional language or symbols on the label, creates a false or 
misleading impression that the product was endorsed by, made by, used 
by, or made under the supervision of, the government represented by 
that flag or the armed forces of the United States. This section does 
not prohibit the use of a flag as part of a claim of American origin or 
another country of origin.
    (b) Government seals. Wine labels, containers, or packaging may not 
contain any government seal or other insignia that is likely create a 
false or misleading impression that the product has been endorsed by, 
made by, used by, or produced for, or under the supervision of, or in 
accordance with the specification of, that government. Seals required 
or specifically authorized by applicable law or regulations and used in 
accordance with such law or regulations are not prohibited.


Sec.  4.127   Depictions simulating government stamps or relating to 
supervision.

    (a) Wine labels, containers, or packaging may not contain any 
statements or representations that mislead consumers to believe that 
the wine is manufactured or processed under government authority. Wine 
labels, containers, or packaging may not contain images or designs 
resembling a stamp of the U.S. Government or any State or foreign 
government, and may not contain statements or indications that the wine 
is produced, blended, bottled, packed or sold under, or in accordance 
with, any municipal, State, Federal, or foreign authorization, law, or 
regulations, unless such statement is required or specifically 
authorized by applicable law or regulations. If a municipal, State, or 
Federal Government permit number is stated on a label, containers, or 
packaging, it may not be accompanied by any additional statement 
relating to that permit number with the exception of the name and 
address of the person associated with that permit number.
    (b) If imported wines are covered by a certificate of origin and/or 
a certificate of vintage date issued by an official duly authorized by 
the appropriate foreign government, the container, except where 
prohibited by the foreign government, may refer to that certificate or 
to the fact of that certification, but the container must not contain 
any additional statements relating to the certificate or certification. 
Any reference to such a certificate or certification must be in 
substantially the following form:
    This product was accompanied at the time of the importation by a 
certificate issued by the

-----------------------------------------------------------------------
(Name of government)

government indicating that the product is
-----------------------------------------------------------------------
(Class and type as stated on the container)

and (if container bears a statement of vintage date) that the wine is 
of the vintage of

-----------------------------------------------------------------------
(Year of vintage stated on the container).


Sec.  4.128   Claims related to distilled spirits or malt beverages.

    (a) General. Except as provided in paragraph (b) of this section, 
no label, carton, case, or any other packaging material may contain a 
statement, design, or representation that tends to create a false or 
misleading impression that the wine is a distilled spirits or malt 
beverage product, or that it contains distilled spirits or malt 
beverages. For example, the use of the name of a class or type 
designation of a distilled spirits or malt beverage product, as set 
forth in part 5 or 7 of this chapter, is prohibited, if the use of that 
name creates a misleading impression as to the identity of the product. 
Homophones or coined words that simulate or imitate a class or type 
designation are also prohibited.
    (b) Exceptions. This section does not prohibit:
    (1) A truthful and accurate statement of alcohol content;
    (2) The use of a brand name of a distilled spirits or malt beverage 
product as a wine brand name, provided that the overall label does not 
create a misleading impression as to the identity of the product;
    (3) The use of a distilled spirits or malt beverage cocktail name 
as a brand name or a distinctive or fanciful name of a wine product, 
provided that a statement of composition, in accordance with Sec.  
4.151, appears in the same field of vision as the brand name or a 
distinctive or fanciful name and the overall label does not create a 
misleading impression about the identity of the product;
    (4) The use of a statement of composition that includes a reference 
to the type of distilled spirits contained therein;
    (5) The use of truthful and accurate statements about the 
production of the wine, as part of a statement of composition or 
otherwise, such as ``aged in whisky barrels,'' so long as such 
statements do not create a misleading impression as to the identity of 
the product; or
    (6) The use of terms that simply compare wine to distilled spirits 
or malt beverage products without creating a misleading impression as 
to the identity of the product.


Sec.  4.129   Health-related statements.

    (a) Definitions. When used in this section, the following terms 
have the meaning indicated:
    (1) Health-related statement means any statement related to health 
(other than the warning statement required under part 16 of this 
chapter) and includes statements of a curative or therapeutic nature 
that, expressly or by implication, suggest a relationship between the 
consumption of alcohol, wine, or any substance found within the wine, 
and health benefits or effects on health. The term includes both 
specific health claims and general references to alleged health 
benefits or effects on health associated with the consumption of 
alcohol, wine, or any substance found within the wine, as well as 
health-related directional statements. The term also includes 
statements and claims that imply that a physical or psychological 
sensation results from consuming the wine, as well as statements and 
claims of nutritional value (for example, statements of vitamin 
content). Numerical statements of the calorie,

[[Page 60633]]

carbohydrate, protein, and fat content of the product do not constitute 
claims of nutritional value.
    (2) Specific health claim means a type of health-related statement 
that, expressly or by implication, characterizes the relationship of 
alcohol, wine, or any substance found within the wine, to a disease or 
health-related condition. Implied specific health claims include 
statements, symbols, vignettes, or other forms of communication that 
suggest, within the context in which they are presented, that a 
relationship exists between wine, alcohol, or any substance found 
within the wine, and a disease or health-related condition.
    (3) Health-related directional statement means a type of health-
related statement that directs or refers consumers to a third party or 
other source for information regarding the effects on health of wine or 
alcohol consumption.
    (b) Rules for labeling--(1) Health-related statements. In general, 
labels may not contain any health-related statement that is untrue in 
any particular or tends to create a misleading impression as to the 
effects on health of alcohol consumption. TTB will evaluate such 
statements on a case-by-case basis and may require as part of the 
health-related statement a disclaimer or some other qualifying 
statement to dispel any misleading impression conveyed by the health-
related statement.
    (2) Specific health claims. (i) TTB will consult with the Food and 
Drug Administration (FDA), as needed, on the use of a specific health 
claim on the wine. If FDA determines that the use of such a labeling 
claim is a drug claim that is not in compliance with the requirements 
of the Federal Food, Drug, and Cosmetic Act, TTB will not approve the 
use of that specific health claim on the wine.
    (ii) TTB will approve the use of a specific health claim on a wine 
label only if the claim: Is truthful and adequately substantiated by 
scientific or medical evidence; is sufficiently detailed and qualified 
with respect to the categories of individuals to whom the claim 
applies; adequately discloses the health risks associated with both 
moderate and heavier levels of alcohol consumption; and outlines the 
categories of individuals for whom any levels of alcohol consumption 
may cause health risks. This information must appear as part of the 
specific health claim.
    (3) Health-related directional statements. A health-related 
directional statement is presumed misleading unless it:
    (i) Directs consumers in a neutral or other non-misleading manner 
to a third party or other source for balanced information regarding the 
effects on health of alcohol or alcohol beverage product consumption; 
and
    (ii)(A) Includes as part of the health-related directional 
statement the following disclaimer: ``This statement should not 
encourage you to drink or to increase your alcohol consumption for 
health reasons''; or
    (B) Includes as part of the health-related directional statement 
some other qualifying statement that the appropriate TTB officer finds 
is sufficient to dispel any misleading impression conveyed by the 
health-related directional statement.


Sec.  4.130   Appearance of endorsement.

    (a) General. Wine labels, containers, or packaging may not include 
the name, or the simulation or abbreviation of the name, of any living 
individual of public prominence, or an existing private or public 
organization, or any graphic, pictorial, or emblematic representation 
of the individual or organization, if its use is likely to lead a 
consumer to falsely believe that the product has been endorsed, made, 
or used by, or produced for, or under the supervision of, or in 
accordance with the specifications of, such individual or organization. 
This section does not prohibit the use of such names where the 
individual or organization has provided authorization for their use.
    (b) Documentation. The appropriate TTB officer may request 
documentation from the bottler or importer to establish that the person 
or organization has provided authorization to use the name of that 
person or organization.
    (c) Disclaimers. Statements or other representations do not violate 
this section if, taken as a whole, they create no misleading impression 
as to an implied endorsement either because of the context in which 
they are presented or because of the use of an adequate disclaimer.


Sec.  4.131   Use of the word ``importer'' or similar words.

    (a) Except as provided in paragraph (b) of this section, labels, 
containers, or packaging for wine that is not required to bear an 
``imported by'' statement under Sec.  4.67 or Sec.  4.68 may not 
include the word ``importer'' or any other word that creates the 
misleading impression that the product was imported.
    (b) If the word ``importer'' or a similar word is part of the bona 
fide name of a permittee by or for whom the wine was bottled, or a 
retailer for whom the wine was bottled or distributed, it may appear as 
part of the name and address statement, as long as the words ``Product 
of the United States'' or similar dispelling language appears 
immediately adjacent to the name and address statement, in the same 
size and type of the name and address statement.


Sec.  4.132   [Reserved]


Sec.  4.133   Claims regarding terms defined or authorized by this 
part.

    (a) Wine labels, containers, or packaging may not include any use 
of a term defined in this part in a manner that is not consistent with 
the definitions set forth in this part.
    (b) Wine labels, containers, or packaging materials may not contain 
any coined word or name that simulates, imitates, or which tends to 
create the impression that the wine so labeled is entitled to bear, any 
class, type, or authorized designation recognized by the regulations in 
this part or in part 5 or part 7 of this chapter unless the wine 
conforms to the requirements prescribed with respect to such 
designation and is in fact so designated on its labels.
    (c) Except as provided by Sec.  4.136, statements or 
representations on wine labels, containers, or packaging may not make 
claims about the grape varieties used in production of a wine that does 
not bear a varietal designation under Sec.  4.156 or Sec.  4.157.
    (d) Except as provided by Sec.  4.134, statements or 
representations on wine labels, containers, or packaging may not make 
claims about the year that grapes were grown or harvested unless the 
wine label bears a vintage date in accordance with Sec.  4.95, and the 
claims are consistent with that date.


Sec.  4.134   Statements related to dates or ages.

    (a) Statement of age. Except as provided in paragraphs (b) and (c) 
of this section, a wine label, container, or packaging may not bear any 
statement or other representation of age, including representations in 
the brand name, except for:
    (1) Vintage wine, in accordance with Sec.  4.95;
    (2) References relating to methods of wine production involving 
storage or aging, in accordance with Sec.  4.56. Any such age statement 
must indicate how long the wine has been aged and the type of aging 
that occurred, for example, ``Barrel aged for __ months;'' or
    (3) Use of the word ``old'' as part of the brand name; or
    (4) Additional truthful, accurate, and specific information about 
the year of

[[Page 60634]]

harvest of the grapes or fruit used to make still, sparkling, or 
carbonated grape wine, or still, sparkling, or carbonated fruit wine, 
respectively. The information must indicate the percentage of wine 
derived from grapes or fruit, respectively, grown in each of the 
labeled harvest years, such as ``60% of the grapes used to make this 
wine were harvested in 2014; the remaining 40% were harvested in 
2013,'' or ``this wine is a blend of 50% wine made from apples 
harvested in 2012 and 50% wine made from apples harvested in 2011.'' 
When applicable, the years of harvest must be presented in descending 
order based on the percentage of wine derived from grapes or fruit 
grown in each year.
    (b) Statement of bottling date. For purposes of paragraph (a) of 
this section, a statement of the bottling date of a wine will not be 
deemed to be a representation relative to age, provided that the 
statement appears in the following form: ``Bottled in __'' (inserting 
the year in which the wine was bottled).
    (c) Miscellaneous date statements. Except in the case of vintage 
dates and bottling, storage, or aging dates as provided in paragraphs 
(a) and (b) of this section, a wine label must not bear any date 
unless, in addition to the date and immediately adjacent to the date 
and in the same size and kind of printing, a statement of the 
significance or relevance of the date is provided, such as 
``established'' or ``founded in''. If the date refers to the date of 
establishment of any business or brand name, the date and its 
accompanying statement must appear immediately adjacent to the name of 
the person, company, or brand name to which it relates if the 
appropriate TTB officer finds that this is necessary in order to 
prevent confusion as to the person, company, or brand name to which the 
establishment date applies. This paragraph does not authorize the use 
of dates referring to the date of growth or harvest of the grapes on 
wines that are not labeled with vintage dates in accordance with Sec.  
4.95.


Sec.  4.135   Indications of origin.

    (a) General rule. Except as otherwise provided in Sec. Sec.  4.64 
and 4.174, which address brand names of geographic significance and 
semi-generic designations, respectively, any statement, design, device 
or representation on a wine label, container, or packaging that 
indicates or implies an origin other than the true place of origin of 
the wine is prohibited. This section does not prohibit name and address 
statements in accordance with this part.
    (b) Wine that is labeled with an appellation of origin. Except as 
otherwise provided in Sec. Sec.  4.64 and 4.174, which address brand 
names of geographic significance and semi-generic designations, 
respectively, any statement or representation regarding the origin of 
the grapes, fruit, or agricultural materials used to make wine that is 
labeled with an appellation of origin must be consistent with the 
appellation of origin that appears on the label.
    (c) Wine that is not labeled with an appellation of origin. Wine 
that is not labeled with an appellation of origin may be labeled with 
additional information that provides truthful information about the 
origin of the grapes, fruit, or other agricultural materials that were 
used to produce the wine provided that:
    (1) The name of the place of origin of the grapes, fruit, or other 
agricultural products does not appear on the label in a way that 
creates the misleading impression that the wine is entitled to an 
appellation of origin under Sec. Sec.  4.88-4.90 or Sec. Sec.  4.96-
4.97; and
    (2) Any additional information about the origin of the grapes, 
fruit, or other agricultural products of the wine sets forth the origin 
of 100 percent of the grapes, fruit, or other agricultural products 
used to make the wine, in descending order of predominance, together 
with the place where the wine was produced.
    (d) Examples of permissible statements of origin as additional 
information. A wine that is produced in New York and designated as 
``red wine,'' may be labeled with a statement that indicates the origin 
and percentage of the gapes that were used to produce the wine. If 50 
percent of the grapes used to make the wine were grown in New York, and 
50 percent of the grapes used to make the wine were grown in Virginia, 
the wine may bear a statement on the label to the effect of ``this wine 
was produced and bottled in New York from 50 percent New York grapes 
and 50 percent Virginia grapes.''


Sec.  4.136   Use of a varietal name, type designation of varietal 
significance, semi-generic name, or geographic distinctive designation.

    (a) The use of a varietal name, type designation of varietal 
significance, semi-generic name, or geographic distinctive designation 
is presumed to be misleading and is thus prohibited on the label, 
container, or packaging of any wine that is not made in accordance with 
the standards prescribed for still grape wine, sparkling grape wine, or 
carbonated grape wine of Sec. Sec.  4.142, 4.143, and 4.144.
    (b) The use of such a term on the label of a wine, container, or 
packaging of any wine that is made in accordance with the standards 
prescribed for still grape wine, sparkling grape wine, or carbonated 
grape wine but does not meet the requirements for use of the 
designation named, including its use in a brand name, product name, or 
a distinctive or fanciful name, is prohibited where the use of such 
name may tend to create a false or misleading impression as to the 
designation, origin, or identity of the wine.
    (c) This paragraph does not prohibit the use of truthful, accurate, 
and specific additional information on the label about the grape 
varieties used to make a still grape wine, sparkling grape wine, or 
carbonated grape wine, provided that the information includes every 
grape variety used to make the wine, listed in descending order of 
predominance. The percentage of each grape variety may be, but is not 
required to be, shown on the label, along with a tolerance of two 
percentage points. When shown, percentages must be shown for all grape 
varieties listed, and the total must equal 100 percent.


Sec.  4.137   Terms relating to intoxicating qualities.

    Wine labels, containers, or packaging may not contain any statement 
or representation that tends to create the impression that the wine 
should be purchased or consumed based on intoxicating qualities.

Subpart I--The Standards of Identity for Wine


Sec.  4.141   The standards of identity in general.

    (a) Standards of identity (class and type designations) and other 
designations (statements of composition). Sections 4.142 through 4.150 
provide for the standards of identity for wine. These standards are 
broken into nine classes and several types within each class. In 
general, the class and/or type designation is used to meet the 
mandatory requirement found in Sec.  4.63(a)(2). In certain 
circumstances, a statement of composition as prescribed in Sec.  4.151 
may be required. In those circumstances, the statement of composition 
meets the mandatory label information requirement in Sec.  4.63(a)(2). 
All parts of the designation of wine, whether mandatory or optional, 
must appear together and in lettering substantially of the same size 
and kind. Whenever any term for which a standard of identity has been

[[Page 60635]]

established in this subpart is used in this part, the term has the 
meaning assigned to it by that standard of identity.
    (b) Cellar treatment of wine. See Sec.  4.154 for cellar treatments 
that change the class and type designation of wine and for those cellar 
treatments that are authorized for use without changing the class and 
type of wine.


Sec.  4.142   Still grape wine--class and type designation.

    (a) Still grape wine. (1) Still grape wine is wine produced by the 
normal alcoholic fermentation of the juice of sound, ripe grapes 
(including restored or unrestored pure condensed grape must), with or 
without the addition, after fermentation, of pure condensed grape must 
and with or without added spirits of the type authorized for natural 
wine under 26 U.S.C. 5382, but without other addition or abstraction 
except as may occur in cellar treatment of the type authorized for 
natural wine under 26 U.S.C. 5382.
    (2) Still grape wine may be ameliorated, or sweetened, before, 
during, or after fermentation, in a way that is consistent with the 
limits set forth in 26 U.S.C. 5383 for natural grape wine, provided 
that grape wine designated as ``specially sweetened grape wine'' under 
paragraph (c)(11) of this section may be sweetened in accordance with 
the standards set forth in 26 U.S.C. 5385.
    (3) Still grape wine must contain less than 0.392 grams of carbon 
dioxide per 100 milliliters. The maximum volatile acidity, calculated 
as acetic acid and exclusive of sulfur dioxide is 0.14 gram per 100 mL 
(20 degrees Celsius) for red wine and 0.12 gram per 100 mL (20 degrees 
Celsius) for other grape wine, provided that the maximum volatile 
acidity for wine produced from unameliorated juice of 28 or more 
degrees Brix is 0.17 gram per 100 mL for red wine and 0.15 gram per 100 
mL for white wine.
    (b) Class designation of grape wine. Still grape wine must be 
designated as ``still grape wine'' or ``grape wine'' unless paragraph 
(c) of this section applies. Still grape wine that is designated with 
an authorized type designation may use the class designation ``grape 
wine'' in addition to the type designation.
    (c) Type designation of still grape wine. Still grape wine may be 
designated with one or more of the following type designation(s) that 
apply in place of or in addition to the class designation.
    (1) Red, white, blush, pink, ros[eacute], and amber wine. Still 
grape wine that derives its characteristic color from the presence or 
absence of the red coloring matter of the skins, juice, or pulp of 
grapes may be designated as ``red wine,'' ``white wine,'' ``blush 
wine,'' ``pink wine,'' ``ros[eacute] wine,'' or ``amber wine,'' as the 
case may be.
    (2) Grape variety. The names of one or more grape varieties (for 
example, ``chardonnay'' or ``cabernet franc and merlot'') may be used 
as the type designation in accordance with Sec.  4.156.
    (3) Grape type designation of varietal significance. A grape type 
designation of varietal significance (for example, ``moscato'' or 
``scuppernong'') may be used as the type designation in accordance with 
Sec.  4.157.
    (4) Semi generic designation of geographic significance. A semi-
generic designation of geographic significance (for example, 
``Angelica'') may be used as the type designation in accordance with 
Sec.  4.174.
    (5) Non-generic designation that is a distinctive designations of 
specific grape wines. A non-generic designation that is a distinctive 
designation of specific grape wine (for example, ``Bordeaux Blanc'') 
may be used as the type designation in accordance with Sec.  4.175.
    (6) Table wine and light wine. Still grape wine having an alcoholic 
content greater than 7 percent by volume and not in excess of 14 
percent by volume may be designated as ``table wine'' or ``light 
wine.''
    (7) Dessert wine. Still grape wine having an alcoholic content 
greater than 14 percent by volume and not in excess of 24 percent by 
volume may be designated as ``dessert wine.''
    (8) Angelica. Angelica is grape wine having the taste, aroma, and 
characteristics generally attributed to angelica. Angelica has an 
alcohol content in excess of 14 percent but not in excess of 24 percent 
by volume. The alcohol content is derived in part from added grape 
brandy or alcohol. Angelica has been recognized as a semi-generic 
designation of geographic significance and is subject to the 
requirements of Sec.  4.174.
    (9) Madeira, port, and sherry. Madeira, port, and sherry are grape 
wines having the taste, aroma, and characteristics generally attributed 
to such wines. Madeira, port, and sherry have an alcohol content in 
excess of 14 percent but not in excess of 24 percent by volume. The 
alcohol content is derived in part from added grape brandy or alcohol. 
These grape wine types have been recognized as semi-generic designation 
of geographic significance and are subject to the requirements of Sec.  
4.174.
    (10) Muscatel. Muscatel is grape wine having the taste, aroma, and 
characteristics generally attributed to Muscatel. Muscatel has an 
alcohol content in excess of 14 percent but not in excess of 24 percent 
by volume. The alcohol content is derived in part from added grape 
brandy or alcohol. Muscatel is a grape type designation.
    (11) ``Specially sweetened grape wine.'' Grape wine sweetened in 
accordance with the standards set forth in 26 U.S.C. 5385 must include 
the words ``extra sweet,'' ``specially sweetened,'' ``specially 
sweet,'' or ``sweetened with excess sugar'' as part of the class and 
type designation.


Sec.  4.143   Sparkling grape wine--class and type designation.

    (a) Sparkling grape wine. Sparkling grape wine is still grape wine 
made effervescent with carbon dioxide resulting solely from the 
secondary fermentation of the wine within a closed container, tank or 
bottle. Sparkling grape wine must contain at least 0.392 grams of 
carbon dioxide per 100 milliliters of wine.
    (b) Class designation of sparkling wine. Sparkling grape wine must 
be designated as ``sparkling wine'' or ``sparkling grape wine.''
    (c) Type designations of sparkling wine. In addition to the class 
designation, sparkling grape wine may be designated with one or more of 
the following type designation(s) that apply.
    (1) Red, white, amber, pink, ros[eacute], and blush. Sparkling wine 
that derives its characteristic color from the presence or absence of 
the red coloring matter of the skins, juice, or pulp of grapes may be 
designated as ``sparkling red (or white, blush, pink, ros[eacute], or 
amber, as the case may be) wine.''
    (2) Grape variety. The names of one or more grape varieties 
following the word ``sparkling'' (for example, ``sparkling chardonnay'' 
or ``sparkling cabernet franc and merlot'') may be used as a type 
designation for sparkling grape wine in accordance with Sec.  4.156.
    (3) Grape type designation of varietal significance. A grape type 
designation (for example, ``sparkling moscato'' or ``sparkling 
scuppernong'') may be used as a type designation for sparkling wine in 
accordance with Sec.  4.157.
    (4) Semi-generic designation of geographic significance. A semi-
generic designation of geographic significance (for example, 
``champagne'') may be used as the type designation for sparkling grape 
wine in accordance with Sec.  4.174.
    (5) Nongeneric designation that is a distinctive designation. A 
nongeneric designation that is a distinctive

[[Page 60636]]

designation of a specific grape wine (for example, ``sparkling asti 
spumante'') may be used as the type designation in accordance with 
Sec.  4.176.
    (6) Champagne. Champagne is a type of sparkling grape wine with an 
alcohol content of less than 14 percent alcohol by volume. Champagne 
derives its effervescence solely from the secondary fermentation of the 
wine within glass containers of not greater than one gallon capacity, 
and possesses the taste, aroma, and other characteristics attributed to 
champagne as made in the Champagne district of France. Champagne has 
been recognized as a semi-generic designation of geographic 
significance and must be labeled in accordance with Sec.  4.174.
    (7) Champagne style and champagne type. A sparkling wine having 
less than 14 percent alcohol by volume, and having the taste, aroma, 
and characteristics generally attributed to champagne but not otherwise 
conforming to the standard for ``champagne'' as prescribed by paragraph 
(c)(6) of this section may, in addition to but not in lieu of the class 
designation ``sparkling wine,'' be further designated as ``champagne 
style'' or ``champagne type,'' along with one of the required terms 
denoting use of bulk process set forth in paragraph (d) of this 
section. The designation ``champagne'' has been recognized as a semi-
generic designation of geographic significance and thus wines labeled 
with a designation of ``champagne style'' or ``champagne type'' must be 
labeled in accordance with Sec.  4.174.
    (8) Crackling wine, petillant wine, frizzante wine, cremant, 
perlant, reciotto, and other similar wine. Crackling, petillant, 
frizzante, cremant, perlant, and reciotto wines are types of sparkling 
grape wines that are normally less effervescent than champagne or other 
similar sparkling wine, but containing sufficient carbon dioxide in 
solution to produce, upon pouring under normal conditions, after the 
disappearance of air bubbles, a slow and steady effervescence evidenced 
by the formation of gas bubbles flowing through the wine. Such wines 
may be designated as: ``crackling,'' ``petillant,'' ``frizzante,'' 
``cremant,'' ``perlant,'' and ``reciotto'' wines.
    (d) Bulk process. In addition to the product designation, any 
sparkling grape wine that derives its effervescence from secondary 
fermentation in containers greater than 1-gallon capacity must be 
labeled with one or more of the following statements: ``Bulk process,'' 
``fermented outside the bottle,'' ``secondary fermentation outside the 
bottle,'' ``secondary fermentation before bottling,'' ``not fermented 
in the bottle,'' or ``not bottle fermented.'' The statement ``charmat 
method'' or ``charmat process'' may be used as additional information 
in addition to but not in lieu of one of the required statements. This 
information must be stated on the same label as the product designation 
and must appear in at least half the type size as the product 
designation.


Sec.  4.144   Carbonated grape wine--class and type designation.

    (a) Carbonated grape wine. Carbonated grape wine is still grape 
wine made effervescent by the injection of carbon dioxide. Carbonated 
grape wine must contain at least 0.392 grams of carbon dioxide per 100 
milliliters of wine.
    (b) Class designation of carbonated wine. Carbonated grape wine 
must be designated as ``carbonated wine'' or ``carbonated grape wine.''
    (c) Type designation. In addition to the class designation, 
carbonated grape wine may be designated with one or more of the 
following type designation(s) that apply.
    (1) Red, white, amber, pink, ros[eacute], and blush. Carbonated 
wine that derives its characteristic color from the presence or absence 
of the red coloring matter of the skins, juice, or pulp of grapes may 
be designated as ``carbonated red (or white, blush, pink, ros[eacute], 
or amber, as the case may be) wine.''
    (2) Grape variety. The names of one or more grape varieties may be 
used as a type designation for carbonated grape wine (for example, 
``carbonated chardonnay'' or ``carbonated merlot and cabernet franc'') 
in accordance with Sec.  4.156.
    (3) Grape type designation of varietal significance. A grape type 
designation may be used as a type designation for carbonated grape wine 
(for example, ``carbonated moscato'' or ``carbonated scuppernong'') in 
accordance with Sec.  4.157.
    (4) Semi-generic designation of geographic significance. A semi-
generic designation of geographic significance may be used as a type 
designation of carbonated grape wine (for example, ``carbonated 
Burgundy'') in accordance with Sec.  4.174.


Sec.  4.145   Fruit wine--class and type designation.

    (a) Fruit wine. (1) Fruit wine is wine produced by the normal 
alcoholic fermentation of the juice of sound, ripe fruit (including 
restored or unrestored pure condensed fruit must) other than grapes, 
with or without the addition, after fermentation, of pure condensed 
fruit must and, with or without added spirits of the type authorized 
for natural wine under 26 U.S.C. 5382, but without other addition or 
abstraction except as may occur in cellar treatment of the type 
authorized for natural wine under 26 U.S.C. 5382.
    (2) Fruit wine may be ameliorated, or sweetened, before, during, or 
after fermentation, in a way that is consistent with the limits set 
forth in 26 U.S.C. 5384 for natural fruit wine, provided that fruit 
wine designated as ``specially sweetened fruit wine'' (or with a 
similar term) under paragraph (c)(8) of this section may be sweetened 
in accordance with the standards set forth in 26 U.S.C. 5385.
    (3) The maximum volatile acidity, calculated as acetic acid and 
exclusive of sulfur dioxide, shall not be, for fruit wine that does not 
contain brandy or wine spirits, more than 0.14 gram, and for other 
fruit wine, more than 0.12 gram, per 100 milliliters (20 degrees 
Celsius).
    (b) Class designation for fruit wine--(1) Fruit wine derived wholly 
from one kind of fruit. Fruit wine derived wholly from one kind of 
fruit must be designated with the name of that fruit followed by the 
word ``wine.'' For example, wine that is derived wholly from 
strawberries, oranges, or peaches must be designated as ``strawberry 
wine,'' ``orange wine,'' ``peach wine,'' respectively.
    (2) Fruit wine derived from more than one kind of fruit. Fruit wine 
derived from the fermentation of more than one kind of fruit must be 
designated with the name of each fruit, followed by the word ``wine'' 
(for example, ``blueberry/banana wine,'' or ``orange-lime wine''). (For 
the rules regarding statements of composition when two types of fruit 
wine are blended together, see Sec.  4.151(c)).
    (c) Type designation of fruit wine. Fruit wine may be designated 
with one or more of the following applicable type designation(s) in 
place of the class designation.
    (1) Cider. Fruit wine that is derived wholly from apples may be 
designated as ``cider.''
    (2) Perry. Fruit wine that is derived wholly from pears may be 
designated as ``perry.''
    (3) Sparkling fruit wine. Fruit wine that is rendered effervescent 
(at least 0.392 grams of carbon dioxide per 100 milliliters of wine) by 
carbon dioxide resulting solely from the secondary fermentation of the 
wine within a closed container, tank, or bottle may be designated as 
such provided that the name of the fruit follows the word 
``sparkling.'' For example, a fruit wine

[[Page 60637]]

that is derived wholly from peaches and rendered effervescent as 
indicated in this paragraph, must be designated as ``sparkling peach 
wine.'' If a fruit wine is authorized to carry the designation of 
``sparkling'' and is derived from more than one type of fruit, it must 
be designated as ``sparkling fruit wine'' and carry a statement that 
indicates the types of fruit that the wine is made from, or as 
``sparkling (name all fruits) wine.''
    (4) Carbonated fruit wine. Fruit wine that is rendered effervescent 
(at least 0.392 grams of carbon dioxide per 100 milliliters of wine) by 
carbon dioxide may be designated as such provided that the name of the 
fruit follows the word ``carbonated.'' For example, a fruit wine that 
is wholly derived from peaches and rendered effervescent as indicated 
in this paragraph must be designated as ``carbonated peach wine.'' If a 
fruit wine is authorized to carry the designation of ``carbonated'' and 
is derived from more than one type of fruit, it must be designated as 
``carbonated fruit wine'' and carry a statement indicating the types of 
fruit the wine is made from, or as ``carbonated (name all fruits) 
wine.''
    (5) Fruit table wine and fruit light wine. Fruit wine that has an 
alcohol content greater than 7 percent by volume and not in excess of 
14 percent by volume may be designated as ``(name of fruit(s)) table 
wine'' or ``(name of fruit(s)) light wine.''
    (6) Fruit dessert wine. Fruit wine that has an alcohol content 
greater than 14 percent by volume and not in excess of 24 percent by 
volume may be designated as ``(name of fruit(s)) dessert wine.''
    (7) Specially sweetened fruit wine. Fruit wine sweetened in 
accordance with the standards set forth in 26 U.S.C. 5385 must include 
the words ``extra sweet,'' ``specially sweetened,'' ``specially 
sweet,'' or ``sweetened with excess sugar'' as part of the class and 
type designation.


Sec.  4.146   Agricultural wine--class and type designation.

    (a) Agricultural wine. (1) Agricultural wine is made from suitable 
agricultural products other than the juice of grapes, berries, or other 
fruits and is produced by the normal alcoholic fermentation of sound 
fermentable agricultural products, either fresh or dried, or of the 
restored or unrestored pure condensed must thereof, and without added 
distilled spirits.
    (2) Agricultural wine may not be flavored or colored; however, hops 
may be used in the production of honey wine in accordance with the 
standards set forth in part 24 of this chapter.
    (3) Agricultural wine may be ameliorated in accordance with the 
standards set forth in part 24 of this chapter. The maximum volatile 
acidity, calculated as acetic acid and exclusive of sulfur dioxide, 
shall not be, for wine of this class, more than 0.14 grams per 100 
milliliters (20 degrees Celsius).
    (b) Class designation of agricultural wine--(1) Agricultural wine 
derived wholly from one kind of agricultural product. Agricultural wine 
derived wholly from one kind of agricultural product must be designated 
by the word ``wine'' qualified by the name of the agricultural product. 
For example, agricultural wine that is derived wholly from dandelions, 
raisins, or agave must be designated as ``dandelion wine,'' ``raisin 
wine,'' or ``agave wine,'' respectively. Agricultural wine derived 
wholly from honey may be designated as either ``honey wine'' or 
``mead.''
    (2) Agricultural wine derived from more than one kind of 
agricultural product. Agricultural wine derived from the fermentation 
of more than one kind of agricultural product must be designated with 
the name of each agricultural material, followed by the word ``wine'' 
(for example, ``dandelion honey wine). (For the rules regarding 
statements of composition when two types of agricultural wine are 
blended together, see Sec.  4.151(c)).
    (c) Type designations. One or more of the following type 
designations may be used in place of the class designation for 
agricultural wine:
    (1) Sparkling agricultural wine. Agricultural wine that is rendered 
effervescent (at least 0.392 grams of carbon dioxide per 100 
milliliters of wine) by carbon dioxide resulting solely from the 
secondary fermentation of the wine within a closed container, tank, or 
bottle may be designated as ``sparkling (name of agricultural product) 
wine.'' For example, agricultural wine that is derived wholly from 
dandelions and rendered effervescent as stated in this paragraph must 
be designated as ``sparkling dandelion wine.''
    (2) Carbonated agricultural wine. Agricultural wine that is 
rendered effervescent (at least 0.392 grams of carbon dioxide per 100 
milliliters of wine) by carbon dioxide may be designated as 
``carbonated (name of agricultural product) wine.'' For example, 
agricultural wine that is derived wholly from dandelions and rendered 
effervescent as stated in this paragraph must be designated as 
``carbonated dandelion wine.''
    (3) Agricultural table wine and light wine. Agricultural wine that 
has an alcohol content greater than 7 percent by volume and not in 
excess of 14 percent by volume may be designated as ``(name of 
agricultural product(s)) table wine'' or ``(name of agricultural 
product(s)) light wine.''
    (4) Agricultural dessert wine. Agricultural wine having an 
alcoholic content greater than 14 percent by volume and not in excess 
of 24 percent by volume may be designated as ``(name of agricultural 
product(s)) dessert wine.''


Sec.  4.147   Aperitif--class and type designation.

    (a) Aperitif wine. Aperitif wine is compounded from grape wine 
containing added brandy or alcohol may be flavored with herbs and other 
natural aromatic flavoring materials, with or without the addition of 
caramel for coloring purposes; and possess the taste, aroma, and 
characteristics generally attributed to aperitif wine; and must have an 
alcoholic content of not less than 15 percent by volume.
    (b) Class designation of aperitif wine. Aperitif wine must be 
designated as aperitif wine unless paragraph (c) of this section 
applies.
    (c) Type designation of aperitif wine. The following type 
designation may be used for aperitif wine in place of the class 
designation as applicable.
    (1) Vermouth. Vermouth is a type of aperitif wine made from grape 
wine, having the taste, aroma, and characteristics generally attributed 
to vermouth. Vermouth has been recognized as a generic designation of 
geographical significance and may be designated as ``vermouth.''
    (2) [Reserved].


Sec.  4.148   Rice wine--class and type designation.

    (a) Rice wine. Rice wine is produced from the alcoholic 
fermentation of rice, with or without the addition of distilled 
spirits.
    (b) Class designation of rice wine. Wine of this class must be 
designated as rice wine unless it meets one of the type designations in 
paragraph (c) of this section.
    (c) Type designation of rice wine. One or more of the following 
type designations may be used for rice wine as applicable.
    (1) Sak[eacute]. Sak[eacute] is produced from rice in accordance 
with the commonly accepted method of manufacture of such product. 
Sak[eacute] has been designated as a generic designation of geographic 
significance under Sec.  4.183.
    (2) Gyeongju Beopju. Gyeongju Beopju is a rice wine produced in the 
Republic of Korea in accordance with the laws and regulations of the 
Republic of Korea governing the manufacture of such product.

[[Page 60638]]

    (3) Rice table wine and light wine. Rice wine that has an alcohol 
content greater than 7 percent by volume and not in excess of 14 
percent by volume may be designated as ``rice table wine'' or ``rice 
light wine.''
    (4) Rice dessert wine. Rice wine having an alcoholic content 
greater than 14 percent by volume and not in excess of 24 percent by 
volume may be designated as ``rice dessert wine.''


Sec.  4.149   Retsina wine--designation.

    ``Retsina wine'' is still grape table wine fermented or flavored 
with resin. Retsina has been recognized as a semi-generic designation 
of geographic significance and is subject to the rules found in Sec.  
4.174 with regard to semi-generic designations.


Sec.  4.150   Imitation and substandard or other than standard wine--
designation.

    (a) ``Imitation wine'' shall bear as a part of its designation the 
word ``imitation,'' and shall include:
    (1) Any wine containing synthetic materials.
    (2) Any wine made from a mixture of water with residue remaining 
after thorough pressing of grapes, fruit, or other agricultural 
products.
    (3) Any class or type of wine the taste, aroma, color, or other 
characteristics of which have been acquired, in whole or in part, by 
treatment with methods or materials of any kind (except as permitted in 
Sec.  4.154(c)(5)), if the taste, aroma, color, or other 
characteristics of normal wines of such class or type are acquired 
without such treatment.
    (4) Any wine made from must concentrated at any time to more than 
80[deg] brix.
    (b) ``Substandard wine'' or ``other than standard wine'' shall bear 
as a part of its designation the words ``substandard'' or ``other than 
standard,'' and shall include:
    (1) Any wine having a volatile acidity in excess of the maximum 
prescribed therefor in subpart I of this part.
    (2) Any wine for which no maximum volatile acidity is prescribed in 
subpart I of this part, inclusive, having a volatile acidity, 
calculated as acetic acid and exclusive of sulfur dioxide, in excess of 
0.14 gram per 100 milliliters (20 degrees Celsius).
    (3) Any wine for which a standard of identity is prescribed in this 
subpart I of this part, inclusive, which, through disease, 
decomposition, or otherwise, fails to have the composition, color, and 
clean vinous taste and aroma of normal wines conforming to such 
standard.
    (4) Any ``grape wine,'' ``fruit wine,'' or ``wine from other 
agricultural products'' to which sugar, water, or a sugar-water 
solution has been added in excess of the production standards for such 
wine as prescribed in part 24 of this chapter and in an amount which is 
in excess of the limitations prescribed in the standards of identity 
for these products, unless, in the case of ``fruit wine'' and ``wine 
from other agricultural products'' the normal acidity of the material 
from which such wine is produced is 20 parts or more per thousand and 
the volume of the resulting product has not been increased more than 60 
percent by such addition.


Sec.  4.151   Statements of composition.

    (a) General. If the class of the wine is not defined in one of the 
standards of identity specified in subpart I of this part, or the wine 
has been altered, treated, or blended beyond the standards permitted by 
Sec.  4.154, a truthful and adequate statement of composition must 
appear on the label as the class designation. A distinctive or fanciful 
name, or a designation in accordance with trade understanding may 
appear in addition to the statement of composition.
    (b) The statement of composition may not include any reference to a 
varietal (grape type) designation, type designation of varietal 
significance, semi-generic geographic type designation, or geographic 
distinctive designation.
    (c) The appropriate TTB officer may require a statement of 
composition to identify the base wine(s), including blends of wine or 
fermentable materials, as well as other materials added to the wine 
before, during, and after fermentation, as appropriate, in order to 
ensure that the label provides adequate information about the identity 
of the product. Where a product consists entirely of a blend of two 
different types of fruit or agricultural wine, the statement of 
composition must include of the names of the types of wine (such as, 
``blueberry wine and apple wine'' or ``mead/rhubarb wine'').


Sec.  Sec.  4.152-4.153   [Reserved]

Cellar Treatment and Alteration of Class and Type


Sec.  4.154   Cellar treatment and alteration of class or type.

    (a) Statement of composition. If the class or type of any wine is 
altered, and the product as altered does not fall within any other 
class or type designations specified in Sec. Sec.  4.142 through 4.150, 
then such wine must be labeled with a statement of composition in 
accordance with Sec.  4.151.
    (b) Alteration of class or type. Any of the following, occurring 
before, during, or after fermentation, will result in an alteration of 
class or type of wine:
    (1) Treatment of any class or type of wine with a substance that is 
not a natural component of the wine and that remains in the wine, 
provided, that the presence in finished wine of not more than 350 parts 
per million of total sulfur dioxide, or sulfites expressed as sulfur 
dioxide, is not prohibited under this paragraph;
    (2) Treatment of any class or type of wine with a substance that is 
not foreign to the wine but that remains in the wine in larger 
quantities than is naturally and normally present in other wines of the 
same class or type that are not so treated;
    (3) Treatment of any class or type of wine with a method or 
material of any kind to such an extent or in such a manner as to affect 
the basic composition of the wine by altering any of its characteristic 
elements;
    (4) Blending wine of one class with wine of another class or 
blending of wines of different types within the same class; and
    (5) Treatment of any class or type of wine for which a standard of 
identity is prescribed in this part with sugar, water, or a sugar-water 
solution in excess of the quantities specifically authorized in that 
standard of identity, except that the class or type of such wine is not 
deemed to be altered:
    (i) If fruit wine, agricultural wine, aperitif wine, rice wine, and 
imitation wine have a high normal acidity, if the total solids content 
is not more than 22 grams per 100 cubic centimeters and the content of 
natural acid is not less than 7.69 grams per liter; or
    (ii) If grape wine, fruit wine, agricultural wine, aperitif wine, 
rice wine, retsina, and imitation wine have the normal acidity of 20 
grams per liter, the volume of the resulting product has been increased 
not more than 60 percent by the addition of sugar, water, or a sugar-
water solution for the sole purpose of correcting natural deficiencies 
due to such acidity, and (except in the case of such wine when produced 
from fruit or berries other than grapes) the phrase ``Made with over 35 
percent sugar-water solution'' is included as part of the class and 
type statement.
    (c) Authorized cellar treatments: The following treatments are 
authorized for use provided that they do not result in the alteration 
of the class or type of the wine under the provisions of paragraph (b) 
of this section:
    (1) Treatment with filtering equipment, or with fining or 
sterilizing agents;

[[Page 60639]]

    (2) Treatment with pasteurization or refrigeration as necessary to 
bring the wine to commercial standards in accordance with acceptable 
cellar practice but only in such a manner and to such an extent as not 
to change the basic composition of the wine or eliminate any of its 
characteristic elements;
    (3) Treatment with methods and materials authorized for use under 
part 24 of this chapter (such as correcting cloudiness, precipitation, 
or abnormal color) to the minimum extent necessary to correct the wine;
    (4) Treatment with constituents naturally present in the kind of 
fruit or other agricultural product from which the wine is produced for 
the purpose of correcting deficiencies of these constituents, but only 
to the extent that such constituents would be present in normal wines 
of the same class or type not so treated;
    (5) Treatment of any class or type of wine involving the use of 
volatile fruit-flavor concentrates in the manner provided in section 
5382 of the Internal Revenue Code; and
    (6) In accordance with the provisions of Sec. Sec.  4.143 through 
4.157, carbon dioxide may be used to maintain counterpressure during 
the transfer of finished sparkling wines from bulk processing tanks to 
bottles, or from bottle to bottle, provided that the carbon dioxide 
content of the wine shall not be increased by more than 0.009 gram. per 
100 mL during the transfer operation.


Sec.  4.155   [Reserved]

Grape Type Labeling


Sec.  4.156   Varietal (grape type) labeling as type designations.

    (a) General. The names of one or more grape varieties may be used 
as the type designation of a grape wine only if the wine is also 
labeled with an appellation of origin, as defined in Sec.  4.88.
    (b) Use of one variety name. Except as otherwise provided in 
paragraph (c)(1) or (2) of this section, the name of a single grape 
variety may appear as a type designation on a wine label only if:
    (1) Not less than 75 percent of the wine is derived from grapes of 
that variety, and
    (2) The entire qualifying percentage of the named variety was grown 
in the area described by the labeled appellation of origin.
    (c) Exceptions. (1) Wine made from any Vitis labrusca variety 
(exclusive of hybrids with Vitis labrusca parentage) may be labeled 
with the variety name if:
    (i) Not less than 51 percent of the wine is derived from grapes of 
the named variety;
    (ii) The following statement is shown on any label: ``contains not 
less than 51 percent (name of variety).'' This statement does not have 
to appear if 75 percent or more of the wine is derived from grapes of 
the named variety; and
    (iii) The entire qualifying percentage of the named variety was 
grown in the labeled appellation of origin area.
    (2) Wine made from any variety of any species found by the 
appropriate TTB officer upon appropriate application to be too strongly 
flavored at 75 percent minimum varietal content may be labeled with the 
varietal name if:
    (i) Not less than 51 percent of the wine is derived from grapes of 
that variety;
    (ii) The statement ``contains not less than 51 percent (name of 
variety)'' is shown on the label (except that this statement need not 
appear if 75 percent or more of the wine is derived from grapes of the 
named variety); and
    (iii) The entire qualifying percentage of the named variety was 
grown in the labeled appellation of origin.
    (d) Two or more varieties. The names of two or more grape varieties 
may be used as the type designation if:
    (1) Not less than 85 percent of the wine is derived from grapes of 
the labeled varieties;
    (2) The wine derived each grape variety listed on the label is in 
greater proportion than wine derived from grapes of any variety that is 
not listed; and
    (3) The varieties must be listed in descending order of 
predominance, based on the percentage of wine derived from each variety 
of grape.
    (e) List of approved variety names for American wine. The name of a 
grape variety may be used in a type designation for an American wine 
only if that name has been approved by the Administrator. A list of 
approved grape variety names appears in subpart J of this part.
    (f) List of administratively approved grape variety names. TTB 
administratively approves grape variety names pending future 
rulemaking. An administrative approval is temporary in nature, and it 
means that TTB will allow the use of the grape variety name as a type 
designation on a wine label pending rulemaking. An administrative 
approval may be revoked as a result of subsequent rulemaking on the 
grape variety name. See the TTB website, at https://www.ttb.gov for a 
list of administratively approved grape variety names.


Sec.  4.157   Type designations of varietal significance for American 
wines.

    This section specifies type designations of varietal significance 
that are used for American wines. A name specified in this section may 
appear on a label as a type designation for American wine only if the 
wine is also labeled with an appellation of origin as defined in Sec.  
4.157.
    (a) Muscadine. Muscadine is the name of an American wine that 
derives at least 75 percent of its volume from Muscadinia rotundifolia 
grapes.
    (b) Muscatel. Muscatel is the name of a American wine that derives 
its predominant taste, aroma, and characteristics, and at least 75 
percent of its volume from any Muscat grape source, and that conforms 
to the standards specified in Sec.  4.142(c)(11).
    (c) Muscat or moscato. Muscat or moscato is the name of an American 
wine that derives at least 75 percent of its volume from any Muscat 
grape source.
    (d) Scuppernong. Scuppernong is the name of an American wine that 
derives at least 75 percent of its volume from bronze Muscadinia 
rotundifolia grapes.


Sec.  4.158   [Reserved]

Generic, Semi-Generic, and Non-Generic Designations of Geographic 
Significance


Sec.  4.173   Generic designations of geographic significance.

    (a) Definition. A generic designation is the name of a class or 
type of wine that once had geographic significance but has been deemed 
by the Administrator to have lost any geographic significance.
    (b) List of generic designations. Vermouth and Sak[eacute] are 
generic designations that may be used as a class or type designation, 
in accordance with subpart I of this part.


Sec.  4.174   Semi-generic designations of geographic significance.

    (a) Definition. A semi-generic designation of geographic 
significance is a geographic term which is also the designation of a 
class or type of wine and which has been deemed to have become semi-
generic by the Administrator. A semi-generic designation may be used to 
designate wine of an origin other than that indicated by such name only 
when used in accordance with the rules set forth in paragraph (c) of 
this section.
    (b) List of semi-generic designations of geographic significance. 
Each of the following names has been found to be semi-generic:
    (1) Angelica (associated with wine from the United States);
    (2) Burgundy (associated with wine from France);
    (3) Chablis (associated with wine from France);

[[Page 60640]]

    (4) Champagne (associated with wine from France);
    (5) Chianti (associated with wine from Italy);
    (6) Claret (associated with wine from France);
    (7) Haut Sauterne (associated with wine from France);
    (8) Madeira (associated with wine from Portugal);
    (9) Hock (associated with wine from Germany);
    (10) Malaga (associated with wine from Spain),
    (11) Marsala (associated with wine from Italy);
    (12) Moselle (associated with wine from France);
    (13) Port (associated with wine from Portugal);
    (14) Retsina (associated with wine from Greece);
    (15) Rhine wine (associated with wine from Germany);
    (16) Sauterne (associated with wine from France);
    (17) Sherry (associated with wine from Spain); and
    (18) Tokay (associated with wine from Hungary).
    (c) Use of authorized semi-generic designations of geographic 
significance. A semi-generic designation of geographic significance may 
be used to designate wines of an origin other than that indicated by 
such name only if:
    (1) There appears an appropriate appellation of origin disclosing 
the true place of origin of the wine in the same field of vision as the 
semi-generic designation;
    (2) The person, or the successor in interest of a person, using a 
semi-generic designation name listed in paragraphs (b)(2) through (18) 
of this section, held a COLA or a certificate of exemption from label 
approval (see Sec.  4.22) issued before March 10, 2006, for a wine 
label bearing the same brand name or brand name and a distinctive or 
fanciful name and on which the semi-generic designation appeared; and
    (3) The wine so designated conforms to the standard of identity, if 
any, for such wine contained in the regulations in this part or, if 
there is no such standard, to the trade understanding of such class or 
type.
    (d) Imported wine originating from the place indicated by the name. 
In the case of wine originating from the place indicated by the name, 
the semi-generic designation may be used to designate the wine only if:
    (1) The wine conforms either to the standard of identity specified 
for the wine in subpart I of this part or, if no such standard exists, 
to the trade understanding of the class or type of the wine; and
    (2) The wine conforms to the requirements of the foreign laws and 
regulations that govern the composition, method of production, and 
designation of wines available for consumption within the country of 
origin.


Sec.  4.175   Nongeneric designation of geographic significance and 
nongeneric designations that are distinctive designations of specific 
grape wines.

    (a) Definition. A nongeneric designation of geographic significance 
is a name of geographic significance that has not been found by the 
Administrator to be generic or semi-generic. A nongeneric name of 
geographic significance may be deemed to be the distinctive designation 
of a wine if the Administrator finds that it is known to the consumer 
and to the trade as the designation of a specific wine of a particular 
place or region, distinguishable from all other wines.
    (b) Use of nongeneric designations of geographic significance. 
Nongeneric designations of geographic significance are appellation of 
origin names that may be used only to designate wines of the origin 
indicated by such name in accordance with Sec. Sec.  4.88 through 4.91, 
as applicable. Examples of nongeneric names that are not distinctive 
designations of specific grape wines are American, California, Lake 
Erie, Napa Valley, New York State, French, and Spanish. Additional 
examples of foreign nongeneric names are listed in subpart C of part 12 
of this chapter.
    (c) Use of nongeneric names that are distinctive designations of 
specific grape wines. Nongeneric designations of geographic 
significance are appellation of origin names that may be used only to 
designate wines of the origin indicated by such name in accordance with 
Sec. Sec.  4.88 through 4.91, as applicable, and that may also be used 
as the class and type designation of the wine. Examples of nongeneric 
names that are distinctive designations of specific grape wines are: 
Bordeaux Blanc, Bordeaux Rouge, Graves, Medoc, Saint-Julien, Chateau 
Yquem, Chateau Margaux, Chateau Lafite, Pommard, Chambertin, 
Montrachet, Rhone, Liebfraumilch, Rudesheimer, Forster, Deidesheimer, 
Schloss Johannisberger, Lagrima, and Lacryma Christi. A list of foreign 
distinctive designations, as determined by the Administrator, appears 
in subpart D of part 12 of this chapter.


Sec.  4.176-4.177  [Reserved]

Subpart J--American Grape Variety Names


Sec.  4.191  Approval of grape variety names.

    (a) Any interested person may petition the Administrator for the 
approval of a grape variety name. The petition may be in the form of a 
letter and should provide evidence of the following:
    (1) Acceptance of the new grape variety;
    (2) The validity of the name for identifying the grape variety;
    (3) That the variety is used or will be used in winemaking; and
    (4) That the variety is grown and used in the United States.
    (b) For the approval of names of new grape varieties, documentation 
submitted with the petition to provide evidence that the requirements 
in paragraph (a) of this section have been met may include:
    (1) Reference to the publication of the name of the variety in a 
scientific or professional journal of horticulture or a published 
report by a professional, scientific or winegrowers' organization;
    (2) Reference to a plant patent, if so patented; and
    (3) Information pertaining to the commercial potential of the 
variety, such as the acreage planted and its location or market 
studies.
    (c) The Administrator will not approve a grape variety name if:
    (1) The name has previously been used for a different grape 
variety;
    (2) The name contains a term or name found to be misleading under 
Sec.  4.122; or
    (3) The name of a new grape variety contains the term ``Riesling.''
    (d) For new grape varieties developed in the United States, the 
Administrator may determine if the use of names which contain words of 
geographical significance, place names, or foreign words are misleading 
under Sec.  4.122. The Administrator will not approve the use of a 
grape variety name found to be misleading.
    (e) TTB administratively approves grape variety names pending 
future rulemaking. An administrative approval is temporary in nature, 
and it means that TTB will allow the use of the grape variety name as a 
type designation on a wine label pending rulemaking. An administrative 
approval may be revoked as a result of subsequent rulemaking on the 
grape variety name. The list of administratively approved grape variety 
names can be found on TTB's website at https://www.ttb.gov.

[[Page 60641]]

Sec.  4.192   List of approved names.

    The following grape variety names have been approved by the 
Administrator for use as type designations for American wines. When 
more than one name may be used to identify a single variety of grape, 
the synonym is shown in parentheses following the grape variety name. 
Grape variety names may be spelled with or without the hyphens or 
diacritic marks indicated in the list. The list of grape variety names 
administratively approved under Sec.  4.191(e) is available on the TTB 
website at https://www.ttb.gov.

Aglianico
Agawam
Albari[ntilde]o (Alvarinho)
Albemarle
Aleatico
Alicante Bouschet
Aligot[eacute]
Alvarelh[atilde]o
Alvarinho (Albari[ntilde]o)
Arneis
Aurore
Auxerrois
Bacchus
Baco blanc
Baco noir
Barbera
Beacon
Beclan
Bellandais
Beta
Biancolella
Black Corinth
Black Malvoisie (Cinsaut)
Black Monukka
Black Muscat (Muscat Hamburg)
Black Pearl
Blanc Du Bois
Blaufr[auml]nkish (Lemberger, Limberger)
Blue Eye
Bonarda
Bountiful
Brianna
Burdin 4672
Burdin 5201
Burdin 11042
Burgaw
Burger
Cabernet Diane
Cabernet Dor[eacute]
Cabernet franc
Cabernet Pfeffer
Cabernet Sauvignon
Calzin
Campbell Early (Island Belle)
Canada Muscat
Canaiolo (Canaiolo Nero)
Canaiolo Nero (Canaiolo)
Captivator
Carignan (Carignane)
Carignane (Carignan)
Carlos
Carmen[egrave]re
Carmine
Carnelian
Cascade
Castel 19-637
Catawba
Cayuga White
Centurion
Chambourcin
Chancellor
Charbono
Chardonel
Chardonnay
Chasselas dor[eacute]
Chelois
Chenin blanc
Chief
Chowan
Cinsaut (Black Malvoisie)
Clairette blanche
Clinton
Colombard (French Colombard)
Colobel
Corot noir
Cortese
Corvina
Concord
Conquistador
Couderc noir
Counoise
Cowart
Creek
Crimson Cabernet
Cynthiana (Norton)
Dearing
De Chaunac
Delaware
Diamond
Dixie
Dolcetto
Doreen
Dornfelder
Dulcet
Durif (Petite Sirah)
Dutchess
Early Burgundy
Early Muscat
Edelweiss
Eden
Ehrenfelser
Ellen Scott
Elvira
Emerald Riesling
Erbaluce
Favorite
Feher Szagos
Fern[atilde]o Pires
Fern Munson
Fiano
Flame Tokay
Flora
Florental
Folle blanche
Forastera
Fredonia
Freedom
Freisa
French Colombard (Colombard)
Frontenac
Frontenac gris
Fry
Fum[eacute] blanc (Sauvignon blanc)
Furmint
Gamay noir
Garnacha (Grenache, Grenache noir)
Garnacha blanca (Grenache blanc)
Garronet
Geneva Red 7
Gew[uuml]rztraminer
Gladwin 113
Glennel
Gold
Golden Isles
Golden Muscat
Graciano
Grand Noir
Green Hungarian
Grenache (Garnacha, Grenache noir)
Grenache blanc (Garnacha blanca)
Grenache noir (Garnacha, Grenache)
Grignolino
Grillo
Gros Verdot
Gr[uuml]ner Veltliner
Helena
Herbemont
Higgins
Horizon
Hunt
Iona
Interlaken
Isabella
Island Belle (Campbell Early)
Ives
James
Jewell
Joannes Seyve 12-428
Joannes Seyve 23-416
Kerner
Kay Gray
Kleinberger
La Crescent
LaCrosse
Lagrein
Lake Emerald
Lambrusco
Landal
Landot noir
Lenoir
L[eacute]on Millot
Lemberger (Blaufr[auml]nkish, Limberger)
Limberger (Blaufr[auml]nkisch, Lemberger)
Louise Swenson
Lucie Kuhlmann
Madeline Angevine
Magnolia
Magoon
Malbec
Malvasia bianca (Moscato greco)
Mammolo
Mar[eacute]chal Foch
Marquette
Marsanne
Mataro (Monastrell, Mourv[egrave]dre)
Melody
Melon (Melon de Bourgogne)
Melon de Bourgogne (Melon)
Merlot
Meunier (Pinot Meunier)

[[Page 60642]]

Mish
Mission
Missouri Riesling
Monastrell (Mataro, Mourv[egrave]dre)
Mondeuse (Refosco)
Montefiore
Montepulciano
Moore Early
Morio-Muskat
Moscato greco (Malvasia bianca)
Mourv[egrave]dre (Mataro, Monastrell)
M[uuml]ller-Thurgau
M[uuml]nch
Muscadelle
Muscat blanc (Muscat Canelli)
Muscat Canelli (Muscat blanc)
Muscat du Moulin
Muscat Hamburg (Black Muscat)
Muscat of Alexandria
Muscat Ottonel
Naples
Nebbiolo
N[eacute]grette
Negrara
Negro Amaro
Nero d'Avola
New York Muscat
Niagara
Noah
Noble
Noiret
Norton (Cynthiana)
Ontario
Orange Muscat
Palomino
Pamlico
Pedro Ximenes
Peloursin
Petit Bouschet
Petit Manseng
Petit Verdot
Petite Sirah (Durif)
Peverella
Picpoul (Piquepoul blanc)
Pinotage
Pinot blanc
Pinot Grigio (Pinot gris)
Pinot gris (Pinot Grigio)
Pinot Meunier (Meunier)
Pinot noir
Piquepoul blanc (Picpoul)
Prairie Star
Precoce de Malingre
Pride
Primitivo
Princess
Rayon d'Or
Ravat 34
Ravat 51 (Vignoles)
Ravat noir
Redgate
Refosco (Mondeuse)
Regale
Reliance
Riesling (White Riesling)
Rkatsiteli (Rkatziteli)
Rkatziteli (Rkatsiteli)
Roanoke
Rondinella
Rosette
Roucaneuf
Rougeon
Roussanne
Royalty
Rubired
Ruby Cabernet
St. Croix
St. Laurent
St. Pepin
St. Vincent
Sabrevois
Sagrantino
Saint Macaire
Salem
Salvador
Sangiovese
Sauvignon blanc (Fum[eacute] blanc)
Sauvignon gris
Scarlet
Scheurebe
S[eacute]millon
Sereksiya
Seyval (Seyval blanc)
Seyval blanc (Seyval)
Shiraz (Syrah)
Siegerrebe
Siegfried
Southland
Souz[atilde]o
Steuben
Stover
Sugargate
Sultanina (Thompson Seedless)
Summit
Suwannee
Sylvaner
Symphony
Syrah (Shiraz)
Swenson Red
Tannat
Tarheel
Taylor
Tempranillo (Valdepe[ntilde]as)
Teroldego
Thomas
Thompson Seedless (Sultanina)
Tinta Madeira
Tinto c[atilde]o
Tocai Friulano
Topsail
Touriga
Traminer
Traminette
Trebbiano (Ugni blanc)
Trousseau
Trousseau gris
Ugni blanc (Trebbiano)
Valdepe[ntilde]as (Tempranillo)
Valdigui[eacute]
Valerien
Valiant
Valvin Muscat
Van Buren
Veeblanc
Veltliner
Ventura
Verdelet
Verdelho
Vergennes
Vermentino
Vidal blanc
Vignoles (Ravat 51)
Villard blanc
Villard noir
Vincent
Viognier
Vivant
Welsch Rizling
Watergate
Welder
White Riesling (Riesling)
Wine King
Yuga
Zinfandel
Zinthiana
Zweigelt


Sec.  4.193  Alternative names permitted for temporary use.

    (a) Johannisberg Riesling. The name ``Johannisberg Riesling'' may 
be used as the type designation in lieu of ``Riesling'' for wines 
bottled prior to January 1, 2006.
    (b) Agwam. The name ``Agwam'' may be used as the type designation 
in lieu of ``Agawam'' for wines bottled prior to October 29, 2012.

Subpart K--Standards of Fill and Authorized Container Sizes


Sec.  4.201  General.

    (a) Except as provided in paragraph (b) of this section, no person 
engaged in business as a producer, blender, importer, or wholesaler of 
wine, directly or indirectly, or through an affiliate, may sell or ship 
or deliver for sale or shipment, or otherwise introduce in interstate 
or foreign commerce, or receive therein, or remove from customs custody 
for consumption, any wine in containers, unless the wine is bottled in 
conformity with Sec. Sec.  4.202 and 4.203.
    (b) Sections 4.202 and 4.203 do not apply to:
    (1) Rice wine;
    (2) Wine packed in containers of 18 liters or more;
    (3) Imported wine in the original containers in which such wine 
entered customs custody, if the wine was bottled or packed before 
January 1, 1979; or
    (4) Imported wine bottled or packed before January 1, 1979, and 
certified as to such in a statement, available to the appropriate TTB 
officer upon request, signed by an official duly authorized by the 
appropriate foreign government.
    (c) Section 4.203 does not apply to wine domestically bottled or 
packed, either in or out of customs custody, before January 1, 1979, if 
the wine was bottled or packed according to the standards of fill 
(listed in ounces,

[[Page 60643]]

quarts, and gallons) prescribed by regulation before that date.


Sec.  4.202  Standard wine containers.

    (a) General. Wine must be bottled in standard wine containers, as 
defined in this paragraph. A standard wine container is a container 
that is made, formed, and filled in such a way that it does not mislead 
purchasers as regards it contents. An individual carton or other 
container of a bottle may not be so designed as to mislead purchasers 
as to the size of the bottle it contains.
    (b) Headspace. Wine containers must be designed and filled so that 
the headspace, or empty space between the top of the wine and the top 
of the container, meets the following specifications:
    (1) If the net contents stated on the label are 187 milliliters or 
more, the headspace must not exceed 6 percent of the container's total 
capacity after closure.
    (2) In the case of all other containers, the headspace must not 
exceed 10 percent of the container's total capacity after closure.
    (c) Design. Regardless of the correctness of the stated net 
contents, a wine container is deemed to mislead the purchaser if it is 
made and formed in such a way that its actual capacity is substantially 
less than the capacity it appears to have upon visual examination under 
ordinary conditions of purchase or use.
    (d) Fill. Containers must be filled with a quantity of wine that 
corresponds to one of the authorized container sizes prescribed in 
Sec.  4.203.


Sec.  4.203  Standards of fill (container sizes).

    (a) Authorized standards of fill. Subject to the container 
requirements set forth in Sec.  4.202, wine subject to this part must 
be placed in one of the following authorized container sizes:
    (1) 3 liters.
    (2) 1.5 liters.
    (3) 1 liter.
    (4) 750 milliliters.
    (5) 500 milliliters.
    (6) 375 milliliters.
    (7) 187 milliliters.
    (8) 100 milliliters.
    (9) 50 milliliters.
    (b) Sizes larger than 3 liters. Wine may be bottled in containers 
of 4 liters or larger if the containers are filled and labeled in 
quantities of whole liters (4 liters, 5 liters, 6 liters, etc.). This 
applies to containers that have a capacity of up to 17 liters.
    (c) Tolerances. The tolerances in fill are the same as are allowed 
by Sec.  4.62 in respect to statement of net contents on labels.


Sec.  4.204  Aggregate packaging to meet standard of fill requirements.

    (a) Under the conditions set forth in paragraphs (b) through (f) of 
this section, industry members may use aggregate packaging to satisfy a 
standard of fill required under Sec.  4.203. In other words, industry 
members may bottle wine in containers that do not meet a standard of 
fill, as long as those containers are then packaged together in a 
larger container and the entire net contents of the aggregate package 
meets a standard of fill. For example, thirty 25-milliliter (mL) 
bottles may be packaged together to meet the 750 mL standard of fill. 
The industry member must submit the actual external container and a 
sample of one of the internal containers to TTB together with the 
industry member's application for label approval.
    (b) The class and type, tax class, and alcohol content of the wine 
in each of the individual internal containers of the aggregate package 
must be the same.
    (c) The external container, as well as each of the individual 
internal containers, must be labeled with all of the mandatory label 
information required by this part and parts 16 and 24 of this chapter; 
however, an appropriate standard of fill is not required for internal 
containers.
    (d) The external container must include a net contents statement 
that indicates how the aggregate package equals an authorized standard 
of fill (for example, ``750 mL = 30 containers of 25 mL each''). The 
internal container must include a net contents statement in accordance 
with Sec.  4.68.
    (e) The external container must be shrink-wrapped, boxed, or sealed 
in such a manner that the smaller containers cannot be easily removed.
    (f) Each of the smaller containers must be labeled ``NOT FOR 
INDIVIDUAL SALE.''

Subpart L--Recordkeeping and Substantiation Requirements


Sec.  4.211   Recordkeeping requirements--certificates.

    (a) Certificates of label approval (COLAs). Upon request by the 
appropriate TTB officer, a bottler or importer must provide evidence 
that a container of wine is covered by a COLA or a certificate of 
exemption. This requirement may be satisfied by providing original 
certificates, photocopies or electronic copies of COLAs, or records 
showing the TTB Identification number assigned to the COLA. TTB may 
request such information for a period of five years from the date that 
the products covered by the COLA were removed from the bottler's 
premises or from customs custody, as applicable.
    (b) Labels with revisions. Where labels on containers reflect 
revisions to the approved label that have been made in compliance with 
allowable revisions authorized by TTB Form 5100.31 or otherwise 
authorized by TTB, the bottler or importer must, upon request by the 
appropriate TTB officer, identify the COLA covering the product if the 
product is required to be covered by a COLA. TTB may request such 
information for a period of five years from the date that the products 
covered by the COLA were removed from the bottler's premises or from 
customs custody, as applicable.
    (c) Other recordkeeping requirements under this part. See Sec.  
4.30 for other recordkeeping requirements under this part.


Sec.  4.212  Substantiation requirements.

    (a) Application. The substantiation requirements of this section 
apply to any claim made on any label or container subject to the 
requirements of this part.
    (b) Reasonable basis in fact. All claims, whether implicit or 
explicit, must have a reasonable basis in fact. Claims that contain 
express or implied statements regarding the amount of support for the 
claim (such as ``tests prove,'' or ``studies show'') must have the 
level of substantiation that is claimed. Any labeling claim that does 
not have a reasonable basis in fact, or cannot be adequately 
substantiated upon the request of the appropriate TTB officer, will be 
considered misleading within the meaning of Sec.  4.122(b)(2).
    (c) Evidence that claims are adequately substantiated. The 
appropriate TTB officer may request that bottlers and importers provide 
evidence that labeling claims are adequately substantiated at any time 
within a period of five years from the time the wine was removed from 
the bottling premises or from customs custody, as applicable.

Subpart M--Penalties and Compromise of Liability


Sec.  4.221  Criminal penalties.

    A violation of the labeling provisions of 27 U.S.C. 205(e) is 
punishable as a misdemeanor. See 27 U.S.C. 207 for the statutory 
provisions relating to criminal penalties, consent decrees, and 
injunctions.


Sec.  4.222  Conditions of basic permit.

    A basic permit is conditioned upon compliance with the requirements 
of 27 U.S.C. 205, including the labeling

[[Page 60644]]

provisions of this part. A willful violation of the conditions of a 
basic permit provides grounds for the revocation or suspension of the 
permit, as applicable, as set forth in part 1 of this chapter.


Sec.  4.223  Compromise.

    Pursuant to 27 U.S.C. 207, the appropriate TTB officer is 
authorized, with respect to any violation of 27 U.S.C. 205, to 
compromise the liability arising with respect to such violation upon 
payment of a sum not in excess of $500 for each offense, to be 
collected by the appropriate TTB officer and to be paid into the 
Treasury as miscellaneous receipts.

Subpart N--Paperwork Reduction Act


Sec.  4.231  OMB control numbers assigned under the Paperwork Reduction 
Act.

    (a) Purpose. This subpart displays the control numbers assigned to 
information collection requirements in this part by the Office of 
Management and Budget (OMB) under the Paperwork Reduction Act of 1995, 
Public Law 104-13.
    (b) Chart. The following chart identifies each section in this part 
that contains an information collection requirement and the OMB control 
number that is assigned to that information collection requirement.

------------------------------------------------------------------------
          Section where contained              Current OMB Control No.
------------------------------------------------------------------------
4.21......................................  1513-0020.
4.22......................................  1513-0020, 1513-0111.
4.23......................................  1513-0020, 1513-0111.
4.24......................................  1513-0020, 1513-0064.
4.25......................................  1513-0020, 1513-0111.
4.27......................................  1513-0020.
4.28......................................  1513-0122.
4.30......................................  1513-0064, 1513-0119, New
                                             control number.
4.62......................................  1513-0087.
4.63......................................  1513-0084, 1513-0087.
4.81......................................  1513-0087, 1513-0121.
4.82......................................  1513-0087, 1513-0121.
4.83......................................  1513-0087.
4.84......................................  1513-0087.
4.85......................................  1513-0087.
4.86......................................  1513-0087.
4.87......................................  1513-0087.
4.88......................................  1513-0087.
4.89......................................  1513-0087.
4.90......................................  1513-0087.
4.91......................................  1513-0087.
4.92......................................  1513-0087.
4.93......................................  1513-0087.
4.94......................................  1513-0087.
4.95......................................  1513-0087.
4.96......................................  1513-0087.
4.97......................................  1513-0087.
4.98......................................  1513-0087.
4.121.....................................  1513-0087.
4.122.....................................  1513-0087.
4.123.....................................  1513-0087.
4.124.....................................  1513-0087.
4.125.....................................  1513-0087.
4.126.....................................  1513-0087.
4.127.....................................  1513-0087.
4.128.....................................  1513-0087.
4.129.....................................  1513-0087.
4.130.....................................  1513-0087.
4.131.....................................  1513-0087.
4.133.....................................  1513-0087.
4.134.....................................  1513-0087.
4.135.....................................  1513-0087.
4.136.....................................  1513-0087.
4.201.....................................  1513-0064.
4.211.....................................  New control number.
4.212.....................................  New control number.
------------------------------------------------------------------------

0
2. Revise part 5 to read as follows:

PART 5--LABELING OF DISTILLED SPIRITS

Sec.
5.0 Scope.
Subpart A--General Provisions
5.1 Definitions.
5.2 Territorial extent.
5.3 General requirements and prohibitions under the FAA Act.
5.4-5.6 [Reserved]
5.7 Other TTB labeling regulations that apply to distilled spirits.
5.8 Distilled spirits for export.
5.9 Compliance with Federal and State requirements.
5.10 Other related regulations.
5.11 Forms.
5.12 Delegations of the Administrator.
Subpart B--Certificates of Label Approval and Certificates of Exemption 
From Label Approval

Requirements for Distilled Spirits Bottled in the United States

5.21 Requirement for certificates of label approval (COLAs) for 
distilled spirits bottled in the United States.
5.22 Rules regarding certificates of label approval (COLAs) for 
distilled spirits bottled in the United States.
5.23 Application for exemption from label approval for distilled 
spirits bottled in the United States.

Requirements for Distilled Spirits Imported in Containers

5.24 Certificates of label approval (COLAs) for distilled spirits 
imported in containers.
5.25 Rules regarding certificates of label approval (COLAs) for 
distilled spirits imported in containers.

Administrative Rules

5.27 Presenting certificates of label approval (COLAs) to Government 
officials.
5.28 Formulas, samples, and documentation.
5.29 Personalized labels.
5.30 Certificates of age and origin for imported spirits.
Subpart C--Alteration of Labels, Relabeling, and Adding Information to 
Containers
5.41 Alteration of labels.
5.42 Authorized relabeling activities by distillers and importers.
5.43 Relabeling activities that require separate written 
authorization from TTB.
5.44 Adding a label or other information to a container that 
identifies the wholesaler, retailer, or consumer.
Subpart D--Label Standards
5.51 Firmly affixed requirements.
5.52 Legibility and other requirements for mandatory information on 
labels.
5.53 Minimum type size of mandatory information.
5.54 Visibility of mandatory information.
5.55 Language requirements.
5.56 Additional information.
Subpart E--Mandatory Label Information
5.61 What constitutes a label for purposes of mandatory information.
5.62 Packaging (cartons, coverings, and cases).
5.63 Mandatory label information.
5.64 Brand name.
5.65 Alcohol content.
5.66 Name and address for domestically bottled distilled spirits 
that were wholly made in the United States.
5.67 Name and address for domestically bottled distilled spirits 
that were bottled after importation.
5.68 Name and address for distilled spirits that were imported in a 
container.
5.69 Country of origin.
5.70 Net contents.
5.71 Neutral spirits and name of commodity.
5.72 Coloring materials.
5.73 Treatment of whisky or brandy with wood.
5.74 Statements of age, storage, and percentage.
Subpart F--Restricted Labeling Statements
5.81 General.

Food Allergen Labeling

5.82 Voluntary disclosure of major food allergens.
5.83 Petitions for exemption from major food allergen labeling.

Production Claims

5.84 Use of the term ``organic.''
5.85 Environmental, sustainability, and similar statements.
5.86 [Reserved]

Other Label Terms

5.87 ``Barrel Proof'' and similar terms.
5.88 Bottled in bond.
5.89 Multiple distillation claims.
5.90 Terms related to Scotland.
5.91 Use of the term ``pure.''
Subpart G--Prohibited Labeling Practices
5.101 General.
5.102 False or untrue statements.
5.103 Obscene or indecent depictions.
Subpart H--Labeling Practices That Are Prohibited If They Are 
Misleading
5.121 General.

[[Page 60645]]

5.122 Misleading statements or representations.
5.123 Guarantees.
5.124 Disparaging statements.
5.125 Tests or analyses.
5.126 Depictions of government symbols.
5.127 Depictions simulating government stamps or relating to 
supervision.
5.128 Claims related to wine or malt beverages.
5.129 Health-related statements.
5.130 Appearance of endorsement.
Subpart I--Standards of Identity for Distilled Spirits
5.141 The standards of identity in general.
5.142 Neutral spirits or alcohol.
5.143 Whisky.
5.144 Gin.
5.145 Brandy.
5.146 Blended applejack.
5.147 Rum.
5.148 Agave spirits.
5.149 Absinthe or absinth.
5.150 Cordials and liqueurs.
5.151 Flavored spirits.
5.152 Imitations.
5.153 Diluted spirits.
5.154 Rules for geographical designations.
5.155 Alteration of class and type.
5.156 Distilled spirits specialty products.
5.157-5.165 [Reserved]
5.166 Statement of composition.
Subpart J--Formulas
5.191 Application.
5.192 Formula requirements.
5.193 Operations requiring formulas.
5.194 Adoption of predecessor's formulas.
Subpart K--Standards of Fill and Authorized Container Sizes
5.201 General.
5.202 Standard liquor containers.
5.203 Standards of fill (container sizes).
5.204 Aggregate packaging to meet standard of fill requirements.
5.205 Distinctive liquor bottle approval.
Subpart L--Recordkeeping and Substantiation Requirements
5.211 Recordkeeping requirements--certificates.
5.212 Substantiation requirements.
Subpart M--Penalties and Compromise of Liability
5.221 Criminal penalties.
5.222 Conditions of basic permit.
5.223 Compromise.
Subpart N--Paperwork Reduction Act
5.231 OMB control numbers assigned under the Paperwork Reduction 
Act.

    Authority: 26 U.S.C. 5301, 7805, 27 U.S.C. 205 and 207.


Sec.  5.05.0  Scope.

    This part sets forth requirements that apply to the labeling and 
packaging of distilled spirits in containers, including requirements 
for label approval and rules regarding mandatory, regulated, and 
prohibited labeling statements.

Subpart A--General Provisions


Sec.  5.15.1  Definitions.

    When used in this part and on forms prescribed under this part, the 
following terms have the meaning assigned to them in this section, 
unless the terms appear in a context that requires a different meaning. 
Any other term defined in the Federal Alcohol Administration Act (FAA 
Act) and used in this part has the same meaning assigned to it by the 
FAA Act.
    Administrator. The Administrator, Alcohol and Tobacco Tax and Trade 
Bureau, Department of the Treasury.
    Age. The length of time during which, after distillation and before 
bottling, the distilled spirits have been stored in oak barrels in such 
a manner that chemical changes take place as a result of direct contact 
with the wood. For bourbon whisky, rye whisky, wheat whisky, malt 
whisky, or rye malt whisky, and straight whiskies other than straight 
corn whisky, aging must occur in charred new oak barrels.
    American proof. See Proof.
    Appropriate TTB officer. An officer or employee of the Alcohol and 
Tobacco Tax and Trade Bureau (TTB) authorized to perform any function 
relating to the administration or enforcement of this part by the 
current version of TTB Order 1135.5, Delegation of the Administrator's 
Authorities, in 27 CFR part 5, Labeling of Distilled Spirits.
    Bottler. Any distiller or processor of distilled spirits who places 
distilled spirits in containers.
    Brand name. The name under which a distilled spirit or line of 
distilled spirits is sold.
    Certificate holder. The permittee or brewer whose name, address, 
and basic permit number, plant registry number, or brewer's notice 
number appears on an approved TTB Form 5100.31.
    Certificate of exemption from label approval. A certificate issued 
on TTB Form 5100.31, which authorizes the bottling of wine or distilled 
spirits, under the condition that the product will under no 
circumstances be sold, offered for sale, shipped, delivered for 
shipment, or otherwise introduced by the applicant, directly or 
indirectly, into interstate or foreign commerce.
    Certificate of label approval (COLA). A certificate issued on TTB 
Form 5100.31 that authorizes the bottling of wine, distilled spirits, 
and malt beverages, or the removal of bottled wine, distilled spirits, 
and malt beverages from customs custody for introduction into commerce, 
as long as the product bears labels identical to the labels appearing 
on the face of the certificate, or labels with changes authorized by 
TTB on the certificate or otherwise.
    Container. Any can, bottle, box with an internal bladder, cask, 
keg, or other closed receptacle, in any size or material, that is for 
use in the sale of distilled spirits at retail. See subpart K of this 
part for rules regarding authorized standards of fill for containers.
    Customs officer. An officer of U.S. Customs and Border Protection 
(CBP) or any agent or other person authorized by law to perform the 
duties of such an officer.
    Distilled spirits. Ethyl alcohol, hydrated oxide of ethyl, spirits 
of wine, whisky, rum, brandy, gin, and other distilled spirits, 
including all dilutions and mixtures thereof, for nonindustrial use. 
The term ``distilled spirits'' does not include mixtures containing 
wine, bottled at 48 degrees of proof or less, if the mixture contains 
more than 50 percent wine on a proof gallon basis. The term ``distilled 
spirits'' also does not include products containing less than 0.5 
percent alcohol by volume.
    Distilling season. The period from January 1 through June 30, which 
is the spring distilling season, or the period from July 1 through 
December 31, which is the fall distilling season.
    Distinctive or fanciful name. A descriptive name or phrase chosen 
to identify a distilled spirits product on the label. It does not 
include a brand name, class or type designation, or statement of 
composition.
    FAA Act. The Federal Alcohol Administration Act.
    Gallon. A U.S. gallon of 231 cubic inches at 60 degrees Fahrenheit.
    Grain. Includes cereal grains and the seeds of the pseudocereals 
amaranth, buckwheat, and quinoa.
    In bulk. In barrels or other receptacles having a capacity in 
excess of 1 wine gallon (3.785 liters).
    Interstate or foreign commerce. Commerce between any State and any 
place outside of that State or commerce within the District of Columbia 
or commerce between points within the same State but through any place 
outside of that State.
    Liter or litre. A metric unit of capacity equal to 1,000 cubic 
centimeters or 1,000 milliliters (mL) of distilled spirits at 15.56 
degrees Celsius (60 degrees Fahrenheit), and equivalent to 33.814 U.S. 
fluid ounces.
    Net contents. The amount, by volume, of distilled spirits held in a 
container.
    Oak barrel. A cylindrical oak drum of approximately 50 gallons used 
to age bulk spirits.
    Permittee. Any person holding a basic permit under the FAA Act.

[[Page 60646]]

    Person. Any individual, corporation, partnership, association, 
joint-stock company, business trust, limited liability company, or 
other form of business enterprise, including a receiver, trustee, or 
liquidating agent and including an officer or employee of any agency of 
a State or political subdivision of a State.
    Produced at or distilled at. When used with reference to specific 
degrees of proof of a distilled spirits product, the phrases ``produced 
at'' and ``distilled at'' mean the composite proof of the distilled 
spirits after completion of distillation and before reduction in proof, 
if any.
    Proof. The ethyl alcohol content of a liquid at 60 degrees 
Fahrenheit, stated as twice the percentage of ethyl alcohol by volume.
    Proof gallon. A gallon of liquid at 60 degrees Fahrenheit that 
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.
    Spirits. See Distilled spirits.
    State. One of the 50 States of the United States, the District of 
Columbia, or the Commonwealth of Puerto Rico.
    TTB. The Alcohol and Tobacco Tax and Trade Bureau of the Department 
of the Treasury.
    United States (U.S.). The 50 States, the District of Columbia, and 
the Commonwealth of Puerto Rico.


Sec.  5.25.2  Territorial extent.

    The provisions of this part apply to the 50 States, the District of 
Columbia, and the Commonwealth of Puerto Rico.


Sec.  5.35.3  General requirements and prohibitions under the FAA Act.

    (a) Certificates of label approval (COLAs). Subject to the 
requirements and exceptions set forth in the regulations in subpart B 
of this part, any bottler of distilled spirits, and any person who 
removes distilled spirits in containers from customs custody for sale 
or any other commercial purpose, is required to first obtain from TTB a 
COLA covering the label(s) on each container.
    (b) Alteration, mutilation, destruction, obliteration, or removal 
of labels. Subject to the requirements and exceptions set forth in the 
regulations in subpart C of this part, it is unlawful to alter, 
mutilate, destroy, obliterate, or remove labels on distilled spirits 
containers. This prohibition applies to any person, including 
retailers, holding distilled spirits for sale in interstate or foreign 
commerce or any person holding distilled spirits for sale after 
shipment in interstate or foreign commerce.
    (c) Labeling requirements for distilled spirits. It is unlawful for 
any person engaged in business as a bottler, wholesaler, or importer of 
distilled spirits, directly or indirectly, or through an affiliate, to 
sell or ship, or deliver for sale or shipment, or otherwise introduce 
or receive in interstate or foreign commerce, or remove from customs 
custody, any distilled spirits in containers unless the distilled 
spirits are bottled in containers, and the containers are marked, 
branded and labeled, in conformity with the regulations in this part.
    (d) Labeled in accordance with this part. In order to be labeled in 
accordance with the regulations in this part, a container of distilled 
spirits must be in compliance with the following requirements:
    (1) It must bear one or more label(s) meeting the standards for 
``labels'' set forth in subpart D of this part;
    (2) One or more of the labels on the container must include the 
mandatory information set forth in subpart E of this part;
    (3) Claims on any label, container, or packaging (as defined in 
Sec.  5.82) must comply with the rules for regulated label statements, 
as applicable, set forth in subpart F of this part;
    (4) Statements or any other representations on any label, 
container, or packaging (as defined in Sec. Sec.  5.81(b) and 5.121(b)) 
may not violate the regulations in subparts G and H of this part 
regarding certain practices on labeling of distilled spirits;
    (5) The class and type designation on the label(s), as well as any 
designation appearing on containers or packaging must comply with the 
standards of identity set forth in subpart I of this part; and
    (6) The distilled spirits in the container may not be adulterated 
within the meaning of the Federal Food, Drug, and Cosmetic Act.
    (e) Bottled in accordance with this part. In order to be bottled in 
accordance with the regulations in this part, the distilled spirits 
must be bottled in authorized standards of fill in containers that meet 
the requirements of subpart K of this part.


Sec.  Sec.  5.4Sec.  5.4-5.6   [Reserved]


Sec.  5.75.7  Other TTB labeling regulations that apply to distilled 
spirits.

    In addition to the regulations in this part, distilled spirits must 
also comply with the following TTB labeling regulations:
    (a) Health warning statement. Alcoholic beverages, including 
distilled spirits, that contain at least half of one percent alcohol by 
volume, must be labeled with a health warning statement, in accordance 
with the Alcoholic Beverage Labeling Act of 1988 (ABLA). The 
regulations implementing the ABLA are contained in 27 CFR part 16.
    (b) Internal Revenue Code requirements. The labeling and marking 
requirements for distilled spirits under the Internal Revenue Code are 
found in 27 CFR part 19, subpart T (for domestic products) and 27 CFR 
part 27, subpart E (for imported products).


Sec.  5.85.8  Distilled spirits for export.

    Distilled spirits that are exported in bond without payment of tax 
directly from a distilled spirits plant or from customs custody are not 
subject to this part. For purposes of this section, direct exportation 
in bond does not include exportation after distilled spirits have been 
removed for consumption or sale in the United States, with appropriate 
tax determination or payment.


Sec.  5.95.9  Compliance with Federal and State requirements.

    (a) General. Compliance with the requirements of this part relating 
to the labeling and bottling of distilled spirits does not relieve 
industry members from responsibility for complying with other 
applicable Federal and State requirements, including but not limited to 
those highlighted in paragraphs (b) and (c) of this section.
    (b) Ingredient safety. While it remains the responsibility of the 
industry member to ensure that any ingredient used in production of 
distilled spirits complies fully with all applicable U.S. Food and Drug 
Administration (FDA) regulations pertaining to the safety of food 
ingredients and additives, the appropriate TTB officer may at any time 
request documentation to establish such compliance. As set forth in 
Sec.  5.3(d), distilled spirits that are adulterated under the Federal 
Food, Drug, and Cosmetic Act are not labeled in accordance with this 
part.
    (c) Containers. While it remains the responsibility of the industry 
member to ensure that containers are made of suitable materials that 
comply with all applicable FDA health and safety regulations for the 
packaging of beverages for consumption, the appropriate TTB officer may 
at any time request documentation to establish such compliance.


Sec.  5.10   Other related regulations.

    (a) TTB regulations. Other TTB regulations that relate to distilled 
spirits are listed in paragraphs (a)(1) through (9) of this section:

[[Page 60647]]

    (1) 27 CFR part 1--Basic Permit Requirements Under the Federal 
Alcohol Administration Act, Nonindustrial Use of Distilled Spirits and 
Wine, Bulk Sales and Bottling of Distilled Spirits;
    (2) 27 CFR part 13--Labeling Proceedings;
    (3) 27 CFR part 14--Advertising of Alcohol Beverage Products;
    (4) 27 CFR part 16--Alcoholic Beverage Health Warning Statement;
    (5) 27 CFR part 19--Distilled Spirits Plants;
    (6) 27 CFR part 26--Liquors and Articles From Puerto Rico and the 
Virgin Islands;
    (7) 27 CFR part 27--Importation of Distilled Spirits, Wines, and 
Beer;
    (8) 27 CFR part 28--Exportation of Alcohol; and
    (9) 27 CFR part 71--Rules of Practice in Permit Proceedings.
    (b) Other Federal Regulations. The regulations listed in paragraphs 
(b)(1) through (9) of this section issued by other Federal agencies 
also may apply:
    (1) 7 CFR part 205--National Organic Program;
    (2) 19 CFR part 11--Packing and Stamping; Marking;
    (3) 19 CFR part 102--Rules of Origin;
    (4) 19 CFR part 134--Country of Origin Marking;
    (5) 21 CFR part 1--General Enforcement Regulations, Subpart H, 
Registration of Food Facilities, and Subpart I, Prior Notice of 
Imported Food;
    (6) 21 CFR parts 70-82, which pertain to food and color additives;
    (7) 21 CFR part 101--Food Labeling;
    (8) 21 CFR part 110--Current Good Manufacturing Practice in 
Manufacturing, Packing, or Holding Human Food; and
    (9) 21 CFR parts 170-189, which pertain to food additives and 
secondary direct food additives.


Sec.  5.11   Forms.

    (a) General. TTB prescribes and makes available all forms required 
by this part. Any person completing a form must provide all of the 
information required by each form as indicated by the headings on the 
form and the instructions for the form. Each form must be filed in 
accordance with this part and the instructions for the form.
    (b) Electronically filing forms. The forms required by this part 
can be filed electronically by using TTB's online filing systems: COLAs 
Online and Formulas Online. Anyone who intends to use one of these 
online filing systems must first register to use the system by 
accessing the TTB website at https://www.ttb.gov.
    (c) Obtaining paper forms. Forms required by this part are 
available for printing through the TTB website (https://www.ttb.gov) or 
by mailing a request to the Alcohol and Tobacco Tax and Trade Bureau, 
National Revenue Center, 550 Main Street, Room 8002, Cincinnati, OH 
45202.


Sec.  5.12   Delegations of the Administrator.

    Most of the regulatory authorities of the Administrator contained 
in this part are delegated to ``appropriate TTB officers.'' To 
determine which officers have been delegated specific authorities, see 
the current version of TTB Order 1135.5, Delegation of the 
Administrator's Authorities in 27 CFR part 5, Labeling of Distilled 
Spirits. Copies of this order can be obtained by accessing the TTB 
website (https://www.ttb.gov) or by mailing a request to the Alcohol 
and Tobacco Tax and Trade Bureau, National Revenue Center, 550 Main 
Street, Room 8002, Cincinnati, OH 45202.

Subpart B--Certificates of Label Approval and Certificates of 
Exemption from Label Approval.

Requirements for Distilled Spirits Bottled in the United States


Sec.  5.21   Requirement for certificates of label approval (COLAs) for 
distilled spirits bottled in the United States.

    (a) This section applies to distilled spirits bottled in the United 
States, outside of customs custody.
    (b) No person may bottle distilled spirits without first applying 
for and obtaining a COLA issued by the appropriate TTB officer. This 
requirement applies to distilled spirits produced and bottled in the 
United States and to distilled spirits imported in bulk, regardless of 
where produced, and bottled in the United States. Bottlers may obtain 
an exemption from this requirement only if they satisfy the conditions 
set forth in Sec.  5.23.


Sec.  5.22   Rules regarding certificates of label approval (COLAs) for 
distilled spirits bottled in the United States.

    (a) What a COLA authorizes. An approved TTB Form 5100.31 authorizes 
the bottling of distilled spirits covered by the COLA, as long as the 
container bears labels identical to the labels appearing on the face of 
the COLA, or labels with changes authorized by TTB on the COLA or 
otherwise. The list of allowable changes can be found on the TTB 
website at https://www.ttb.gov.
    (b) What a COLA does not do. Among other things, the issuance of a 
COLA does not:
    (1) Confer trademark protection;
    (2) Relieve the certificate holder from its responsibility to 
ensure that all ingredients used in the production of the distilled 
spirit comply with applicable requirements of the Food and Drug 
Administration with regard to ingredient safety; or
    (3) Relieve the certificate holder from liability for violations of 
the FAA Act, the Alcohol Beverage Labeling Act of 1988, the Internal 
Revenue Code, or related regulations and rulings.
    (i) The issuance of a COLA does not mean that TTB has verified the 
accuracy of any representations or claims made on the label with 
respect to the product in the container. It is the responsibility of 
the applicant to ensure that all information on the application is true 
and correct, and that all labeling representations and claims are 
truthful, accurate, and not misleading with respect to the product in 
the container.
    (ii) A distilled spirit may be mislabeled even when the label is 
covered by a COLA. For example, if the label on the container contains 
representations that are false or misleading when applied to the 
product in the container, the distilled spirit is not labeled in 
accordance with the regulations in this part, even if it is covered by 
a COLA.
    (c) When to obtain a COLA. The COLA must be obtained prior to 
bottling. No bottler may bottle distilled spirits, or remove distilled 
spirits from the premises where bottled, unless a COLA has been 
obtained.
    (d) Application for a COLA. The bottler may apply for a COLA by 
submitting an application to TTB on Form 5100.31, in accordance with 
the instructions on the form. The bottler may apply for a COLA either 
electronically by accessing TTB's online system, COLAs Online, at 
https://www.ttb.gov, or by submitting the paper form. For procedures 
regarding the issuance of COLAs, see part 13 of this chapter.


Sec.  5.23   Application for exemption from label approval for 
distilled spirits bottled in the United States.

    (a) Exemption. Any bottler of distilled spirits may apply to be 
exempt from the requirements of this part, by showing to the 
satisfaction of the appropriate TTB officer that the distilled spirits 
to be bottled are not to be sold, offered for sale, or shipped or 
delivered for shipment, or otherwise introduced, in interstate or 
foreign commerce.
    (b) Application required. The bottler must file an application on 
TTB Form 5100.31 for exemption from label approval before bottling the 
distilled spirits. The bottler may apply for a

[[Page 60648]]

certificate of exemption from label approval either electronically, by 
accessing TTB's online system, COLAs Online, at https://www.ttb.gov, or 
by using the paper form. For procedures regarding the issuance of 
certificates of exemption from label approval, see part 13 of this 
chapter.
    (c) Labeling of distilled spirits covered by certificate of 
exemption. The application for a certificate of exemption from label 
approval requires that the applicant identify the State in which the 
product will be sold. As a condition of receiving exemption from label 
approval, the label covered by an approved certificate of exemption 
must include the statement ``For sale in [name of State] only.'' See 
Sec. Sec.  19.517 and 19.518 of this chapter for additional labeling 
rules that apply to distilled spirits covered by a certificate of 
exemption.

Requirements for Distilled Spirits Imported in Containers


Sec.  5.24   Certificates of label approval (COLAs) for distilled 
spirits imported in containers.

    (a) Application requirement. Any person removing distilled spirits 
in containers from customs custody for consumption must first apply for 
and obtain a COLA covering the distilled spirits from the appropriate 
TTB officer.
    (b) Release of distilled spirits from customs custody. Distilled 
spirits, imported in containers, are not eligible for release from 
customs custody for consumption, and no person may remove such 
distilled spirits from customs custody for consumption, unless the 
person removing the distilled spirits has obtained and is in possession 
of a COLA covering the distilled spirits.
    (c) Filing requirements. If filing electronically, the importer 
must file with U.S. Customs and Border Protection (CBP), at the time of 
filing the customs entry, the TTB-assigned identification number of the 
valid COLA that corresponds to the label on the brand or lot of 
distilled spirits to be imported. If the importer is not filing 
electronically, the importer must provide a copy of the COLA to CBP at 
the time of entry. In addition, the importer must provide a copy of the 
applicable COLA, and proof of the certificate holder's authorization if 
applicable, upon request by the appropriate TTB officer or a customs 
officer.
    (d) Scope of this section. The COLA requirement imposed by this 
section applies only to distilled spirits that are removed for sale or 
any other commercial purpose. Distilled spirits that are imported in 
containers are not eligible for a certificate of exemption from label 
approval. See 27 CFR 27.49, 27.74, and 27.75 for labeling exemptions 
applicable to certain imported samples of distilled spirits.
    (e) Relabeling in customs custody. Containers of distilled spirits 
in customs custody that are required to be covered by a COLA but are 
not labeled in conformity with a COLA must be relabeled, under the 
supervision and direction of customs officers, prior to their removal 
from customs custody for consumption.


Sec.  5.25   Rules regarding certificates of label approval (COLAs) for 
distilled spirits imported in containers.

    (a) What COLA authorizes. An approved TTB Form 5100.31 authorizes 
the use of the labels covered by the COLA on containers of distilled 
spirits, as long as the container bears labels identical to the labels 
appearing on the face of the COLA, or labels with changes authorized by 
the form or otherwise authorized by TTB.
    (b) What a COLA does not do. Among other things, the issuance of a 
COLA does not:
    (1) Confer trademark protection;
    (2) Relieve the certificate holder from its responsibility to 
ensure that all ingredients used in the production of the distilled 
spirit comply with applicable requirements of the Food and Drug 
Administration with regard to ingredient safety; or
    (3) Relieve the certificate holder from liability for violations of 
the FAA Act, the Alcoholic Beverage Labeling Act, the Internal Revenue 
Code, or related regulations and rulings.
    (i) The issuance of a COLA does not mean that TTB has verified the 
accuracy of any representations or claims made on the label with 
respect to the product in the container. It is the responsibility of 
the applicant to ensure that all information on the application is true 
and correct and that all labeling representations and claims are 
truthful, accurate, and not misleading with respect to the product in 
the container.
    (ii) Distilled spirits may be mislabeled even when the label is 
covered by a COLA. For example, if the label on the container contains 
representations that are false or misleading when applied to the 
product in the container the distilled spirits are not labeled in 
accordance with the regulations in this part, even if it is covered by 
a COLA.
    (c) When to obtain a COLA. The COLA must be obtained prior to the 
removal of distilled spirits in containers from customs custody for 
consumption.
    (d) Application for a COLA. The person responsible for the 
importation of distilled spirits must obtain approval of the labels by 
submitting an application to TTB on TTB Form 5100.31. A person may 
apply for a COLA either electronically, by accessing TTB's online 
system, COLAs Online, at https://www.ttb.gov, or by submitting the 
paper form. For procedures regarding the issuance of COLAs, see part 13 
of this chapter.

Administrative Rules


Sec.  5.27   Presenting certificates of label approval (COLAs) to 
Government officials.

    A certificate holder must present the original or a paper or 
electronic copy of the appropriate COLA upon the request of any duly 
authorized representative of the United States Government.


Sec.  5.28   Formulas, samples, and documentation.

    (a) In addition to any formula specifically required under subpart 
J, TTB may require formulas under certain circumstances in connection 
with the label approval process. Prior to or in conjunction with the 
review of an application for a certificate of label approval (COLA) on 
TTB Form 5100.31, the appropriate TTB officer may require a bottler or 
importer to submit a formula, the results of laboratory testing of the 
distilled spirits, or a sample of any distilled spirits or ingredients 
used in producing a distilled spirit. The appropriate TTB officer also 
may request such information or samples after the issuance of such a 
COLA, or in connection with any distilled spirit that is required to be 
covered by a COLA. A formula may be filed electronically by using 
Formulas Online, or it may be submitted on paper on Form 5100.51. See 
Sec.  5.11 for more information on forms and Formulas Online.
    (b) Upon request of the appropriate TTB officer, a bottler or 
importer must submit a full and accurate statement of the contents of 
any container to which labels are to be or have been affixed, as well 
as any other documentation on any issue pertaining to whether the 
distilled spirits are labeled in accordance with this part.


Sec.  5.29   Personalized labels.

    (a) General. Applicants for label approval may obtain permission 
from TTB to make certain changes in order to personalize labels without 
having to resubmit labels for TTB approval. Personalized labels may 
contain a personal message, picture, or other artwork that is specific 
to the consumer who is purchasing the product. For example, a distiller 
may offer individual or corporate customers labels that

[[Page 60649]]

commemorate an event such as a wedding or grand opening.
    (b) Application. Any person who intends to offer personalized 
labels must submit a template for the personalized label with the 
application for label approval, and must note on the application a 
description of the specific personalized information that may change.
    (c) Approval of personalized label. If the application complies 
with the regulations, TTB will issue a certificate of label approval 
(COLA) with a qualification allowing the personalization of labels. The 
qualification will allow the certificate holder to add or change items 
on the personalized label such as salutations, names, graphics, 
artwork, congratulatory dates and names, or event dates without 
applying for a new COLA. All of these items on personalized labels must 
comply with the regulations of this part.
    (d) Changes not allowed to personalized labels. Approval of an 
application to personalize labels does not authorize the addition of 
any information that discusses either the alcohol beverage or 
characteristics of the alcohol beverage or that is inconsistent with or 
in violation of the provisions of this part or any other applicable 
provision of law or regulations.


Sec.  5.30   Certificates of age and origin for imported spirits.

    (a) Scotch, Irish, and Canadian whiskies. (1) Scotch, Irish, and 
Canadian whiskies, imported in containers, are not eligible for release 
from customs custody for consumption, and no person may remove such 
whiskies from customs custody for consumption, unless that person has 
obtained and is in possession of an invoice accompanied by a 
certificate of origin issued by an official duly authorized by the 
appropriate foreign government, certifying:
    (i) That the particular distilled spirits are Scotch, Irish, or 
Canadian whisky, as the case may be;
    (ii) That the distilled spirits have been manufactured in 
compliance with the laws of the respective foreign governments 
regulating the manufacture of whisky for home consumption; and
    (iii) That the product conforms to the requirements of the Immature 
Spirits Act of such foreign governments for spirits intended for home 
consumption.
    (2) In addition, an official duly authorized by the appropriate 
foreign government must certify to the age of the youngest distilled 
spirits in the container. The age certified shall be the period during 
which, after distillation and before bottling, the distilled spirits 
have been stored in oak containers.
    (b) Brandy, including Cognac. Brandy (other than fruit brandies of 
a type not customarily stored in oak containers) or Cognac, imported in 
containers, is not eligible for release from customs custody for 
consumption, and no person may remove such brandy or Cognac from 
customs custody for consumption, unless the person so removing the 
brandy or Cognac possesses a certificate issued by an official duly 
authorized by the appropriate foreign country certifying that the age 
of the youngest brandy or Cognac in the container is not less than two 
years, or if age is stated on the label that none of the distilled 
spirits are of an age less than that stated. The age certified shall be 
the period during which, after distillation and before bottling, the 
distilled spirits have been stored in oak containers. If the label of 
any fruit brandy, not stored in oak containers, bears any statement of 
storage in another type of container, the brandy is not eligible for 
release from customs custody for consumption, and no person may remove 
such brandy from customs custody for consumption, unless the person so 
removing the brandy possesses a certificate issued by an official duly 
authorized by the appropriate foreign government certifying to such 
storage. Cognac, imported in containers, is not eligible for release 
from customs custody for consumption, and no person may remove such 
Cognac from customs custody for consumption, unless the person so 
removing the Cognac possesses a certificate issued by an official duly 
authorized by the French Government, certifying that the product is 
grape brandy distilled in the Cognac region of France and entitled to 
be designated as ``Cognac'' by the laws and regulations of the French 
Government.
    (c) Rum. Rum imported in containers that contain any statement of 
age is not eligible to be released from customs custody for 
consumption, and no person may remove such rum from customs custody for 
consumption, unless the person so removing the rum possesses a 
certificate issued by an official duly authorized by the appropriate 
foreign country, certifying to the age of the youngest rum in the 
container. The age certified shall be the period during which, after 
distillation and before bottling, the distilled spirits have been 
stored in oak containers.
    (d) Tequila. (1) Tequila imported in containers is not eligible for 
release from customs custody for consumption, and no person may remove 
such Tequila from customs custody for consumption, unless the person 
removing such Tequila possesses a certificate issued by an official 
duly authorized by the Mexican Government stating that the product is 
entitled to be designated as Tequila under the applicable laws and 
regulations of the Mexican Government.
    (2) If the label of any Tequila imported in containers contains any 
statement of age, the Tequila is not eligible for release from customs 
custody for consumption, and no person may remove such Tequila from 
customs custody for consumption, unless the person removing the Tequila 
possesses a certificate issued by an official duly authorized by the 
Mexican Government as to the age of the youngest Tequila in the 
container. The age certified shall be the period during which the 
Tequila has been stored in oak containers after distillation and before 
bottling.
    (e) Other whiskies. Whisky, as defined in Sec.  5.143(c)(2) through 
(7) and (10) through (14), that is imported in containers may be 
released from customs custody for econsumption only if the invoice is 
accompanied by a certificate issued by a duly authorized official of 
the appropriate foreign government certifying:
    (1) In the case of whisky (regardless of whether it is mixed or 
blended) that contains no neutral spirits:
    (i) The type of the whisky as defined in Sec.  5.143;
    (ii) The American proof at which the whisky was distilled;
    (iii) That no neutral spirits (or other whisky in the case of 
straight whisky) have been added or otherwise included in the whisky
    (iv) The age of the whisky; and
    (v) The type of oak barrel in which the whisky was aged and whether 
the barrel was new or reused, charred or uncharred; and
    (2) In the case of whisky containing neutral spirits:
    (i) The type of the whisky as defined in Sec.  5.143;
    (ii) The percentage of straight whisky used in the blend, if any;
    (iii) The American proof at which any straight whisky in the blend 
was distilled;
    (iv) The percentage of whisky other than straight whisky in the 
blend, if any;
    (v) The percentage of neutral spirits in the blend and the name of 
the commodity from which the neutral spirits were distilled;
    (vi) The age of any straight whisky and the age of any other whisky 
in the blend; and
    (vii) The type of oak barrel in which the age of each whisky in the 
blend was attained and whether the barrel was new or reused and charred 
or uncharred.

[[Page 60650]]

    (f) Miscellaneous. Distilled spirits (other than Scotch, Irish, and 
Canadian whiskies, and Cognac) imported in containers are not eligible 
for release from customs custody for consumption, and no person shall 
remove such spirits from customs custody for consumption, unless that 
person has obtained and is in possession of an invoice accompanied by a 
certificate of origin issued by an official duly authorized by the 
appropriate foreign government, if the issuance of such certificates 
with respect to such distilled spirits is required by the foreign 
government concerned, certifying as to the identity of the distilled 
spirits and that the distilled spirits have been manufactured in 
compliance with the laws of the respective foreign government 
regulating the manufacture of such distilled spirits for home 
consumption.
    (g) Retention of certificates--distilled spirits imported in 
containers. The importer of distilled spirits imported in containers 
must retain for five years following the removal of the bottled 
distilled spirits from customs custody copies of the certificates (and 
accompanying invoices, if applicable) required by paragraphs (a) 
through (f) of this section, and must provide them upon request of the 
appropriate TTB officer or a customs officer.
    (h) Distilled spirits imported in bulk for bottling in the United 
States. Distilled spirits that would be required under paragraphs (a) 
through (f) of this section to be covered by a certificate of age and/
or a certificate of origin and that are imported in bulk for bottling 
in the United States may be removed from the premises where bottled 
only if the bottler possesses a certificate of age and/or a certificate 
of origin, issued by the appropriate entity as set forth in paragraphs 
(a) through (f) of this section, applicable to the spirits that 
provides the same information as a certificate required under 
paragraphs (a) through (f) of this section, would provide for like 
spirits imported in bottles. The bottler of distilled spirits imported 
in bulk must retain for five years following the removal of such 
spirits from the domestic plant where bottled copies of the 
certificates required by paragraphs (a) through (f), and must provide 
them upon request of the appropriate TTB officer.
    (i) Retention of distilled spirits certificates--distilled spirits 
in bulk. The bottler of distilled spirits imported in bulk must retain, 
for five years following the removal of such distilled spirits from the 
premises where bottled, copies of the certificates required by 
paragraphs (a) through (f) of this section, and must provide them upon 
request of the appropriate TTB officer.

Subpart C--Alteration of Labels, Relabeling, and Adding Information 
to Containers


Sec.  5.41   Alteration of labels.

    (a) Prohibition. It is unlawful for any person to alter, mutilate, 
destroy, obliterate or remove any mark, brand, or label on distilled 
spirits in containers held for sale in interstate or foreign commerce, 
or held for sale after shipment in interstate or foreign commerce, 
except as authorized by Sec.  5.42, Sec.  5.43, or Sec.  5.44, or as 
otherwise authorized by Federal law.
    (b) Authorized relabeling. For purposes of the relabeling 
activities authorized by this subpart, the term ``relabel'' includes 
the alteration, mutilation, destruction, obliteration, or removal of 
any existing mark, brand, or label on the container, as well as the 
addition of a new label (such as a sticker that adds information about 
the product or information engraved on the container) to the container, 
and the replacement of a label with a new label bearing identical 
information.
    (c) Obligation to comply with other requirements. Authorization to 
relabel under this subpart in no way authorizes the placement of labels 
on containers that do not accurately reflect the brand, bottler, 
identity, or other characteristics of the product; nor does it relieve 
the person conducting the relabeling operations from any obligation to 
comply the regulations in this part and with State or local law, or to 
obtain permission from the owner of the brand where otherwise required.


Sec.  5.42   Authorized relabeling activities by distillers and 
importers.

    (a) Relabeling at distilled spirits plant premises. Proprietors of 
distilled spirits plant premises may relabel domestically bottled 
distilled spirits prior to removal from, and after return to bond at, 
the distilled spirits plant premises, with labels covered by a 
certificate of label approval (COLA), without obtaining separate 
permission from TTB for the relabeling activity.
    (b) Relabeling after removal from distilled spirits plant premises. 
Proprietors of distilled spirits plant premises may relabel 
domestically bottled distilled spirits after removal from distilled 
spirits plant premises with labels covered by a COLA, without obtaining 
separate permission from TTB for the relabeling activity.
    (c) Relabeling in customs custody. Under the supervision of customs 
officers, imported distilled spirits in containers in customs custody 
may be relabeled without obtaining separate permission from TTB for the 
relabeling activity. Such containers must bear labels covered by a COLA 
upon their removal from customs custody for consumption. See Sec.  
5.24(b).
    (d) Relabeling after removal from customs custody. Imported 
distilled spirits in containers may be relabeled by the importer 
thereof after removal from customs custody without obtaining separate 
permission from TTB for the relabeling activity, as long as the labels 
are covered by a COLA.


Sec.  5.43  Relabeling activities that require separate written 
authorization from TTB.

    Any persons holding distilled spirits for sale who need to relabel 
the containers but are not eligible to obtain a COLA to cover the 
labels that they wish to affix to the containers may apply for written 
permission for the relabeling of distilled spirits containers. The 
appropriate TTB officer may permit relabeling of distilled spirits in 
containers if the facts show that the relabeling is for the purpose of 
compliance with the requirements of this part or State law. The written 
application must include copies of the original and proposed new 
labels; the circumstances of the request, including the reason for 
relabeling; the number of containers to be relabeled; the location 
where the relabeling will take place; and the name and address of the 
person who will be conducting the relabeling operations.


Sec.  5.44   Adding a label or other information to a container that 
identifies the wholesaler, retailer, or consumer.

    Any label or other information that identifies the wholesaler, 
retailer, or consumer of the distilled spirits may be added to 
containers (by the addition of stickers, engraving, stenciling, etc.) 
without prior approval from TTB and without being covered by a 
certificate of label approval or certificate of exemption from label 
approval. Such information may be added before or after the containers 
have been removed from distilled spirits plant premises or released 
from customs custody. The information added:
    (a) May not violate the provisions of subpart F, G, or H of this 
part;
    (b) May not contain any reference to the characteristics of the 
product; and
    (c) May not be added to the container in such a way that it 
obscures any other labels on the container.

[[Page 60651]]

Subpart D--Label Standards


Sec.  5.51  Firmly affixed requirements.

    Any label that is not an integral part of the container must be 
affixed to the container in such a way that it cannot be removed 
without thorough application of water or other solvents.


Sec.  5.52  Legibility and other requirements for mandatory information 
on labels.

    (a) Readily legible. Mandatory information on labels must be 
readily legible to potential consumers under ordinary conditions.
    (b) Separate and apart. Mandatory information on labels, except 
brand names, must be separate and apart from any additional 
information. This does not preclude the addition of brief optional 
phrases of additional information as part of the class or type 
designation (such as, ``premium vodka'' or ``delicious Tequila''), the 
name and address statement (such as, ``Proudly distilled and bottled by 
ABC Distilling Company, Atlanta, GA, for over 30 years'') or other 
information required by Sec.  5.63(a) and (b), as long as the 
additional information does not detract from the prominence of the 
mandatory information. The statements required by Sec.  5.63(c) may not 
include additional information.
    (c) Contrasting background. Mandatory information must appear in a 
color that contrasts with the background on which it appears, except 
that if the net contents are blown into a glass container, they need 
not be contrasting. The color of the container and of the spirits must 
be taken into account if the label is transparent or if mandatory label 
information is etched, engraved, sandblasted, or otherwise carved into 
the surface of the container or is branded, stenciled, painted, 
printed, or otherwise directly applied on to the surface of the 
container. Examples of acceptable contrasts are:
    (1) Black lettering appearing on a white or cream background; or
    (2) White or cream lettering appearing on a black background.
    (d) Capitalization. Except for the aspartame statement when 
required by Sec.  5.63(c)(4), which must appear in all capital letters, 
mandatory information prescribed by this part may appear in all capital 
letters, in all lower case letters, or in mixed-case using both capital 
and lower-case letters.


Sec.  5.53  Minimum type size of mandatory information.

    All capital and lowercase letters in statements of mandatory 
information on labels must meet the following type size requirements.
    (a) Containers of more than 200 milliliters. All mandatory 
information must be in script, type, or printing that is at least two 
millimeters in height.
    (b) Containers of 200 milliliters or less. All mandatory 
information must be in script, type, or printing that is at least one 
millimeter in height.


Sec.  5.54  Visibility of mandatory information.

    Mandatory information on a label must be readily visible and may 
not be covered or obscured in whole or in part. See Sec.  5.62 for 
rules regarding packaging of containers (including cartons, coverings, 
and cases). See part 14 of this chapter for regulations pertaining to 
advertising materials.


Sec.  5.55  Language requirements.

    (a) General. Mandatory information must appear in the English 
language, with the exception of the brand name and except as provided 
in paragraphs (c) and (d) of this section.
    (b) Foreign languages. Additional statements in a foreign language, 
including translations of mandatory information that appears elsewhere 
in English on the label, are allowed on labels and containers as long 
as they do not in any way conflict with, or contradict, the 
requirements of this part.
    (c) Distilled spirits for consumption in the Commonwealth of Puerto 
Rico. Mandatory information may be stated solely in the Spanish 
language on labels of distilled spirits bottled for consumption within 
the Commonwealth of Puerto Rico.
    (d) Exception for country of origin statements. The country of 
origin statement for distilled spirits may appear in a language other 
than English when allowed by U.S. Customs and Border Protection 
regulations.


Sec.  5.56  Additional information.

    Information (other than mandatory information) that is truthful, 
accurate, and specific, and that does not violate subpart F, G, or H of 
this part, may appear on labels. Such additional information may not 
conflict with, modify, qualify or restrict mandatory information in any 
manner.

Subpart E--Mandatory Label Information


Sec.  5.61  What constitutes a label for purposes of mandatory 
information.

    (a) Label. Certain information, as outlined in Sec.  5 63, must 
appear on a label. When used in this part for purposes of determining 
where mandatory information must appear, the term ``label'' includes:
    (1) Material affixed to the container, whether made of paper, 
plastic film, or other matter;
    (2) For purposes of the net content statement only, information 
blown, embossed, or molded into the container as part of the process of 
manufacturing the container;
    (3) Information etched, engraved, sandblasted, or otherwise carved 
into the surface of the container; and
    (4) Information branded, stenciled, painted, printed, or otherwise 
directly applied on to the surface of the container.
    (b) Information appearing elsewhere on the container. Information 
appearing on the following parts of the container is subject to all of 
the restrictions and prohibitions set forth in subparts F, G and H of 
this part, but will not satisfy any requirements for mandatory 
information that must appear on labels in this part:
    (1) Material affixed to, or information appearing on, the bottom 
surface of the container;
    (2) Caps, corks or other closures unless authorized to bear 
mandatory information by the appropriate TTB officer; and
    (3) Foil or heat shrink bottle capsules.
    (c) Materials not firmly affixed to the container. Any materials 
that accompany the container to the consumer but are not firmly affixed 
to the container, including booklets, leaflets, and hang tags, are not 
``labels'' for purposes of this part. Such materials are instead 
subject to the advertising regulations in part 14 of this chapter.


Sec.  5.62  Packaging (cartons, coverings, and cases).

    (a) General. The term ``packaging'' includes any covering, carton, 
case, carrier, or other packaging of distilled spirits containers used 
for sale at retail, but does not include shipping cartons or cases that 
are not intended to accompany the container to the consumer.
    (b) Prohibition. Any packaging of distilled spirits containers may 
not contain any statement, design, device, or graphic, pictorial, or 
emblematic representation that violates the provisions of subpart F, G, 
or H of this part.
    (c) Requirements for closed packaging. If containers are enclosed 
in closed packaging, including sealed opaque coverings, cartons, cases, 
carriers, or other packaging used for sale at retail, such packaging 
must bear all mandatory label information required on the label under 
Sec.  5.63.
    (1) Packaging is considered closed if the consumer must open, rip, 
untie,

[[Page 60652]]

unzip, or otherwise manipulate the package to remove the container in 
order to view any of the mandatory information.
    (2) Packaging is not considered closed if a consumer could view all 
of the mandatory information on the container by merely lifting the 
container up, or if the packaging is transparent or designed in a way 
that all of the mandatory information can be easily read by the 
consumer without having to open, rip, untie, unzip, or otherwise 
manipulate the package.
    (d) Packaging that is not closed. The following requirements apply 
to packaging that is not closed.
    (1) The packaging may display any information that is not in 
conflict with the label on the container that is inside the packaging.
    (2) If the packaging displays a brand name, it must display the 
brand name in its entirety. For example, if a brand name is required to 
be modified with additional information on the container, the packaging 
must also display the same modifying language.
    (3) If the packaging displays a class or type designation, it must 
be identical to the class or type designation appearing on the 
container. For example, if the packaging displays a class or type 
designation for a brandy for which a truthful and adequate statement of 
composition is required on the container, the packaging must also 
include the statement of composition as well.
    (e) Labeling of containers within the packaging. The container 
within the packaging is subject to all labeling requirements of this 
part, including mandatory labeling information requirements, regardless 
of whether the packaging bears such information.


Sec.  5.63  Mandatory label information.

    (a) Mandatory information required to appear within the same field 
of vision. Distilled spirits containers must bear a label or labels (as 
defined in Sec.  5.61) containing the following information within the 
same field of vision (which means a single side of a container (for a 
cylindrical container, a side is 40 percent of the circumference) where 
all of the pieces of information can be viewed simultaneously without 
the need to turn the container):
    (1) Brand name, in accordance with Sec.  5.64;
    (2) Class, type, or other designation, in accordance with subpart I 
of this part; and
    (3) Alcohol content, in accordance with Sec.  5.65.
    (b) Other mandatory information. Distilled spirits containers must 
bear a label or labels (as defined in Sec.  5.61) anywhere on the 
container bearing the following information:
    (1) Name and address of the bottler or distiller, in accordance 
with Sec.  5.66, or the importer, in accordance with Sec.  5.67 or 
Sec.  5.68, as applicable; and
    (2) Net contents (which may be blown, embossed, or molded into the 
container as part of the process of manufacturing the container), in 
accordance with Sec.  5.68.
    (c) Disclosure of certain ingredients, processes and other 
information. The following ingredients, processes, and other 
information must be disclosed on a label, without the inclusion of any 
additional information as part of the statement, as follows:
    (1) Neutral spirits. The percentage of neutral spirits and the name 
of the commodity from which the neutral spirits were distilled, or in 
the case of continuously distilled neutral spirits or gin, the name of 
the commodity only, in accordance with Sec.  5.70;
    (2) Coloring or treatment with wood. Coloring or treatment with 
wood, in accordance with Sec. Sec.  5.71 and 5.72;
    (3) Age. A statement of age or age and percentage of type, when 
required or used, in accordance with Sec.  5.73;
    (4) State of distillation. State of distillation of any type of 
whisky defined in Sec.  5.143(c)(2) through (c)(7), which is distilled 
in the United States, in accordance with Sec.  5.66(f);
    (5) FD&C Yellow No. 5. If a distilled spirit contains the coloring 
material FD&C Yellow No. 5, the label must include a statement to that 
effect, such as ``FD&C Yellow No. 5'' or ``Contains FD&C Yellow No. 
5'';
    (6) Cochineal extract or carmine. If a distilled spirit contains 
the color additive cochineal extract or the color additive carmine, the 
label must include a statement to that effect, using the respective 
common or usual name (such as ``contains cochineal extract'' or 
``contains carmine''). This requirement applies to labels when either 
of the coloring materials was used in a distilled spirit that is 
removed from bottling premises or from customs custody on or after 
April 16, 2013;
    (7) Sulfites. If a distilled spirit contains 10 or more parts per 
million of sulfur dioxide or other sulfiting agent measured as total 
sulfur dioxide, the label must include a statement to that effect. 
Examples of acceptable statements are ``Contains sulfites'' or 
``Contains (a) sulfiting agent(s)'' or a statement identifying the 
specific sulfiting agent. The alternative terms ``sulphites'' or 
``sulphiting'' may be used; and
    (8) Aspartame. If the distilled spirit contains aspartame, the 
label must include the following statement, in capital letters, 
separate and apart from all other information: ``PHENYLKETONURICS: 
CONTAINS PHENYLALANINE.''
    (d) Distinctive liquor bottles. See Sec.  5.205(b)(2) for exemption 
from placement requirements for certain mandatory information for 
distinctive liquor bottles.


Sec.  5.64  Brand name.

    (a) Requirement. The distilled spirits label must include a brand 
name. If the distilled spirits are not sold under a brand name, then 
the name of the bottler, distiller or importer, as applicable, 
appearing in the name and address statement is treated as the brand 
name.
    (b) Misleading brand names. Labels may not include any misleading 
brand names. A brand name is misleading if it creates (by itself or in 
association with other printed or graphic matter) any erroneous 
impression or inference as to the age, origin, identity, or other 
characteristics of the distilled spirits. A brand name that would 
otherwise be misleading may be qualified with the word ``brand'' or 
with some other qualification, if the appropriate TTB officer 
determines that the qualification dispels any misleading impression 
that might otherwise be created.


Sec.  5.65   Alcohol content.

    (a) General. The alcohol content for distilled spirits must be 
stated on the label as a percentage of alcohol by volume. Products that 
contain a significant amount of material, such as solid fruit, that may 
absorb spirits after bottling must state the alcohol content at the 
time of bottling as follows: ``Bottled at __ percent alcohol by 
volume.''
    (b) How the alcohol content must be expressed. The following rules 
apply to statements of alcohol content.
    (1) A statement of alcohol content must be expressed as a 
percentage of alcohol by volume and not by a range, or by maximums or 
minimums.
    (i) In addition, the alcohol content in degrees of proof may be 
stated on a label as long as it appears immediately adjacent to the 
mandatory statement of alcohol content as a percentage of alcohol by 
volume. Additional statements of proof may appear on the label without 
being immediately adjacent to the mandatory alcohol by volume 
statement.
    (ii) Other truthful, accurate, and specific factual representations 
of alcohol content, such as alcohol by

[[Page 60653]]

weight, may be made, as long as they appear together with, and as part 
of, the statement of alcohol content as a percentage of alcohol by 
volume.
    (2)(i) The alcohol content statement must be expressed in one of 
the following formats:
    (A) ``Alcohol __ percent by volume'';
    (B) ``__ percent alcohol by volume''; or
    (C) ``Alcohol by volume __ percent.''
    (ii) Any of the words or symbols may be enclosed in parentheses and 
authorized abbreviations may be used with or without a period. The 
alcohol content statement does not have to appear with quotation marks.
    (3) The statements listed in paragraph (b)(2)(i) of this section 
must appear as shown, except that the following abbreviations may be 
used: Alcohol may be abbreviated as ``alc''; percent may be represented 
by the percent symbol ``%''; alcohol and volume may be separated by a 
slash ``/'' in lieu of the word ``by''; and volume may be abbreviated 
as ``vol''.
    (4) Examples. The following are examples of alcohol content 
statements that comply with the requirements of this part:
    (i) ``40% alc/vol'';
    (ii) ``Alc. 40 percent by vol.'';
    (iii) ``Alc 40% by vol''; and
    (iv) ``40% Alcohol by Volume.''
    (c) Tolerances. A tolerance of plus or minus 0.3 percentage points 
is allowed for actual alcohol content that is above or below the 
labeled alcohol content.


Sec.  5.66  Name and address for domestically bottled distilled spirits 
that were wholly made in the United States.

    (a) General. Domestically bottled distilled spirits that were 
wholly made in the United States and contain no imported distilled 
spirits must be labeled in accordance with this section. (See 
Sec. Sec.  5.67 and 5.68 for name and address requirements applicable 
to distilled spirits that are not wholly made in the United States.) 
For purposes of this section, a ``processor'' who solely bottles the 
labeled distilled spirits will be considered the ``bottler.''
    (b) Form of statement. The bottler, distiller, or processor of the 
distilled spirits must be identified by a phrase describing the 
function performed by that person. If that person performs more than 
one function, the label may (but is not required to) so indicate.
    (1) If the name of the bottler appears on the label, it must be 
preceded by a phrase such as ``bottled by,'' ``canned by,'' ``packed 
by,'' or ``filled by,'' followed by the name and address of the 
bottler.
    (2) If the name of the processor appears on the label, it must be 
preceded by a phrase such as ``blended by,'' ``made by,'' ``prepared 
by,'' ``produced by,'' or ``manufactured by,'' as appropriate, followed 
by the name and address of the processor. When applied to distilled 
spirits, the term ``produced by'' indicates a processing operation 
(formerly known as rectification) that involves a change in the class 
or type of the product through the addition of flavors or some other 
processing activity.
    (3) If the name of the distiller appears on the label, it must be 
preceded by a phrase such as ``distilled by,'' followed by the name and 
address of the distiller. If the distilled spirits were bottled for the 
distiller thereof, the name and address of the distiller may be 
preceded by a phrase such as ``distilled by and bottled for,'' or 
``bottled for.''
    (c) Listing of more than one function. If different functions are 
performed by more than one person, statements on the label may not 
create the misleading impression that the different functions were 
performed by the same person.
    (d) Form of address--(1) General. The address consists of the city 
and State where the operation occurred, or the city and State of the 
principal place of business of the person performing the operation. 
This information must be consistent with the information on the basic 
permit. Addresses may, but are not required to, include additional 
information such as street names, counties, zip codes, phone numbers, 
and website addresses. The postal abbreviation of the State name may be 
used; for example, California may be abbreviated as CA.
    (2) More than one address. If the bottler, distiller, or processor 
listed on the name and address statement is the actual operator of more 
than one distilled spirits plant engaged in bottling, distilling, or 
processing operations, as applicable, the label may state, immediately 
following the name of the permittee, the addresses of those other 
plants, in addition to the address of the plant at which the distilled 
spirits were bottled. In this situation, the address where the 
operation occurred must be indicated on the label or on the container 
by printing, coding, or other markings.
    (3) Principal place of business. The label may provide the address 
of the bottler's, distiller's, or processor's principal place of 
business, in lieu of the place where the bottling, distilling, or other 
operation occurred, provided that the address where the operation 
occurred is indicated on the label or on the container by printing, 
coding, or other markings.
    (4) Distilled spirits bottled for another person. (i) If distilled 
spirits are bottled for another person, other than the actual distiller 
thereof, the label may state, in addition to (but not in place of) the 
name and address of the bottler, the name and address of such other 
person, immediately preceded by the words ``bottled for'' or another 
similar appropriate phrase. Such statements must clearly indicate the 
relationship between the two persons (for example, contract bottling).
    (ii) If the same brand of distilled spirits is bottled by two 
distillers that are not under the same ownership, the label for each 
distiller may set forth both locations where bottling takes place, as 
long as the label uses the actual location (and not the principal place 
of business) and as long as the nature of the arrangement is clearly 
set forth.
    (5) No additional places or addresses may be stated for the same 
person unless:
    (i) That person is actively engaged in the conduct of an additional 
bona fide and actual alcohol beverage business at such additional place 
or address, and
    (ii) The label also contains in direct conjunction therewith, 
appropriate descriptive material indicating the function occurring at 
such additional place or address in connection with the particular 
product (such as ``distilled by.'')
    (e) Special rule for straight whiskies. If ``straight whiskies'' 
(see Sec.  5.143) of the same type are distilled in the same State by 
two or more different distillers and are combined (either at the time 
of bottling or at a warehouseman's bonded premises for further storage) 
and subsequently bottled and labeled as ``straight whisky,'' that 
``straight whisky'' must bear a label that contains name and address 
information of the bottler. If that combined ``straight whisky'' is 
bottled by or for the distillers, in lieu of the name and address of 
the bottler, the label may contain the words ``distilled by,'' followed 
immediately by the names (or trade names) and addresses of the 
different distillers who distilled a portion of the ``straight whisky'' 
and the percentage of ``straight whisky'' distilled by each distiller, 
with a tolerance of plus or minus 2 percent. If ``straight whisky'' 
consists of a mixture of ``straight whiskies'' of the same type from 
two or more different distilleries of the same proprietor located 
within the same State, and if that ``straight whisky'' is bottled by or 
for that proprietor, in lieu of the name and address of the bottler, 
the ``straight whisky'' may bear

[[Page 60654]]

a label containing the words ``distilled by'' followed by the name (or 
trade name) of the proprietor and the addresses of the different 
distilleries that distilled a portion of the ``straight whisky.''
    (f) State of distillation for whisky. (1) The State of 
distillation, which is the State in which original distillation takes 
place, must appear on the label of any type of whisky defined in Sec.  
5.143(c)(2) through (7), which is distilled in the United States. The 
State of distillation may appear on any label and must be shown in at 
least one of the following ways:
    (i) By including a ``distilled by'' (or ``distilled and bottled 
by'' or any other phrase including the word ``distilled'') statement as 
part of the mandatory name and address statement, followed by a single 
location.
    (ii) By including the name of the State in which original 
distillation occurred immediately adjacent to the class or type 
designation (such as ``Kentucky bourbon whisky''), as long as the 
product was both distilled and aged in that State in conformance with 
the requirements of Sec.  5.143(b).
    (iii) By including a separate statement, such as ``Distilled in 
[name of State].''
    (2) The appropriate TTB officer may require that the State of 
distillation or other information appear on a label of any whisky 
subject to the requirements of paragraph (f)(1) of this section (and 
may prescribe placement requirements for such information), even if 
that State appears in the name and address statement, if such 
additional information is necessary to negate any misleading or 
deceptive impression that might otherwise be created as regards the 
actual State of distillation.
    (3) In the case of ``light whisky,'' the State name ``Kentucky'' or 
``Tennessee'' may not appear on any label, except as a part of a name 
and address as specified in paragraph (a)(1), (2), or (4) of this 
section.
    (g) Trade or operating names. (1) The name of the person appearing 
on the label may be the trade name or the operating name, as long as it 
is identical to a trade or operating name appearing on the basic 
permit. In the case of a distillation statement for spirits bottled in 
bond, the name or trade name under which the spirits were distilled 
must be shown.
    (2) A trade name may be used only if the use of that name would not 
create a misleading impression as to the age, origin, or identity of 
the product. For example, if a distiller or bottler of the spirits 
authorizes the use of its trade name by another distiller or bottler 
that is not under the same ownership, that trade name may not be used 
on a label in a way that tends to mislead consumers as to the identity 
or location of the distiller or bottler.


Sec.  5.67  Name and address for domestically bottled distilled spirits 
that were bottled after importation.

    (a) General. This section applies to distilled spirits that were 
bottled after importation. See Sec.  5.68 for name and address 
requirements applicable to imported distilled spirits that were bottled 
after importation. See 19 CFR parts 102 and 134 for U.S. Customs and 
Border Protection country of origin marking requirements.
    (b) Distilled spirits bottled after importation in the United 
States. Distilled spirits bottled, without further blending, making, 
preparing, producing, manufacturing, or distilling activities after 
importation, must bear one of the following name and address 
statements:
    (1) The name and address of the bottler, preceded by the words 
``bottled by,'' ``canned by,'' ``packed by,'' or ``filled by'';
    (2) If the distilled spirits were bottled for the person 
responsible for the importation, the words ``imported by and bottled 
(canned, packed, or filled) in the United States for'' (or a similar 
appropriate phrase) followed by the name and address of the principal 
place of business in the United States of the person responsible for 
the importation;
    (3) If the distilled spirits were bottled by the person responsible 
for the importation, the words ``imported by and bottled (canned, 
packed, or filled) in the United States by'' (or a similar appropriate 
phrase) followed by the name and address of the principal place of 
business in the United States of the person responsible for the 
importation.
    (c) Distilled spirits that were subject to blending or other 
production activities after importation. Distilled spirits that, after 
importation in bulk, were blended, made, prepared, produced, 
manufactured or further distilled, may not bear an ``imported by'' 
statement on the label, but must instead be labeled in accordance with 
the rules set forth in Sec.  5.66 for mandatory and optional labeling 
statements.
    (d) Optional statements. In addition to the statements required by 
paragraph (a)(1) of this section, the label may also state the name and 
address of the principal place of business of the foreign producer.
    (e) Form of address. (1) The address consists of the city and State 
where the operation occurred, or the city and State of the principal 
place of business of the person performing the operation. This 
information must be consistent with the information on the basic 
permit. Addresses may, but are not required to, include additional 
information such as street names, counties, zip codes, phone numbers, 
and website addresses.
    (2) If the bottler or processor listed on the name and address 
statement is the actual operator of more than one distilled spirits 
plant engaged in bottling, distilling, or processing operations, as 
applicable the label may state, immediately following the name of the 
bottler, the addresses of those other plants, in addition to the 
address of the plant at which the distilled spirits were bottled. In 
this situation, the address where the operation occurred must be 
indicated on the label or on the container by printing, coding, or 
other markings.
    (3) Principal place of business. The label may provide the address 
of the bottler's or processor's principal place of business, in lieu of 
the place where the bottling, distilling, or other operation occurred, 
provided that the address where the operation occurred is indicated on 
the label or on the container by printing, coding, or other markings.
    (f) Trade or operating names. A trade name may be used if the trade 
name is listed on the basic permit or other qualifying documentation 
and if its use on the label would not create any misleading impression 
as to the age, origin, or identity of the product.


Sec.  5.68  Name and address for distilled spirits that were imported 
in a container.

    (a) General. This section applies to distilled spirits that were 
imported in a container, as defined in Sec.  5.1. See Sec.  5.67 for 
name and address requirements applicable to distilled spirits that were 
domestically bottled after importation. See 19 CFR parts 102 and 134 
for U.S. Customs and Border Protection country of origin marking 
requirements.
    (b) Mandatory labeling statement. Distilled spirits imported in 
containers, as defined in Sec.  5.1, must bear a label stating the 
words ``imported by'' or a similar appropriate phrase, followed by the 
name and address of the importer.
    (1) For purposes of this section, the importer is the holder of the 
importer's basic permit who either makes the original Customs entry or 
is the person for whom such entry is made, or the holder of the 
importer's basic permit who is the agent, distributor, or franchise 
holder for the particular brand of imported alcohol beverages and who 
places the order abroad.
    (2) The address of the importer must be stated as the city and 
State of the principal place of business and must be

[[Page 60655]]

consistent with the address reflected on the importer's basic permit. 
Addresses may, but are not required to, include additional information 
such as street names, counties, zip codes, phone numbers, and website 
addresses. The postal abbreviation of the State name may be used; for 
example, California may be abbreviated as CA.
    (c) Optional statements. In addition to the statements required by 
paragraph (b)(1) of this section, the label may also state the name and 
address of the principal place of business of the foreign producer.
    (d) Form of address. The ``place'' stated must be the city and 
State, shown on the basic permit or other qualifying document, of the 
premises at which the operations took place; and the place for each 
operation that is designated on the label must be shown.
    (e) Trade or operating names. A trade name may be used if the trade 
name is listed on the basic permit or other qualifying documentation 
and if its use on the label would not create any misleading impression 
as to the age, origin, or identity of the product.


Sec.  5.69  Country of origin.

    (a) Pursuant to U.S. Customs and Border Protection (CBP) 
regulations at 19 CFR parts 102 and 134, a country of origin statement 
must appear on the container of distilled spirits imported in 
containers or bottled in the United States after importation. Labeling 
statements with regard to the country of origin must be consistent with 
CBP regulations. The determination of the country (or countries) of 
origin, for imported wines, as well as for blends of imported distilled 
spirits with domestically produced distilled spirits, must comply with 
CBP regulations.
    (b) It is the responsibility of the importer or bottler, as 
appropriate, to ensure compliance with the country of origin marking 
requirement, both when distilled spirits are imported in containers and 
when imported distilled spirits are subject to bottling, blending, or 
production activities in the United States. Industry members may seek a 
ruling from CBP for a determination of the country of origin for their 
product.


Sec.  5.70  Net contents.

    The requirements of this section apply to the net contents 
statement required by Sec.  5.63.
    (a) General. The volume of spirits in the container must appear on 
a label as a net contents statement. The net contents for the external 
container of an aggregate package must be stated as specified in Sec.  
5.204. The word ``liter'' may be alternatively spelled ``litre'' or may 
be abbreviated as ``L''. The word ``milliliters'' may be abbreviated as 
``ml.,'' ``mL.,'' or ``ML.'' Net contents in U.S. equivalents and in 
metric equivalents such as centiliters may appear on a label and, if 
used, must appear in the same field of vision as the metric net 
contents statement.
    (b) Tolerances. (1) The following tolerances are permissible for 
purposes of applying paragraph (a) of this section:
    (i) Errors in measuring. Discrepancies due to errors in measuring 
that occur in filling conducted in compliance with good commercial 
practice;
    (ii) Differences in capacity. Discrepancies due exclusively to 
differences in the capacity of containers, resulting solely from 
unavoidable difficulties in manufacturing the containers so as to be of 
uniform capacity, provided that the discrepancy does not result from a 
container design that prevents the manufacture of containers of an 
approximately uniform capacity; and
    (iii) Differences in atmospheric conditions. Discrepancies in 
measure due to differences in atmospheric conditions in various places, 
including discrepancies resulting from the ordinary and customary 
exposure of alcohol beverage products in containers to evaporation, 
provided that the discrepancy is determined to be reasonable on a case 
by case basis.
    (2) Shortages and overages. A contents shortage in certain of the 
containers in a shipment may not be counted against a contents overage 
in other containers in the same shipment for purposes of determining 
compliance with the requirements of this section.


Sec.  5.71  Neutral spirits and name of commodity.

    (a) In the case of distilled spirits (other than cordials, 
liqueurs, flavored neutral spirits, including flavored vodka, and 
distilled spirits specialty products) manufactured by blending or other 
processing, if neutral spirits were used in the production of the 
spirits, the percentage of neutral spirits so used and the name of the 
commodity from which the neutral spirits were distilled must appear on 
a label. The statement of percentage and the name of the commodity must 
be in substantially the following form: ``__% neutral spirits distilled 
from ____ (insert grain, cane products, fruit, or other commodity as 
appropriate)''; or ``__% neutral spirits (vodka) distilled from ____ 
(insert grain, cane products, fruit, or other commodity as 
appropriate)''; or ``__% (grain) (cane products), (fruit) neutral 
spirits'', or ``__% grain spirits.''
    (b) In the case of gin manufactured by a process of continuous 
distillation or in the case of neutral spirits, a label on the 
container must state the name of the commodity from which the gin or 
neutral spirits were distilled. The statement of the name of the 
commodity must appear in substantially the following form: ``Distilled 
from grain'' or ``Distilled from cane products''.


Sec.  5.72  Coloring materials.

    The words ``artificially colored'' must appear on a label of any 
distilled spirits product containing synthetic or natural materials 
that primarily contribute color, or when information on a label conveys 
the impression that a color was derived from a source other than the 
actual source of the color, except that:
    (a) If no coloring material other than a color exempt from 
certification under FDA regulations has been added, a truthful 
statement of the source of the color may appear in lieu of the words 
``artificially colored,'' for example, ``Contains Beta Carotene'' or 
``Colored with beet extract.'' See 21 CFR parts 73 and 74 for the list 
of such colors under Food and Drug Administration (FDA) regulations;
    (b) If no coloring material has been added other than one certified 
as suitable for use in foods by the FDA, the words ``(to be filled in 
with name of) certified color added'' or ``Contains Certified Color'' 
may appear in lieu of the words ``artificially colored''; and
    (c) If no coloring material other than caramel has been added, the 
words ``colored with caramel,'' ``contains caramel color,'' or another 
statement specifying the use of caramel color, may appear in lieu of 
the words ``artificially colored.'' However, no statement of any type 
is required for the use of caramel color in brandy, rum, or Tequila, or 
in any type of whisky other than straight whisky if used at not more 
than 2\1/2\ percent by volume of the finished product.
    (d) As provided in Sec.  5.61, the use of FD&C Yellow No. 5, 
carmine, or cochineal extract must be specifically stated on the label 
even if the label also contains a phrase such as ``contains certified 
color'' or ``artificially colored.''


Sec.  5.73   Treatment of whisky or brandy with wood.

    The words ``colored and flavored with wood ___'' (inserting 
``chips,'' ``slabs,'' etc., as appropriate) must appear immediately 
adjacent to, and in the same size of type as, the class and type 
designation under subpart I of this part for whisky and brandy treated, 
in whole or in part, with wood through percolation or otherwise during

[[Page 60656]]

distillation or storage, other than through contact with an oak barrel. 
However, the statement specified in this section is not required in the 
case of brandy treated with an infusion of oak chips in accordance with 
Sec.  5.155(b)(3)(B).


Sec.  5.74   Statements of age, storage, and percentage.

    (a) General. (1) As defined in Sec.  5.1, age is the length of time 
during which, after distillation and before bottling, the distilled 
spirits have been stored in oak barrels in such a manner that chemical 
changes take place as a result of direct contact with the wood. For 
bourbon whisky, rye whisky, wheat whisky, malt whisky, or rye malt 
whisky, and straight whiskies other than straight corn whisky, aging 
must occur in charred new oak barrels.
    (2) If an age statement is used, it is permissible to understate 
the age of a product, but overstatements of age are prohibited. 
However, the age statement may not conflict with the standard of 
identity, if aging is required as part of the standard of identity. For 
example, the standard of identity for straight rye whisky requires that 
the whisky be aged for a minimum of 2 years, so the age statement 
``Aged 1 year,'' would be prohibited, even if the spirits were actually 
aged for more than 2 years, because it is inconsistent with the 
standard of identity.
    (3) If spirits are aged in more than one oak barrel (for example, 
if a whisky is aged 2 years in a new charred oak barrel and then placed 
into a second new charred oak barrel for an additional 6 months,) only 
the time spent in the first barrel is counted towards the ``age.''
    (4) The age may be stated in years, months, or days.
    (b) Age statements and percentage of type statements for whisky. 
For all domestic or foreign whiskies that are aged less than four 
years, including blends containing a whisky that is aged less than four 
years, an age statement and percentage of types of whisky statement is 
required to appear on a label, unless the whisky is labeled as 
``bottled in bond'' in conformity with Sec.  5.88. For all other 
whiskies, the statements are optional, but if used, they must conform 
to the formatting requirements listed below. Moreover, if the bottler 
chooses to include a statement of age or percentage on the label of a 
product that is four years old or more and that contains neutral 
spirits, the statement must appear immediately adjacent to the neutral 
spirits statement required by Sec.  5.70. The following are the 
allowable formats for the age and percentage statements for whisky:
    (1) In the case of whisky, whether or not mixed or blended but 
containing no neutral spirits, the age of the youngest whisky in the 
product. The age statement must appear substantially as follows: ``__ 
years old'';
    (2) In the case of whisky containing neutral spirits, whether or 
not mixed or blended, if any straight whisky or other whisky in the 
product is less than 4 years old, the percentage by volume of each such 
whisky and the age of each such whisky (the age of the youngest of the 
straight whiskies or other whiskies if the product contains two or more 
of either). The age and percentage statement for a straight whisky and 
other whisky must appear immediately adjacent to the neutral spirits 
statement required by Sec.  5.70 and must read substantially as 
follows:
    (i) If the product contains only one straight whisky and no other 
whisky: ``__ percent straight whisky __ years old;''
    (ii) If the product contains more than one straight whisky but no 
other whisky: ``__ percent straight whiskies __ years or more old.'' In 
this case the age blank must state the age of the youngest straight 
whisky in the product. However, in lieu of the foregoing statement, the 
following statement may appear on the label: ``__ percent straight 
whisky __ years old, __ percent straight whisky __ years old, and __ 
percent straight whisky __ years old'';
    (iii) If the product contains only one straight whisky and one 
other whisky: ``__ percent straight whisky __ years old, __ percent 
whisky __ years old''; or
    (iv) If the product contains more than one straight whisky and more 
than one other whisky: ``__ percent straight whiskies __ years or more 
old, __ percent whiskies __ years or more old.'' In this case, the age 
blanks must state the age of the youngest straight whisky and the age 
of the youngest other whisky. However, in lieu of the foregoing 
statement, the following statement may appear on the label: ``__ 
percent straight whisky __ years old, __ percent straight whisky __ 
years old, __ percent whisky __ years old, and __ percent whisky __ 
years old'';
    (3) In the case of an imported rye whisky, wheat whisky, malt 
whisky, or rye malt whisky, a label on the product must state each age 
and percentage in the manner and form that would be required if the 
whisky had been made in the United States;
    (4) In the case of whisky made in the United States and stored in 
reused oak barrels, other than corn whisky, white whisky, unaged 
whisky, and light whisky, in lieu of the words ``__ years old'' 
specified in paragraphs (b)(1) and (b)(2) of this section, the period 
of storage in the reused oak barrels must appear on the label as 
follows: ``stored __ years in reused cooperage;''
    (5) In the case of white whisky that is not aged, the statement 
must appear as follows: ``unaged,'' ``not aged,'' or a similar 
statement. The designation ``unaged whisky'' satisfies this 
requirement.
    (c) Statements of age for rum, brandy, and agave spirits. A 
statement of age on labels of rums, brandies, and agave spirits is 
optional, except that, in the case of brandy (other than immature 
brandies, fruit brandies, marc brandy, pomace brandy, Pisco brandy, and 
grappa brandy, which are not customarily stored in oak barrels) not 
stored in oak barrels for a period of at least two years, a statement 
of age must appear on the label. Any statement of age authorized or 
required under this paragraph must appear substantially as follows: 
``__ years old,'' with the blank to be filled in with the age of the 
youngest distilled spirits in the product.
    (d) Statement of storage for grain spirits. In the case of grain 
spirits, the period of storage in oak barrels may appear on a label 
immediately adjacent to the percentage statement required under Sec.  
5.73 of this part, for example: ``__% grain spirits stored __ years in 
oak barrels.''
    (e) Other distilled spirits. (1) Statements regarding age or 
maturity or similar statements or representations on labels for all 
other spirits, except neutral spirits, are permitted only when the 
distilled spirits are stored in an oak barrel and, once dumped from the 
barrel, subjected to no treatment besides mixing with water, filtering, 
and bottling. If batches are made from barrels of spirits of different 
ages, the label may only state the age of the youngest spirits.
    (2) Statements regarding age or maturity or similar statements of 
neutral spirits (except for grain spirits as stated in paragraph (c) of 
this section) are prohibited from appearing on any label.
    (f) Other age representations. (1) If a representation that is 
similar to an age or maturity statement permitted under this section 
appears on a label, a statement of age, in a manner that is conspicuous 
and in characters at least half the type size of the representation, 
must also appear on each label that carries the representation, except 
in the following cases:

[[Page 60657]]

    (i) The use of the word ``old'' or another word denoting age as 
part of the brand name of the product is not deemed to be an age 
representation that requires a statement of age; and
    (ii) Labels of whiskies and brandies (other than immature brandies, 
pomace brandy, marc brandy, Pisco brandy, and grappa brandy) not 
required to bear a statement of age, and rum and agave spirits aged for 
not less than four years, may contain general inconspicuous age, 
maturity or similar representations without the label having to bear an 
age statement.
    (2) Distillation dates (which may be an exact date or a year) may 
appear on a label of spirits where the spirits are manufactured solely 
through distillation. A distillation date may only appear if an 
optional or mandatory age statement is used on the label and must 
appear in the same field of vision as the age statement.

Subpart F--Restricted Labeling Statements.


Sec.  5.81   General.

    (a) Application. The labeling practices, statements, and 
representations in this subpart may be used on distilled spirits labels 
only when used in compliance with this subpart. In addition, if any of 
the practices, statements, or representations in this subpart are used 
elsewhere on containers or in packaging, they must comply with the 
requirements of this subpart. For purposes of this subpart:
    (1) The term ``label'' includes all labels on distilled spirits 
containers on which mandatory information may appear, as set forth in 
Sec.  5.61(a), as well as any other label on the container.
    (2) The term ``container'' includes all parts of the distilled 
spirits container, including any part of a distilled spirits container 
on which mandatory information may appear, as well as those parts of 
the container on which information does not satisfy mandatory labeling 
requirements, as set forth in Sec.  5.61(b).
    (3) The term ``packaging'' includes any carton, case, carrier, 
individual covering or other packaging of such containers used for sale 
at retail, but does not include shipping cartons or cases that are not 
intended to accompany the container to the consumer.
    (b) Statement or representation. For purposes of the practices in 
this subpart, the term ``statement or representation'' includes any 
statement, design, device, or representation, and includes pictorial or 
graphic designs or representations as well as written ones. The term 
``statement or representation'' includes explicit and implicit 
statements and representations.

Food Allergen Labeling


Sec.  5.82   Voluntary disclosure of major food allergens.

    (a) Definitions. For purposes of this section, the following terms 
or phrases have the meanings indicated.
    (1) Major food allergen means any of the following:
    (i) Milk, egg, fish (for example, bass, flounder, or cod), 
Crustacean shellfish (for example, crab, lobster, or shrimp), tree nuts 
(for example, almonds, pecans, or walnuts), wheat, peanuts, and 
soybeans; or
    (ii) A food ingredient that contains protein derived from a food 
specified in paragraph (a)(1)(i) of this section, except:
    (A) Any highly refined oil derived from a food specified in 
paragraph (a)(1)(i) of this section and any ingredient derived from 
such highly refined oil; or
    (B) A food ingredient that is exempt from major food allergen 
labeling requirements pursuant to a petition for exemption approved by 
the Food and Drug Administration (FDA) under 21 U.S.C. 343(w)(6) or 
pursuant to a notice submitted to FDA under 21 U.S.C. 343(w)(7), 
provided that the food ingredient meets the terms or conditions, if 
any, specified for that exemption.
    (2) Name of the food source from which each major food allergen is 
derived. ``Name of the food source from which each major food allergen 
is derived'' means the name of the food as listed in paragraph 
(a)(1)(i) of this section, except that:
    (i) In the case of a tree nut, it means the name of the specific 
type of nut (for example, almonds, pecans, or walnuts); and
    (ii) In the case of Crustacean shellfish, it means the name of the 
species of Crustacean shellfish (for example, crab, lobster, or 
shrimp); and
    (iii) The names ``egg'' and ``peanuts,'' as well as the names of 
the different types of tree nuts, may be expressed in either the 
singular or plural form, and the name ``soy,'' ``soybean,'' or ``soya'' 
may be used instead of ``soybeans.''
    (b) Voluntary labeling standards. Major food allergens used in the 
production of a distilled spirits product may, on a voluntary basis, be 
declared on any label affixed to the container. However, if any one 
major food allergen is voluntarily declared, all major food allergens 
used in production of the distilled spirits product, including major 
food allergens used as fining or processing agents, must be declared, 
except when covered by a petition for exemption approved by the 
appropriate TTB officer under Sec.  5.83. The major food allergens 
declaration must consist of the word ``Contains'' followed by a colon 
and the name of the food source from which each major food allergen is 
derived (for example, ``Contains: egg'').


Sec.  5.83   Petitions for exemption from major food allergen labeling.

    (a) Submission of petition. Any person may petition the appropriate 
TTB officer to exempt a particular product or class of products from 
the labeling requirements of Sec.  5.82. The burden is on the 
petitioner to provide scientific evidence (as well as the analytical 
method used to produce the evidence) that demonstrates that the 
finished product or class of products, as derived by the method 
specified in the petition, either:
    (1) Does not cause an allergic response that poses a risk to human 
health; or
    (2) Does not contain allergenic protein derived from one of the 
foods identified in Sec.  5.82(a)(1)(i), even though a major food 
allergen was used in production.
    (b) Decision on petition. TTB will approve or deny a petition for 
exemption submitted under paragraph (a) of this section in writing 
within 180 days of receipt of the petition. If TTB does not provide a 
written response to the petitioner within that 180-day period, the 
petition will be deemed denied, unless an extension of time for 
decision is mutually agreed upon by the appropriate TTB officer and the 
petitioner. TTB may confer with the Food and Drug Administration (FDA) 
on petitions for exemption, as appropriate and as FDA resources permit. 
TTB may require the submission of product samples and other additional 
information in support of a petition; however, unless required by TTB, 
the submission of samples or additional information by the petitioner 
after submission of the petition will be treated as the withdrawal of 
the initial petition and the submission of a new petition. An approval 
or denial under this section will constitute final agency action.
    (c) Resubmission of a petition. After a petition for exemption is 
denied under this section, the petitioner may resubmit the petition 
along with supporting materials for reconsideration at any time. TTB 
will treat this submission as a new petition.
    (d) Availability of information--(1) General. TTB will promptly 
post to its website (https://www.ttb.gov) all

[[Page 60658]]

petitions received under this section, as well as TTB's responses to 
those petitions. Any information submitted in support of the petition 
that is not posted to the TTB website will be available to the public 
pursuant to the Freedom of Information Act, at 5 U.S.C. 552, except 
where a request for confidential treatment is granted under paragraph 
(d)(2) of this section.
    (2) Requests for confidential treatment of business information. A 
person who provides trade secrets or other commercial or financial 
information in connection with a petition for exemption under this 
section may request that TTB give confidential treatment to that 
information. A failure to request confidential treatment at the time 
the information in question is submitted to TTB will constitute a 
waiver of confidential treatment. A request for confidential treatment 
of information under this section must conform to the following 
standards:
    (i) The request must be in writing;
    (ii) The request must clearly identify the information to be kept 
confidential;
    (iii) The request must relate to information that constitutes trade 
secrets or other confidential commercial or financial information 
regarding the business transactions of an interested person, the 
disclosure of which would cause substantial harm to the competitive 
position of that person;
    (iv) The request must set forth the reasons why the information 
should not be disclosed, including the reasons why the disclosure of 
the information would prejudice the competitive position of the 
interested person; and
    (v) The request must be supported by a signed statement by the 
interested person, or by an authorized officer or employee of that 
person, certifying that the information in question is a trade secret 
or other confidential commercial or financial information and that the 
information is not already in the public domain.

Production Claims


Sec.  5.84   Use of the term ``organic.''

    Use of the term ``organic'' is permitted if any such use complies 
with United States Department of Agriculture (USDA) National Organic 
Program rules (7 CFR part 205), as interpreted by the USDA.


Sec.  5.85   Environmental, sustainability, and similar statements.

    Statements related to environmental or sustainable agricultural 
practices, social justice principles, and other similar statements 
(such as, ``Produced using 100% solar energy'' or ``Carbon Neutral'') 
may appear as long as the statements are truthful, specific and not 
misleading. Statements or logos indicating environmental, sustainable 
agricultural, or social justice certification (such as, ``Biodyvin,'' 
``Salmon-Safe,'' or ``Fair Trade Certified'') may appear on distilled 
spirits that are actually certified by the appropriate organization.


Sec.  5.86   [Reserved]

Other Label Terms


Sec.  5.87   ``Barrel Proof'' and similar terms.

    (a) The term ``barrel proof'' or ``cask strength'' may be used to 
refer to distilled spirits stored in wood barrels only when the 
bottling proof is not more than two degrees lower than the proof of the 
spirits when the spirits are dumped from the barrels.
    (b) The term ``original proof,'' ``original barrel proof,'' 
``original cask strength,'' or ``entry proof'' may be used only if the 
distilled spirits were stored in wooden barrels and the proof of the 
spirits entered into the barrel and the proof of the bottled spirits 
are the same.


Sec.  5.88   Bottled in bond.

    (a) The term ``bond,'' ``bonded,'' ``bottled in bond,'' or ``aged 
in bond,'' or phrases containing these or synonymous terms, may be used 
(including as part of the brand name) only if the distilled spirits 
are:
    (1) Composed of the same kind (type, if one is applicable to the 
spirits, otherwise class) of spirits distilled from the same class of 
materials;
    (2) Distilled in the same distilling season (as defined in Sec.  
5.1) by the same distiller at the same distillery.
    (3) Stored for at least four years in wooden barrels wherein the 
spirits have been in contact with the wood surface, except for gin and 
vodka, which must be stored for at least four years in wooden barrels 
coated or lined with paraffin or other substance which will preclude 
contact of the spirits with the wood surface;
    (4) Unaltered from their original condition or character by the 
addition or subtraction of any substance other than by filtration, 
chill proofing, or other physical treatments (which do not involve the 
addition of any substance which will remain in the finished product or 
result in a change in class or type);
    (5) Reduced in proof by the addition of only pure water to 50 
percent alcohol by volume (100 degrees of proof); and
    (6) Bottled at 50 percent alcohol by volume (100 degrees of proof).
    (b) Imported spirits labeled as ``bottled in bond'' or other 
synonymous term described above must be manufactured in accordance with 
paragraphs (a)(1) through (6) of this section and may only be so 
labeled if the laws and regulations of the country in which the spirits 
are manufactured authorize the bottling of spirits in bond and require 
or specifically authorize such spirits to be so labeled. The ``bottled 
in bond'' or synonymous statement must be immediately followed, in the 
same font and type size, by the name of the country under whose laws 
and regulations such distilled spirits were so bottled.
    (c) Domestically manufactured spirits labeled as ``bottled in 
bond'' or with some other synonymous statement must bear the real name 
of the distillery or the trade name under which the distiller distilled 
and warehoused the spirits, and the number of the distilled spirits 
plant in which distilled, and the number of the distilled spirits plant 
in which bottled. The label may also bear the name or trade name of the 
bottler.


Sec.  5.89   Multiple distillation claims.

    (a) Truthful statements about the number of distillations, such as 
``double distilled,'' ``distilled three times,'' or similar terms to 
convey multiple distillations, may be used; except that only additional 
distillations beyond those required to meet the product's production 
standards may be counted as additional distillations. For example, if 
in order to meet the production standards for vodka (which requires the 
spirits reach an alcohol content level of at least 95 percent), a 
particular product must be distilled three times, and then the vodka is 
distilled two more times, that vodka could be labeled as ``triple 
distilled.'' For the purposes of this section only, the term 
``distillation'' means a single run through a pot still or a single run 
through a column of a column (reflux) still. For example, if a column 
still has three separate columns, one complete additional run through 
the system would constitute three additional distillations.
    (b) The number of distillations may be understated but may not be 
overstated.


Sec.  5.90   Terms related to Scotland.

    (a) The words ``Scotch,'' ``Scots,'' ``Highland,'' or 
``Highlands,'' and similar words connoting, indicating, or commonly 
associated with Scotland, may only be used to designate distilled 
spirits wholly manufactured in Scotland, except that the term ``Scotch 
whisky'' may appear in the designation for a flavored spirit 
(``Flavored Scotch Whisky'') or in a truthful statement of composition 
(``Scotch whisky with natural flavors'') where the base distilled 
spirit meets the requirements

[[Page 60659]]

for a Scotch whisky designation, regardless of where the finished 
product is manufactured.
    (b) In accordance with Sec.  5.127, statements relating to 
government supervision may appear on Scotch whisky containers only if 
such labeling statements are required or specifically authorized by the 
applicable regulations of the United Kingdom.


Sec.  5.91   Use of the term ``pure.''

    Distilled spirits labels, containers, or packaging may not bear the 
word ``pure'' unless it:
    (a) Refers to a particular ingredient used in the production of the 
distilled spirits, and is a truthful representation about that 
ingredient;
    (b) Is part of the bona fide name of a permittee or retailer for 
which the distilled spirits are bottled; or
    (c) Is part of the bona fide name of the permittee that bottled the 
distilled spirits.

Subpart G--Prohibited Labeling Practices


Sec.  5.101   General.

    (a) Application. The prohibitions set forth in this subpart apply 
to any distilled spirits label, container, or packaging. For purposes 
of this subpart:
    (1) The term ``label'' includes all labels on distilled spirits 
containers on which mandatory information may appear, as set forth in 
Sec.  5.61(a), as well as any other label on the container;
    (2) The term ``container'' includes all parts of the distilled 
spirits container, including any part of a distilled spirits container 
on which mandatory information may appear, as well as those parts of 
the container on which information does not satisfy mandatory labeling 
requirements, as set forth in Sec.  5.61(b); and
    (3) The term ``packaging'' includes any carton, case, carrier, 
individual covering or other packaging of such containers used for sale 
at retail, but does not include shipping cartons or cases that are not 
intended to accompany the container to the consumer.
    (b) Statement or representation. For purposes of the prohibited 
practices in this subpart, the term ``statement or representation'' 
includes any statement, design, device, or representation, and includes 
pictorial or graphic designs or representations as well as written 
ones. The term ``statement or representation'' includes explicit and 
implicit statements and representations.


Sec.  5.102   False or untrue statements.

    Distilled spirits labels, containers, or packaging may not contain 
any statement or representation that is false or untrue in any 
particular.


Sec.  5.103   Obscene or indecent depictions.

    Distilled spirits labels, containers, or packaging may not contain 
any statement, design, device, picture, or representation that is 
obscene or indecent.

Subpart H--Labeling Practices That Are Prohibited If They Are 
Misleading


Sec.  5.121   General.

    (a) Application. The labeling practices that are prohibited if 
misleading set forth in this subpart apply to any distilled spirits 
label, container, or packaging. For purposes of this subpart:
    (1) The term ``label'' includes all labels on distilled spirits 
containers on which mandatory information may appear, as set forth in 
Sec.  5.61(a), as well as any other label on the container;
    (2) The term ``container'' includes all parts of the distilled 
spirits container, including any part of a distilled spirits container 
on which mandatory information may appear, as well as those parts of 
the container on which information does not satisfy mandatory labeling 
requirements, as set forth in Sec.  5.61(b); and
    (3) The term ``packaging'' includes any carton, case, carrier, 
individual covering or other packaging of such containers used for sale 
at retail, but does not include shipping cartons or cases that are not 
intended to accompany the container to the consumer.
    (b) Statement or representation. For purposes of this subpart, the 
term ``statement or representation'' includes any statement, design, 
device, or representation, and includes pictorial or graphic designs or 
representations as well as written ones. The term ``statement or 
representation'' includes explicit and implicit statements and 
representations.


Sec.  5.122   Misleading statements or representations.

    (a) General prohibition. Distilled spirits labels, containers, or 
packaging may not contain any statement or representation, irrespective 
of falsity, that is misleading to consumers as to the age, origin, 
identity, or other characteristics of the distilled spirits, or with 
regard to any other material factor.
    (b) Ways in which statements or representations may be misleading. 
(1) A statement or representation is prohibited, irrespective of 
falsity, if it directly creates a misleading impression, or if it does 
so indirectly through ambiguity, omission, inference, or by the 
addition of irrelevant, scientific, or technical matter. For example, 
an otherwise truthful statement may be misleading because of the 
omission of material information, the disclosure of which is necessary 
to prevent the statement from being misleading.
    (2) As set forth in Sec.  5.212(b), all claims, whether implicit or 
explicit, must have a reasonable basis in fact. Any claim on distilled 
spirits labels, containers, or packaging that does not have a 
reasonable basis in fact, or cannot be adequately substantiated upon 
the request of the appropriate TTB officer, is considered misleading.


Sec.  5.123   Guarantees.

    Distilled spirits labels, containers, or packaging may not contain 
any statement relating to guarantees if the appropriate TTB officer 
finds it is likely to mislead the consumer. However, money-back 
guarantees are not prohibited.


Sec.  5.124   Disparaging statements.

    (a) General. Distilled spirits labels, containers, or packaging may 
not contain any false or misleading statement that explicitly or 
implicitly disparages a competitor's product.
    (b) Examples. (1) An example of an explicit statement that falsely 
disparages a competitor's product is ``Brand X is not aged in oak 
barrels,'' when such statement is not true.
    (2) An example of an implicit statement that disparages 
competitors' products in a misleading fashion is ``We do not add 
arsenic to our distilled spirits,'' when such a claim may lead 
consumers to falsely believe that other distillers do add arsenic to 
their distilled spirits.
    (c) Truthful and accurate comparisons. This section does not 
prevent truthful and accurate comparisons between products (such as, 
``Our liqueur contains more strawberries than Brand X'') or statements 
of opinion (such as, ``We think our rum tastes better than any other 
distilled spirits on the market'').


Sec.  5.125   Tests or analyses.

    Distilled spirits labels, containers, or packaging may not contain 
any statement or representation of or relating to analyses, standards, 
or tests, whether or not it is true, that is likely to mislead the 
consumer. An example of such a misleading statement is ``tested and 
approved by our research laboratories'' if the testing and approval 
does not in fact have any significance.

[[Page 60660]]

Sec.  5.126   Depictions of government symbols.

    (a) Representations of the armed forces and flags. Distilled 
spirits labels, containers, or packaging may not show an image of any 
government's flag or any representation related to the armed forces of 
the United States if the representation, standing alone or considered 
together with any additional language or symbols on the label, creates 
a false or misleading impression that the product was endorsed by, made 
by, used by, or made under the supervision of, the government 
represented by that flag or the armed forces of the United States. This 
section does not prohibit the use of a flag as part of a claim of 
American origin or another country of origin.
    (b) Government seals. Distilled spirits labels, containers, or 
packaging may not contain any government seal or other insignia that is 
likely to create a false or misleading impression that the product has 
been endorsed by, made by, used by, or made for, or under the 
supervision of, or in accordance with the specification of, that 
government. Seals required or specifically authorized by applicable law 
or regulations and used in accordance with such law or regulations are 
not prohibited.


Sec.  5.127   Depictions simulating government stamps or relating to 
supervision.

    Distilled spirits labels, containers, or packaging may not contain 
any statements, images, and designs that mislead consumers to believe 
that the distilled spirits are manufactured or processed under 
government authority. Distilled spirits labels, containers, or 
packaging may not contain images or designs resembling a stamp of the 
U.S. Government or any State or foreign government, other than stamps 
authorized or required by this or any other government, and may not 
contain statements or indications that the distilled spirits are 
distilled, blended, bottled, packed or sold under, or in accordance 
with, any municipal, State, Federal, or foreign authorization, law, or 
regulations, unless such statement is required or specifically 
authorized by applicable law or regulation. If a municipal, State, or 
Federal Government permit number is stated on distilled spirits labels, 
containers, or packaging, it may not be accompanied by any additional 
statement relating to that permit number.


Sec.  5.128   Claims related to wine or malt beverages.

    (a) General. Except as provided in paragraph (b) of this section, 
no label, carton, case, or any other packaging material may contain a 
statement, design, or representation that tends to create a false or 
misleading impression that the distilled spirits product is a wine or 
malt beverage product, or that it contains wine or malt beverages. For 
example, the use of the name of a class or type designation of a wine 
or malt beverage product, as set forth in parts 4 or 7 of this chapter, 
is prohibited, if the use of that name creates a misleading impression 
as to the identity of the product. Homophones or coined words that 
simulate or imitate a class or type designation are also prohibited.
    (b) Exceptions. This section does not prohibit:
    (1) A truthful and accurate statement of alcohol content;
    (2) The use of a brand name of a wine or malt beverage product as a 
distilled spirits product brand name, provided that the overall label 
does not create a misleading impression as to the identity of the 
product;
    (3) The use of a wine or malt beverage cocktail name as a brand 
name or a distinctive or fanciful name of a distilled spirits product, 
provided that a statement of composition, in accordance with Sec.  
5.166, appears in the same field of vision as the brand name or the 
distinctive or fanciful name and the overall label does not create a 
misleading impression about the identity of the product;
    (4) The use of truthful and accurate statements about the 
production of the distilled spirits product, as part of a statement of 
composition or otherwise, such as ``flavored with chardonnay grapes,'' 
so long as such statements do not create a misleading impression as to 
the identity of the product; or
    (5) The use of terms that simply compare distilled spirits products 
to wine or malt beverages without creating a misleading impression as 
to the identity of the product.


Sec.  5.129   Health-related statements.

    (a) Definitions. When used in this section, the following terms 
have the meaning indicated:
    (1) Health-related statement means any statement related to health 
(other than the warning statement required under part 16 of this 
chapter) and includes statements of a curative or therapeutic nature 
that, expressly or by implication, suggest a relationship between the 
consumption of alcohol, distilled spirits, or any substance found 
within the distilled spirits product, and health benefits or effects on 
health. The term includes both specific health claims and general 
references to alleged health benefits or effects on health associated 
with the consumption of alcohol, distilled spirits, or any substance 
found within the distilled spirits, as well as health-related 
directional statements. The term also includes statements and claims 
that imply that a physical or psychological sensation results from 
consuming the distilled spirits, as well as statements and claims of 
nutritional value (for example, statements of vitamin content).
    (2) Specific health claim means a type of health-related statement 
that, expressly or by implication, characterizes the relationship of 
distilled spirits, alcohol, or any substance found within the distilled 
spirits, to a disease or health-related condition. Implied specific 
health claims include statements, symbols, vignettes, or other forms of 
communication that suggest, within the context in which they are 
presented, that a relationship exists between alcohol, distilled 
spirits, or any substance found within the distilled spirits, and a 
disease or health-related condition.
    (3) Health-related directional statement means a type of health-
related statement that directs or refers consumers to a third party or 
other source for information regarding the effects on health of 
distilled spirits or alcohol consumption.
    (b) Rules for labeling--(1) Health-related statements. In general, 
distilled spirits may not contain any health-related statement that is 
untrue in any particular or tends to create a misleading impression as 
to the effects on health of alcohol consumption. TTB will evaluate such 
statements on a case-by-case basis and may require as part of the 
health-related statement a disclaimer or some other qualifying 
statement to dispel any misleading impression conveyed by the health-
related statement.
    (2) Specific health claims. (i) TTB will consult with the Food and 
Drug Administration (FDA), as needed, on the use of a specific health 
claim on the distilled spirits. If FDA determines that the use of such 
a labeling claim is a drug claim that is not in compliance with the 
requirements of the Federal Food, Drug, and Cosmetic Act, TTB will not 
approve the use of that specific health claim on the distilled spirits.
    (ii) TTB will approve the use of a specific health claim on a 
distilled spirits label only if the claim is truthful and adequately 
substantiated by scientific or medical evidence; is sufficiently 
detailed and qualified with respect to the categories of individuals to 
whom the claim applies; adequately discloses the health risks 
associated with both moderate and heavier levels

[[Page 60661]]

of alcohol consumption; and outlines the categories of individuals for 
whom any levels of alcohol consumption may cause health risks. This 
information must appear as part of the specific health claim.
    (3) Health-related directional statements. A health-related 
directional statement is presumed misleading unless it:
    (i) Directs consumers in a neutral or other non-misleading manner 
to a third party or other source for balanced information regarding the 
effects on health of distilled spirits or alcohol consumption; and
    (ii)(A) Includes as part of the health-related directional 
statement the following disclaimer: ``This statement should not 
encourage you to drink or to increase your alcohol consumption for 
health reasons;'' or
    (B) Includes as part of the health-related directional statement 
some other qualifying statement that the appropriate TTB officer finds 
is sufficient to dispel any misleading impression conveyed by the 
health-related directional statement.


Sec.  5.130   Appearance of endorsement.

    (a) General. Distilled spirits labels, containers, or packaging may 
not include the name, or the simulation or abbreviation of the name, of 
any living individual of public prominence, or an existing private or 
public organization, or any graphic, pictorial, or emblematic 
representation of the individual or organization, if its use is likely 
to lead a consumer to falsely believe that the product has been 
endorsed, made, or used by, or produced for, or under the supervision 
of, or in accordance with the specifications of, such individual or 
organization. This section does not prohibit the use of such names 
where the individual or organization has provided authorization for 
their use.
    (b) Documentation. The appropriate TTB officer may request 
documentation from the bottler or importer to establish that the person 
or organization has provided authorization to use the name of that 
person or organization.
    (c) Disclaimers. Statements or other representations do not violate 
this section if, taken as a whole, they create no misleading impression 
as to an implied endorsement either because of the context in which 
they are presented or because of the use of an adequate disclaimer.

Subpart I--Standards of Identity for Distilled Spirits


Sec.  5.141   The standards of identity in general.

    (a) General. Distilled spirits are divided, for labeling purposes, 
into classes, which are further divided into specific types. As set 
forth in Sec.  5.63, a distilled spirits product label must bear the 
appropriate class, type or other designation. The standards that define 
the classes and types are known as the ``standards of identity.'' The 
classes and types of distilled spirits set forth in this subpart apply 
only to distilled spirits for beverage or other nonindustrial purposes.
    (b) Rules. (1) Unless otherwise specified, when a standard of 
identity states that a mash is of a particular ingredient (such as 
``fermented mash of grain''), the mash must be made entirely of that 
ingredient without the addition of other fermentable ingredients.
    (2) Where an intermediate product is used to manufacture a 
distilled spirits product, the components of that intermediate product 
are considered as being directly added to the finished product for 
purposes of determining the class or type of the finished product and 
for any applicable limitations or statements of composition.
    (3) Some distilled spirits products may conform to the standards of 
identity of more than one class. Such products may be designated with 
any class designation defined in this subpart to which the products 
conform.
    (c) Designating with both class and type. If a product is 
designated with both the class and the type, the class and type must be 
in the same type size and in the same field of vision.
    (d) Words in a designation. All words in a designation must be in 
the same type size and must appear together.


Sec.  5.142   Neutral spirits or alcohol.

    (a) The class neutral spirits. ``Neutral spirits'' or ``alcohol'' 
are distilled spirits distilled from any suitable material at or above 
95 percent alcohol by volume (190[deg] proof), and, if bottled, bottled 
at not less than 40 percent alcohol by volume (80[deg] proof). The 
source material may, but need not, appear in the class designation (for 
example, ``Apple Neutral Spirits'' or ``Grain Neutral Spirits''). 
Neutral spirits other than the type ``grain spirits'' may be designated 
as ``neutral spirits'' or ``alcohol'' on a label. Neutral spirits other 
than the type ``grain spirits'' that are stored in wood barrels may not 
be aged in wood barrels at any time.
    (b) Types. The following chart lists the types of neutral spirits 
and the rules that apply to the type designation.

------------------------------------------------------------------------
       Type designation                        Standards
------------------------------------------------------------------------
(1) Vodka....................  Neutral spirits so distilled, or so
                                treated after distillation with charcoal
                                or other materials, as to be without
                                distinctive character, aroma, taste, or
                                color. Vodka may not be aged or stored
                                in wood barrels at any time except when
                                labeled as bottled in bond pursuant to
                                Sec.   5.68. Vodka treated and filtered
                                with not less than one ounce of
                                activated carbon or activated charcoal
                                per 100 wine gallons of spirits may be
                                labeled as ``charcoal filtered.'' Vodka
                                may contain up to two grams per liter of
                                sugar and up to one gram per liter of
                                citric acid. Addition of any other
                                flavoring or blending materials changes
                                the classification to flavored vodka or
                                to a distilled spirits specialty
                                product, as appropriate. Vodka must be
                                designated on the label as ``neutral
                                spirits,'' ``alcohol,'' or ``vodka''.
(2) Grain spirits............  Neutral spirits distilled from a
                                fermented mash of grain and stored in
                                oak barrels. ``Grain spirits'' must be
                                designated as such on the label. Grain
                                spirits may not be designated as
                                ``neutral spirits'' or ``alcohol'' on
                                the label.
------------------------------------------------------------------------

Sec.  5.143   Whisky.

    (a) The class whisky. ``Whisky'' or ``whiskey'' is distilled 
spirits that is an alcoholic distillate from a fermented mash of any 
grain distilled at less than 95 percent alcohol by volume (190[deg] 
proof) having the taste, aroma, and characteristics generally 
attributed to whisky, stored in oak barrels (except that corn whisky, 
white whisky, and unaged whisky need not be so stored), and bottled at 
not less than 40 percent alcohol by volume (80[deg] proof), and also 
includes mixtures of such distillates for which no specific standards 
of identity are prescribed.
    (b) Label designations. The word whisky may be spelled as either 
``whisky'' or ``whiskey''. Whisky conforming to one of the types of 
whisky defined in paragraph (c) of this section must be designated as 
that type on the label, except that whisky distilled in Tennessee may 
be called ``Tennessee Whisky'' even if it conforms to one of the 
specific type designations. The place, state, or region where the

[[Page 60662]]

whisky was distilled may appear as part of the designation on the label 
if the distillation and any required aging took place in that location; 
blending and bottling need not have taken place in the same place, 
state, or region (e.g., ``New York Bourbon Whisky'' must be distilled 
and aged in the State of New York). However, if any whisky is made 
partially from whisky distilled in a country other than that indicated 
by the type designation, the label must indicate the percentage of such 
whisky and the country where that whisky was distilled. Additionally, 
the label of whisky that does not meet one of the standards for 
specific types of whisky and that is comprised of components distilled 
in more than one country must contain a statement of composition 
indicating the country of origin of each component (such as ``Whisky--
50% from Japan, 50% from the United States''). The word ``bourbon'' may 
not be used to describe any whisky or whisky-based distilled spirits 
not distilled and aged in the United States. The whiskies defined in 
paragraphs (c)(2) through (6) and (10) through (14) of this section are 
distinctive products of the United States and must have the country of 
origin stated immediately adjacent to the type designation if it is 
distilled outside of the United States, or the whisky designation must 
be proceeded by the term ``American type'' if the country of origin 
appears elsewhere on the label. For example, ``Brazilian Corn Whisky,'' 
``Rye Whisky distilled in Sweden,'' and ``Blended Whisky--Product of 
Japan'' are statements that meet this country of origin requirement. 
``Light whisky'' and ``Blended light whisky'' may only be produced in 
the United States.
    (c) Types of whisky. The following tables set out the designations 
for whisky. Table 1 sets forth the standards for whisky that are 
defined based on production, storage, and processing standards, while 
Table 2 sets forth rules for the types of whisky that are defined as 
distinctive products of certain countries. For the whiskies listed in 
Table 1, a whisky may use the designation listed, when it complies with 
the production standards in the subsequent columns. The ``source'' 
column indicates the source of the grain mash used to make the whisky. 
The ``distillation proof'' indicates the allowable distillation proof 
for that type. The ``storage'' column indicates the type of packages 
(barrels) in which the spirits must be stored and limits for the proof 
of the spirits when entering the packages. The ``neutral spirits 
permitted'' column indicates whether neutral spirits may be used in the 
product in their original state (and not as vehicles for flavoring 
materials), and if so, how much may be used. The ``harmless coloring, 
flavoring, blending materials permitted'' column indicates whether 
harmless coloring, flavoring, or blending materials, other than neutral 
spirits in their original form, described in Sec.  5.142, may be used 
in the product. The use of the word ``straight'' is a further 
designation of a type, and is optional. The designation ``white 
whisky'' may only appear on whiskies that are clear in color and that 
meet the rules in paragraph (b)(15) of this section.

                               Table 1 to Paragraph (c): Types of Whisky and Production, Storage, and Processing Standards
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                                                     Allowable coloring,
               Type                         Source              Distillation proof             Storage           Neutral spirits     flavoring, blending
                                                                                                                    permitted        materials permitted
--------------------------------------------------------------------------------------------------------------------------------------------------------
(1) Whisky, which may be used as    Fermented grain mash.  Less than 190[deg].........  Oak barrels with no   No..................  Yes.
 the designation if the whisky                                                           minimum time
 does not meet one of the type                                                           requirement.
 designations.
(2) Bourbon Whisky, Rye Whisky,     Fermented mash of not  160[deg] or less...........  Charred new oak       No..................  Yes, except for
 Wheat Whisky, Malt Whisky, Rye      less than 51%,                                      barrels at 125[deg]                         bourbon whisky.
 Malt Whisky, or [name of other      respectively: Corn,                                 or less.
 grain] Whisky.                      Rye, Wheat, Malted
                                     Barley, Malted Rye
                                     Grain [Other grain].
(3) Corn Whisky. (Whisky            Fermented mash of not  160[deg] or less...........  Required only if age  No..................  Yes.
 conforming to this standard must    less than 80% corn.                                 is claimed on the
 be designated as ``corn                                                                 label. If stored,
 whisky.'').                                                                             must be stored at
                                                                                         125[deg] or less in
                                                                                         used or uncharred
                                                                                         new oak barrels.
(4) Straight Whisky...............  Fermented mash of      160\0\ or less.............  Charred new oak       No..................  No.
                                     less than 51% corn,                                 barrels at 125\0\
                                     rye, wheat, malted                                  or less for a
                                     barley, or malted                                   minimum of two
                                     rye grain. (Includes                                years.
                                     mixtures of straight
                                     whiskies made in the
                                     same state.).
(5) Straight Bourbon Whisky,        Fermented mash of not  160[deg] or less...........  Charred new oak       No..................  No.
 Straight Rye Whisky, Straight       less than 51%,                                      barrels at 125[deg]
 Wheat Whisky, Straight Malt         respectively: Corn,                                 or less for a
 Whisky, or Straight Rye Malt        Rye, Wheat, Malted                                  minimum of two
 Whisky.                             Barley, Malted Rye                                  years.
                                     Grain.
(6) Straight Corn Whisky..........  Fermented mash of not  160[deg] or less...........  125[deg] or less in   No..................  No.
                                     less than 80% corn.                                 used or uncharred
                                                                                         new oak barrels for
                                                                                         a minimum of 2
                                                                                         years.

[[Page 60663]]

 
(7) Whisky distilled from Bourbon/  Fermented mash of not  160[deg] or less...........  Used oak barrels....  No..................  Yes.
 Rye/Wheat/Malt/Rye Malt/[Name of    less than 51%,
 other grain] mash.                  respectively: Corn,
                                     Rye, Wheat, Malted
                                     Barley, Malted Rye
                                     Grain [Other grain].
(8) Light Whisky..................  Fermented grain mash.  More than 160[deg].........  Used or uncharred     No..................  Yes.
                                                                                         new oak barrels.
(9) Blended Light Whisky (Light     Fermented grain mash   Blend......................  Used or uncharred     No..................  Yes.
 Whisky--a blend).                   but mixed with less                                 new oak barrels.
                                     than 20% Straight
                                     Whisky on a proof
                                     gallon basis.
(10) Blended Whisky (Whisky--a      At least 20% Straight  160[deg] or less...........  Will contain a blend  Maximum of 80% on a   Yes.
 blend).                             Whisky on a proof                                   of spirits, some      proof gallon basis.
                                     gallon basis plus                                   stored and some not
                                     Whisky or Neutral                                   stored.
                                     Spirits alone or in
                                     combination.
(11) Blended Bourbon Whisky,        At least 51% on a      Blend......................  Will contain a blend  Maximum of 49% on a   Yes.
 Blended Rye Whisky, Blended Wheat   proof gallon basis                                  of spirits, some      proof gallon basis.
 Whisky, Blended Malt Whisky,        of: Straight                                        stored and some not
 Blended Rye Malt Whisky, Blended    Bourbon, Rye, Wheat,                                stored.
 Corn Whisky (or __ Whisky--a        Malt, Rye Malt, or
 blend).                             Corn Whisky; the
                                     rest comprised of
                                     Whisky or Neutral
                                     Spirits alone or in
                                     combination.
(12) Blend of Straight Whiskies     Mixture of Straight    160[deg] or less...........  Will contain a blend  No, except as part    Yes.
 (Blended Straight Whiskies).        Whiskies that does                                  of spirits which      of a flavor.
                                     not conform to                                      were aged at least
                                     ``Straight Whisky''.                                two years.
(13) Blended Straight Bourbon       Mixture of Straight    160[deg] or less...........  Will contain a blend  No, except as part    Yes.
 Whisky, Blended Straight Rye        Whiskies of the same                                of spirits which      of a flavor.
 Whisky, Blended Straight Malt       named type produced                                 were aged at least
 Whisky, Blended Straight Rye Malt   in different states                                 two years.
 Whisky, Blended Straight Corn       or produced in the
 Whisky.                             same state but
                                     contains flavoring
                                     material.
(14) Spirit Whisky................  Mixture of Neutral     Blend......................  Will contain a blend  Maximum of 95% on a   Yes.
                                     Spirits and 5% or                                   of spirits, some      proof gallon basis.
                                     more on a proof                                     stored and some not
                                     gallon basis of:                                    stored.
                                     Whisky or Straight
                                     Whisky or a
                                     combination of both.
                                     The Straight Whisky
                                     component must be
                                     less than 20% on a
                                     proof gallon basis.
(15) White Whisky or Unaged Whisky  Fermented grain mash.  Less than 190[deg].........  Storage is not        No..................  Yes.
 (Unaged whisky may only be used     When the mash is                                    required for
 as a designation if the whisky is   made up of at least                                 ``white whisky''
 not aged.).                         51% of a single type                                and is prohibited
                                     of grain, the                                       for ``unaged
                                     product may be                                      whisky.'' If white
                                     further designated                                  whisky is stored,
                                     as White [Name of                                   oak barrels, with
                                     grain] Whisky or                                    no minimum time
                                     Unaged [Name of                                     requirement, and
                                     grain] Whisky.                                      filtered after
                                                                                         storage to remove
                                                                                         color.
--------------------------------------------------------------------------------------------------------------------------------------------------------


[[Page 60664]]


 Table 2 to Paragraph (c): Types of Whisky That Are Distinctive Products
------------------------------------------------------------------------
 
------------------------------------------------------------------------
(16) Scotch whisky...........  Whisky which is a distinctive product of
                                Scotland, manufactured in Scotland in
                                compliance with the laws of the United
                                Kingdom regulating the manufacture of
                                Scotch whisky for consumption in the
                                United Kingdom: Provided, That if such
                                product is a mixture of whiskies, such
                                mixture is ``blended Scotch whisky'' or
                                ``Scotch whisky--a blend''.
(17) Irish whisky............  Whisky which is a distinctive product of
                                Ireland, manufactured either in the
                                Republic of Ireland or in Northern
                                Ireland, in compliance with their laws
                                regulating the manufacture of Irish
                                whisky for home consumption: Provided,
                                That if such product is a mixture of
                                whiskies, such mixture is ``blended
                                Irish whisky'' or ``Irish whisky--a
                                blend''.
(18) Canadian whisky.........  Whisky which is a distinctive product of
                                Canada, manufactured in Canada in
                                compliance with the laws of Canada
                                regulating the manufacture of Canadian
                                whisky for consumption in Canada:
                                Provided, That if such product is a
                                mixture of whiskies, such mixture is
                                ``blended Canadian whisky'' or
                                ``Canadian whisky--a blend''.
------------------------------------------------------------------------

Sec.  5.144   Gin.

    (a) The class gin. ``Gin'' is distilled spirits made by original 
distillation from mash, or by redistillation of distilled spirits, or 
by mixing neutral spirits, with or over juniper berries and, 
optionally, with or over other aromatics, or with or over extracts 
derived from infusions, percolations, or maceration of such materials, 
and includes mixtures of gin and neutral spirits. It must derive its 
main characteristic flavor from juniper berries and be bottled at not 
less than 40 percent alcohol by volume (80[deg] proof). Gin may be aged 
in oak containers.
    (b) Distilled gin. Gin made exclusively by original distillation or 
by redistillation may be further designated as ``distilled,'' ``Dry,'' 
``London,'' ``Old Tom'' or some combination of these four terms.


Sec.  5.145   Brandy.

    (a) The class brandy. ``Brandy'' is spirits that are distilled from 
the fermented juice, mash, or wine of fruit, or from the residue 
thereof, distilled at less than 95 percent alcohol by volume (190[deg] 
proof) having the taste, aroma, and characteristics generally 
attributed to the product, and bottled at not less than 40 percent 
alcohol by volume (80[deg] proof).
    (b) Label designations. Brandy conforming to one of the type 
designations must be designated with the type name or specific 
designation specified in the requirements for that type. The term 
``brandy'' without further qualification (such as ``peach'' or 
``marc'') may only be used as a designation on labels of grape brandy 
as defined in paragraph (c)(1) of this section. Brandy conforming to 
one of the type designations defined in paragraphs (c)(1) through (12) 
of this section must be designated on the label with the type name 
unless a specific designation is included in the requirements for that 
type. Brandy, or mixtures thereof, not conforming to any of the types 
defined in this section must be designated on the label as ``brandy'' 
followed immediately by a truthful and adequate statement of 
composition.
    (c) Types. Paragraphs (c)(1) through (12) of this section set out 
the types of brandy and the standards for each type.

------------------------------------------------------------------------
             Type                              Standards
------------------------------------------------------------------------
(1) Fruit brandy.............  Brandy distilled solely from the
                                fermented juice or mash of whole, sound,
                                ripe fruit, or from standard grape or
                                other fruit wine, with or without the
                                addition of not more than 20 percent by
                                weight of the pomace of such juice or
                                wine, or 30 percent by volume of the
                                lees of such wine, or both (calculated
                                prior to the addition of water to
                                facilitate fermentation or
                                distillation). Fruit brandy includes
                                mixtures of such brandy with not more
                                than 30 percent (calculated on a proof
                                gallon basis) of lees brandy. Fruit
                                brandy derived solely from grapes and
                                stored for at least two years in oak
                                containers must be designated ``grape
                                brandy'' or ``brandy.'' Grape brandy
                                that has been stored in oak barrels for
                                fewer than two years must be designated
                                ``immature grape brandy'' or ``immature
                                brandy.'' Fruit brandy, other than grape
                                brandy, derived from one variety of
                                fruit, must be designated by the word
                                ``brandy'' qualified by the name of such
                                fruit (for example, ``peach brandy''),
                                except that ``apple brandy'' may be
                                designated ``applejack,'' ``plum
                                brandy'' may be designated
                                ``Slivovitz,'' and ``cherry brandy'' may
                                be designated ``Kirschwasser.'' Fruit
                                brandy derived from more than one
                                variety of fruit must be designated as
                                ``fruit brandy'' qualified by a truthful
                                and adequate statement of composition,
                                for example ``Fruit brandy distilled
                                from strawberries and blueberries.''
(2) Cognac or ``Cognac         Grape brandy distilled exclusively in the
 (grape) brandy''.              Cognac region of France, which is
                                entitled to be so designated by the laws
                                and regulations of the French
                                government.
(3) Armagnac.................  Grape brandy distilled exclusively in
                                France in accordance with the laws and
                                regulations of France regulating the
                                manufacture of Armagnac for consumption
                                in France.
(4) Brandy de Jerez..........  Grape brandy distilled exclusively in
                                Spain in accordance with the laws and
                                regulations of Spain regulating the
                                manufacture of Brandy de Jerez for
                                consumption in Spain.
(5) Calvados.................  Apple brandy distilled exclusively in
                                France in accordance with the laws and
                                regulations of France regulating the
                                manufacture of Calvados for consumption
                                in France.
(6) Pisco....................  Grape brandy distilled in Peru or Chile
                                in accordance with the laws and
                                regulations of the country of
                                manufacture of Pisco for consumption in
                                the country of manufacture, including:
                                (i) ``Pisco Per[uacute]'' (or ``Pisco
                                Peru''), which is Pisco manufactured in
                                Peru in accordance with the laws and
                                regulations of Peru governing the
                                manufacture of Pisco for consumption in
                                that country; and
                                (ii) ``Pisco Chileno'' (or ``Chilean
                                Pisco''), which is Pisco manufactured in
                                Chile in accordance with the laws and
                                regulations of Chile governing the
                                manufacture of Pisco for consumption in
                                that country.
(7) Dried fruit brandy.......  Brandy that conforms to the standard for
                                fruit brandy except that it has been
                                derived from sound, dried fruit, or from
                                the standard wine of such fruit. Brandy
                                derived from raisins, or from raisin
                                wine, must be designated ``raisin
                                brandy.'' Dried fruit brandy, other than
                                raisin brandy, must be designated by the
                                word ``brandy'' qualified by the name of
                                the dried fruit from which made preceded
                                by the word ``dried'', for example,
                                ``dried apricot brandy.''
(8) Lees brandy..............  Brandy distilled from the lees of
                                standard grape or other fruit wine, and
                                such brandy derived solely from grapes
                                must be designated ``grape lees brandy''
                                or ``lees brandy.'' Lees brandy derived
                                from fruit other than grapes must be
                                designated as ``lees brandy,'' qualified
                                by the name of the fruit from which such
                                lees are derived, for example, ``cherry
                                lees brandy.''

[[Page 60665]]

 
(9) Pomace brandy or Marc      Brandy distilled from the skin and pulp
 brandy.                        of sound, ripe grapes or other fruit,
                                after the withdrawal of the juice or
                                wine therefrom. Such brandy derived
                                solely from grape components must be
                                designated ``grape pomace brandy,''
                                ``grape marc brandy'', ``pomace
                                brandy,'' or ``mark brandy.'' Grape
                                pomace brandy may alternatively be
                                designated as ``grappa'' or ``grappa
                                brandy.'' Pomace or marc brandy derived
                                from fruit other than grapes must be
                                designated as ``pomace brandy'' or
                                ``marc brandy'' qualified by the name of
                                the fruit from which derived, for
                                example, ``apple pomace brandy'' or
                                ``pear marc brandy.''
(10) Residue brandy..........  Brandy distilled wholly or in part from
                                the fermented residue of fruit or wine.
                                Such brandy derived solely from grapes
                                must be designated ``grape residue
                                brandy,'' or ``residue brandy.'' Residue
                                brandy, derived from fruit other than
                                grapes, must be designated as ``residue
                                brandy'' qualified by the name of the
                                fruit from which derived, for example,
                                ``orange residue brandy.'' Brandy
                                distilled wholly or in part from residue
                                materials which conforms to any of the
                                standards set forth in paragraphs (b)(1)
                                and (7) through (9) of this section may,
                                regardless of such fact, be designated
                                ``residue brandy'', but the use of such
                                designation shall be conclusive,
                                precluding any later change of
                                designation.
(11) Neutral brandy..........  Any type of brandy distilled at more than
                                85% alcohol by volume (170[deg] proof)
                                but less than 95% alcohol by volume.
                                Such brandy derived solely from grapes
                                must be designated ``grape neutral
                                brandy,'' or ``neutral brandy.'' Other
                                neutral brandies, must be designated in
                                accordance with the rules for those
                                types of brandy, and be qualified by the
                                word ``neutral''; for example, ``neutral
                                citrus residue brandy''.
(12) Substandard brandy......  Any brandy:
                                (i) Distilled from fermented juice,
                                mash, or wine having a volatile acidity,
                                calculated as acetic acid and exclusive
                                of sulfur dioxide, in excess of 0.20
                                gram per 100 cubic centimeters (20
                                degrees Celsius); measurements of
                                volatile acidity must be calculated
                                exclusive of water added to facilitate
                                distillation.
                                (ii) distilled from unsound, moldy,
                                diseased, or decomposed juice, mash,
                                wine, lees, pomace, or residue, or which
                                shows in the finished product any taste,
                                aroma, or characteristic associated with
                                products distilled from such material.
                                (iii) Such brandy derived solely from
                                grapes must be designated ``substandard
                                grape brandy,'' or ``substandard
                                brandy.'' Other substandard brandies
                                must be designated in accordance with
                                the rules for those types of brandy, and
                                be qualified by the word
                                ``substandard''; for example,
                                ``substandard fig brandy''.
------------------------------------------------------------------------

Sec.  5.146   Blended applejack.

    (a) The class blended applejack. ``Blended applejack'' is a mixture 
containing at least 20 percent on a proof gallon basis of apple brandy 
(applejack) that has been stored in oak barrels for not less than two 
years, and not more than 80 percent of neutral spirits on a proof 
gallon basis. Blended applejack must be bottled at not less than 40 
percent alcohol by volume (80[deg] proof).
    (b) Label designation. The label designation for blended applejack 
may be ``blended applejack'' or ``applejack-a blend.''


Sec.  5.147   Rum.

    (a) The class rum. ``Rum'' is distilled spirits that is distilled 
from the fermented juice of sugar cane, sugar cane syrup, sugar cane 
molasses, or other sugar cane by-products at less than 95 percent 
alcohol by volume (190[deg] proof) having the taste, aroma, and 
characteristics generally attributed to rum, and bottled at not less 
than 40 percent alcohol by volume (80[deg] proof); and also includes 
mixtures solely of such spirits. All rum may be designated as ``rum'' 
on the label, even if it also meets the standards for a specific type 
of rum.
    (b) Types. Paragraph (b)(1) of this section describes a specific 
type of rum and the standards for that type.

------------------------------------------------------------------------
             Type                              Standards
------------------------------------------------------------------------
(1) Cacha[ccedil]a...........  Rum that is a distinctive product of
                                Brazil, manufactured in Brazil in
                                compliance with the laws of Brazil
                                regulating the manufacture of
                                Cacha[ccedil]a for consumption in that
                                country. The word ``Cacha[ccedil]a'' may
                                be spelled with or without the diacritic
                                mark (i.e., ``Cacha[ccedil]a'' or
                                ``Cachaca''). Cacha[ccedil]a may be
                                designated as ``Cacha[ccedil]a'' or
                                ``rum'' on labels.
(2) [Reserved]
------------------------------------------------------------------------

Sec.  5.148   Agave spirits.

    (a) The class agave spirits. ``Agave spirits'' are distilled from a 
fermented mash, of which at least 51 percent is derived from plant 
species in the genus Agave and up to 49 percent is derived from sugar. 
Agave spirits must be distilled at less than 95 percent alcohol by 
volume (190[deg] proof) and bottled at or above 40 percent alcohol by 
volume (80[deg] proof). Agave spirits may be stored in wood barrels. 
Agave spirits may not contain added flavoring or coloring materials, 
except as specified in Sec.  5.155. This class also includes mixtures 
of agave spirits. Agave spirits that meet the standard of identity for 
``Tequila'' or ``Mezcal'' may be designated as ``agave spirits,'' or as 
``Tequila'' or ``Mezcal'', as applicable.
    (b) Types. Paragraphs (b)(1) and (2) of this section describe the 
types of agave spirits and the rules for each type.

------------------------------------------------------------------------
             Type                              Standards
------------------------------------------------------------------------
(1) Tequila..................  An agave spirit that is a distinctive
                                product of Mexico. Tequila must be made
                                in Mexico, in compliance with the laws
                                and regulations of Mexico governing the
                                manufacture of Tequila for consumption
                                in that country.
(2) Mezcal...................  An agave spirit that is a distinctive
                                product of Mexico. Mezcal must be made
                                in Mexico, in compliance with the laws
                                and regulations of Mexico governing the
                                manufacture of Mezcal for consumption in
                                that country.
------------------------------------------------------------------------


[[Page 60666]]

Sec.  5.149   Absinthe or absinth.

    (a) The class absinthe. Absinthe is distilled spirits distilled at 
less than 95 percent alcohol by volume (190[deg] proof) made with 
wormwood (Artemisia absinthium), anise, and fennel (with or without 
other flavoring materials) and possessing the taste, aroma, and 
characteristics generally attributed to absinthe. Absinthe may contain 
added sugar. When bottled, absinthe must be at least 30 percent alcohol 
by volume (60[deg] of proof). The designations ``absinthe'' and 
``absinth'' are interchangeable.
    (b) Thujone-free requirement. Absinthe must be thujone-free in 
accordance with U.S. Food and Drug Administration (FDA) regulations and 
standards.


Sec.  5.150   Cordials and liqueurs.

    (a) The class cordials and liqueurs. Cordials and liqueurs are 
flavored distilled spirits that are made by mixing or redistilling 
distilled spirits with or over fruits, flowers, plants, or pure juices 
therefrom, or other natural flavoring materials, or with extracts 
derived from infusions, percolation, or maceration of such materials, 
and containing sugar (such as sucrose, fructose, dextrose, or levulose) 
in an amount of not less than 2\1/2\ percent by weight of the finished 
product. Designations on labels may be ``Cordial'' or ``Liqueur,'' or, 
in the alternative, may be one of the type designations below. Cordials 
and liqueurs may not be designated as ``distilled,'' ``compound,'' or 
``straight''. The designation of a cordial or liqueur may include the 
word ``dry'' if sugar is less than 10 percent by weight of the finished 
product.
    (b) Types. Paragraph (b)(1) through (12) of this section list 
definitions and standards for optional type designations.

------------------------------------------------------------------------
                   The Types of Cordials and Liqueurs
-------------------------------------------------------------------------
             Type                                 Rule
------------------------------------------------------------------------
(1) Sloe gin.................  A cordial or liqueur with the main
                                characteristic flavor derived from sloe
                                berries.
(2) Rye liqueur, bourbon       Liqueurs, bottled at not less than 30
 liqueur (or rye cordial or     percent alcohol by volume, in which not
 bourbon cordial).              less than 51 percent, on a proof gallon
                                basis, of the distilled spirits used
                                are, respectively, rye or bourbon
                                whisky, straight rye or straight bourbon
                                whisky, or whisky distilled from a rye
                                or bourbon mash, and which possess a
                                predominant characteristic rye or
                                bourbon flavor derived from such whisky.
                                Wine, if used, must be within the 2\1/2\
                                percent limitation provided in Sec.
                                5.155 for coloring, flavoring, and
                                blending materials.
(3) Rock and rye; Rock and     Liqueurs, bottled at not less than 24
 bourbon; Rock and brandy;      percent alcohol by volume, in which, in
 Rock and rum.                  the case of rock and rye and rock and
                                bourbon, not less than 51 percent, on a
                                proof gallon basis, of the distilled
                                spirits used are, respectively, rye or
                                bourbon whisky, straight rye or straight
                                bourbon whisky, or whisky distilled from
                                a rye or bourbon mash, and, in the case
                                of rock and brandy and rock and rum, the
                                distilled spirits used are all grape
                                brandy or rum, respectively; containing
                                rock candy or sugar syrup, with or
                                without the addition of fruit, fruit
                                juices, or other natural flavoring
                                materials, and possessing, respectively,
                                a predominant characteristic rye,
                                bourbon, brandy, or rum flavor derived
                                from the distilled spirits used. Wine,
                                if used, must be within the 2\1/2\
                                percent limitation provided in Sec.
                                5.155 for harmless coloring, flavoring,
                                and blending materials.
(4) Rum liqueur, gin liqueur,  Liqueurs, bottled at not less than 30
 brandy liqueur.                percent alcohol by volume, in which the
                                distilled spirits used are entirely rum,
                                gin, or brandy, respectively, and which
                                possess, respectively, a predominant
                                characteristic rum, gin, or brandy
                                flavor derived from the distilled
                                spirits used. In the case of brandy
                                liqueur, the type of brandy must be
                                stated in accordance with paragraph (d)
                                of this section, except that liqueurs
                                made entirely with grape brandy may be
                                designated simply as ``brandy liqueur.''
                                Wine, if used, must be within the 2\1/2\
                                percent limitation provided for in Sec.
                                 5.155 for harmless coloring, flavoring,
                                and blending materials.
(5) Amaretto.................  Almond flavored liqueur/cordial.
(6) Kummel...................  Caraway flavored liqueur/cordial.
(7) Ouzo, Anise, Anisette....  Anise flavored liqueurs/cordials.
(8) Sambuca..................  Anise flavored liqueur. See Sec.
                                5.154(b)(3) for designation rules for
                                Sambuca not produced in Italy.
(9) Peppermint Schnapps......  Peppermint flavored liqueur/cordial.
(10) Triple Sec and Curacao..  Orange flavored liqueurs/cordials.
                                Curacao may be preceded by the color of
                                the liqueur/cordial (for example, Blue
                                Curacao).
(11) Cr[egrave]me de ___.....  A liqueur/cordial where the blank is
                                filled in with the predominant flavor
                                (for example, Cr[egrave]me de menthe is
                                mint flavored liqueur/cordial.)
(12) Goldwasser..............  Herb flavored liqueur/cordial and
                                containing gold flakes. See Sec.
                                5.154(b)(3) for designation rules for
                                goldwasser not made in Germany.
------------------------------------------------------------------------

Sec.  5.151  Flavored spirits.

    (a) The class flavored spirits. ``Flavored spirits'' are distilled 
spirits that are spirits conforming to one of the standards of identity 
set forth in Sec. Sec.  5.142 through 5.150 (the ``base spirits'') to 
which have been added nonbeverage flavors, wine, or nonalcoholic 
natural flavoring materials, with or without the addition of sugar, and 
bottled at not less than 30 percent alcohol by volume (60[deg] proof). 
The flavored spirits must be specifically designated by the single base 
spirit and one or more of the most predominant flavors (for example, 
``Pineapple Flavored Tequila'' or ``Cherry Vanilla Flavored Bourbon 
Whisky''). The base spirit must conform to the standard of identity for 
that spirit before the flavoring is added. Base spirits that are a 
distinctive product of a particular place must be manufactured in 
accordance with the laws and regulations of the country as designated 
in the base spirit's standard of identity. If the finished product 
contains more than 2\1/2\ percent by volume of wine, the kinds and 
percentages by volume of wine must be stated as a part of the 
designation (whether the wine is added directly to the product or 
whether it is first mixed into an intermediate product), except that a 
flavored brandy may contain an additional 12\1/2\ percent by volume of 
wine, without label disclosure, if the additional wine is derived from 
the particular fruit corresponding to the labeled flavor of the 
product.


Sec.  5.152   Imitations.

    (a) Imitations must bear, as a part of the designation thereof, the 
word ``imitation'' and include the following:
    (1) Any class or type of distilled spirits to which has been added 
coloring or flavoring material of such nature as to cause the resultant 
product to simulate any other class or type of distilled spirits;

[[Page 60667]]

    (2) Any class or type of distilled spirits (other than distilled 
spirits specialty products as defined in Sec.  5.156) to which has been 
added flavors considered to be artificial or imitation. (Note: TTB 
Procedure XXXX-XX, available on the TTB website (https://www.ttb.gov) 
provides guidance on the use of the terms ``natural'' and 
``artificial'' when referencing flavoring materials);
    (3) Any class or type of distilled spirits (except cordials, 
liqueurs and specialties marketed under labels which do not indicate or 
imply that a particular class or type of distilled spirits was used in 
the manufacture thereof) to which has been added any whisky essence, 
brandy essence, rum essence, or similar essence or extract which 
simulates or enhances, or is used by the trade or in the particular 
product to simulate or enhance, the characteristics of any class or 
type of distilled spirits;
    (4) Any type of whisky to which beading oil has been added;
    (5) Any rum to which neutral spirits or distilled spirits other 
than rum have been added;
    (6) Any brandy made from distilling material to which has been 
added any amount of sugar other than the kind and amount of sugar 
expressly authorized in the production of standard wine; and
    (7) Any brandy to which neutral spirits or distilled spirits other 
than brandy have been added, except that this provision shall not apply 
to any product conforming to the standard of identity for blended 
applejack.
    (b) If any of the standards set forth in paragraphs (a)(1) through 
(7) of this section apply, the ``Imitation'' class designation must be 
used in front of the appropriate class designation (for example, 
Imitation Whisky).


Sec.  5.153   Diluted spirits.

    (a) The class diluted spirits. When a minimum bottling alcohol 
content (proof) is required for a class or type and a product would 
meet one of the classes or types prescribed in this subpart except that 
that product does not meet the minimum bottling alcohol content, the 
product must be designated with the applicable class or type 
designation (and statement of composition, if required) immediately 
preceded by the word ``Diluted'' in readily legible type at least half 
as large as the class or type designation to which it refers. Examples 
of such designations are ``Diluted Vodka,'' ``Diluted Cherry Lees 
Brandy,'' and ``Diluted flavored whisky.''
    (b) [Reserved]


Sec.  5.154   Rules for geographical designations.

    (a) Geographical designations. (1) Geographical names for distilled 
spirits found by the appropriate TTB officer to have lost their 
geographical significance by usage and common knowledge to such extent 
that they have become generic may be used without regard to where the 
product is actually manufactured or bottled. The following names have 
been found to be generic: London dry gin, Geneva (Hollands) gin.
    (2) Except as provided in paragraph (a)(3) of this section, 
geographical names that have not become generic shall not be applied to 
distilled spirits made in any place other than the particular place or 
region indicated in the name. Examples are Greek brandy, Jamaica rum, 
Puerto Rico rum, Demerara rum, and Andong Soju.
    (3) Geographical names that are not generic may be used as the 
designation for types of distilled spirits made in a place other than 
the particular region indicated by the name if:
    (i) The appropriate TTB officer has determined that the name 
represents a type of distilled spirits;
    (ii) The word ``type,'' ``style,'' or some other statement 
indicating the true place of production appears as part of the 
designation; and
    (iii) The distilled spirits to which the name is applied conforms 
to the standard of identity identified in this subpart.
    (iv) The following geographical names are recognized as types of 
distilled spirits in accordance with paragraph (a)(3)(i) of this 
section: Eau de Vie de Dantzig (Danziger Goldwasser), Ojen, and Swedish 
punch.
    (b) Products without geographical designations that are associated 
with a particular geographical region. (1) A name that is not a 
geographical name but that is generally perceived as a name associated 
with a particular geographic place, region, or country may not be used 
on the label of a product of any other place, region or country, except 
as otherwise provided in this paragraph.
    (2) Designations for distilled spirits listed in this paragraph and 
that by usage and common knowledge have lost any geographical 
significance to such an extent that the appropriate TTB officer finds 
they have become generic may be used to designate spirits of any 
origin. Examples of names that TTB has found to be generic include: 
Zubrovka, Aquavit, Arrack, Kummel, Amaretto, and Ouzo.
    (3) Designations for distilled spirits listed in this paragraph 
that the appropriate TTB officer has determined have, by usage and 
common knowledge, become associated with distilled spirits produced in 
geographic areas other than the region with which the name was 
originally associated may be used to designate products of any origin, 
as long as the designation for such product includes the word ``type'' 
or an adjective such as ``American'' that clearly indicates the true 
place of production. TTB has determined that the names ``Habanero,'' 
``Sambuca,'' and ``Goldwasser'' fall into this category.


Sec.  5.155   Alteration of class and type.

    (a) Definitions--(1) Coloring, flavoring, or blending material. For 
the purposes of this section, the term ``coloring, flavoring, or 
blending material'' means a harmless substance that is an essential 
component of the class or type of distilled spirits to which it is 
added; or a harmless substance, such as caramel, straight malt or 
straight rye malt whiskies, fruit juices, sugar, infusion of oak chips 
when approved by the Administrator, or wine, that is not an essential 
component part of the distilled spirits product to which it is added 
but which is customarily employed in the product in accordance with 
established trade usage.
    (2) Certified color. For purposes of this section, the term 
``certified color'' means a color additive that is required to undergo 
batch certification in accordance with part 74 or part 82 of the Food 
and Drug Administration regulations (21 CFR parts 74 and 82). An 
example of a certified color is FD&C Blue No. 2.
    (b) Allowable additions. Except as provided in paragraph (c) of 
this section, the following may be added to distilled spirits without 
changing the class or type designation:
    (1) Coloring, flavoring, and blending materials that are essential 
components of the class or type of distilled spirits to which added;
    (2) Coloring, flavoring, and blending materials that are not 
essential component parts of the distilled spirits to which added, 
provided that such coloring, flavoring, or blending materials do not 
total more than 2 \1/2\ percent by volume of the finished product; and
    (3) Wine, when added to Canadian whisky in Canada in accordance 
with the laws and regulations of Canada governing the manufacture of 
Canadian whisky.
    (c) Exceptions. The addition of the following will require a 
redesignation of the class or type of the distilled spirits product to 
which added:
    (1) Coloring, flavoring, or blending materials that are not 
essential component parts of the class or type of

[[Page 60668]]

distilled spirits to which they are added, if such coloring, flavoring, 
and blending materials total more than 2\1/2\ percent by volume of the 
finished product;
    (2) Any material, other than caramel, infusion of oak chips, and 
sugar, added to Cognac brandy;
    (3) Any material whatsoever added to neutral spirits or straight 
whisky, except that vodka may be treated with sugar, in an amount not 
to exceed two grams per liter, and with citric acid, in an amount not 
to exceed one gram per liter;
    (4) Certified colors, carmine, or cochineal extract;
    (5) Any material that would render the product to which it is added 
an imitation, as defined in Sec.  5.152; or
    (6) For products that are required to be stored in oak barrels in 
accordance with a standard of identity, the storing of the product in 
an additional barrel made of another type of wood.
    (d) Extractions from distilled spirits. The removal of any 
constituents from a distilled spirits product to such an extent that 
the product no longer possesses the taste, aroma, and characteristics 
generally attributed to that class or type of distilled spirits will 
alter the class or type of the product, and the resulting product must 
be redesignated appropriately. In addition, in the case of straight 
whisky, the removal of more than 15 percent of the fixed acids, 
volatile acids, esters, soluble solids, or higher alcohols, or the 
removal of more than 25 percent of the soluble color, constitutes an 
alteration of the class or type of the product and requires a 
redesignation of the product.
    (e) Exceptions. Nothing in this section has the effect of modifying 
the standards of identity specified in Sec.  5.150 for cordials and 
liqueurs, and in Sec.  5.151 for flavored spirits, or of authorizing 
any product defined in Sec.  5.152 to be designated as other than an 
imitation.


Sec.  5.156   Distilled spirits specialty products.

    (a) General. Distilled spirits that do not meet one of the other 
standards of identity specified in this subpart are distilled spirits 
specialty products and must be designated in accordance with trade and 
consumer understanding, or, if no such understanding exists, with a 
distinctive or fanciful name (which may be the name of a cocktail) 
appearing in the same field of vision as a statement of composition. 
The statement of composition and the distinctive or fanciful name serve 
as the class and type designation for these products. The statement of 
composition must follow the rules found in Sec.  5.166. A product may 
not bear a designation which indicates it contains a class or type of 
distilled spirits unless the distilled spirits therein conform to such 
class and type.
    (b) Products designated in accordance with trade and consumer 
understanding. Products may be designated in accordance with trade and 
consumer understanding without a statement of composition if the 
appropriate TTB officer has determined that there is such 
understanding.


Sec.  Sec.  5.157-5.165   [Reserved]


Sec.  5.166   Statements of composition.

    (a) Rules for the statement of composition. When a statement of 
composition is required as part of a designation for a distilled 
spirits specialty product, the statement must contain all of the 
information specified in this section, as applicable. The statement 
must specify all harmless coloring, flavoring, and blending materials, 
except to the extent the materials in the product are part of a 
distilled spirit that is identified in the statement of composition and 
the distilled spirit contains the materials within the limitations 
specified in the standards of identity for the distilled spirit, or the 
standards set out in Sec.  5.155. If an intermediate product is used to 
make a distilled spirits specialty product, the materials used to make 
the intermediate product should be identified in the statement of 
composition as if they were mixed directly into the distilled spirits 
without regard to the fact that they were first mixed into an 
intermediate product.
    (1) Identify the distilled spirits and wines. The statement of 
composition must clearly identify the distilled spirits and wines used 
in the finished product. The statement of composition must show the 
required class and/or type designation for each distilled spirit (e.g., 
``vodka,'' ``whisky,'' ``rum,'' ``gin''). The statement of composition 
must identify any wines used in the product, but the statement is not 
required to specifically identify the classes and/or types of the 
wines. The statement of composition must list each distilled spirit and 
wine in order of predominance on a proof gallon basis. If a product 
contains multiple classes and/or types of wine and the statement of 
composition does not specifically identify each one, the predominance 
of the wine must be determined based on its total quantity in the 
product on a proof gallon basis.
    (2) Identify flavoring and blending material(s) (not including 
distilled spirits and wines) used before, during, and after 
distillation. The statement of composition must disclose flavoring and 
blending materials used in the finished product. If the flavoring 
materials were used before or during the distillation process, the 
statement of composition must indicate that the distilled spirits were 
distilled with the flavoring material (e.g., Vodka Distilled with 
Cinnamon). If a single flavoring material is used in the production of 
the distilled spirits product, the flavoring material may be 
specifically identified (such as, ``strawberry flavor,'' ``strawberry 
juice,'' or ``whole strawberries'') or generally referenced (such as, 
``natural flavor''). If two or more flavoring materials are used in the 
production of the distilled spirits product, each flavoring material 
may be specifically identified (such as, ``peach flavor, kiwi flavor,'' 
or ``peach and kiwi flavors'') or the characterizing flavor may be 
specifically identified and the remaining flavoring material(s) may be 
generally referenced (such as, ``peach and other natural and artificial 
flavor(s)''), or all flavors may be generally referenced (such as, 
``with artificial flavors''). (Note: TTB Procedure XXXX-XX, available 
on the TTB website (https://www.ttb.gov), provides guidance on the use 
of the terms ``natural'' and ``artificial'' when referencing flavoring 
materials.)
    (3) Identify added coloring material(s). The statement of 
composition must disclose the addition of coloring material(s), whether 
added directly or through flavoring material(s), if the addition of 
such material(s) to the base distilled spirits is not in accordance 
with the standards of identity. The coloring material(s) may be 
identified specifically (such as, ``caramel color,'' ``FD&C Red #40,'' 
``annatto,'' etc.) or as a general statement, such as, ``Contains 
certified color'', for colors approved under 21 CFR part 74, or 
``artificially colored,'' to indicate the presence of any one or a 
combination of coloring material(s). However, FD&C Yellow No. 5, 
cochineal extract, and carmine require specific disclosure in 
accordance with Sec.  5.71 and may be disclosed either in the statement 
of composition or elsewhere, in accordance with that section, if the 
statement of composition contains only a general disclosure of added 
colors. Where the standard of identity for that base spirit does not 
require disclosure, caramel used in the production of the base spirit 
is not required to be disclosed as part of the statement of 
composition. However, caramel added in the production of the specialty 
product must be disclosed.
    (4) Identify added artificial or other non-nutritive sweeteners. 
The statement of composition must disclose any artificial sweetener 
that is added to a distilled spirits product, whether the artificial 
sweetener is added directly or

[[Page 60669]]

through flavoring material(s). The artificial sweetener may be 
identified specifically by either generic name or trademarked brand 
name, or as a general statement (such as ``artificially sweetened''), 
to indicate the presence of any one or combination of artificial 
sweeteners. However, if aspartame is used, an additional warning 
statement is required in accordance with Sec.  5.63.
    (5) Identify certain ingredients. The statement of composition must 
disclose any ingredient that is permitted by a standard of identity, 
but used in a method or quantity that makes the finished product no 
longer meet the standard of identity. For example, vodka to which more 
than two grams of sugar per liter is added is no longer designated as 
vodka. The statement of composition may read ``Vodka with added 
sugar.''
    (b) [Reserved]

Subpart J--Formulas


Sec.  5.191   Application.

    The requirements of this subpart apply to the following persons:
    (a) Proprietors of distilled spirits plants qualified as processors 
under part 19 of this chapter;
    (b) Persons in the Commonwealth of Puerto Rico who manufacture 
distilled spirits products for shipment to the United States. However, 
the filing of a formula for approval by TTB is only required for those 
products that will be shipped to the United States; and
    (c) Persons who ship Virgin Islands distilled spirits products into 
the United States.


Sec.  5.192   Formula requirements.

    (a) General. An approved formula is required to blend, mix, purify, 
refine, compound, or treat distilled spirits in a manner that results 
in a change of class or type of the spirits.
    (b) Preparation and submission. In order to obtain formula 
approval, a person listed in Sec.  5.191 must complete and file TTB 
Form 5100.51, Formula and Process for Domestic and Imported Alcohol 
Beverages, electronically or in paper format, in accordance with the 
instructions for the form. When a product will be made or processed 
under the same formula at more than one location operated by the 
distiller or processor, the distiller or processor must identify on the 
form each place of production or processing by name and address, and by 
permit number, if applicable, and must ensure that a copy of the 
approved formula is maintained at each location.
    (c) Existing approvals. Any approval of a formula will remain in 
effect until revoked, superseded, or voluntarily surrendered, and if 
the formula is revoked, superseded, or voluntarily surrendered, any 
existing qualifying statements on such approval as to the rate of tax 
or the limited use of alcoholic flavors will be made obsolete.
    (d) Change in formula. Any change in an approved formula requires 
the filing of a new Form 5100.51 for approval of the changed formula. 
After a changed formula is approved, the filer must surrender the 
original formula approval to the appropriate TTB officer.


Sec.  5.193   Operations requiring formulas.

    The following operations change the class or type of distilled 
spirits and therefore require formula approval under Sec.  5.192:
    (a) The compounding of distilled spirits through the mixing of a 
distilled spirits product with any coloring or flavoring material, 
wine, or other material containing distilled spirits (except for 
harmless coloring, flavoring or blending materials that do not alter 
the class or type pursuant to Sec.  5.155);
    (b) The manufacture of an intermediate product to be used 
exclusively in other distilled spirits products on bonded premises;
    (c) Any filtering or stabilizing process that results in a 
distilled spirits product's no longer possessing the taste, aroma, and 
characteristics generally attributed to the class or type of distilled 
spirits before the filtering or stabilizing, or, in the case of 
straight whisky, that results in the removal of more than 15 percent of 
the fixed acids, volatile acids, esters, soluble solids, or higher 
alcohols, or more than 25 percent of the soluble color;
    (d) The mingling of spirits that differ in class or in type of 
materials from which made;
    (e) The mingling of distilled spirits that were stored in charred 
cooperage with distilled spirits that were stored in plain or reused 
cooperage, or the mixing of distilled spirits that have been treated 
with wood chips with distilled spirits not so treated, or the mixing of 
distilled spirits that have been subjected to any treatment which 
changes their character with distilled spirits not subjected to such 
treatment, unless it is determined by the appropriate TTB officer in 
each of these cases that the composition of the distilled spirits is 
the same notwithstanding the storage in different kinds of cooperage or 
the treatment of a portion of the spirits;
    (f) Except when authorized for production or storage operations by 
part 19 of this chapter, the use of any physical or chemical process or 
any apparatus that accelerates the maturing of the distilled spirits;
    (g) The steeping or soaking of plant materials, such as fruits, 
berries, aromatic herbs, roots, or seeds, in distilled spirits or wines 
at a distilled spirits plant;
    (h) The artificial carbonating of distilled spirits;
    (i) In Puerto Rico, the blending of distilled spirits with any 
liquors manufactured outside Puerto Rico;
    (j) The production of gin by:
    (1) Redistillation, over juniper berries and other natural 
aromatics or over the extracted oils of such materials, of spirits 
distilled at or above 190 degrees of proof that are free from 
impurities, including such spirits recovered by redistillation of 
imperfect gin spirits; or
    (2) Mixing gin with other distilled spirits;
    (k) The treatment of gin by:
    (1) The addition or abstraction of any substance or material other 
than pure water after redistillation in a manner that would change its 
class and type designation; or
    (2) The addition of any substance or material other than juniper 
berries or other natural aromatics or the extracted oils of such 
materials, or the addition of pure water, before or during 
redistillation, in a manner that would change its class and type 
designation; and
    (l) The recovery of spirits by redistillation from distilled 
spirits products containing other alcoholic ingredients and from 
spirits that have previously been entered for deposit. However, no 
formula approval is required for spirits redistilled into any type of 
neutral spirits other than vodka or for spirits redistilled at less 
than 190 degrees of proof that lack the taste, aroma and other 
characteristics generally attributed to whisky, brandy, rum, or gin and 
that are designated as ``Spirits'' preceded or followed by a word or 
phrase descriptive of the material from which distilled. Such spirits 
may not be designated ``Spirits Grain'' or ``Grain Spirits'' on any 
label.


Sec.  5.194   Adoption of predecessor's formulas.

    A successor to a person listed in Sec.  5.191 may adopt a 
predecessor's approved formulas by filing an application with the 
appropriate TTB officer. The application must include a list of the 
formulas for adoption and must identify each formula by formula number, 
name of product, and date of approval. The application must clearly 
show that the predecessor has authorized the use of the previously 
approved formulas by the successor.

[[Page 60670]]

Subpart K--Standards of Fill and Authorized Container Sizes.


Sec.  5.201   General.

    No person engaged in business as a distiller, blender, or other 
producer, or as an importer or wholesaler, or as a bottler or 
warehouseman and bottler, directly or indirectly, or through an 
affiliate, may sell or ship or deliver for sale or shipment in 
interstate or foreign commerce, or otherwise introduce in interstate or 
foreign commerce, or receive therein, or remove from customs custody 
for consumption, any distilled spirits in containers, unless the 
distilled spirits are bottled in conformity with Sec. Sec.  5.202 and 
5.203.


Sec.  5.202   Standard liquor containers.

    (a) General. Except as provided in paragraph (d) of this section 
and in Sec.  5.205, distilled spirits must be bottled in standard 
liquor containers, as defined in this paragraph. A standard liquor 
container is a container that is made, formed, and filled in such a way 
that it does not mislead purchasers as regards its contents. An 
individual carton or other container of a bottle may not be so designed 
as to mislead purchasers as to the size of the bottle it contains.
    (b) Headspace. A filled liquor container of a capacity of 200 
milliliters (6.8 fl. oz.) or more is deemed to mislead the purchaser if 
it has a headspace in excess of 8 percent of the total capacity of the 
container after closure.
    (c) Design. Regardless of the correctness of the stated net 
contents, a liquor container is deemed to mislead the purchaser if it 
is made and formed in such a way that its actual capacity is 
substantially less than the capacity it appears to have upon visual 
examination under ordinary conditions of purchase or use.
    (d) Exception for distinctive liquor bottles. The provisions of 
paragraphs (b) and (c) of this section do not apply to liquor bottles 
for which a distinctive liquor bottle approval has been issued pursuant 
to Sec.  5.205.


Sec.  5.203   Standards of fill (container sizes).

    (a) Authorized standards of fill. The following metric standards of 
fill are authorized for distilled spirits, whether domestically bottled 
or imported:
    (1) Containers other than cans. For containers other than cans 
described in paragraph (a)(2) of this section--
    (i) 1.75 liters.
    (ii) 1.00 liter.
    (iii) 750 mL.
    (iii) 375 mL.
    (iv) 200 mL.
    (v) 100 mL.
    (vi) 50 mL.
    (2) Metal cans. For metal containers that have the general shape 
and design of a can, that have a closure that is an integral part of 
the container, and that cannot be readily reclosed after opening--
    (i) 355 mL.
    (ii) 200 mL.
    (iii) 100 mL.
    (iv) 50 mL.
    (b) Spirits bottled using outdated standards. Paragraph (a) of this 
section does not apply to:
    (1) Imported distilled spirits in the original containers in which 
entered into customs custody prior to January 1, 1980 (or prior to July 
1, 1989 in the case of distilled spirits imported in 500 mL 
containers); or
    (2) Imported distilled spirits bottled or packed prior to January 
1, 1980 (or prior to July 1, 1989 in the case of distilled spirits in 
500 mL containers) and certified as to such in a statement signed by an 
official duly authorized by the appropriate foreign government.


Sec.  5.204   Aggregate packaging to meet standard of fill 
requirements.

    (a) Under the conditions set forth in paragraphs (b) through (f) of 
this section, industry members may use aggregate packaging to satisfy a 
standard of fill required under Sec.  5.203 of this part. That is, 
industry members may bottle distilled spirits in containers that do not 
meet a standard of fill, as long as those containers are then packaged 
together in a larger container and the entire net contents of the 
aggregate package meets a standard of fill. For example, thirty 25-mL 
containers may be packaged together to meet the 750 mL standard of 
fill. The industry member must submit the actual external container and 
a sample of one of the internal containers to TTB upon request by the 
appropriate TTB officer as part of the COLA review process.
    (b) The distilled spirits in each of the individual internal 
containers of the aggregate package must have the same alcohol content.
    (c) The external container, as well as each of the individual 
internal containers, must be labeled with all of the mandatory label 
information required by this part and parts 16 and 19 of this chapter; 
however, an appropriate standard of fill is not required for internal 
containers.
    (d) The external container must include a net contents statement 
that indicates how the aggregate package equals an authorized standard 
of fill (for example, ``750 mL = 30 containers of 25 mL each''). 
Internal containers must include a net contents statement in accordance 
with Sec.  5.68 of this part.
    (e) The external container must be shrink-wrapped, boxed, or sealed 
in such a manner that the smaller containers cannot be easily removed.
    (f) Each of the smaller containers must be labeled ``NOT FOR 
INDIVIDUAL SALE.''


Sec.  5.205   Distinctive liquor bottle approval.

    (a) General. A bottler or importer of distilled spirits in 
distinctive liquor bottles may apply for a distinctive liquor bottle 
approval from the appropriate TTB officer. The distinctive liquor 
bottle approval will provide an exemption only from those requirements 
that are specified in paragraph (b) of this section. A distinctive 
liquor bottle is a container that is not the customary shape and that 
may obscure the net contents of the distilled spirits.
    (b) Exemptions provided by the distinctive liquor bottle approval. 
The distinctive liquor bottle approval issued pursuant to this section 
will provide that:
    (1) The provisions of Sec.  5.202(b) and (c) do not apply to the 
liquor containers for which the distinctive liquor bottle approval has 
been issued; and
    (2) The information required to appear in the same field of vision 
pursuant to Sec.  5.63(a) may appear elsewhere on a distinctive liquor 
bottle for which the distinctive liquor bottle approval has been 
issued, if the design of the container precludes the presentation of 
all mandatory information in the same field of vision.
    (c) How to apply. A bottler or importer of distilled spirits in 
distinctive liquor bottles may apply for a distinctive liquor bottle 
approval as part of the application for a COLA.

Subpart L--Recordkeeping and Substantiation Requirements


Sec.  5.211   Recordkeeping requirements--certificates.

    (a) Certificates of label approval (COLAs). Upon request by the 
appropriate TTB officer, a bottler or importer must provide evidence 
that a container of distilled spirits is covered by a certificate of 
label approval (COLA) or a certificate of exemption. This requirement 
may be satisfied by providing original COLAs, photocopies or electronic 
copies of COLAs, or records showing the TTB Identification number 
assigned to the approved certificate. TTB may request such information 
for a period of five years from the date that the products covered by 
the COLAs were removed from the bottler's premises or from customs 
custody, as applicable.

[[Page 60671]]

    (b) Labels with revisions. Where labels on containers reflect 
revisions to the approved label that have been made in compliance with 
allowable revisions authorized by TTB Form 5100.31 or otherwise 
authorized by TTB, the bottler or importer must, upon request by the 
appropriate TTB officer, identify the COLA covering the product if the 
product is required to be covered by a COLA. TTB may request such 
information for a period of five years from the date that the products 
covered by the COLAs were removed from the bottler's premises or from 
customs custody, as applicable.
    (c) Other recordkeeping requirements under this part. See 
Sec. Sec.  5.26, 5.30, and 5.192(b) for other recordkeeping 
requirements under this part.


Sec.  5.212   Substantiation requirements.

    (a) Application. The substantiation requirements of this section 
apply to any claim made on any label or container subject to the 
requirements of this part.
    (b) Reasonable basis in fact. All claims, whether implicit or 
explicit, must have a reasonable basis in fact. Claims that contain 
express or implied statements regarding the amount of support for the 
claim (such as ``tests prove,'' or ``studies show'') must have the 
level of substantiation that is claimed. Any labeling claim that does 
not have a reasonable basis in fact, or cannot be adequately 
substantiated upon the request of the appropriate TTB officer, will be 
considered misleading within the meaning of Sec.  5.122(b)(2).
    (c) Evidence that claims are adequately substantiated. The 
appropriate TTB officer may request that bottlers and importers provide 
evidence that labeling claims are adequately substantiated at any time 
within a period of five years from the time the distilled spirits were 
removed from the bottling premises or from customs custody, as 
applicable.

Subpart M--Penalties and Compromise of Liability


Sec.  5.221   Criminal penalties.

    A violation of the labeling provisions of 27 U.S.C. 205(e) is 
punishable as a misdemeanor. See 27 U.S.C. 207 for the statutory 
provisions relating to criminal penalties, consent decrees, and 
injunctions.


Sec.  5.222   Conditions of basic permit.

    A basic permit is conditioned upon compliance with the requirements 
of 27 U.S.C. 205, including the labeling provisions of this part. A 
willful violation of the conditions of a basic permit provides grounds 
for the revocation or suspension of the permit, as applicable, as set 
forth in part 1 of this chapter.


Sec.  5.223   Compromise.

    Pursuant to 27 U.S.C. 207, the appropriate TTB officer is 
authorized, with respect to any violation of 27 U.S.C. 205, to 
compromise the liability arising with respect to such violation upon 
payment of a sum not in excess of $500 for each offense, to be 
collected by the appropriate TTB officer and to be paid into the 
Treasury as miscellaneous receipts.

Subpart N--Paperwork Reduction Act


Sec.  5.231   OMB control numbers assigned under the Paperwork 
Reduction Act.

    (a) Purpose. This subpart displays the control numbers assigned to 
information collection requirements in this part by the Office of 
Management and Budget (OMB) under the Paperwork Reduction Act of 1995, 
Public Law 104-13.
    (b) Chart. The following chart identifies each section in this part 
that contains an information collection requirement and the OMB control 
number that is assigned to that information collection requirement.

------------------------------------------------------------------------
          Section where contained              Current OMB Control No.
------------------------------------------------------------------------
5.21......................................  1513-0020.
5.22......................................  1513-0020,
                                            1513-0111.
5.23......................................  1513-0020,
                                            1513-0111.
5.24......................................  1513-0020,
                                            1513-0064,
                                            1513-0122.
5.25......................................  1513-0020,
                                            1513-0111,
                                            1513-0122.
5.27......................................  1513-0020,
                                            1513-0122.
5.28......................................  1513-0122.
5.30......................................  New control number.
5.62......................................  1513-0087.
5.63......................................  1513-0084,
                                            1513-0087.
5.81......................................  1513-0087.
5.82......................................  1513-0087,
                                            1513-0121.
5.83......................................  1513-0087,
                                            1513-0121.
5.84......................................  1513-0087.
5.85......................................  1513-0087.
5.86......................................  1513-0087.
5.87......................................  1513-0087.
5.88......................................  1513-0087.
5.89......................................  1513-0087.
5.90......................................  1513-0087.
5.121.....................................  1513-0087.
5.122.....................................  1513-0087.
5.123.....................................  1513-0087.
5.124.....................................  1513-0087.
5.125.....................................  1513-0087.
5.126.....................................  1513-0087.
5.127.....................................  1513-0087.
5.128.....................................  1513-0087.
5.129.....................................  1513-0087.
5.130.....................................  1513-0087.
5.192.....................................  1513-0122,
                                            1513-0046.
5.193.....................................  1513-0122,
                                            1513-0046.
5.194.....................................  1513-0122.
5.203.....................................  1513-0064.
5.211.....................................  New control number.
5.212.....................................  New control number.
------------------------------------------------------------------------

0
3. Revise part 7 to read as follows:

PART 7--LABELING OF MALT BEVERAGES

Subpart A--General Provisions

Sec.
7.0 Scope.
7.1 Definitions.
7.2 Territorial extent.
7.3 General requirements and prohibitions under the FAA Act.
7.4 Jurisdictional limits of the FAA Act.
7.5 Ingredients and processes.
7.6 Brewery products not covered by this part.
7.7 Other TTB labeling regulations that apply to malt beverages.
7.8 Malt beverages for export.
7.9 Compliance with Federal and State requirements.
7.10 Other related regulations.
7.11 Forms.
7.12 Delegations of the Administrator.
Subpart B--Certificates of Label Approval

Requirements for Malt Beverages Bottled in the United States

7.21 Requirement for certificates of label approval (COLAs) for malt 
beverages bottled in the United States.
7.22 Rules regarding certificates of label approval (COLAs) for malt 
beverages bottled in the United States.
7.23 [Reserved]

Requirements for Malt Beverages Imported in Containers

7.24 Certificates of label approval (COLAs) for malt beverages 
imported in containers.
7.25 Rules regarding certificates of label approval (COLAs) for malt 
beverages imported in containers.

Administrative Rules

7.27 Presenting certificates of label approval (COLAs) to Government 
officials.
7.28 Formulas, samples, and documentation.
7.29 Personalized labels.
Subpart C--Alteration of Labels, Relabeling, and Adding Information to 
Containers
7.41 Alteration of labels.
7.42 Authorized relabeling activities by brewers and importers.

[[Page 60672]]

7.43 Relabeling activities that require separate written 
authorization from TTB.
7.44 Adding a label or other information to a container that 
identifies the wholesaler, retailer, or consumer.
Subpart D--Label Standards
7.51 Firmly affixed requirements.
7.52 Legibility and other requirements for mandatory information on 
labels.
7.53 Type size of mandatory information.
7.54 Visibility of mandatory information.
7.55 Language requirements.
7.56 Additional information.
Subpart E--Mandatory Label Information
7.61 What constitutes a label for purposes of mandatory information.
7.62 Packaging (cartons, coverings, and cases).
7.63 Mandatory label information.
7.64 Brand name.
7.65 Alcohol content.
7.66 Name and address for domestically bottled malt beverages that 
were wholly fermented in the United States.
7.67 Name and address for domestically bottled malt beverages that 
were bottled after importation.
7.68 Name and address for malt beverages that are imported in a 
container.
7.69 Country of origin.
7.70 Net contents.
Subpart F--Restricted Labeling Statements
7.81 General.

Food Allergen Labeling

7.82 Voluntary disclosure of major food allergens.
7.83 Petitions for exemption from major food allergen labeling.

Production and Other Claims

7.84 Use of the term ``organic.''
7.85 Environmental, sustainability, and similar statements.
7.86 [Reserved].
7.87 Use of the term ``draft.''
Subpart G--Prohibited Labeling Practices
7.101 General.
7.102 False or untrue statements.
7.103 Obscene or indecent depictions.
Subpart H--Labeling Practices That Are Prohibited if They Are 
Misleading
7.121 General.
7.122 Misleading statements or representations.
7.123 Guarantees.
7.124 Disparaging statements.
7.125 Tests or analyses.
7.126 Depictions of government symbols.
7.127 Depictions simulating government stamps or relating to 
supervision.
7.128 Claims related to distilled spirits or wines.
7.129 Health-related statements.
7.130 Appearance of endorsement.
7.131 The word ``bonded'' and similar terms
7.132 Strength claims.
Subpart I--Classes and Types of Malt Beverages
7.141 Class and type.
7.142 Class designations.
7.143 Class and type--special rules.
7.144 Malt beverages fermented or flavored with certain traditional 
ingredients.
7.145 Malt beverages containing less than 0.5 percent alcohol by 
volume.
7.146 Geographical names.
7.147 Statement of composition.
Subparts J-K--Reserved
Subpart L--Recordkeeping and Substantiation Requirements
7.211 Recordkeeping requirements-certificates.
7.212 Substantiation requirements.
Subpart M--Penalties and Compromise of Liability
7.221 Criminal penalties.
7.222 Conditions of basic permit.
7.223 Compromise.
Subpart N--Paperwork Reduction Act
7.231 OMB control numbers assigned under the Paperwork Reduction 
Act.

    Authority:  27 U.S.C. 205 and 207.


Sec.  7.07.0  Scope.

    This part sets forth requirements that apply to the labeling and 
packaging of malt beverages in containers, including requirements for 
label approval and rules regarding mandatory, regulated, and prohibited 
labeling statements.

Subpart A--General Provisions


Sec.  7.17.1  Definitions.

    When used in this part and on forms prescribed under this part, the 
following terms have the meaning assigned to them in this section, 
unless the terms appear in a context that requires a different meaning. 
Any other term defined in the Federal Alcohol Administration Act (FAA 
Act) and used in this part has the same meaning assigned to it by the 
FAA Act.
    Administrator. The Administrator, Alcohol and Tobacco Tax and Trade 
Bureau, Department of the Treasury.
    Appropriate TTB officer. An officer or employee of the Alcohol and 
Tobacco Tax and Trade Bureau (TTB) authorized to perform any function 
relating to the administration or enforcement of this part by the 
current version of TTB Order 1135.7, Delegation of the Administrator's 
Authorities in 27 CFR part 7, Labeling of Malt Beverages.
    Bottler. Any brewer or wholesaler who places malt beverages in 
containers.
    Brand name. The name under which a malt beverage or a line of malt 
beverages is sold.
    Certificate holder. The permittee or brewer whose name, address, 
and basic permit number, plant registry number, or brewer's notice 
number appears on an approved TTB Form 5100.31.
    Certificate of exemption from label approval. A certificate issued 
on TTB Form 5100.31, which authorizes the bottling of wine or distilled 
spirits, under the condition that the product will under no 
circumstances be sold, offered for sale, shipped, delivered for 
shipment, or otherwise introduced by the applicant, directly or 
indirectly, into interstate or foreign commerce.
    Certificate of label approval (COLA). A certificate issued on TTB 
Form 5100.31 that authorizes the bottling of wine, distilled spirits, 
and malt beverages, or the removal of bottled wine, distilled spirits, 
and malt beverages from customs custody for introduction into commerce, 
as long as the product bears labels identical to the labels appearing 
on the face of the certificate, or labels with changes authorized by 
TTB on the certificate or otherwise.
    Container. Any can, bottle, box with an internal bladder, cask, 
keg, barrel or other closed receptacle, in any size or material, that 
is for use in the sale of malt beverages at retail.
    Customs officer. An officer of U.S. Customs and Border Protection 
(CBP) or any agent or other person authorized by law to perform the 
duties of such an officer.
    Distinctive or fanciful name. A descriptive name or phrase chosen 
to identify a malt beverage product on the label. It does not include a 
brand name, class or type designation, statement of composition, or 
designation known to the trade or consumers.
    FAA Act. The Federal Alcohol Administration Act.
    Gallon. A U.S. gallon of 231 cubic inches of malt beverages at 39.1 
degrees Fahrenheit (4 degrees Celsius). All other liquid measures used 
are subdivisions of the gallon as defined.
    Interstate or foreign commerce. Commerce between any State and any 
place outside of that State or commerce within the District of Columbia 
or commerce between points within the same State but through any place 
outside of that State.
    Keg collar. A disk that is pushed down over the keg's bung or tap 
cover.
    Malt beverage. A beverage made by the alcoholic fermentation of an 
infusion or decoction, or combination of both, in potable brewing 
water, of 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

[[Page 60673]]

food consumption. See Sec.  7.5 for standards applying to the use of 
processing methods and flavors in malt beverage production.
    Net contents. The amount, by volume, of a malt beverage held in a 
container.
    Person. Any individual, corporation, partnership, association, 
joint-stock company, business trust, limited liability company, or 
other form of business enterprise, including a receiver, trustee, or 
liquidating agent and including an officer or employee of any agency of 
a State or political subdivision of a State.
    State. One of the 50 States of the United States, the District of 
Columbia, or the Commonwealth of Puerto Rico.
    Tap cover. A cap, usually made of plastic, that fits over the top 
of the tap (or bung) of a keg.
    TTB. The Alcohol and Tobacco Tax and Trade Bureau of the Department 
of the Treasury.
    United States (U.S.). The 50 States, the District of Columbia, and 
the Commonwealth of Puerto Rico.


Sec.  7.27.2  Territorial extent.

    The provisions of this part apply to the 50 states, the District of 
Columbia, and the Commonwealth of Puerto Rico.


Sec.  7.37.3  General requirements and prohibitions under the FAA Act.

    (a) Certificates of label approval (COLAs). Subject to the 
requirements and exceptions set forth in the regulations in subpart B 
of this part, any brewer or wholesaler who bottles malt beverages, and 
any person who removes malt beverages in containers from customs 
custody for sale or any other commercial purpose, is required to first 
obtain from TTB a COLA covering the label(s) on each container.
    (b) Alteration, mutilation, destruction, obliteration, or removal 
of labels. Subject to the requirements and exceptions set forth in the 
regulations in subpart C of this part, it is unlawful to alter, 
mutilate, destroy, obliterate, or remove labels on malt beverage 
containers. This prohibition applies to any person, including 
retailers, holding malt beverages for sale in interstate or foreign 
commerce or any person holding malt beverages for sale after shipment 
in interstate or foreign commerce.
    (c) Labeling requirements for malt beverages. Subject to the 
jurisdictional limits of the FAA Act, as set forth in Sec.  7.4, it is 
unlawful for any person engaged in business as a brewer, wholesaler, or 
importer of malt beverages, directly or indirectly, or through an 
affiliate, to sell or ship, or deliver for sale or shipment, or 
otherwise introduce or receive in interstate or foreign commerce, or 
remove from customs custody, any malt beverages in containers unless 
the malt beverages are bottled in containers and the containers are 
marked, branded, and labeled in conformity with the regulations in this 
part.
    (d) Labeled in accordance with this part. In order to be labeled in 
accordance with the regulations in this part, a container of malt 
beverages must be in compliance with the following requirements:
    (1) It must bear one or more labels meeting the standards for 
``labels'' set forth in subpart D of this part;
    (2) One or more of the labels on the container must include the 
mandatory information set forth in subpart E of this part;
    (3) Claims on the label(s), containers, and packaging (as defined 
in Sec.  7.62) must comply with the rules for regulated label 
statements, as applicable, set forth in subpart F of this part;
    (4) Statements or any other representations on any malt beverage 
label, container, or packaging (as defined in Sec. Sec.  7.81(b) and 
7.121(b)) may not violate the regulations in subparts G and H of this 
part regarding certain practices on labeling of malt beverages;
    (5) The class and type designation on the label(s), as well as any 
designation appearing on containers or packaging, must comply with the 
standards for classes and types set forth in subpart I of this part; 
and
    (6) The malt beverage must not be adulterated within the meaning of 
the Federal Food, Drug, and Cosmetic Act.


Sec.  7.47.4  Jurisdictional limits of the FAA Act.

    (a) Malt beverages sold in interstate or foreign commerce--(1) 
General. The labeling provisions of this part apply to malt beverages 
sold or shipped or delivered for shipment, or otherwise introduced into 
or received in any State from any place outside thereof, only to the 
extent that the laws or regulations of such State impose requirements 
similar to the requirements of the regulations in this part, with 
respect to the labels and labeling of malt beverages sold within that 
State.
    (2) Similar State law. For purposes of this section, a ``similar'' 
State law may be found in State laws or regulations that apply 
specifically to malt beverages or in State laws or regulations that 
provide general labeling requirements that are not specific to malt 
beverages. In order to be ``similar'' to the Federal requirements, the 
State requirements need not be identical to the Federal requirements. 
Nonetheless, if the label in question does not violate the laws or 
regulations of the State or States into which the brewer, wholesaler, 
or importer is shipping the malt beverages, it does not violate this 
part.
    (b) Malt beverages not sold in interstate or foreign commerce. The 
regulations in this part do not apply to domestically bottled malt 
beverages that are not and will not be sold, shipped, delivered for 
sale or shipment, or otherwise introduced in interstate or foreign 
commerce.


Sec.  7.57.5  Ingredients and processes.

    (a) Use of nonbeverage flavors and other nonbeverage ingredients 
containing alcohol. (1) Nonbeverage flavors and other nonbeverage 
ingredients containing alcohol may be used in producing a malt beverage 
(sometimes referred to as a ``flavored malt beverage''). Except as 
provided in paragraph (a)(2) of this section, no more than 49 percent 
of the overall alcohol content (determined without regard to any 
tolerance otherwise allowed by this part) of the finished product may 
be derived from the addition of nonbeverage flavors and other 
nonbeverage ingredients containing alcohol. For example, a finished 
malt beverage that contains 5.0 percent alcohol by volume must derive a 
minimum of 2.55 percent alcohol by volume from the fermentation of 
barley malt and other materials and may derive not more than 2.45 
percent alcohol by volume from the addition of nonbeverage flavors and 
other nonbeverage ingredients containing alcohol.
    (2) In the case of malt beverages with an alcohol content of more 
than 6 percent by volume (determined without regard to any tolerance 
otherwise allowed by this part), no more than 1.5 percent of the volume 
of the malt beverage may consist of alcohol derived from added 
nonbeverage flavors and other nonbeverage ingredients containing 
alcohol.
    (b) Processing. Malt beverages may be filtered or otherwise 
processed in order to remove color, taste, aroma, bitterness, or other 
characteristics derived from fermentation.


Sec.  7.67.6  Brewery products not covered by this part.

    Certain fermented products that are regulated as ``beer'' under the 
Internal Revenue Code (IRC) do not fall within the definition of a 
``malt beverage'' under the FAA Act and thus are not subject to this 
part. See Sec.  7.7 for related TTB regulations that may apply to these 
products. See Sec. Sec.  25.11 and 27.11 of this

[[Page 60674]]

chapter for the definition of ``beer'' under the IRC.
    (a) Sak[eacute] and similar products. Sak[eacute] and similar 
products (including products that fall within the definition of 
``beer'' under parts 25 and 27 of this chapter) that fall within the 
definition of a ``wine'' under the FAA Act are covered by the labeling 
regulations for wine in 27 CFR part 4.
    (b) Other beers not made with both malted barley and hops. The 
regulations in this part do not cover beer products that are not made 
with both malted barley and hops, or their parts or their products, or 
that do not fall within the definition of a ``malt beverage'' under 
Sec.  7.1 for any other reason. Bottlers and importers of alcohol 
beverages that do not fall within the definition of malt beverages, 
wine, or distilled spirits under the FAA Act should refer to the 
applicable labeling regulations for foods issued by the U.S. Food and 
Drug Administration. See 21 CFR part 101.


Sec.  7.77.7  Other TTB labeling regulations that apply to malt 
beverages.

    In addition to the regulations in this part, malt beverages must 
also comply with the following TTB labeling regulations:
    (a) Health warning statement. Alcoholic beverages, including malt 
beverages, that contain at least one-half of one percent alcohol by 
volume, must be labeled with a health warning statement in accordance 
with the Alcoholic Beverage Labeling Act of 1988 (ABLA). The 
regulations implementing the ABLA are contained in 27 CFR part 16.
    (b) Internal Revenue Code requirements. The labeling and marking 
requirements for beer under the Internal Revenue Code are found in 27 
CFR part 25, subpart J (for domestic breweries) and 27 CFR part 27, 
subpart E (for importers).


Sec.  7.87.8  Malt beverages for export.

    Malt beverages that are exported in bond without payment of tax 
directly from a brewery or from customs custody are not subject to this 
part. For purposes of this section, direct exportation in bond does not 
include exportation after malt beverages have been removed for 
consumption or sale in the United States, with appropriate tax 
determination or payment.


Sec.  7.97.9  Compliance with Federal and State requirements.

    (a) General. Compliance with the requirements of this part relating 
to the labeling and bottling of malt beverages does not relieve 
industry members from responsibility for complying with other 
applicable Federal and State requirements, including but not limited to 
those highlighted in paragraphs (b) and (c) of this section.
    (b) Ingredient safety. While it remains the responsibility of the 
industry member to ensure that any ingredient used in production of 
malt beverages complies fully with all applicable U.S. Food and Drug 
Administration (FDA) regulations pertaining to the safety of food 
ingredients and additives, the appropriate TTB officer may at any time 
request documentation to establish such compliance.
    (c) Containers. While it remains the responsibility of the industry 
member to ensure that containers are made of suitable materials that 
comply with all applicable FDA health and safety regulations for the 
packaging of beverages for consumption, the appropriate TTB officer may 
at any time request documentation to establish such compliance.


Sec.  7.10   Other related regulations.

    (a) TTB regulations. Other TTB regulations that relate to malt 
beverages are listed in paragrpahs (a)(1) through (9) of this section:
    (1) 27 CFR part 1--Basic Permit Requirements Under the Federal 
Alcohol Administration Act, Nonindustrial Use of Distilled Spirits and 
Wine, Bulk Sales and Bottling of Distilled Spirits;
    (2) 27 CFR part 13--Labeling Proceedings;
    (3) 27 CFR part 14--Advertising of Alcohol Beverage Products;
    (4) 27 CFR part 16--Alcoholic Beverage Health Warning Statement;
    (5) 27 CFR part 25--Beer;
    (6) 27 CFR part 26--Liquors and Articles from Puerto Rico and the 
Virgin Islands;
    (7) 27 CFR part 27--Importation of Distilled Spirits, Wines, and 
Beer;
    (8) 27 CFR part 28--Exportation of Alcohol; and
    (9) 27 CFR part 71--Rules of Practice in Permit Proceedings.
    (b) Other Federal regulations. The regulations listed in paragraphs 
(b)(1) through (9) of this section issued by other Federal agencies 
also may apply:
    (1) 7 CFR part 205--National Organic Program;
    (2) 19 CFR part 11--Packing and Stamping; Marking;
    (3) 19 CFR part 102--Rules of Origin;
    (4) 19 CFR part 134--Country of Origin Marking;
    (5) 21 CFR part 1--General Enforcement Provisions, Subpart I, Prior 
Notice of Imported Food;
    (6) 21 CFR parts 70-82, which pertain to food and color additives;
    (7) 21 CFR part 101--Food Labeling;
    (8) 21 CFR part 110--Current Good Manufacturing Practice in 
Manufacturing, Packing, or Holding Human Food; and
    (9) 21 CFR parts 170-189, which pertain to food additives and 
secondary direct food additives for human consumption.


Sec.  7.11   Forms.

    (a) General. TTB prescribes and makes available all forms required 
by this part. Any person completing a form must provide all of the 
information required by each form as indicated by the headings on the 
form and the instructions for the form. Each form must be filed in 
accordance with this part and the instructions for the form.
    (b) Electronically filing forms. The forms required by this part 
can be filed electronically by using TTB's online filing systems: COLAs 
Online and Formulas Online. Anyone who intends to use one of these 
online filing systems must first register to use the system by 
accessing the TTB website at https://www.ttb.gov.
    (c) Obtaining paper forms. Forms required by this part are 
available for printing through the TTB website (https://www.ttb.gov) or 
by mailing a request to the Alcohol and Tobacco Tax and Trade Bureau, 
National Revenue Center, 550 Main Street, Room 8002, Cincinnati, OH 
45202.


Sec.  7.12   Delegations of the Administrator.

    Most of the regulatory authorities of the Administrator contained 
in this part are delegated to ``appropriate TTB officers.'' To find out 
which officers have been delegated specific authorities, see the 
current version of TTB Order 1135.7, Delegation of the Administrator's 
Authorities in 27 CFR part 7, Labeling of Malt Beverages. Copies of 
this order can be obtained by accessing the TTB website (https://www.ttb.gov) or by mailing a request to the Alcohol and Tobacco Tax and 
Trade Bureau, National Revenue Center, 550 Main Street, Room 8002, 
Cincinnati, OH 45202.

Subpart B--Certificates of Label Approval

Requirements for Malt Beverages Bottled in the United States


Sec.  7.21   Requirement for certificates of label approval (COLAs) for 
malt beverages bottled in the United States.

    (a) COLA requirement. Subject to the requirements and exceptions 
set forth in paragraphs (b) and (c) of this section, a brewer or 
wholesaler bottling malt beverages must obtain a COLA covering

[[Page 60675]]

the malt beverages from TTB prior to bottling the malt beverages or 
removing the malt beverages from the premises where they were bottled.
    (b) Malt beverages shipped or sold in interstate commerce. Persons 
bottling malt beverages (other than malt beverages in customs custody) 
for shipment, or delivery for sale or shipment, into a State (from 
outside of that State) are required to obtain a COLA covering those 
malt beverages only if the laws or regulations of the State require 
that all malt beverages sold or otherwise disposed of in such State be 
labeled in conformity with the requirements of subparts D through I of 
this part. This requirement applies when the State has either adopted 
subparts D through I of this part in their entireties or has adopted 
requirements identical to those set forth in subparts D through I of 
this part. In accordance with Sec. Sec.  7.3 and 7.4, malt beverages 
that are not subject to the COLA requirements of this section may still 
be subject to the substantive labeling provisions of subparts D through 
I of this part to the extent that the State into which the malt 
beverages are being shipped has similar State laws or regulations.
    (c) Products not shipped or sold in interstate commerce. Persons 
bottling malt beverages that will not be shipped or delivered for sale 
or shipment in interstate or foreign commerce are not required to 
obtain a COLA or a certificate of exemption from label approval. (Note: 
A certificate of exemption from label approval is a certificate issued 
by TTB to cover a wine or distilled spirits product that will not be 
sold, offered for sale, shipped, delivered for shipment, or otherwise 
introduced, in interstate or foreign commerce.)


Sec.  7.22   Rules regarding certificates of label approval (COLAs) for 
malt beverages bottled in the United States.

    (a) What a COLA authorizes. An approved TTB Form 5100.31 authorizes 
the bottling of malt beverages covered by the COLA, as long as the 
container bears labels identical to the labels appearing on the face of 
the COLA, or labels with changes authorized by TTB on the COLA or 
otherwise. The list of allowable changes can be found on the TTB 
website at https://www.ttb.gov.
    (b) What a COLA does not do. Among other things, the issuance of a 
COLA does not:
    (1) Confer trademark protection;
    (2) Relieve the certificate holder from its responsibility to 
ensure that all ingredients used in the production of the malt beverage 
comply with applicable requirements of the U.S. Food and Drug 
Administration with regard to ingredient safety; or
    (3) Relieve the certificate holder from liability for violations of 
the FAA Act, the Alcoholic Beverage Labeling Act, the Internal Revenue 
Code, or related regulations and rulings.
    (i) The issuance of a COLA does not mean that TTB has verified the 
accuracy of any representations or claims made on the label with 
respect to the product in the container. It is the responsibility of 
the applicant to ensure that all information on the application is true 
and correct, and that all labeling representations and claims are 
truthful, accurate, and not misleading with respect to the product in 
the container.
    (ii) A malt beverage may be mislabeled even when the label is 
covered by a COLA. For example, if the label on the container contains 
representations that are false or misleading when applied to the 
product in the container, the malt beverage is not labeled in 
accordance with the regulations in this part, even if it is covered by 
a COLA.
    (c) When to obtain a COLA. The COLA must be obtained prior to 
bottling. No brewer or wholesaler may bottle malt beverages or remove 
malt beverages from the premises where bottled unless a COLA has been 
obtained.
    (d) Application for a COLA. The bottler may apply for a COLA by 
submitting an application to TTB on Form 5100.31, in accordance with 
the instructions on the form. The bottler may apply for a COLA either 
electronically by accessing TTB's online system, COLAs Online, at 
https://www.ttb.gov, or by submitting the paper form. For procedures 
regarding the issuance of COLAs, see part 13 of this chapter.


Sec.  7.23   [Reserved]

Requirements for Malt Beverages Imported in Containers


Sec.  7.24   Certificates of label approval (COLAs) for malt beverages 
imported in containers.

    (a) Application requirement. Any person removing malt beverages in 
containers from customs custody for consumption must first apply for 
and obtain a COLA covering the malt beverages from the appropriate TTB 
officer.
    (b) Release of malt beverages from customs custody. Malt beverages, 
imported in containers, are not eligible for release from customs 
custody for consumption, and no person may remove such malt beverages 
from customs custody for consumption, unless the person removing the 
malt beverages has obtained and is in possession of a COLA covering the 
malt beverages.
    (c) Filing requirements. If filing electronically, the importer 
must file with U.S Customs and Border Protection (CBP), at the time of 
filing the customs entry, the TTB-assigned identification number of the 
valid COLA that corresponds to the label on the brand or lot of malt 
beverages being imported. If the importer is not filing electronically, 
the importer must provide a copy of the COLA to CBP at the time of 
entry. In addition, the importer must provide a copy of the applicable 
COLA, and proof of the certificate holder's authorization if 
applicable, upon request by the appropriate TTB officer or a customs 
officer.
    (d) Scope of this section. The COLA requirement imposed by this 
section applies only to malt beverages that are removed for sale or any 
other commercial purpose. See 27 CFR 27.49, 27.74, and 27.75 for 
labeling exemptions applicable to certain imported samples of malt 
beverages.
    (e) Relabeling in customs custody. Containers of malt beverages in 
customs custody that are required to be covered by a COLA but are not 
labeled in conformity with a COLA must be relabeled, under the 
supervision and direction of customs officers, prior to their removal 
from customs custody for consumption.
    (f) State law. Paragraph (a) through (c) of this section apply only 
if the laws or regulations of the State in which the malt beverages are 
withdrawn require that all malt beverages sold or otherwise disposed of 
in such State be labeled in conformity with the requirements of 
subparts D through I of this part. A State requires that malt beverages 
be labeled in conformity with the requirements of subparts D through I 
of this part when the State has either adopted subparts D through I of 
this part in their entireties or has adopted requirements identical to 
those set forth in subparts D through I in this part. In accordance 
with Sec. Sec.  7.3 and 7.4, malt beverages that are not subject to the 
COLA requirements of this section may still be subject to the 
substantive labeling provisions of subparts D through I of this part to 
the extent that the State into which the malt beverages are being 
shipped has similar State law or regulation.


Sec.  7.25   Rules regarding certificates of label approval (COLAs) for 
malt beverages imported in containers.

    (a) What a COLA authorizes. An approved TTB Form 5100.31 authorizes

[[Page 60676]]

the use of the labels covered by the COLA on containers of malt 
beverages, as long as the container bears labels identical to the 
labels appearing on the face of the COLA, or labels with changes 
authorized by the form or otherwise authorized by TTB.
    (b) What a COLA does not do. Among other things, the issuance of a 
COLA does not:
    (1) Confer trademark protection;
    (2) Relieve the certificate holder from its responsibility to 
ensure that all ingredients used in the production of the malt beverage 
comply with applicable requirements of the U.S. Food and Drug 
Administration with regard to ingredient safety; or
    (3) Relieve the certificate holder from liability for violations of 
the FAA Act, the Alcoholic Beverage Labeling Act, the Internal Revenue 
Code, or related regulations and rulings.
    (i) The issuance of a COLA does not mean that TTB has verified the 
accuracy of any representations or claims made on the label with 
respect to the product in the container. It is the responsibility of 
the applicant to ensure that all information on the application is true 
and correct and that all labeling representations and claims are 
truthful, accurate, and not misleading with respect to the product in 
the container.
    (ii) Malt beverages may be mislabeled even when the label is 
covered by a COLA. For example, if the label on the container contains 
representations that are false or misleading when applied to the 
product in the container the malt beverage is not labeled in accordance 
with the regulations in this part, even if it is covered by a COLA.
    (c) When to obtain a COLA. The COLA must be obtained prior to the 
removal of malt beverages in containers from customs custody for 
consumption.
    (d) Application for a COLA. The person responsible for the 
importation of malt beverages must obtain approval of the labels by 
submitting an application to TTB on Form 5100.31. A person may apply 
for a COLA either electronically by accessing TTB's online system, 
COLAs Online, at TTB's website (https://www.ttb.gov) or by submitting 
the paper form. For procedures regarding the issuance of COLAs, see 
part 13 of this chapter.

Administrative Rules


Sec.  7.27   Presenting certificates of label approval (COLAs) to 
Government officials.

    A certificate holder must present the original or a paper or 
electronic copy of the appropriate COLA upon the request of any duly 
authorized representative of the United States Government.


Sec.  7.28   Formulas, samples, and documentation.

    (a) Prior to or in conjunction with the review of an application 
for a certificate of label approval (COLA) on TTB Form 5100.31, the 
appropriate TTB officer may require a bottler or importer to submit a 
formula, the results of laboratory testing of the malt beverage, or a 
sample of any malt beverage or ingredients used in producing a malt 
beverage. The appropriate TTB officer also may request such information 
after the issuance of such COLA or in connection with any malt beverage 
that is required to be covered by a COLA. A formula may be filed 
electronically by using Formulas Online, or it may be submitted on 
paper on TTB Form 5100.51. See Sec.  7.11 for more information on forms 
and Formulas Online.
    (b) Upon request of the appropriate TTB officer, a bottler or 
importer must submit a full and accurate statement of the contents of 
any container to which labels are to be or have been affixed, as well 
as any other documentation on any issue pertaining to whether the malt 
beverages are labeled in accordance with this part. TTB may also 
request such information after the issuance of such a COLA, or in 
connection with any malt beverage that is required to be covered by a 
COLA.


Sec.  7.29   Personalized labels.

    (a) General. Applicants for label approval may obtain permission 
from TTB to make certain changes in order to personalize labels without 
having to resubmit labels for TTB approval. Personalized labels may 
contain a personal message, picture, or other artwork that is specific 
to the consumer who is purchasing the product. For example, a brewer 
may offer individual or corporate customers labels that commemorate an 
event such as a wedding or grand opening.
    (b) Application. Any person who intends to offer personalized 
labels must submit a template for the personalized label with the 
application for label approval, and must note on the application a 
description of the specific personalized information that may change.
    (c) Approval of personalized label. If the application complies 
with the regulations, TTB will issue a certificate of label approval 
(COLA) with a qualification allowing the personalization of labels. The 
qualification will allow the certificate holder to add or change items 
on the personalized label such as salutations, names, graphics, 
artwork, congratulatory dates and names, or event dates without 
applying for a new COLA. All of these items on personalized labels must 
comply with the regulations of this part.
    (d) Changes not allowed to personalized labels. Approval of an 
application to personalize labels does not authorize the addition of 
any information that discusses either the alcohol beverage or 
characteristics of the alcohol beverage or that is inconsistent with or 
in violation of the provisions of this part or any other applicable 
provision of law or regulations.

Subpart C--Alteration of Labels, Relabeling, and Adding Information 
to Containers


Sec.  7.41   Alteration of labels.

    (a) Prohibition. It is unlawful for any person to alter, mutilate, 
destroy, obliterate or remove any mark, brand, or label on malt 
beverages in containers held for sale in interstate or foreign 
commerce, or held for sale after shipment in interstate or foreign 
commerce, except as authorized by Sec.  7.42, Sec.  7.43, or Sec.  
7.44, or as otherwise authorized by Federal law.
    (b) Authorized relabeling. For purposes of the relabeling 
activities authorized by this subpart, the term ``relabel'' includes 
the alteration, mutilation, destruction, obliteration, or removal of 
any existing mark, brand, or label on the container, as well as the 
addition of a new label (such as a sticker that adds information about 
the product or information engraved on the container) to the container, 
and the replacement of a label with a new label bearing identical 
information.
    (c) Obligation to comply with other requirements. Authorization to 
relabel under this subpart in no way authorizes the placement of labels 
on containers that do not accurately reflect the brand, bottler, 
identity, or other characteristics of the product; nor does it relieve 
the person conducting the relabeling operations from any obligation to 
comply the regulations in this part and with State or local law, or to 
obtain permission from the owner of the brand where otherwise required.


Sec.  7.42   Authorized relabeling activities by brewers and importers.

    (a) Relabeling at brewery premises. Brewers may relabel 
domestically bottled malt beverages prior to removal from, and after 
return to bond at, the brewery premises, with labels covered by a 
certificate of label approval (COLA,) without obtaining separate 
permission from TTB for the relabeling activity.
    (b) Relabeling after removal from brewery premises. Brewers may 
relabel

[[Page 60677]]

domestically bottled malt beverages after removal from brewery premises 
with labels covered by a COLA, without obtaining separate permission 
from TTB for the relabeling activity.
    (c) Relabeling in customs custody. Under the supervision of U.S. 
customs officers, imported malt beverages in containers in customs 
custody may be relabeled without obtaining separate permission from TTB 
for the relabeling activity. Such containers must bear labels covered 
by a COLA upon their removal from customs custody for consumption. See 
Sec.  7.24(b).
    (d) Relabeling after removal from customs custody. Imported malt 
beverages in containers may be relabeled by the importer thereof after 
removal from customs custody without obtaining separate permission from 
TTB for the relabeling activity, as long as the labels are covered by a 
COLA.


Sec.  7.43   Relabeling activities that require separate written 
authorization from TTB.

    Any persons holding malt beverages for sale who need to relabel the 
containers but are not eligible to obtain a COLA to cover the labels 
that they wish to affix to the containers may apply for written 
permission for the relabeling of malt beverage containers. The 
appropriate TTB officer may permit relabeling of malt beverages in 
containers if the facts show that the relabeling is for the purpose of 
compliance with the requirements of this part or State law. The written 
application must include copies of the original and proposed new 
labels; the circumstances of the request, including the reason for 
relabeling; the number of containers to be relabeled; the location 
where the relabeling will take place; and the name and address of the 
person who will be conducting the relabeling operations.


Sec.  7.44   Adding a label or other information to a container that 
identifies the wholesaler, retailer, or consumer.

    Any label or other information that identifies the wholesaler, 
retailer, or consumer of the malt beverage may be added to containers 
(by the addition of stickers, engraving, stenciling, etc.) without 
prior approval from the appropriate TTB officer and without being 
covered by a certificate of label approval. Such information may be 
added before or after the containers are removed from brewery premises 
or released from customs custody. The information added:
    (a) May not violate the provisions of subparts F, G, and H of this 
part;
    (b) May not contain any reference to the characteristics of the 
product; and
    (c) May not be added to the container in such a way that it 
obscures any other label on the container.

Subpart D--Label Standards


Sec.  7.51   Firmly affixed requirements.

    (a) General rule. Except as otherwise provided in paragraph (b) of 
this section, any label that is not an integral part of the container 
must be affixed to the container in such a way that it cannot be 
removed without thorough application of water or other solvents.
    (b) Exception for keg labels. A label on a keg with a capacity of 
10 gallons or more that is in the form of a keg collar or tap cover is 
not required to be firmly affixed, provided that the name of the 
bottler of the malt beverage is permanently or semi-permanently stated 
on the keg in the form of embossing, engraving, stamping, or through 
the use of a sticker or ink jet method. This section in no way affects 
the requirements of part 16 of this chapter regarding the mandatory 
health warning statement.


Sec.  7.52   Legibility and other requirements for mandatory 
information on labels.

    (a) Readily legible. Mandatory information on labels must be 
readily legible to potential consumers under ordinary conditions.
    (b) Separate and apart. Mandatory information on labels, except 
brand names, must be separate and apart from any additional 
information. This does not preclude the addition of brief optional 
phrases of additional information as part of the class or type 
designation (such as ``premium malt beverage''), the name and address 
statement (such as ``Proudly brewed and bottled by ABC Brewing Co. in 
Pittsburgh, PA, for over 30 years''), or other information required by 
Sec.  7.63(a) as long as the additional information does not detract 
from the prominence of the mandatory information. The statements 
required by Sec.  7.63(b) may not include additional information.
    (c) Contrasting background. Mandatory information must appear in a 
color that contrasts with the background on which it appears, except 
that if the net contents or the name and address are blown into a glass 
container, they need not be contrasting. The color of the container and 
of the malt beverages must be taken into account if the label is 
transparent or if mandatory label information is etched, engraved, 
sandblasted, or otherwise carved into the surface of the container or 
is branded, stenciled, painted, printed, or otherwise directly applied 
on to the surface of the container. Examples of acceptable contrasts 
are:
    (1) Black lettering appearing on a white or cream background; or
    (2) White or cream lettering appearing on a black background.
    (d) Capitalization. Except for the aspartame statement when 
required by Sec.  7.63(b)(4), which must appear in all capital letters, 
mandatory information may appear in all capital letters, in all lower 
case letters, or in mixed-case using both capital and lower-case 
letters.


Sec.  7.53   Type size of mandatory information.

    All capital and lowercase letters in statements of mandatory 
information on labels must meet the following type size requirements.
    (a) Minimum type size--(1) Containers of more than one-half pint. 
All mandatory information (including the alcohol content statement) 
must be in script, type, or printing that is at least two millimeters 
in height.
    (2) Containers of one-half pint or less. All mandatory information 
(including the alcohol content statement) must be in script, type, or 
printing that is at least one millimeter in height.
    (b) Maximum type size for alcohol content statement--(1) Containers 
of more than 40 fluid ounces. The alcohol content statement may not 
appear in script, type, or printing that is more than four millimeters 
in height on containers of malt beverages of more than 40 fluid ounces.
    (2) Containers of 40 fluid ounces or less. The alcohol content 
statement may not appear in script, type, or printing that is more than 
three millimeters in height on containers of malt beverages of 40 fluid 
ounces or less.


Sec.  7.54   Visibility of mandatory information.

    Mandatory information on a label must be readily visible and may 
not be covered or obscured in whole or in part. See Sec.  7.62 for 
rules regarding packaging of containers (including cartons, coverings, 
and cases). See part 14 of this chapter for regulations pertaining to 
advertising materials.


Sec.  7.55   Language requirements.

    (a) General. Mandatory information must appear in the English 
language, with the exception of the brand name and except as provided 
in paragraphs (c) and (d) of this section.
    (b) Foreign languages. Additional statements in a foreign language, 
including translations of mandatory information that appears elsewhere 
in English on the label, are allowed on labels and containers as long 
as they do not in any way conflict with, or contradict, the 
requirements of this part.

[[Page 60678]]

    (c) Malt beverages for consumption in the Commonwealth of Puerto 
Rico. Mandatory information may be stated solely in the Spanish 
language on labels of malt beverages bottled for consumption within the 
Commonwealth of Puerto Rico.
    (d) Exception for country of origin statements. The country of 
origin statement for malt beverages may appear in a language other than 
English when allowed by U.S. Customs and Border Protection regulations.


Sec.  7.56   Additional information.

    Information (other than mandatory information) that is truthful, 
accurate, and specific, and that does not violate subpart F, G, or H of 
this part, may appear on labels. Such additional information may not 
conflict with, modify, qualify or restrict mandatory information in any 
manner.

Subpart E--Mandatory Label Information


Sec.  7.61   What constitutes a label for purposes of mandatory 
information.

    (a) Label. Certain information, as outlined in Sec.  7.63, must 
appear on a label. When used in this part for purposes of determining 
where mandatory information must appear, the term ``label'' includes:
    (1) Material affixed to the container, whether made of paper, 
plastic, film, or other matter;
    (2) For purposes of the net contents statement and the name and 
address statement only, information blown, embossed, or molded into the 
container as part of the process of manufacturing the container;
    (3) Information etched, engraved, sandblasted, or otherwise carved 
into the surface of the container;
    (4) Information branded, stenciled, painted, printed, or otherwise 
directly applied on to the surface of the container; and
    (5) Information on a keg collar or a tap cover of a keg, only if it 
includes mandatory information that is not repeated elsewhere on a 
label firmly affixed to the container and only if it meets the 
requirements of Sec.  7.51.
    (b) Information appearing elsewhere on the container. Information 
appearing on the following parts of the container is subject to all of 
the restrictions and prohibitions set forth in subparts F, G and H of 
this part, but will not satisfy any requirements for mandatory 
information that must appear on labels in this part:
    (1) Material affixed to, or information appearing on, the bottom 
surface of the container;
    (2) Caps, corks, or other closures unless authorized to bear 
mandatory information by the appropriate TTB officer; and
    (3) Foil or heat shrink bottle capsules.
    (c) Materials not firmly affixed to the container. Any materials 
that accompany the container to the consumer but are not firmly affixed 
to the container, including booklets, leaflets, and hang tags, are not 
``labels'' for purposes of this part. Such materials are instead 
subject to the advertising regulations in part 14 of this chapter.


Sec.  7.62   Packaging (cartons, coverings, and cases).

    (a) General. The term ``packaging'' includes any covering, carton, 
case, carrier, or other packaging of malt beverage containers used for 
sale at retail, but does not include shipping cartons or cases that are 
not intended to accompany the container to the consumer.
    (b) Prohibition. Any packaging of malt beverage containers may not 
contain any statement, design, device, or graphic, pictorial, or 
emblematic representation that violates the provisions of subpart F, G, 
or H of this part.
    (c) Requirements for closed packaging. If containers are enclosed 
in closed packaging, including sealed opaque coverings, cartons, cases, 
carriers, or other packaging used for sale at retail, such packaging 
must bear all mandatory label information required on the label under 
Sec.  7.63.
    (1) Packaging is considered closed if the consumer must open, rip, 
untie, unzip, or otherwise manipulate the package to remove the 
container in order to view any of the mandatory information.
    (2) Packaging is not considered closed if a consumer could view all 
of the mandatory information on the container by merely lifting the 
container up, or if the packaging is transparent or designed in a way 
that all of the mandatory information can be easily read by the 
consumer without having to open, rip, untie, unzip, or otherwise 
manipulate the package.
    (d) Packaging that is not closed. The following requirements apply 
to packaging that is not closed.
    (1) The packaging may display any information that is not in 
conflict with the label on the container that is inside the packaging.
    (2) If the packaging displays a brand name, it must display the 
brand name in its entirety. For example, if a brand name is required to 
be modified with additional information on the container, the packaging 
must also display the same modifying language.
    (3) If the packaging displays a class or type designation it must 
be identical to the class or type designation appearing on the 
container. For example, if the packaging displays a class or type 
designation for a specialty product for which a statement of 
composition is required on the container, the packaging must include 
the statement of composition as well.
    (e) Labeling of containers within the packaging. The container 
within the packaging is subject to all labeling requirements of this 
part, including mandatory labeling information requirements, regardless 
of whether the packaging bears such information.


Sec.  7.63  Mandatory label information.

    (a) Mandatory information. Malt beverage containers must bear a 
label or labels (as defined in Sec.  7.61(a)) containing the following 
information:
    (1) Brand name, in accordance with Sec.  7.64;
    (2) Class, type, or other designation, in accordance with subpart I 
of this part;
    (3) Alcohol content, in accordance with Sec.  7.65, for malt 
beverages that contain any alcohol derived from added nonbeverage 
flavors or other added nonbeverage ingredients (other than hops 
extract) containing alcohol;
    (4) Name and address of the bottler or importer (which may be 
blown, embossed, or molded into the container as part of the process of 
manufacturing the container), in accordance with Sec.  7.66, Sec.  
7.67, or Sec.  7.68 as applicable; and
    (5) Net contents (which may be blown, embossed, or molded into the 
container as part of the process of manufacturing the container), in 
accordance with Sec.  7.70.
    (b) Disclosure of certain ingredients. Certain ingredients must be 
declared on a label without the inclusion of any additional information 
as part of the statement as follows:
    (1) FD&C Yellow No. 5. If a malt beverage contains the coloring 
material FD&C Yellow No. 5, the label must include a statement to that 
effect, such as ``FD&C Yellow No. 5'' or ``Contains FD&C Yellow No. 
5.''
    (2) Cochineal extract or carmine. If a malt beverage contains the 
color additive cochineal extract or the color additive carmine, the 
label must include a statement to that effect, using the respective 
common or usual name (such as, ``contains cochineal extract'' or 
``contains carmine''). This requirement applies to labels when either 
of the coloring materials is used in a malt beverage that is removed 
from bottling

[[Page 60679]]

premises or from customs custody on or after April 16, 2013.
    (3) Sulfites. If a malt beverage contains 10 or more parts per 
million of sulfur dioxide or other sulfiting agent(s) measured as total 
sulfur dioxide, the label must include a statement to that effect. 
Examples of acceptable statements are ``Contains sulfites'' or 
``Contains (a) sulfiting agent(s)'' or a statement identifying the 
specific sulfiting agent. The alternative terms ``sulphites'' or 
``sulphiting'' may be used.
    (4) Aspartame. If the malt beverage contains aspartame, the label 
must include the following statement, in capital letters, separate and 
apart from all other information: ``PHENYLKETONURICS: CONTAINS 
PHENYLALANINE.''


Sec.  7.64  Brand name.

    (a) Requirement. The malt beverage label must include a brand name. 
If the malt beverage is not sold under a brand name, then the name of 
the bottler or importer, as applicable, appearing in the name and 
address statement is treated as the brand name.
    (b) Misleading brand names. Labels may not include any misleading 
brand names. A brand name is misleading if it creates (by itself or in 
association with other printed or graphic matter) any erroneous 
impression or inference as to the age, origin, identity, or other 
characteristics of the malt beverage. A brand name that would otherwise 
be misleading may be qualified with the word ``brand'' or with some 
other qualification if the appropriate TTB officer determines that the 
qualification dispels any misleading impression that might otherwise be 
created.


Sec.  7.65  Alcohol content.

    (a) General. Alcohol content and the percentage and quantity of the 
original gravity or extract may be stated on any malt beverage label. 
When alcohol content is stated, it must be stated as prescribed in 
paragraph (b) of this section.
    (b) How the alcohol content must be expressed. The following rules 
apply to both mandatory and optional statements of alcohol content.
    (1) A statement of alcohol content must be expressed as a 
percentage of alcohol by volume and not by proof, by a range, or by 
maximums or minimums. Other truthful, accurate, and specific factual 
representations of alcohol content, such as alcohol by weight, may be 
made, as long as they appear together with, and as part of, the 
statement of alcohol content as a percentage of alcohol by volume.
    (2) For malt beverages containing one half of one percent (0.5 
percent) or more alcohol by volume, statements of alcohol content must 
be expressed to the nearest one-tenth of a percentage point, subject to 
the tolerance permitted by paragraph (c) of this section. For malt 
beverages containing less than one half of one percent alcohol by 
volume, alcohol content may be expressed either to the nearest one-
tenth or the nearest one-hundredth of a percentage point, and such 
statements are not subject to any tolerance. See paragraph (e) of this 
section for the rules applicable to such statements.
    (3)(i) The alcohol content statement must be expressed in one of 
the following formats:
    (A) ``Alcohol __ percent by volume'';
    (B) ``__ percent alcohol by volume''; or
    (C) ``Alcohol by volume: __ percent.''
    (ii) Any of the words or symbols may be enclosed in parentheses and 
authorized abbreviations may be used with or without a period. The 
alcohol content statement does not have to appear with quotation marks.
    (4) The statements listed in paragraph (b)(3) of this section must 
appear as shown, except that the following abbreviations may be used: 
Alcohol may be abbreviated as ``alc''; percent may be represented by 
the percent symbol ``%''; alcohol and volume may be separated by a 
slash ``/'' in lieu of the word ``by''; and volume may be abbreviated 
as ``vol''.
    (5) Examples. The following are examples of alcohol content 
statements that comply with the requirements of this part:
    (i) ``4.2% alc/vol'';
    (ii) ``Alc. 4.0 percent by vol.'';
    (iii) ``Alc 4% by vol''; and
    (iv) ``5.9% Alcohol by Volume.''
    (c) Tolerances. Except as provided by paragraph (d) of this 
section, a tolerance of up to one percentage point will be permitted, 
either above or below the stated alcohol content, for malt beverages 
containing 0.5 percent or more alcohol by volume. However, any malt 
beverage that is labeled as containing 0.5 percent or more alcohol by 
volume may not contain less than 0.5 percent alcohol by volume, 
regardless of any tolerance. The tolerance provided by this paragraph 
does not apply in determining compliance with the provisions of Sec.  
7.5 regarding the percentage of alcohol derived from added nonbeverage 
flavors and other nonbeverage ingredients containing alcohol.
    (d) Low alcohol and reduced alcohol. The terms ``low alcohol'' or 
``reduced alcohol'' may be used only on labels of malt beverages 
containing less than 2.5 percent alcohol by volume. The actual alcohol 
content may not equal or exceed 2.5 percent alcohol by volume, 
regardless of any tolerance permitted by paragraph (c) of this section.
    (e) Non-alcoholic. The term ``non-alcoholic'' may be used on labels 
of malt beverages only if the statement ``contains less than 0.5 
percent (or 0.5%) alcohol by volume'' appears immediately adjacent to 
it, in readily legible printing, and on a completely contrasting 
background. No tolerances are permitted for malt beverages labeled as 
``non-alcoholic'' and containing less than 0.5 percent alcohol by 
volume. A malt beverage may not be labeled with an alcohol content of 
0.0 percent alcohol by volume, unless it is also labeled as ``alcohol 
free'' in accordance with paragraph (f) of this section, and contains 
no alcohol.
    (f) Alcohol free. The term ``alcohol free'' may be used only on 
malt beverages containing no alcohol. No tolerances are permitted for 
``alcohol free'' malt beverages.


Sec.  7.66  Name and address for domestically bottled malt beverages 
that were wholly fermented in the United States.

    (a) General. Domestically bottled malt beverages that were wholly 
fermented in the United Sates and contain no imported malt beverages 
must be labeled in accordance with this section. (See Sec. Sec.  7.67 
and 7.68 for name and address requirements applicable to malt beverages 
that are not wholly fermented in the United States.)
    (b) Mandatory statement. A label on the container must state the 
name and address of the bottler, in accordance with the rules set forth 
in this section.
    (c) Form of address. The address consists of the city and State and 
must be consistent with the information reflected on the brewer's 
notice required under part 25 of this chapter. Addresses may, but are 
not required to, include additional information such as street names, 
counties, zip codes, phone numbers, and website addresses. The postal 
abbreviation of the State name may be used; for example, California may 
be abbreviated as CA.
    (d) Optional statements. The bottler may, but is not required to, 
be identified by a phrase describing the function performed by that 
person, such as ``bottled by,'' ``canned by,'' ``packed by,'' or 
``filled by,'' followed by the name and address of the bottler. If one 
person performs more than one function, the label may so indicate (for

[[Page 60680]]

example, ``brewed and bottled by XYZ Brewery.'') If different functions 
are performed by more than one person, statements on the label may not 
create the misleading impression that the different functions were 
performed by the same person. The appropriate TTB officer may require 
specific information about the functions performed if necessary to 
prevent a misleading impression on the label.
    (e) Principal place of business. The bottler's principal place of 
business may be shown in lieu of the actual place where the malt 
beverage was bottled if the address shown is a location where a 
bottling operation takes place. The appropriate TTB officer may 
disapprove the listing of a principal place of business if its use 
would create a false or misleading impression as to the geographic 
origin of the malt beverage. See 27 CFR 25.141 and 25.142 for coding 
requirements applicable in these circumstances.
    (f) Multiple breweries under the same ownership. If two or more 
breweries are owned or operated by the same person, the place where the 
malt beverage is bottled within the meaning of paragraph (a) of this 
section may be shown in one of the following two ways:
    (1) Listing of where bottled. The place where the malt beverage is 
bottled may be shown as the only location on the label; or
    (2) Listing of all brewer's locations. The place where the malt 
beverage is bottled may appear in a listing of the locations of 
breweries owned by that person if the place of bottling is not given 
less emphasis than any of the other locations. See 27 CFR 25.141 and 
25.142 for coding requirements applicable in these circumstances.
    (g) Malt beverages bottled for another person. (1) If malt 
beverages are brewed and bottled for another person, the label may 
state, in addition to (but not in lieu of) the name and address of the 
bottler, the name and address of such other person, immediately 
preceded by the words ``brewed and bottled for'' or ``bottled for'' or 
another similar appropriate phrase. Such statements must clearly 
indicate the relationship between the two persons (for example, 
contract brewing).
    (2) If the same brand of malt beverage is brewed and bottled by two 
or more breweries that are not under the same ownership, the label for 
each brewery may set forth all the locations where bottling takes 
place, as long as the label uses the actual location (and not the 
principal place of business) and as long as the nature of the 
arrangement is clearly set forth.
    (h) Use of trade names. The name of the person appearing on the 
label may be the trade name or the operating name, as long as it is 
identical to a trade or operating name appearing on the brewer's 
notice, and as long as use of that name would not create a misleading 
impression as to the age, origin, or identity of the product. For 
example, if a brewery authorizes the use of its trade name by another 
brewery that is not under the same ownership, that trade name may not 
be used on a label in a way that tends to mislead consumers as to the 
identity or location of the bottler.


Sec.  7.67  Name and address for domestically bottled malt beverages 
that were bottled after importation.

    (a) General. This section applies to domestically bottled malt 
beverages that were bottled after importation. See Sec.  7.68 for name 
and address requirements applicable to imported malt beverages that are 
imported in a container. See 19 CFR parts 102 and 134 for U.S. Customs 
and Border Protection country of origin marking requirements.
    (b) Malt beverages that were subject to blending or other 
production activities after importation. Malt beverages that were 
subject, after importation, to blending or other production may not 
bear an ``imported by'' statement on the label, but must instead be 
labeled in accordance with the rules set forth in Sec.  7.66 with 
regard to mandatory and optional labeling statements.
    (c) Malt beverages bottled after importation without blending or 
other production activities. The label on malt beverages that are 
bottled without being subject to blending or other production 
activities in the United States after the malt beverages were imported 
state must state the words ``imported by'' or a similar appropriate 
phrase, followed by the name and address of the importer. The label 
must also state the words ``bottled by'' or ``packed by,'' followed by 
the name and address of the bottler, except that the following phrases 
are acceptable in lieu of the name and address of the bottler under the 
circumstances set forth below:
    (1) If the malt beverages were bottled for the person responsible 
for the importation, the words ``imported and bottled (canned, packed 
or filled) in the United States for'' (or a similar appropriate phrase) 
followed by the name and address of the principal place of business in 
the United States of the person responsible for the importation;
    (2) If the malt beverages were bottled by the person responsible 
for the importation, the words ``imported and bottled (canned, packed 
or filled) in the United States by'' (or a similar appropriate phrase) 
followed by the name and address of the principal place of business in 
the United States of the person responsible for the importation;
    (3) In the situations set forth in paragraphs (c)(1) and (2) of 
this section, the address shown on the label may be that of the 
principal place of business of the importer who is also the bottler, 
provided that the address shown is a location where bottling takes 
place.
    (d) Use of trade names. A trade name may be used if the trade name 
is listed on the importer's basic permit and if its use on the label 
would not create any misleading impression as to the age, origin, or 
identity of the product. In addition, the label may, but is not 
required to, state the name and principal place of business of the 
foreign manufacturer, bottler, or shipper.


Sec.  7.68  Name and address for malt beverages that are imported in a 
container.

    (a) General. This section applies to malt beverages that are 
imported in a container, as defined in Sec.  7.1. See Sec.  7.67 for 
rules regarding name and address requirements applicable to malt 
beverages that are domestically bottled after importation. See 19 CFR 
parts 102 and 134 for U.S. Customs and Border Protection country of 
origin marking requirements.
    (b) Mandatory labeling statement. The label on malt beverages 
imported in containers, as defined in Sec.  7.1, must state the words 
``imported by'' or a similar appropriate phrase, followed by the name 
and address of the importer.
    (1) For purposes of this section, the importer is the holder of the 
importer's basic permit that either makes the original Customs entry or 
is the person for whom such entry is made, or the holder of the 
importer's basic permit that is the agent, distributor, or franchise 
holder for the particular brand of imported alcohol beverages and that 
places the order abroad.
    (2) The address of the importer must be stated as the city and 
State of the principal place of business and must be consistent with 
the address reflected on the importer's basic permit. Addresses may, 
but are not required to, include additional information such as street 
names, counties, zip codes, phone numbers, and website addresses. The 
postal abbreviation of the State name may be used; for example, 
California may be abbreviated as CA.


Sec.  7.69  Country of origin.

    (a) Pursuant to U.S. Customs and Border Protection (CBP) 
regulations at 19 CFR parts 102 and 134, a country of origin statement 
must appear on the

[[Page 60681]]

container of malt beverages imported in containers or bottled in the 
United States after importation. Labeling statements with regard to the 
country of origin must be consistent with CBP regulations. The 
determination of the country (or countries) of origin, for imported 
malt beverages, as well as for blends of imported malt beverages with 
domestically fermented malt beverages, must comply with CBP 
regulations.
    (b) It is the responsibility of the importer or bottler, as 
appropriate, to ensure compliance with the country of origin marking 
requirement, both when malt beverages are imported in containers and 
when imported malt beverages are subject to bottling, blending, or 
production activities in the United States. Industry members may seek a 
ruling from CBP for a determination of the country of origin for their 
product.


Sec.  7.70  Net contents.

    The following rules apply to the net contents statement required by 
Sec.  7.63.
    (a) The volume of malt beverage in the container must appear on a 
label as a net contents statement using the following measures:
    (1) If less than one pint, the net contents must be stated in fluid 
ounces or fractions of a pint.
    (2) If one pint, one quart, or one gallon, the net contents must be 
so stated.
    (3) If more than one pint, but less than one quart, the net 
contents must be stated in fractions of a quart, or in pints and fluid 
ounces.
    (4) If more than one quart, but less than one gallon, the net 
contents must be stated in fractions of a gallon, or in quarts, pints, 
and fluid ounces.
    (5) If more than one gallon, the net contents must be stated in 
gallons and fractions thereof.
    (b) All fractions must be expressed in their lowest denominations.
    (c) Metric measures may be used in addition to, but not in lieu of, 
the U.S. standard measures and must appear in the same field of vision.

Subpart F--Restricted Labeling Statements


Sec.  7.81  General.

    (a) Application. The labeling practices, statements, and 
representations in this subpart may be used on malt beverage labels 
only when used in compliance with this subpart. In addition, if any of 
the practices, statements, or representations in this subpart are used 
elsewhere on containers or in packaging, they must comply with the 
requirements of this subpart. For purposes of this subpart:
    (1) The term ``label'' includes all labels on malt beverage 
containers on which mandatory information may appear, as set forth in 
Sec.  7.61(a), as well as any other label on the container.
    (2) The term ``container'' includes all parts of the malt beverage 
container, including any part of a malt beverage container on which 
mandatory information may appear, as well as those parts of the 
container on which information does not satisfy mandatory labeling 
requirements, as set forth in Sec.  7.61(b).
    (3) The term ``packaging'' includes any carton, case, carrier, 
individual covering, or other packaging of such containers used for 
sale at retail, but does not include shipping cartons or cases that are 
not intended to accompany the container to the consumer.
    (b) Statement or representation. For purposes of this subpart, the 
term ``statement or representation'' includes any statement, design, 
device, or representation, and includes pictorial or graphic designs or 
representations as well as written ones. The term ``statement or 
representation'' includes explicit and implicit statements and 
representations.

Food Allergen Labeling


Sec.  7.82  Voluntary disclosure of major food allergens.

    (a) Definitions. For purposes of this section, the following terms 
have the meanings indicated.
    (1) Major food allergen means any of the following:
    (i) Milk, egg, fish (for example, bass, flounder, or cod), 
Crustacean shellfish (for example, crab, lobster, or shrimp), tree nuts 
(for example, almonds, pecans, or walnuts), wheat, peanuts, and 
soybeans; or
    (ii) A food ingredient that contains protein derived from a food 
specified in paragraph (a)(1)(i) of this section, except:
    (A) Any highly refined oil derived from a food specified in 
paragraph (a)(1)(i) of this section and any ingredient derived from 
such highly refined oil; or
    (B) A food ingredient that is exempt from major food allergen 
labeling requirements pursuant to a petition for exemption approved by 
the Food and Drug Administration (FDA) under 21 U.S.C. 343(w)(6) or 
pursuant to a notice submitted to the FDA under 21 U.S.C. 343(w)(7), 
provided that the food ingredient meets the terms or conditions, if 
any, specified for that exemption.
    (2) Name of the food source from which each major food allergen is 
derived means the name of the food as listed in paragraph (a)(1)(i) of 
this section, except that:
    (i) In the case of a tree nut, it means the name of the specific 
type of nut (for example, almonds, pecans, or walnuts);
    (ii) In the case of Crustacean shellfish, it means the name of the 
species of Crustacean shellfish (for example, crab, lobster, or 
shrimp); and
    (iii) The names ``egg'' and ``peanuts,'' as well as the names of 
the different types of tree nuts, may be expressed in either the 
singular or plural form, and the names ``soy,'' ``soybean,'' or 
``soya'' may be used instead of ``soybeans.''
    (b) Voluntary labeling standards. Major food allergens used in the 
production of a malt beverage product may, on a voluntary basis, be 
declared on a label. However, if any one major food allergen is 
voluntarily declared, all major food allergens used in production of 
the malt beverage product, including major food allergens used as 
fining or processing agents, must be declared, except when covered by a 
petition for exemption approved by the appropriate TTB officer under 
Sec.  7.83. The major food allergens declaration must consist of the 
word ``Contains'' followed by a colon and the name of the food source 
from which each major food allergen is derived (for example, 
``Contains: egg'').
    (c) Cross reference. For mandatory labeling requirements applicable 
to malt beverage products containing FD&C Yellow No. 5, sulfites, 
aspartame, and cochineal extract or carmine, see Sec.  7.63(b).


Sec.  7.83  Petitions for exemption from major food allergen labeling.

    (a) Submission of petition. Any person may petition the appropriate 
TTB officer to exempt a particular product or class of products from 
the labeling requirements of Sec.  7.82. The burden is on the 
petitioner to provide scientific evidence (as well as the analytical 
method used to produce the evidence) that demonstrates that the 
finished product or class of products, as derived by the method 
specified in the petition, either:
    (1) Does not cause an allergic response that poses a risk to human 
health; or
    (2) Does not contain allergenic protein derived from one of the 
foods identified in Sec.  7.82(a)(1)(i), even though a major food 
allergen was used in production.
    (b) Decision on petition. TTB will approve or deny a petition for 
exemption submitted under paragraph (a) of this section in writing 
within 180 days of receipt of the petition. If TTB does not provide a 
written response to the petitioner within that 180-day

[[Page 60682]]

period, the petition will be deemed denied unless an extension of time 
for decision is mutually agreed upon by the appropriate TTB officer and 
the petitioner. TTB may confer with the Food and Drug Administration 
(FDA) on petitions for exemption, as appropriate and as FDA resources 
permit. TTB may require the submission of product samples and other 
additional information in support of a petition; however, unless 
required by TTB, the submission of samples or additional information by 
the petitioner after submission of the petition will be treated as the 
withdrawal of the initial petition and the submission of a new 
petition. An approval or denial under this section will constitute 
final agency action.
    (c) Resubmission of a petition. After a petition for exemption is 
denied under this section, the petitioner may resubmit the petition 
along with supporting materials for reconsideration at any time. TTB 
will treat this submission as a new petition.
    (d) Availability of information--(1) General. TTB will promptly 
post to its website (https://www.ttb.gov) all petitions received under 
this section as well as TTB's responses to those petitions. Any 
information submitted in support of the petition that is not posted to 
the TTB website will be available to the public pursuant to the Freedom 
of Information Act (5 U.S.C. 552), except where a request for 
confidential treatment is granted under paragraph (d)(2) of this 
section.
    (2) Requests for confidential treatment of business information. A 
person who provides trade secrets or other commercial or financial 
information in connection with a petition for exemption under this 
section may request that TTB give confidential treatment to that 
information. A failure to request confidential treatment at the time 
the information in question is submitted to TTB will constitute a 
waiver of confidential treatment. A request for confidential treatment 
of information under this section must conform to the following 
standards:
    (i) The request must be in writing;
    (ii) The request must clearly identify the information to be kept 
confidential;
    (iii) The request must relate to information that constitutes trade 
secrets or other confidential, commercial, or financial information 
regarding the business transactions of an interested person, the 
disclosure of which would cause substantial harm to the competitive 
position of that person;
    (iv) The request must set forth the reasons why the information 
should not be disclosed, including the reasons the disclosure of the 
information would prejudice the competitive position of the interested 
person; and
    (v) The request must be supported by a signed statement by the 
interested person, or by an authorized officer or employee of that 
person, certifying that the information in question is a trade secret 
or other confidential, commercial, or financial information and that 
the information is not already in the public domain.

Production and Other Claims


Sec.  7.84  Use of the term ``organic.''

    Use of the term ``organic'' is permitted if any such use complies 
with the United States Department of Agriculture (USDA) National 
Organic Program rules (7 CFR part 205), as interpreted by the USDA.


Sec.  7.85  Environmental, sustainability, and similar statements.

    Statements related to environmental or sustainable agricultural 
practices, social justice principles, and other similar statements 
(such as, ``Produced using 100% solar energy'' or ``Carbon Neutral'') 
may appear as long as the statements are truthful, specific and not 
misleading. Statements or logos indicating environmental, sustainable 
agricultural, or social justice certification (such as, ``Biodyvin,'' 
``Salmon-Safe,'' or ``Fair Trade Certified'') may appear on malt 
beverages that are actually certified by the appropriate organization.


Sec.  7.86  [Reserved]


Sec.  7.87  Use of the term ``draft.''

    (a) General. A malt beverage may be labeled with the term ``draft'' 
only if it complies with the requirements of paragraph (b)(1), (2), or 
(3) of this section. The word ``draft'' may be spelled ``draft'' or 
``draught.''
    (b) Requirements. (1) Malt beverages in a container of one gallon 
or more that dispenses the malt beverages through a tap, spigot, 
faucet, or similar device may be described as draft.
    (2) Malt beverages packaged in customary bottles or cans may be 
described as draft if they are unpasteurized and require refrigeration 
for preservation, or if the beer has been sterile filtered and 
aseptically filled (but not pasteurized).
    (3) Malt beverages that have been pasteurized that are packaged in 
customary bottles or cans may be described as ``draft brewed,'' ``draft 
beer flavor,'' ``old time on-tap taste,'' or with a similar expression 
only if the word ``pasteurized'' appears conspicuously on the label or 
container.

Subpart G--Prohibited Labeling Practices


Sec.  7.101  General.

    (a) Application. The prohibitions set forth in this subpart apply 
to any malt beverage label, container, or packaging. For purposes of 
this subpart:
    (1) The term ``label'' includes all labels on malt beverage 
containers on which mandatory information may appear, as set forth in 
Sec.  7.61(a), as well as any other label on the container;
    (2) The term ``container'' includes all parts of the malt beverage 
container, including any part of a malt beverage container on which 
mandatory information may appear, as well as those parts of the 
container on which information does not satisfy mandatory labeling 
requirements as set forth in Sec.  7.61(b); and
    (3) The term ``packaging'' includes any carton, case, carrier, 
individual covering, or other packaging of such containers used for 
sale at retail but does not include shipping cartons or cases that are 
not intended to accompany the container to the consumer.
    (b) Statement or representation. For purposes of the practices in 
this subpart, the term ``statement or representation'' includes any 
statement, design, device, or representation, and includes pictorial or 
graphic designs or representations as well as written ones. The term 
``statement or representation'' includes explicit and implicit 
statements and representations.


Sec.  7.102  False or untrue statements.

    Malt beverage labels, containers, or packaging may not contain any 
statement or representation that is false or untrue in any particular.


Sec.  7.103  Obscene or indecent depictions.

    Malt beverage labels, containers, or packaging may not contain any 
statement or representation that is obscene or indecent.

Subpart H--Labeling Practices That Are Prohibited if They Are 
Misleading


Sec.  7.121  General.

    (a) Application. The labeling practices that are prohibited if 
misleading set forth in this subpart apply to any malt beverage label, 
container, or packaging. For purposes of this subpart:
    (1) The term ``label'' includes all labels on malt beverage 
containers on which mandatory information may appear, as set forth in 
Sec.  7.61(a), as well as any other label on the container;
    (2) The term ``container'' includes all parts of the malt beverage 
container, including any part of a malt beverage

[[Page 60683]]

container on which mandatory information may appear, as well as those 
parts of the container on which information does not satisfy mandatory 
labeling requirements, as set forth in Sec.  7.61(b); and
    (3) The term ``packaging'' includes any carton, case, carrier, 
individual covering, or other packaging of such containers used for 
sale at retail but does not include shipping cartons or cases that are 
not intended to accompany the container to the consumer.
    (b) Statement or representation. For purposes of this subpart, the 
term ``statement or representation'' includes any statement, design, 
device, or representation, and includes pictorial or graphic designs or 
representations as well as written ones. The term ``statement or 
representation'' includes explicit and implicit statements and 
representations.


Sec.  7.122  Misleading statements or representations.

    (a) General prohibition. Malt beverage labels, containers, or 
packaging may not contain any statement or representation, irrespective 
of falsity, that is misleading to consumers as to the age, origin, 
identity, or other characteristics of the malt beverage, or with regard 
to any other material factor.
    (b) Ways in which statements or representations may be misleading. 
(1) A statement or representation is prohibited, irrespective of 
falsity, if it directly creates a misleading impression or if it does 
so indirectly through ambiguity, omission, inference, or by the 
addition of irrelevant, scientific, or technical matter. For example, 
an otherwise truthful statement may be misleading because of the 
omission of material information, the disclosure of which is necessary 
to prevent the statement from being misleading.
    (2) As set forth in Sec.  7.212(b), all claims, whether implicit or 
explicit, must have a reasonable basis in fact. Any claim on malt 
beverage labels, containers, or packaging that does not have a 
reasonable basis in fact or cannot be adequately substantiated upon the 
request of the appropriate TTB officer is considered misleading.


Sec.  7.123  Guarantees.

    Malt beverage labels, containers, or packaging may not contain any 
statement relating to guarantees if the appropriate TTB officer finds 
it is likely to mislead the consumer. However, money-back guarantees 
are not prohibited.


Sec.  7.124  Disparaging statements.

    (a) General. Malt beverage labels, containers, or packaging may not 
contain any false or misleading statement that explicitly or implicitly 
disparages a competitor's product.
    (b) Examples. (1) An example of an explicit statement that falsely 
disparages a competitor's product is ``Brand X is not aged in oak 
barrels'' when such statement is not true.
    (2) An example of an implicit statement that disparages 
competitors' products in a misleading fashion is ``We do not add 
arsenic to our malt beverage,'' where such a claim is true but it may 
lead consumers to falsely believe that other brewers do add arsenic to 
their malt beverages.
    (c) Truthful and accurate comparisons. This section does not 
prevent truthful and accurate comparisons between products (such as 
``Our ale contains more hops than Brand X'') or statements of opinion 
(such as ``We think our beer tastes better than any other beer on the 
market'').


Sec.  7.125  Tests or analyses.

    Malt beverage labels, containers, or packaging may not contain any 
statement or representation of or relating to analyses, standards, or 
tests, whether or not it is true, that is likely to mislead the 
consumer. An example of a misleading statement is ``tested and approved 
by our research laboratories'' if the testing and approval does not in 
fact have any significance.


Sec.  7.126  Depictions of government symbols.

    (a) Representations of the armed forces or flags. Malt beverage 
labels, containers, or packaging may not show an image of any 
government's flag or any representation related to the armed forces of 
the United States if the representation, standing alone or considered 
together with any additional language or symbols on the label, creates 
a false or misleading impression that the product was endorsed by, made 
by, used by, or made under the supervision of the government 
represented by that flag or by the armed forces of the United States. 
This section does not prohibit the use of a flag as part of a claim of 
American origin or another country of origin.
    (b) Government seals. Malt beverage labels, containers, or 
packaging may not contain any government seal or other insignia that is 
likely to create a false or misleading impression that the product has 
been endorsed by, made by, used by, or produced for, under the 
supervision of, or in accordance with the specification of that 
government. Seals required or specifically authorized by applicable law 
or regulations and used in accordance with such law or regulations are 
not prohibited.


Sec.  7.127  Depictions simulating government stamps or relating to 
supervision.

    Malt beverage labels, containers, or packaging may not contain any 
statements, images, or designs that mislead consumers to believe that 
the malt beverage is manufactured or processed under government 
authority. Malt beverage labels, containers, or packaging may not 
contain images or designs resembling a stamp of the U.S. Government or 
any State or foreign government, other than stamps authorized or 
required by this or any other government, and may not contain 
statements or indications that the malt beverage is produced, blended, 
bottled, packed, or sold under, or in accordance with any municipal, 
State, Federal, or foreign authorization, law, or regulations unless 
such statement is required or specifically authorized by applicable law 
or regulation. If a municipal, State, or Federal Government permit 
number is stated on malt beverage labels, containers, or packaging, it 
may not be accompanied by any additional statement relating to that 
permit number.


Sec.  7.128  Claims related to distilled spirits or wines.

    (a) General. Except as provided in paragraph (b) of this section, 
no malt beverage labels, containers, or packaging may contain a 
statement, design, or representation that tends to create a false or 
misleading impression that the malt beverage product is a distilled 
spirits or wine product, or that it contains distilled spirits or wine. 
For example, the use of the name of a class or type designation of a 
wine or distilled spirits product, as set forth in parts 4 and 5 of 
this chapter, is prohibited if the use of that name tends to create a 
false or misleading impression as to the identity of the product. 
Homophones or coined words that simulate or imitate a class or type 
designation are also prohibited.
    (b) Exceptions. This section does not prohibit:
    (1) A truthful and accurate statement of alcohol content;
    (2) The use of a brand name of a wine or distilled spirits product 
as a malt beverage brand name, provided that the overall label does not 
create a misleading impression as to the identity of the product;
    (3) The use of a cocktail name as a brand name or a distinctive or 
fanciful name of a malt beverage, provided that

[[Page 60684]]

the overall labeling does not present a misleading impression about the 
identity of the product;
    (4) The use of truthful and accurate statements about the 
production of the malt beverage as part of a statement of composition 
or otherwise, such as ``aged in whisky barrels,'' ``fermented with 
grapes,'' or ``Beer brewed with chardonnay grapes'' as long as such 
statements do not create a misleading impression as to the identity of 
the product;
    (5) The use of the designation ``barley (or wheat or rye) wine 
ale'' or ``barley (or wheat or rye) style wine ale''; or
    (6) The use of terms that simply compare malt beverage products to 
wine or distilled spirits products without creating a misleading 
impression as to the identity of the product.


Sec.  7.129  Health-related statements.

    (a) Definitions. When used in this section, the following terms 
have the meaning indicated:
    (1) Health-related statement means any statement related to health 
(other than the warning statement required under part 16 of this 
chapter) and includes statements of a curative or therapeutic nature 
that, expressly or by implication, suggest a relationship between the 
consumption of alcohol, malt beverages, or any substance found within 
the malt beverage, and health benefits or effects on health. The term 
includes both specific health claims and general references to alleged 
health benefits or effects on health associated with the consumption of 
alcohol, a malt beverage, or any substance found within the malt 
beverage product, as well as health-related directional statements. The 
term also includes statements and claims that imply that a physical or 
psychological sensation results from consuming the alcohol beverage 
product, as well as statements and claims of nutritional value (for 
example, statements of vitamin content). Numerical statements of the 
calorie, carbohydrate, protein, and fat content of the product do not 
constitute claims of nutritional value.
    (2) Specific health claim means a type of health-related statement 
that, expressly or by implication, characterizes the relationship of 
malt beverages, alcohol, or any substance found within the malt 
beverage, to a disease or health-related condition. Implied specific 
health claims include statements, symbols, vignettes, or other forms of 
communication that suggest, within the context in which they are 
presented, that a relationship exists between alcohol, malt beverages, 
or any substance found within the malt beverage, and a disease or 
health-related condition.
    (3) Health-related directional statement means a type of health-
related statement that directs or refers consumers to a third party or 
other source for information regarding the effects on health of malt 
beverage or alcohol consumption.
    (b) Rules for malt beverage labels, containers, and packaging--(1) 
Health-related statements. In general, malt beverage labels, 
containers, or packaging may not contain any health-related statement 
that is untrue in any particular or tends to create a misleading 
impression as to the effects on health of alcohol consumption. TTB will 
evaluate such statements on a case-by-case basis and may require as 
part of the health-related statement a disclaimer or some other 
qualifying statement to dispel any misleading impression conveyed by 
the health-related statement.
    (2) Specific health claims. (i) TTB will consult with the Food and 
Drug Administration (FDA) as needed on the use of specific health 
claims on labels, containers, or packaging. If FDA determines that the 
use of such a claim is a drug claim that is not in compliance with the 
requirements of the Federal Food, Drug, and Cosmetic Act, TTB will not 
approve the use of that specific health claim on the malt beverage 
label.
    (ii) TTB will approve the use of a specific health claim on a malt 
beverage label only if the claim is truthful and adequately 
substantiated by scientific or medical evidence; is sufficiently 
detailed and qualified with respect to the categories of individuals to 
whom the claim applies; adequately discloses the health risks 
associated with both moderate and heavier levels of alcohol 
consumption; and outlines the categories of individuals for whom any 
levels of alcohol consumption may cause health risks. This information 
must appear as part of the specific health claim.
    (3) Health-related directional statements. A health-related 
directional statement is presumed misleading unless it:
    (i) Directs consumers in a neutral or other non-misleading manner 
to a third party or other source for balanced information regarding the 
effects on health of malt beverage or alcohol consumption; and
    (ii)(A) Includes as part of the health-related directional 
statement the following disclaimer: ``This statement should not 
encourage you to drink or to increase your alcohol consumption for 
health reasons''; or
    (B) Includes as part of the health-related directional statement 
some other qualifying statement that the appropriate TTB officer finds 
is sufficient to dispel any misleading impression conveyed by the 
health-related directional statement.


Sec.  7.130  Appearance of endorsement.

    (a) General. Malt beverage labels, containers, or packaging may not 
include the name, or the simulation or abbreviation of the name, of any 
living individual of public prominence or an existing private or public 
organization, or any graphic, pictorial, or emblematic representation 
of the individual or organization if its use is likely to lead a 
consumer to falsely believe that the product has been endorsed, made, 
or used by, or produced for, or under the supervision of, or in 
accordance with the specifications of, such individual or organization. 
This section does not prohibit the use of such names where the 
individual or organization has provided authorization for their use.
    (b) Documentation. The appropriate TTB officer may request 
documentation from the bottler or importer to establish that the person 
or organization has provided authorization to use the name of that 
person or organization.
    (c) Disclaimers. Statements or other representations do not violate 
this section if, taken as a whole, they create no misleading impression 
as to an implied endorsement either because of the context in which 
they are presented or because of the use of an adequate disclaimer.


Sec.  7.131  The word ``bonded'' and similar terms.

    Malt beverage labels, containers, or packaging may not contain the 
words ``bonded,'' ``bottled in bond,'' ``aged in bond,'' ``bonded 
age,'' ``bottled under Customs supervision,'' or other phrases 
containing these or synonymous terms that create a misleading 
impression as to governmental supervision over production or bottling.


Sec.  7.132  Strength claims.

    (a) General. For purposes of this section, the term ``strength 
claim'' means a statement that directly or indirectly makes a claim 
about the alcohol content of the product. This section does not apply 
to the use of the terms ``low alcohol,'' ``reduced alcohol,'' ``non-
alcoholic,'' and ``alcohol-free'' in accordance with Sec.  7.65; to 
claims about low alcohol content in general; or to labeling with an 
alcohol content statement in accordance with Sec.  7.65.
    (b) Prohibition. The use of a strength claim on malt beverage 
labels,

[[Page 60685]]

containers, or packaging is prohibited if it misleads consumers by 
implying that products should be purchased or consumed on the basis of 
higher alcohol strength. Examples of strength claims are ``full 
strength,'' ``extra strength,'' ``high test,'' and ``high proof.''

Subpart I--Classes and Types of Malt Beverages


Sec.  7.141  Class and type.

    (a) Products known to the trade. The class of the malt beverage 
must be stated on the label (see Sec.  7.63). The type of the malt 
beverage may be stated, but is not required to appear on the label. 
Statements of class and type must conform to the designation of the 
product as known to the trade. All parts of the designation must appear 
together.
    (b) Malt beverage specialty products--(1) General. A malt beverage 
specialty product is a malt beverage that does not fall under any of 
the class designations set forth in Sec. Sec.  7.142 through 7.144 and 
is not known to the trade under a particular designation, usually 
because of the addition of ingredients such as colorings, flavorings, 
or food materials or the use of certain types of production processes 
where the appropriate TTB officer has not determined that such 
ingredients or processes are generally recognized as traditional in the 
production of a fermented beverage designated as ``beer,'' ``ale,'' 
``porter,'' ``stout,'' ``lager,'' or ``malt liquor.''
    (2) Designation. A malt beverage specialty product must be 
designated with a distinctive or fanciful name, together with a 
statement of the composition of the product, in accordance with Sec.  
7.147. This statement will be considered the class designation for the 
purposes of this part. All parts of the designation must appear 
together.


Sec.  7.142  Class designations.

    The following class designations may be used in accordance with 
this section:
    (a) Any malt beverage, as defined in Sec.  7.1, may be designated 
simply as a ``malt beverage.''
    (b)(1) The class designations ``beer,'' ``ale,'' ``porter,'' 
``stout,'' ``lager,'' and ``malt liquor'' may be used to designate malt 
beverages that contain at least 0.5 percent alcohol by volume and that 
conform to the trade understanding of those designations. These 
designations may be preceded or followed by descriptions of the color 
of the product (such as ``amber,'' ``brown,'' ``red,'' or ``golden'') 
as well as descriptive terms such as ``dry,'' ``export,'' ``cream,'' 
and ``pale.''
    (2) No product other than a malt beverage fermented at a 
comparatively high temperature, possessing the characteristics 
generally attributed to ``ale,'' ``porter,'' or ``stout'' and produced 
without the use of coloring or flavoring materials (other than those 
recognized in standard brewing practices) may bear any of these class 
designations.
    (c) The name ``Pilsen'' (or ``Pilsener'' or ``Pilsner'') may be 
used as the class designation for beers produced in the Czech Republic 
or the United States without use of the word ``type'' or a similar 
qualifying statement. See Sec.  7.106. The name also may be used as the 
class designation for beer produced outside of those countries, as long 
as it is qualified in accordance with the requirements of Sec.  7.146.


Sec.  7.143  Class and type--special rules.

    The following special rules apply to specified class and type 
designations:
    (a) Reconstituted malt beverages. Malt beverages that have been 
concentrated by the removal of water therefrom and reconstituted by the 
addition of water and carbon dioxide must for the purpose of this part 
be labeled in the same manner as malt beverages which have not been 
concentrated and reconstituted, except that there must appear 
immediately adjacent to, and as a part of, the class designation the 
statement ``PRODUCED FROM ___ CONCENTRATE'' (the blank to be filled in 
with the appropriate class designation). All parts of the class 
designation must appear in lettering of substantially the same size and 
kind. However, ice beers, described in paragraph (c) of this section, 
which are produced by the removal of less than 0.5 percent of the 
volume of the beer in the form of ice crystals and that retain beer 
character are not considered concentrated.
    (b) Half and half. No product may be designated with the type 
designation ``half and half'' unless it is in fact composed of equal 
parts of two classes of malt beverages, the names of which are 
conspicuously stated immediately adjacent to the designation ``half and 
half.'' For example, ``Half and Half, Porter and Stout.'' This does not 
preclude the use of terms such as ``half and half'' as part of a 
distinctive or fanciful name that refers to flavors added to a malt 
beverage designated in accordance with trade understanding or with a 
statement of composition.
    (c) Ice beer. Malt beverages supercooled during the brewing process 
to form ice crystals may be labeled with the type designation ``ice'' 
preceding the class designation (beer, ale, etc.).
    (d) Black and tan. A product composed of two classes of malt 
beverages may be designated with the type designation ``black and 
tan,'' and the class and type designation is the names of the two 
classes of malt beverages in conjunction with ``black and tan'' (for 
example, ``Black and Tan, Stout and Ale'').
    (e) Wheat beer. Any ``beer,'' ``ale,'' ``porter,'' ``stout,'' 
``lager,'' ``malt liquor,'' or other malt beverage made from a 
fermentable base that consists of at least 25 percent by weight malted 
wheat may be designated with the type designation ``wheat'' preceding 
the applicable class designation.
    (f) Rye beer. Any ``beer,'' ``ale,'' ``porter,'' ``stout,'' 
``lager,'' ``malt liquor,'' or other malt beverage made from a 
fermentable base that consists of at least 25 percent by weight malted 
rye may be designated with the type designation ``rye'' preceding the 
applicable class designation.
    (g) Barley wine ale. The term ``barley (or wheat or rye) wine ale'' 
or ``barley (or wheat or rye) wine style ale'' may be used in 
accordance with trade understanding.
    (h) Malt beverages aged in barrels--(1) General. Label designations 
for malt beverages aged in barrels or with woodchips, spirals, or 
staves derived from barrels may, but are not required to, include a 
description of how the product was aged. Thus, for example, acceptable 
designations for a standard beer aged in an oak barrel would include 
``beer,'' ``oak aged beer,'' and ``beer aged in an oak barrel.''
    (2) Barrels previously used in the production or storage of wine or 
distilled spirits. Malt beverages aged in barrels previously used in 
the production or storage of wine or distilled spirits, or with 
woodchips, spirals, or staves derived from barrels previously used in 
the production or storage of wine or distilled spirits, or from 
woodchips previously used in the aging of distilled spirits or wine 
may, but are not required to, include a description of how the product 
was aged.
    (i) Examples of acceptable designations for a standard beer aged in 
a wine barrel include ``beer,'' ``beer aged in a wine barrel,'' and 
``wine barrel aged beer.''
    (ii) Examples of acceptable designations for an ale brewed with 
honey and aged in a bourbon barrel include ``honey ale'' and ``bourbon 
barrel aged honey ale'' but not simply ``ale'' or ``bourbon barrel aged 
ale.''
    (3) Misleading designations. Designations that create a misleading 
impression as to the identity of the product by emphasizing certain 
words or terms are prohibited. As set forth in

[[Page 60686]]

Sec.  7.122, malt beverage labels may not include misleading 
representations that imply that a malt beverage contains distilled 
spirits or wine or is a distilled spirits or wine product. Examples of 
designations that would be prohibited under this provision are 
``bourbon ale,'' ``bourbon-flavored lager,'' ``Chardonnay lager,'' or 
``lager with whisky flavors.''
    (i) Other designations. Other type designations (such as ``milk'' 
preceding the class designation ``stout'') may be applied in 
conformance with trade understanding.


Sec.  7.144  Malt beverages fermented or flavored with certain 
traditional ingredients.

    (a) General. Any malt beverage that has been fermented or flavored 
only with one or more ingredients (such as honey or certain fruits) 
that the appropriate TTB officer has determined are generally 
recognized as traditional ingredients in the production of a fermented 
beverage designated as ``beer,'' ``ale,'' ``porter,'' ``stout,'' 
``lager,'' or ``malt liquor'' may be labeled in accordance with trade 
understanding following the rules set forth in this section.
    (1) A list of such traditional ingredients may be found on the TTB 
website (https://www.ttb.gov).
    (2) If the malt beverage has also been fermented or flavored with 
ingredients that the appropriate TTB officer has not determined are 
generally recognized as traditional ingredients in the production of a 
fermented beverage designated as ``beer,'' ``ale,'' ``porter,'' 
``stout,'' ``lager,'' or ``malt liquor,'' it is a malt beverage 
specialty and must be labeled in accordance with the statement of 
composition rules in Sec.  7.147
    (b) Rules for designation. (1) A designation in accordance with 
trade understanding must identify the base product, such as ``malt 
beverage,'' ``beer,'' ``ale,'' ``porter,'' ``stout,'' ``lager,'' or 
``malt liquor'' along with a modifier or explanation that provides the 
consumer with adequate information about the fruit, honey, or other 
food ingredient used in production of the malt beverage. The label may 
include additional information about the production process (such as 
``beer fermented with cherry juice'').
    (2) Where more than one exempted ingredient is included, a 
designation in accordance with trade understanding may identify each 
ingredient (such as ``Ale with cherry juice, cinnamon, and nutmeg''), 
refer to the ingredients by category (such as ``Fruit ale,'' ``Spiced 
ale,'' or ``Ale with natural flavors''), or simply include the 
ingredient or ingredients that the bottler or importer believes best 
identify the product (such as ``Cherry ale,'' ``Cinnamon ale,'' or 
``Nutmeg ale''). The designation must distinguish the product from a 
malt beverage, beer, ale, porter, stout, lager, or malt liquor that is 
not brewed or flavored with any of these ingredients; thus, unmodified 
designations such as ``beer,'' ``stout,'' or ``ale'' would not be 
acceptable.
    (c) Other requirements. All parts of the designation must appear 
together and must be readily legible on a contrasting background. 
Designations that create a misleading impression as to the identity of 
the product by emphasizing certain words or terms are prohibited.


Sec.  7.145  Malt beverages containing less than 0.5 percent alcohol by 
volume.

    (a) Products containing less than one-half of 1 percent (0.5%) of 
alcohol by volume must bear the class designation ``malt beverage,'' 
``cereal beverage,'' or ``near beer.''
    (b) If the designation ``near beer'' is used, both words must 
appear in the same size and style of type, in the same color of ink, 
and on the same background.
    (c) No product containing less than one-half of 1 percent of 
alcohol by volume may bear the class designations ``beer,'' ``lager 
beer,'' ``lager,'' ``ale,'' ``porter,'' ``stout,'' or any other class 
or type designation commonly applied to malt beverages containing one-
half of 1 percent or more of alcohol by volume.


Sec.  7.146  Geographical names.

    (a) General. Except as provided further in paragraphs (b) through 
(e) of this section, any geographical name that may be interpreted as 
designating the origin of the malt beverage may not be used unless it 
is a truthful representation as to the origin of the malt beverage.
    (b) Generic names. The appropriate TTB officer may find certain 
geographic names of types of malt beverages to be generic if they have 
lost their geographic significance through use and common knowledge. 
Generic names may be used to designate a malt beverage regardless of 
its origin. TTB publishes a list of generic names on its website 
(https://www.ttb.gov). The following are examples of names that have 
been found to be generic: India Pale Ale, Scotch ale (Scottish ale), 
and Russian Imperial Stout (Imperial Russian Stout).
    (c) Brand names. A geographical name may be used as part of the 
brand name for a product that does not come from the geographical area 
named in the brand as long as the name is qualified with the word 
``brand'' or with some other qualification that is adequate to dispel 
any misleading impression that might otherwise be created in accordance 
with Sec.  7.64.
    (d) References to types and styles. (1) A geographical name may be 
used on a label to precede a class designation where the name refers to 
a particular type or style of product rather than the geographical 
origin of the malt beverage, under the following conditions:
    (i) The word ``type'' or ``style'' appears immediately adjacent to, 
and in type size at least half as large as, the geographical name (such 
as ``Irish style ale''); or some other statement indicating the true 
place of production appears in the same field of vision as, and in type 
size at least half as large as, the geographical name (such as ``Irish 
ale--brewed in California'' or ``American Vienna lager''); and
    (ii) The malt beverage to which the name is applied conforms to the 
type or style so designated.
    (2) The following are examples of references to types or styles of 
malt beverages: Dortmund, Dortmunder, Vienna, Wien, Wiener, Bavarian, 
Munich, Munchner, Salvator, Kulmbacher, Wurtzburger, and California 
Common. These names of types or styles of malt beverages may be used in 
addition to, but not in lieu of, a class designation (for example, 
``Vienna style Beer,'' ``Bavarian Stout--Brewed in the United States,'' 
or ``California Common Lager--Brewed in Michigan'').
    (3) The words ``type'' or ``style'' may also be used to designate 
malt beverages that are manufactured in the geographic area indicated 
by the name (such as ``German style Dortmunder beer'' or ``Vienna 
beer--an Austrian type of malt beverage'') as long as the label does 
not create confusion as to the origin of the malt beverage. Such 
products may also be designated without the words ``type'' or ``style'' 
(for example, ``Dortmunder beer'' or ``Vienna beer'') for products that 
originate in the geographical area named.
    (e) Pilsen or Pilsener or Pilsner. The name ``Pilsen'' (or 
``Pilsener'' or ``Pilsner'') has not been recognized as generic, but it 
may be used to designate beers produced in the Czech Republic or the 
United States without use of the word ``type'' or a similar qualifying 
statement and without an additional class or type designation. See 
Sec.  7.102(c).


Sec.  7.147  Statement of composition.

    (a) A statement of composition is required to appear on the label 
for malt beverage specialty products, as defined in Sec.  7.141(b), 
which are not known to the trade under a particular designation. For 
example, the addition of flavoring

[[Page 60687]]

materials, colors, or artificial sweeteners may change the class and 
type of the malt beverage. The statement of composition along with a 
distinctive or fanciful name serves as the class and type designation 
for these products.
    (b) When required by this part, a statement of composition must 
contain all of the following information, as applicable:
    (1) Identify the base class and/or type designation. The statement 
of composition must clearly identify the base class and/or type 
designation of the malt beverage product (e.g., ``beer,'' ``lager 
beer,'' ``lager,'' ``ale,'' ``porter,'' ``stout,'' or ``malt 
beverage'').
    (2) Identify added flavoring material(s) used before, during, and 
after fermentation. The statement of composition must disclose 
fermentable or non-fermentable flavoring materials added to the malt 
beverage base class.
    (i) If the flavoring material is used before or during the 
fermentation process, the statement of composition must indicate that 
the malt beverage was fermented or brewed with the flavoring material 
(such as ``Beer Fermented with grapefruit juice'' or ``Grapefruit 
Ale''). If the flavoring material is added after fermentation, the 
statement of composition must describe that process, using terms such 
as ``added,'' ``with,'' ``infused,'' or ``flavored'' (such as 
``Grapefruit-flavored ale.'')
    (ii) If a single flavoring material is used in the production of 
the malt beverage product, the flavoring material may be specifically 
identified (such as ``Ale Fermented with grapefruit juice'') or 
generally referenced (such as ``Ale with natural flavor''). If two or 
more flavoring materials are used in the production of the malt 
beverage, each flavoring material may be specifically identified (such 
as ``lemon juice, kiwi juice'' or ``lemon and kiwi juice'') or the 
characterizing flavoring material may be specifically identified and 
the remaining flavoring materials may be generally referenced (such as 
``kiwi and other natural and artificial flavor(s)''), or all flavors 
may be generally referenced (such as ``with artificial flavors''). 
(Note: TTB Procedure XXXX-XX, available on the TTB website (https://www.ttb.gov), provides guidance on the use of the terms ``natural'' and 
``artificial'' when referencing flavoring materials.)
    (3) Identify Added Coloring Material(s). The statement of 
composition must disclose the addition of coloring material(s), whether 
added directly or through flavoring material(s). The coloring materials 
may be identified specifically (such as ``caramel color,'' ``FD&C Red 
#40,'' ``annatto,'' etc.) or as a general statement, such as ``Contains 
certified color'' for colors approved under 21 CFR subpart 74 or 
``artificially colored'' to indicate the presence of any one or a 
combination of coloring material(s). However, FD&C Yellow No. 5, 
carmine, and cochineal extract require specific disclosure in 
accordance with Sec.  7.63(b)(1) and (2) and that specific disclosure 
may appear either in the statement of composition or elsewhere in 
accordance with those sections.
    (4) Identify added artificial sweeteners. The statement of 
composition must disclose any artificial sweetener that is added to a 
malt beverage product, whether the artificial sweetener is added 
directly or through flavoring material(s). The artificial sweetener may 
be identified specifically by either generic name or trademarked brand 
name, or as a general statement (such as ``artificially sweetened'') to 
indicate the presence of any one or combination of artificial 
sweeteners. However, if aspartame is used, an additional warning 
statement is required in accordance with Sec.  7.63(b)(4).

Subpart J-K--Reserved

Subpart L--Recordkeeping and Substantiation Requirements


Sec.  7.211  Recordkeeping requirements--certificates.

    (a) Certificates of label approval (COLAs). Upon request by the 
appropriate TTB officer, a bottler or importer must provide evidence of 
label approval for a label used on a container of malt beverages that 
is subject to the COLA requirements of this part. This requirement may 
be satisfied by providing original COLAs, photocopies, or electronic 
copies of COLAs, or records showing the TTB Identification number 
assigned to the approved COLA. TTB may request such information for a 
period of five years from the date that the products covered by the 
COLAs were removed from the bottler's premises or from customs custody, 
as applicable.
    (b) Labels with revisions. Where labels on containers reflect 
revisions to the approved label that have been made in compliance with 
allowable revisions authorized by TTB Form 5100.31 or otherwise 
authorized by TTB, the bottler or importer must, upon request by the 
appropriate TTB officer, identify the COLA covering the product if the 
product is required to be covered by a COLA. TTB may request such 
information for a period of five years from the date that the products 
covered by the COLA were removed from the bottler's premises or from 
customs custody, as applicable.
    (c) Other recordkeeping requirements under this part. See Sec.  
7.26 for other recordkeeping requirements under this part.


Sec.  7.212  Substantiation requirements.

    (a) Application. The substantiation requirements of this section 
apply to any claim made on any label or container subject to the 
requirements of this part.
    (b) Reasonable basis in fact. All claims, whether implicit or 
explicit, must have a reasonable basis in fact. Claims that contain 
express or implied statements regarding the amount of support for the 
claim (such as ``tests prove'' or ``studies show'') must have the level 
of substantiation that is claimed. Any labeling claim that does not 
have a reasonable basis in fact or cannot be adequately substantiated 
upon the request of the appropriate TTB officer will be considered 
misleading within the meaning of Sec.  7.122(b)(2).
    (c) Evidence that claims are adequately substantiated. The 
appropriate TTB officer may request that bottlers and importers provide 
evidence that labeling claims are adequately substantiated at any time 
within a period of five years from the time the malt beverages were 
removed from the bottling premises or from customs custody, as 
applicable.

Subpart M--Penalties and Compromise of Liability


Sec.  7.221  Criminal penalties.

    A violation of the labeling provisions of 27 U.S.C. 205(e) is 
punishable as a misdemeanor. See 27 U.S.C. 207 for the statutory 
provisions relating to criminal penalties, consent decrees, and 
injunctions.


Sec.  7.222  Conditions of basic permit.

    A basic permit is conditioned upon compliance with the requirements 
of 27 U.S.C. 205, including the labeling provisions of this part. A 
willful violation of the conditions of a basic permit provides grounds 
for the revocation or suspension of the permit, as applicable, as set 
forth in part 1 of this chapter.


Sec.  7.223  Compromise.

    Pursuant to 27 U.S.C. 207, the appropriate TTB officer is 
authorized, with respect to any violation of 27 U.S.C. 205, to 
compromise the liability arising with respect to such violation upon 
payment of a sum not in excess of $500 for each offense, to be 
collected by the appropriate TTB officer and to be

[[Page 60688]]

paid into the Treasury as miscellaneous receipts.

Subpart N--Paperwork Reduction Act


Sec.  7.231  OMB control numbers assigned under the Paperwork Reduction 
Act.

    (a) Purpose. This subpart displays the control numbers assigned to 
information collection requirements in this part by the Office of 
Management and Budget (OMB) under the Paperwork Reduction Act of 1995, 
Public Law 104-13.
    (b) Chart. The following chart identifies each section in this part 
that contains an information collection requirement and the OMB control 
number that is assigned to that information collection requirement.

------------------------------------------------------------------------
          Section where contained              Current OMB Control No.
------------------------------------------------------------------------
7.21......................................  1513-0020, 1513-0087.
7.22......................................  1513-0020, 1513-0087, 1513-
                                             0111.
7.24......................................  1513-0020, 1513-0064.
7.25......................................  1513-0020, 1513-0111.
7.27......................................  1513-0020, 1513-0087.
7.28......................................  1513-0122.
7.62......................................  1513-0087.
7.63......................................  1513-0084, 1513-0087.
7.66......................................  1513-0085.
7.67......................................  1513-0085.
7.81......................................  1513-0087.
7.82......................................  1513-0087, 1513-0121.
7.83......................................  1513-0087, 1513-0121.
7.84......................................  1513-0087.
7.85......................................  1513-0087.
7.121.....................................  1513-0087.
7.122.....................................  1513-0087.
7.123.....................................  1513-0087.
7.124.....................................  1513-0087.
7.125.....................................  1513-0087.
7.126.....................................  1513-0087.
7.127.....................................  1513-0087.
7.128.....................................  1513-0087.
7.129.....................................  1513-0087.
7.130.....................................  1513-0087.
7.131.....................................  1513-0087.
7.132.....................................  1513-0087.
7.211.....................................  New control number.
7.212.....................................  New control number.
------------------------------------------------------------------------

0
4. Add part 14 to read as follows:

PART 14--ADVERTISING OF WINE, DISTILLED SPIRITS, AND MALT BEVERAGES

Sec.
14.0 Applicability.
Subpart A--General Provisions
14.1 Definitions.
14.2 Territorial extent.
14.3 Delegations of the Administrator's authorities.
14.4 General requirements under the Federal Alcohol Administration 
Act.
14.5 Legibility of mandatory information.
14.6 Mandatory statements.
Subpart B--Rules Related to Specific Practices in Advertisements
14.11 Statements and representations in advertisements.
14.12 Regulated practices.
14.13 Prohibited practices.
14.14 Misleading statements or representations.
14.15 Additional rules for wine.
14.16 Additional rules for distilled spirits.
14.17 Additional rules for malt beverages.
Subpart C--Penalties and Compromise of Liability
14.21 Criminal penalties.
14.22 Conditions of basic permit.
14.23 Compromise.
Subpart D--Paperwork Reduction Act
14.31 OMB control numbers assigned under the Paperwork Reduction 
Act.

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


Sec.  14.014.0  Applicability.

    (a) General. Except as otherwise provided in paragraph (b) of this 
section, the provisions of this part prescribe rules under section 
105(f) of the Federal Alcohol Administration Act for the advertising of 
wine, distilled spirits, and malt beverages.
    (b) Malt beverages. The provisions of this part apply to the 
advertising of malt beverages intended to be sold or shipped or 
delivered for shipment, or otherwise introduced into or received in any 
State from any place outside the State, only to the extent that the 
laws or regulations of such State impose similar requirements with 
respect to the advertising of malt beverages sold within that State.

Subpart A--General Provisions


Sec.  14.114.1  Definitions.

    Administrator. The Administrator, Alcohol and Tobacco Tax and Trade 
Bureau, Department of the Treasury.
    Advertisement or Advertising. The term ``advertisement'' or 
``advertising'' includes any written or verbal statement, illustration, 
or depiction that is in, or calculated to induce sales in, interstate 
or foreign commerce, or is disseminated by mail, whether it appears in 
a newspaper, magazine, trade booklet, menu, wine card, leaflet, 
circular, mailer, book insert, catalog, promotional material, sales 
pamphlet, internet or other electronic site or social network, or any 
written, printed, graphic, or other matter (such as hang tags) 
accompanying, but not firmly affixed to, the container, representations 
made on shipping cases, or in any billboard, sign, or other outdoor 
display, public transit card, other periodical literature, and 
publication, or in a radio or television broadcast, or in any other 
media. However, the term ``advertisement'' does not include:
    (1) Any label, container, or packaging that is subject to the 
provisions of part 4, 5 or 7 of this chapter; or
    (2) Any editorial or other reading material (such as a release) in 
any periodical or publication or newspaper, for the publication of 
which no money or valuable consideration or a thing of value is paid or 
promised, directly or indirectly, by any permittee or brewer, and which 
is not written by or at the direction of a permittee or brewer.
    Appropriate TTB officer. An officer or employee of the Alcohol and 
Tobacco Tax and Trade Bureau (TTB) authorized to perform any function 
relating to the administration or enforcement of this part by the 
current version of TTB Order 1135.14, Delegation of the Administrator's 
Authorities in 27 CFR part 14, Advertising of Wine, Distilled Spirits, 
and Malt Beverages.
    Consumer Specialty Items. Items that are designed to be carried 
away by the consumer, such as nonalcoholic mixers, pouring racks, ash 
trays, bottle or can openers, cork screws, shopping bags, matches, 
printed recipes, pamphlets, cards, leaflets, blotters, post cards, 
pencils, shirts, caps, and visors.
    Container. Any can, bottle, box used to protect an internal 
bladder, cask, keg, barrel or other closed receptacle, in any size or 
material, that is for use in the sale of wine, distilled spirits, or 
malt beverages at retail.
    Distilled spirits. Ethyl alcohol, hydrated oxide of ethyl, spirits 
of wine, whisky, rum, brandy, gin, and other distilled spirits, 
including all dilutions and mixtures thereof, for nonindustrial use. 
The term ``distilled spirits'' does not include mixtures containing 
wine, bottled at 48 degrees of proof or less, if the mixture contains 
more than 50 percent wine on a proof gallon basis. The term ``distilled 
spirits'' also does not include products containing less than 0.5 
percent alcohol by volume.
    FAA Act. Federal Alcohol Administration Act.
    Malt beverage. A beverage made by the alcoholic fermentation of an 
infusion or decoction, or combination of both, in potable brewing 
water, of 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. See Sec.  7.5 of this chapter for standards 
applying to the

[[Page 60689]]

use of processing methods and flavors in malt beverage production.
    Permittee. Any person holding a basic permit under the FAA Act.
    Person. Any individual, corporation, partnership, association, 
joint-stock company, business trust, limited liability company, or 
other form of business enterprise, including a receiver, trustee, or 
liquidating agent, and including an officer or employee of any agency 
of a State or political subdivision of a State.
    Responsible advertiser. The permittee or brewer responsible for the 
publication or broadcast of an advertisement.
    Spirits. See Distilled spirits.
    State. One of the 50 States of the United States, the District of 
Columbia, or the Commonwealth of Puerto Rico.
    TTB. The Alcohol and Tobacco Tax and Trade Bureau, Department of 
the Treasury.
    United States. The 50 States, the District of Columbia, and the 
Commonwealth of Puerto Rico.
    Wine. Section 117(a) of the Federal Alcohol Administration Act (27 
U.S.C. 211(a)) defines ``wine'' as any of the following products for 
nonindustrial use that contain not less than 7 percent and not more 
than 24 percent alcohol by volume:
    (1) Wine as defined in section 610 and section 617 of the Revenue 
Act of 1918 (26 U.S.C. 5381-5392); and
    (2) Other alcoholic beverages not so defined, but made in the 
manner of wine, including sparkling and carbonated wine, wine made from 
condensed grape must, wine made from other agricultural products than 
the juice of sound, ripe grapes, imitation wine, compounds sold as 
wine, vermouth, cider, perry, and sak[eacute].


Sec.  14.214.2  Territorial extent.

    The provisions of this part apply in the 50 States, the District of 
Columbia, and the Commonwealth of Puerto Rico.


Sec.  14.314.3  Delegations of the Administrator's authorities.

    Most of the regulatory authorities of the Administrator contained 
in this part are delegated to ``appropriate TTB officers.'' To 
determine which officers have been delegated specific authorities, see 
the current version of TTB Order 1135.14, Delegation of the 
Administrator's Authorities in 27 CFR part 14, Advertising of Wine, 
Distilled Spirits, and Malt Beverages. You may obtain a copy of this 
order by accessing the TTB website (https://www.ttb.gov) or by mailing 
a request to the Alcohol and Tobacco Tax and Trade Bureau, National 
Revenue Center, 550 Main Street, Room 8002, Cincinnati, OH 45202.


Sec.  14.414.4  General requirements under the FAA Act.

    (a) General. No person engaged in business as a distiller, brewer, 
blender, or other producer, or as an importer or wholesaler of 
distilled spirits, wine or malt beverages, or as a processor, bottler, 
or warehouseman and bottler of distilled spirits, directly or 
indirectly or through an affiliate, may publish or disseminate or cause 
to be published or disseminated by radio or television broadcast, or in 
any newspaper, periodical, or other publication, or by any sign or 
outdoor advertisement, or by electronic or internet media, or any other 
printed or graphic matter, any advertisement of wine, distilled 
spirits, or malt beverages, if such advertising is in, or is calculated 
to induce sale in, interstate or foreign commerce, or is disseminated 
by mail, unless such advertisement is in conformity with the provisions 
of this part.
    (b) Exclusion. The provisions of this part do not apply to a 
retailer or to the publisher of any newspaper, periodical, or other 
publication, or to a radio or television or internet broadcast, unless 
the retailer or publisher or broadcaster is engaged in business as a 
distiller, brewer, blender, or other producer, or as an importer or 
wholesaler of wine, distilled spirits, or malt beverages, or as a 
processor, bottler, or warehouseman and bottler, of distilled spirits, 
directly or indirectly, or through an affiliate.
    (c) Substantiation. The substantiation requirements of this 
paragraph apply to any claim made on any advertisement subject to the 
requirements of this part.
    (1) Reasonable basis in fact. All claims, whether implicit or 
explicit, must have a reasonable basis in fact. Claims that contain 
express or implied statements regarding the amount of support for the 
claim (such as, ``tests prove,'' or ``studies show'') must have the 
level of substantiation that is claimed. Any advertising claim that 
does not have a reasonable basis in fact, or cannot be adequately 
substantiated upon the request of the appropriate TTB officer, will be 
considered misleading within the meaning of Sec.  14.14 (a)(2).
    (2) Evidence that claims are adequately substantiated. The 
appropriate TTB officer may request that the responsible advertiser 
provide evidence that advertising claims are adequately substantiated 
at any time within a period of five years from the time the 
advertisement was last disseminated or published.


Sec.  14.514.5  Legibility of mandatory information.

    (a) Statements required by this part that appear in any written, 
printed, electronic, internet, or other graphic advertisement must be 
in legible type of sufficient size and on a contrasting background so 
as to be readable under ordinary conditions.
    (b) In the case of signs, billboards, and displays that are 
designed for viewing from a distance, the required name and address, or 
name and other contact information (such as, telephone number, website, 
or email), of the responsible advertiser may appear in lettering or 
type size that is smaller than that of the other mandatory information, 
provided that the name and contact information can be readily 
ascertained upon closer examination of the sign, billboard, or display.
    (c) Information required under this part that appears in an 
advertisement in any audio-visual medium must be clear and conspicuous 
and understandable to a consumer viewing or listening to the 
advertisement under ordinary conditions.
    (d) Information required under this part must be presented as being 
clearly part of the advertisement and may not be separated in any 
manner from other parts of the advertisement.
    (e) If an advertisement covers two or more products, the 
information required under this part that differs between the products 
must appear in the advertisement separately for each product.


Sec.  14.614.6  Mandatory statements.

    (a) General. Advertisements of wine, distilled spirits, and malt 
beverages must include the following mandatory information.
    (1) Responsible advertiser. The advertisement must display the 
responsible advertiser's name, city, and State or the name and other 
contact information (such as, telephone number, website, or email 
address) where the responsible advertiser may be contacted.
    (2) Class, type, or other designation. An advertisement must 
contain a statement of the class, type, or other designation that 
applies to the wine, distilled spirits, or malt beverage, and that is 
required to appear on the label of the product under subpart I of part 
4, 5, or 7 of this chapter. The statement must be clear and conspicuous 
and be legible in accordance with Sec.  14.5.
    (3) Exceptions. The following exceptions apply to the rules in 
paragraphs (a)(1) and (2) of this section:
    (i) If an advertisement refers to a general product line or to all 
of the wine, distilled spirits, or malt beverage

[[Page 60690]]

products of one company, whether by the brand name common to all the 
products in the line or by the company name, the only information 
required is the name, city, and State or the name and other contact 
information of the responsible advertiser in accordance with paragraph 
(a)(1) of this section. However, this exception does not apply when 
only one type of wine, distilled spirits, or malt beverage product is 
marketed under the specific brand name advertised; and
    (ii) In the case of a consumer specialty item (for example, a T-
shirt, hat, bumper sticker, or refrigerator magnet), the only 
information required is the company name of the responsible advertiser 
or the brand name of the wine, distilled spirits, or malt beverage 
product.
    (b) Additional rules for distilled spirits. The rules set forth in 
this paragraph apply to distilled spirits advertisements and are in 
addition to the rules specified in paragraph (a) of this section.
    (1) Alcohol content--(i) Mandatory statement. The alcohol content 
for distilled spirits must be stated as a percentage of alcohol by 
volume in the manner set forth in Sec.  5.65 of this chapter.
    (ii) Optional statement. The advertisement may also state the 
alcohol content of the distilled spirits product in degrees of proof if 
that information appears immediately adjacent to the percent-alcohol-
by-volume statement prescribed in paragraph (b)(1)(i) of this section.
    (2) Percentage of neutral spirits and name of commodity--(i) 
Production with neutral spirits. In the case of distilled spirits 
(other than cordials, liqueurs, and specialties) produced by blending 
or other processing, if neutral spirits were used in the production of 
the spirits, the advertisement must state the percentage of neutral 
spirits so used and the name of the commodity from which the neutral 
spirits were distilled. The statement of percentage and the name of the 
commodity must be in substantially the following form: ``__% neutral 
spirits distilled from __ (insert grain, cane products, or fruit as 
appropriate)''; or ``__% neutral spirits (vodka) distilled from __ 
(insert grain, cane products, or fruit, as appropriate)''; or ``__% 
grain (cane products), (fruit) neutral spirits'', or ``__% grain 
spirits.'' The statement used under this paragraph must be identical to 
that on the label of distilled spirits to which the advertisement 
refers.
    (ii) Neutral spirits and gin produced by continuous distillation. 
In the case of neutral spirits or in the case of gin produced by a 
process of continuous distillation, the advertisement must state the 
name of the commodity from which the neutral spirits or gin was 
distilled. The statement of the name of the commodity must appear in 
substantially the following form: ``Distilled from grain,'' or 
``Distilled from cane products,'' or ``Distilled from fruit.'' The 
statement used under this paragraph must be identical to that on the 
label of distilled spirits to which the advertisement refers.

Subpart B--Rules Related to Specific Practices in Advertisements


Sec.  14.11  Statements and representations in advertisements.

    (a) General. Sections 14.12 through 14.14 specify rules that apply 
to advertisements for wine, distilled spirits, and malt beverages. 
Additional rules that apply only to advertisements for wine, only to 
advertisements for distilled spirits, or only to advertisements for 
malt beverages are contained in Sec. Sec.  14.15, 14.16, and 14.17, 
respectively.
    (b) Statement or representation defined. For purposes of the rules 
in this subpart, the term ``statement or representation'' includes any 
statement, design, device, or representation, and includes pictorial or 
graphic designs or representations as well as written ones. The term 
``statement or representation'' includes explicit and implicit 
statements and representations.


Sec.  14.12  Regulated practices.

    (a) General. The practices, statements, and representations in this 
section may be used on wine, distilled spirits, and malt beverage 
labels only when used in compliance with this subpart.
    (b) Statements inconsistent with labeling. (1) An advertisement may 
not contain any statement concerning a brand or lot of the product that 
is inconsistent with any statement appearing on the label.
    (2) Any label depicted on a container in an advertisement must be 
covered by a certificate of label approval (COLA) or certificate of 
exemption from label approval obtained pursuant to part 4, 5, or 7 of 
this chapter, except that malt beverage labels not required to be 
covered by a COLA in accordance with the rules in Sec.  7.21 of this 
chapter may also appear on advertisements. In all cases, the label 
appearing on an advertisement must be identical to that appearing on 
the container.
    (c) Comparative advertising in general. Comparative advertising for 
a wine, distilled spirits, or malt beverage may not be disparaging of a 
competitor's product and may not deceive or mislead the consumer.
    (1) Taste tests. Taste test results may appear in an advertisement 
comparing competitors' products, provided that:
    (i) The results are not disparaging, deceptive, or likely to 
mislead the consumer;
    (ii) The taste test procedure used must meet scientifically 
accepted procedures. An example of a scientifically accepted procedure 
is outlined in the Manual on Sensory Testing Methods, ASTM Special 
Technical Publication 434, published by the American Society for 
Testing and Materials, 1916 Race Street, Philadelphia, Pennsylvania 
19103 (ASTM, 1968, Library of Congress Catalog Card Number 68-15545); 
and
    (iii) A statement must appear in the advertisement providing the 
name and address of the testing administrator.
    (2) [Reserved]


Sec.  14.13  Prohibited practices.

    An advertisement may not contain any of the following:
    (a) Any statement or representation that is obscene or indecent;
    (b) Any statement or representation that is false or misleading; or
    (c) Any subliminal or other deceptive technique or device that 
conveys, or attempts to convey, a message to a person by means of 
images or sounds of a very brief nature that cannot be perceived at a 
normal level of awareness.


Sec.  14.14  Misleading statements or representations.

    (a) General prohibition--(1) Misleading statements or 
representations. No statement or representation, irrespective of 
falsity, that is misleading to consumers as to the age, origin, 
identity, or other characteristics of the wine, distilled spirits, or 
malt beverage, or with regard to any other material factor may appear 
on an advertisement.
    (2) Ways in which statements or representations may be misleading. 
(i) A statement or representation is prohibited, irrespective of 
falsity, if it directly creates a misleading impression, or if it does 
so indirectly through ambiguity, omission, inference, or by the 
addition of irrelevant scientific, or technical matter. For example, an 
otherwise truthful statement may be misleading because of the omission 
of material information, the disclosure of which is necessary to 
prevent the statement from being misleading.
    (ii) As set forth in Sec.  14.4(c), all claims, whether implicit or 
explicit, must have a reasonable basis in fact. Any claim on an 
advertisement that does not have a reasonable basis in fact, or cannot 
be

[[Page 60691]]

adequately substantiated upon the request of the appropriate TTB 
officer, is considered misleading.
    (b) Disparaging statements. False or misleading statements that 
explicitly or implicitly disparage a competitor's product are 
prohibited.
    (1) Examples. (i) An example of an explicit statement that falsely 
disparages a competitor's product is ``Brand X is not aged in oak 
barrels,'' when such statement is not true.
    (ii) An example of an implicit statement that disparages 
competitor's products in a misleading fashion is ``We do not add 
arsenic to our distilled spirits,'' when such a claim may lead 
consumers to falsely believe that other distillers do add arsenic to 
their distilled spirits.
    (2) This paragraph does not prevent truthful and accurate 
comparisons between products (such as ``Our wine contains more 
strawberries than Brand X'') or statements of opinion (such as ``We 
think our beer tastes better than any other beer on the market'').
    (c) Analyses, standards, or tests. Any statement, or representation 
of or relating to analyses, standards, or tests, whether or not it is 
true, that is likely to mislead the consumer is prohibited. An example 
of such a misleading statement is ``tested and approved by our research 
laboratories'' if the testing and approval does not in fact have any 
significance;
    (d) Guarantees. Any statement or representation relating to 
guarantees is prohibited if the appropriate TTB officer finds it is 
likely to mislead the consumer. However, money-back guarantees are not 
prohibited.
    (e) Government authority. Any statement or representation that 
misleads the consumer to believe that the wine, distilled spirits, or 
malt beverage is produced, blended, bottled, packed, or sold under 
Government authority is prohibited, except that:
    (1) A municipal, State, or Federal permit number may appear in the 
advertisement, but the permit number may not be accompanied by any 
additional statement relating to it; and
    (2) Such a statement may appear in an advertisement for distilled 
spirits if it conforms to the statement permitted in subpart E of part 
5 of this chapter for labels of distilled spirits products.
    (f) Cross-commodity claims. (1) An advertisement may not contain a 
statement or representation that tends to create the false or 
misleading impression that a product is a different commodity (as 
defined in paragraph (f)(2) of this section), or that it contains 
another commodity. For example, the use of the name of a class or type 
designation recognized in part 4 or 5 of this chapter is prohibited on 
a malt beverage advertisement, if the use of that name creates a 
misleading impression as to the identity of the product. This 
prohibition includes the use of homophones or coined words that 
simulate or imitate a class or type designation. This paragraph does 
not prohibit the following on advertisements:
    (i) A truthful and accurate statement of alcohol content;
    (ii) The use of a brand name of a wine or distilled spirits product 
as a malt beverage brand name, of a distilled spirits or malt beverage 
product as a wine brand name, or of a wine or malt beverage product as 
a distilled spirits brand name, provided that the overall advertisement 
does not create a misleading impression about the identity of the 
product;
    (iii) The use of a wine, distilled spirits, or malt beverage 
cocktail name as a brand name or a distinctive or fanciful name of 
another commodity's product, provided that a statement of composition, 
in accordance with part 4, 5, or 7 of this chapter, as appropriate, 
appears in the same field of vision as the brand name or the 
distinctive or fanciful name and the overall advertisement does not 
create a misleading impression about the identity of the product;
    (iv) The use of truthful and accurate statements about the 
production of the product, as part of a statement of composition or 
otherwise, such as ``finished in whisky barrels,'' ``fermented with 
rye,'' or ``Beer brewed with chardonnay grapes,'' so long as such 
statements do not create a misleading impression as to the identity of 
the product; or
    (v) The use of terms that compare a product or products of one 
commodity to a product or products of a different commodity without 
creating a misleading impression as to the identity of the product.
    (2) When used in this paragraph, ``commodity'' means wine, 
distilled spirits, or malt beverages.
    (g) Representations of the armed forces or flags. Advertisements 
may not show an image of any government's flag or any representation 
related to the armed forces of the United States if the representation, 
standing alone or considered together with any additional language or 
symbols, creates an impression that the product was endorsed by, made 
by, used by, or made under the supervision of the government 
represented by that flag or by the armed forces of the United States. 
This section does not prohibit the use of a flag as part of a claim of 
American origin or another country of origin.
    (h) Government seals. Advertisements may not contain any government 
seal or other insignia that is likely to mislead the consumer to 
believe that the product has been endorsed by, made by, used by, or 
produced for, under the supervision of, or in accordance with the 
specification of that government.
    (i) Health-related statements--(1) Definitions. When used in this 
section, the following terms have the meaning indicated:
    (i) Health-related statement. ``Health-related statement'' means 
any statement related to health (other than the health warning 
statement required under part 16 of this chapter) and includes any 
statement of a curative or therapeutic nature that, expressly or by 
implication, suggest a relationship between the consumption of alcohol, 
a wine, distilled spirits, or malt beverage product, or any substance 
found within such a product, and health benefits or effects on health. 
The term includes both specific health claims and general references to 
alleged health benefits or effects on health associated with the 
consumption of alcohol, a wine, distilled spirits, or malt beverage 
product, or any substance found within such a product, as well as 
health-related directional statements. The term also includes 
statements and claims that imply that a physical or psychological 
sensation results from consuming the wine, distilled spirits, or malt 
beverage product, as well as statements and claims of nutritional value 
(for example, statements of vitamin content). Numerical statements of 
caloric, carbohydrate, protein, and fat content of the product do not 
constitute claims of nutritional value.
    (ii) Specific health claim. ``Specific health claim'' means a type 
of health-related statement that, expressly or by implication, 
characterizes the relationship of alcohol, a wine, distilled spirits, 
or malt beverage product, or any substance found within such a product, 
to a disease or health-related condition. Implied specific health 
claims include statements, symbols, vignettes, or other forms of 
communication that suggest, within the context in which they are 
presented, that a relationship exists between alcohol, a wine, 
distilled spirits or malt beverage product, or any substance found 
within such a product, and a disease or health-related condition.
    (iii) Health-related directional statement. ``Health-related 
directional statement'' means a type of health-related statement that 
directs or refers consumers to a third party or other

[[Page 60692]]

source for information regarding the effects on health of alcohol or 
consumption of wine, distilled spirits, or malt beverages.
    (2) Rules for advertising--(i) Health-related statements. In 
general, an advertisement for a wine, distilled spirits, or malt 
beverage product may not contain any health-related statement that is 
untrue in any particular or tends to create a misleading impression as 
to the effects on health of alcohol consumption. TTB will evaluate such 
statements on a case-by-case basis and may require as part of the 
health-related statement a disclaimer or some other qualifying 
statement to dispel any misleading impression conveyed by the health-
related statement. Such a disclaimer or other qualifying statement must 
appear as prominently as the health-related statement.
    (ii) Specific health claims. A specific health claim will not be 
considered misleading if it is truthful and adequately substantiated by 
scientific or medical evidence; it is sufficiently detailed and 
qualified with respect to the categories of individuals to whom the 
claim applies; it adequately discloses the health risks associated with 
both moderate and heavier levels of alcohol consumption; and it 
outlines the categories of individuals for whom any levels of alcohol 
consumption may cause health risks. This information must appear as 
part of the specific health claim and as prominently as the specific 
health claim.
    (iii) Health-related directional statements. A health-related 
directional statement is presumed misleading unless it--
    (A) Directs consumers in a neutral or other non-misleading manner 
to a third party or other source for balanced information regarding the 
effects on health of alcohol or wine, distilled spirits, or malt 
beverage consumption; and
    (B)(1) Includes as part of the health-related directional statement 
the following disclaimer: ``This statement should not encourage you to 
drink or to increase your alcohol consumption for health reasons''; or
    (2) Includes as part of the health-related directional statement, 
and as prominently as the health-related directional statement, some 
other qualifying statement that the appropriate TTB officer finds is 
sufficient to dispel any misleading impression conveyed by the health-
related directional statement.


Sec.  14.15  Additional rules for wine.

    The rules in this section apply to advertisements for wine and are 
in addition to the rules that apply to all advertisements as set forth 
in Sec. Sec.  14.12 through 14.14.
    (a) Statements in advertisements. An advertisement for wine may not 
contain:
    (1) Any statement of bonded wine cellar and bonded winery numbers, 
unless stated immediately adjacent to the name and address of the 
person operating the wine cellar or winery. A statement of bonded wine 
cellar and bonded winery numbers may appear in the following form: 
``Bonded Wine Cellar No. __,'' ``Bonded Winery No. __,'' ``B.W.C. No. 
__,'' ``B.W. No. __.'' No additional reference to the statement may be 
made, and the statement may not be used in a way that might give the 
impression that the wine has been made or matured under government 
supervision or in accordance with government specifications or 
standards; or
    (2) Any statement, design, device, or representation that relates 
to alcohol content or that tends to create the impression that a wine 
is intoxicating or has intoxicating qualities, other than a truthful 
and accurate statement of alcohol content.
    (b) Statement of age. Subject to paragraph (c) of this section, an 
advertisement for wine may not contain any statement of age or other 
representation relative to age (including words, symbols, or other 
devices in any brand name or mark), except for:
    (1) Vintage dates on vintage wine, in accordance with Sec.  4.95 of 
this chapter;
    (2) References relating to methods of wine production involving 
storage or aging which are used for the advertised wine; and
    (3) Use of the word ``old'' as part of a brand name.
    (c) Statement of bottling date. For purposes of paragraph (b) of 
this section, a statement of the bottling date of a wine will not be 
deemed to be a representation relative to age, provided that the 
statement appears in the advertisement without undue emphasis in the 
following form: ``Bottled in __'' (inserting the year in which the wine 
was bottled).
    (d) Miscellaneous date statements. Except in the case of vintage 
dates and bottling dates as provided in paragraphs (b)(1) and (c) of 
this section, an advertisement of wine may not bear any date unless, in 
addition to the date and immediately adjacent to the date and in the 
same size and kind of printing, a statement of the significance or 
relevance of the date is provided, such as ``established'' or ``founded 
in.'' If the date refers to the date of establishment of any business 
or brand name, the date and its accompanying statement must appear 
immediately adjacent to the name of the person, company, or brand name 
to which it relates if the appropriate TTB officer finds that this is 
necessary in order to prevent confusion as to the person, company, or 
brand name to which the establishment date applies.
    (e) Statements indicative of origin. An advertisement for wine may 
not contain any statement or representation that indicates or implies 
an origin other than the true place of origin of the wine, except for 
brand names of geographical significance, when used in accordance with 
Sec.  4.64(c) of this chapter, and semi-generic designations, when used 
in accordance with Sec.  4.174 of this chapter.


Sec.  14.16  Additional rules for distilled spirits.

    The rules in this section apply to advertisements for distilled 
spirits products and are in addition to the rules that apply to all 
advertisements as set forth in Sec. Sec.  14.12 through 14.14.
    (a) Statements in advertisements. An advertisement for a distilled 
spirits product may not contain:
    (1) The words ``bond,'' ``bonded,'' ``bottled in bond,'' or ``aged 
in bond,'' or any other phrase containing ``bond'' or ``bonded,'' 
unless those words or phrases appear in the advertisement in the same 
manner and form as prescribed in Sec.  5.88 of this chapter for a label 
for the distilled spirits product in question;
    (2) A statement regarding multiple distillations, such as ``double 
distilled'' or ''triple distilled,'' unless used in accordance with the 
rules in Sec.  5.89 of this chapter; or
    (3) The word ``pure'' unless it:
    (i) Refers to a particular ingredient used in the production of the 
distilled spirits, and is a truthful representation about that 
ingredient;
    (ii) Is part of the bona fide name of a permittee or retailer for 
whom the distilled spirits are bottled; or
    (iii) Is part of the bona fide name of the permittee who bottled 
the distilled spirits.
    (b) Statements of age. (1) Except at provided in paragraph (b)(2) 
of this section, an advertisement for a distilled spirits product may 
not contain any statement, design, or device, directly or by 
implication, concerning age or maturity of any brand or lot of 
distilled spirits, unless a statement of age in accordance with Sec.  
5.73 of this chapter appears on the label of the advertised product. 
When any such statement, design, or device concerning age or maturity 
is contained in an advertisement, it must include (immediately adjacent 
to it and with substantially equal conspicuousness) all parts of the 
statement concerning age

[[Page 60693]]

and percentages required to appear on a label of the product under part 
5 of this chapter.
    (2) An advertisement for any whisky or brandy (except immature 
brandies) for which a statement of age is not required on a label, or 
an advertisement for any rum or Tequila that has been aged for four 
years or more, may contain an inconspicuous, general representation as 
to age or maturity, or other similar representations, even though a 
specific age statement does not appear on the label of the advertised 
product or in the advertisement itself.
    (c) Place of origin and producer or processor. An advertisement for 
a distilled spirits product may not contain any statement, design, 
device, or representation, stating or implying that the distilled 
spirits were manufactured in, or imported from, a country or place 
other than their actual country or place of origin, or that the 
distilled spirits were produced or processed by a person who was not in 
fact the actual producer or processor.


Sec.  14.17  Additional rules for malt beverages.

    The rules in this section apply to advertisements for malt 
beverages and are in addition to the prohibited practice rules that 
apply to for all wine, distilled spirits, or malt beverage 
advertisements as set forth in Sec. Sec.  14.12 through14.14.
    (a) ``Bonded'' and other terms. An advertisement may not contain 
the words ``bonded,'' ``bottled in bond,'' ``aged in bond,'' ``bonded 
age,'' ``bottled under Customs supervision,'' or other phrases 
containing these or synonymous terms that may create a misleading 
impression as to governmental supervision over production or bottling.
    (b) Statement of class. An advertisement may not identify a product 
containing less than one-half of one percent (0.5%) of alcohol by 
volume with the designation ``beer,'' ``lager beer,'' ``lager,'' 
``ale,'' ``porter,'' or ``stout,'' or with any other class or type 
designation commonly applied to fermented malt beverages containing 
one-half of one percent or more of alcohol by volume. In addition, an 
advertisement may identify a product with the class designation 
``ale,'' ``porter,'' or ``stout'' only if the product was fermented at 
comparatively high temperature, was produced without the use of 
coloring or flavoring materials (other than those recognized in 
standard brewing practices), and possesses the characteristics 
generally attributed to ale, porter, or stout. Any statement of class 
or designation used in an advertisement should be identical to the 
designation on the label.
    (c) Strength claims--(1) General. For purposes of this section, the 
term ``strength claim'' means a statement that directly or indirectly 
makes a claim about the alcohol content of the product. This section 
does not apply to the use of the terms ``low alcohol,'' ``reduced 
alcohol,'' ``non-alcoholic,'' and ``alcohol-free'' in accordance with 
Sec.  7.65 of this chapter; to claims about low alcohol content in 
general; or to the use of an alcohol content statement in accordance 
with Sec.  7.65 of this chapter.
    (2) Prohibition. The use of a strength claim on malt beverage 
advertisements is prohibited if it misleads consumers by implying that 
products should be purchased or consumed on the basis of higher alcohol 
strength. Examples of strength claims are ``full strength,'' ``extra 
strength,'' ``high test,'' and ``high proof.''

Subpart C--Penalties and Compromise of Liability


Sec.  14.21  Criminal penalties.

    A violation of the advertising provisions of 27 U.S.C. 205(f) is 
punishable as a misdemeanor. See 27 U.S.C. 207 for the statutory 
provisions relating to criminal penalties, consent decrees, and 
injunctions.


Sec.  14.22  Conditions of basic permit.

    A basic permit is conditioned upon compliance with the requirements 
of 27 U.S.C. 205, including the advertising provisions of this part. A 
willful violation of the conditions of a basic permit provides grounds 
for the revocation or suspension of the permit, as applicable, as set 
forth in part 1 of this chapter.


Sec.  14.23  Compromise.

    Pursuant to 27 U.S.C. 207, the appropriate TTB officer is 
authorized, with respect to any violation of 27 U.S.C. 205, to 
compromise the liability arising with respect to such violation upon 
payment of a sum not in excess of $500 for each offense, to be 
collected by the appropriate TTB officer and to be paid into the 
Treasury as miscellaneous receipts.

Subpart D--Paperwork Reduction Act


Sec.  14.31  OMB control numbers assigned under the Paperwork Reduction 
Act.

    (a) Purpose. This subpart displays the control numbers assigned to 
information collection requirements in this part by the Office of 
Management and Budget (OMB) under the Paperwork Reduction Act of 1995, 
Public Law 104-13.
    (b) Chart. The following chart identifies each section in this part 
that contains an information collection requirement and the OMB control 
number that is assigned to that information collection requirement.

------------------------------------------------------------------------
          Section where contained              Current OMB Control No.
------------------------------------------------------------------------
14.4......................................  New information collection.
14.6......................................  1513-0087.
14.12.....................................  1513-0087.
14.14.....................................  1513-0087.
14.15.....................................  1513-0087.
14.16.....................................  1513-0087.
14.17.....................................  1513-0087.
------------------------------------------------------------------------

PART 19--DISTILLED SPIRITS PLANTS

0
5. The authority citation 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, 5111-5114, 
5121-5124, 5142, 5143, 5146, 5148, 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.

0
6. In Sec.  19.356, revise paragraphs (c) and (d) to read as follows:


Sec.  19.356  Alcohol content and fill.

* * * * *
    (c) Variations in alcohol content. Variations in alcohol content 
may not exceed 0.3 percent alcohol by volume above or below the alcohol 
content stated on the label.
    (d) Example. Under paragraph (c) of this section, a product labeled 
as containing 40 percent alcohol by volume would be acceptable if the 
test for alcohol content found that it contained no less than 39.7 
percent alcohol by volume and no more than 40.3 percent alcohol by 
volume.

    Signed: August 28, 2018.
John J. Manfreda,
Administrator.
    Approved: November 1, 2018.
Timothy E. Skud,
Deputy Assistant Secretary (Tax, Trade and Tariff Policy).
[FR Doc. 2018-24446 Filed 11-23-18; 8:45 am]
 BILLING CODE-P