Proposed Revision to Vintage Date Requirements, 68373-68376 [2011-28645]
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Federal Register / Vol. 76, No. 214 / Friday, November 4, 2011 / Proposed Rules
rules applicable to taxable years
beginning before such date.
Therefore, the public hearing scheduled
for November, 7, 2011 is cancelled.
Steven T. Miller,
Deputy Commissioner for Services and
Enforcement.
Guy R. Traynor,
Acting Chief, Publications and Regulations
Branch, Legal Processing Division, Associate
Chief Counsel, (Procedure and
Administration).
[FR Doc. 2011–28658 Filed 11–3–11; 8:45 am]
BILLING CODE 4830–01–P
[FR Doc. 2011–28660 Filed 11–3–11; 8:45 am]
BILLING CODE 4830–01–P
DEPARTMENT OF THE TREASURY
Internal Revenue Service
DEPARTMENT OF THE TREASURY
26 CFR Part 1
Alcohol and Tobacco Tax and Trade
Bureau
[REG–140280–09]
27 CFR Part 4
RIN 1545–BK16
[Docket No. TTB–2011–0008; Notice No.
122]
Tax Return Preparer Penalties Under
Section 6695; Hearing Cancellation
RIN 1513–AB84
Internal Revenue Service (IRS),
Treasury.
ACTION: Cancellation of notice of
proposed rulemaking and notice of
public hearing.
AGENCY:
This document cancels a
public hearing on notice of proposed
rulemaking and notice of public hearing
(REG–140280–09) that would modify
existing regulations related to the tax
return preparer penalties under section
6695 of the Internal Revenue Code.
DATES: The public hearing, originally
scheduled for November 7, 2011 at
10 a.m., is cancelled.
FOR FURTHER INFORMATION CONTACT:
Richard A. Hurst of the Publications and
Regulations Branch, Legal Processing
Division, Associate Chief Counsel
(Procedure and Administration), at
Richard.A.Hurst@irscounsel.treas.gov.
SUMMARY:
A notice
of proposed rulemaking and notice of
public hearing that appeared in the
Federal Register on Tuesday, October
11, 2011 (76 FR 62689) announced that
a public hearing was scheduled for
November 7, 2011, beginning at 10 a.m.
in the auditorium of the Internal
Revenue Building, 1111 Constitution
Avenue NW., Washington, DC. The
subject of the public hearing is under
section 6695 of the Internal Revenue
Code.
The public comment period for a
notice of proposed rulemaking expires
on November 10, 2011. Outlines of
topics to be discussed at the hearing
were due on November 1, 2011. A
notice of proposed rulemaking and
notice of public hearing instructed those
interested in testifying at the public
hearing to submit an outline of the
topics to be addressed. As of November
2, 2011, no one has requested to speak.
jlentini on DSK4TPTVN1PROD with PROPOSALS
SUPPLEMENTARY INFORMATION:
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Proposed Revision to Vintage Date
Requirements
Alcohol and Tobacco Tax and
Trade Bureau, Treasury.
ACTION: Notice of proposed rulemaking.
AGENCY:
The Alcohol and Tobacco Tax
and Trade Bureau proposes to amend its
wine labeling regulations to allow a
vintage date to appear on a wine that is
labeled with a country as an appellation
of origin. The proposal would provide
greater grape sourcing and wine labeling
flexibility to winemakers, both domestic
and foreign, while still ensuring that
consumers are provided with adequate
information as to the identity and
quality of the wines they purchase.
DATES: Comments must be received on
or before January 3, 2012.
ADDRESSES: You may send comments on
this notice to one of the following
addresses:
• https://www.regulations.gov (via the
online comment form for this notice as
posted within Docket No. TTB–2011–
0008 at ‘‘Regulations.gov,’’ the Federal
e-rulemaking portal);
• Director, Regulations and Rulings
Division, Alcohol and Tobacco Tax and
Trade Bureau, P.O. Box 14412,
Washington, DC 20044–4412; or
• Hand Delivery/Courier in Lieu of
Mail: Alcohol and Tobacco Tax and
Trade Bureau, 1310 G Street NW., Suite
200E, Washington, DC 20005.
See the Public Participation section of
this notice for specific instructions and
requirements for submitting comments,
and for information on how to request
a public hearing.
You may view copies of this notice
and any comments TTB receives about
this proposal at https://
www.regulations.gov within Docket No.
TTB–2011–0008. A direct link to this
SUMMARY:
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68373
docket is also available on the TTB Web
site at https://www.ttb.gov/wine/winerulemaking.shtml under Notice No. 122.
You may also view copies of this notice
and any comments received about this
proposal by appointment at the TTB
Information Resource Center, 1310 G
Street NW., Washington, DC 20005.
Please call 202–453–2270 to make an
appointment.
FOR FURTHER INFORMATION CONTACT:
Jennifer Berry, Alcohol and Tobacco
Tax and Trade Bureau, Regulations and
Rulings Division, P.O. Box 18152,
Roanoke, VA, 24014; telephone 202–
453–1039.
SUPPLEMENTARY INFORMATION:
Background on Wine Labeling
TTB Authority
Section 105(e) of the Federal Alcohol
Administration Act (FAA Act), 27
U.S.C. 205(e), authorizes the Secretary
of the Treasury to prescribe regulations
for the labeling of wine, distilled spirits,
and malt beverages. The FAA Act
requires that these regulations, among
other things, prohibit consumer
deception and the use of misleading
statements on labels, and ensure that
labels provide the consumer with
adequate information as to the identity
and quality of the product. The Alcohol
and Tobacco Tax and Trade Bureau
(TTB) administers the FAA Act and the
regulations promulgated under it.
Current Vintage Date Requirements
Part 4 of the TTB regulations (27 CFR
part 4) sets forth the standards
promulgated under the FAA Act for the
labeling and advertising of wine.
Section 4.27 of the TTB regulations (27
CFR 4.27) sets forth rules regarding the
use of a vintage date on wine labels.
Section 4.27(a) provides that vintage
wine is wine labeled with the year of
harvest of the grapes and that the wine
‘‘must be labeled with an appellation of
origin other than a country (which does
not qualify for vintage labeling).’’ Rules
regarding appellation of origin labeling
are contained in § 4.25 of the TTB
regulations (27 CFR 4.25).
In addition, § 4.27(a)(1) provides that
for American or imported wines labeled
with a viticultural area appellation of
origin (or its foreign equivalent), at least
95 percent of the wine must have been
derived from grapes harvested in the
labeled calendar year. For American or
imported wines labeled with an
appellation of origin other than a
country or viticultural area (or its
foreign equivalent), § 4.27(a)(2) provides
that at least 85 percent of the wine must
have been derived from grapes
harvested in the labeled calendar year.
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Federal Register / Vol. 76, No. 214 / Friday, November 4, 2011 / Proposed Rules
The requirement that vintage wine
must be labeled with an appellation of
origin other than a country derives from
T.D. ATF–53, published in the Federal
Register (43 FR 37672) by TTB’s
predecessor agency, the Bureau of
Alcohol, Tobacco and Firearms (ATF),
on August 23, 1978. Prior to that time
the applicable regulations required that
grapes used to make vintage wine must
have been grown in the same
‘‘viticultural area,’’ a term then
undefined by the regulations.
In amended Notice No. 304, a notice
of proposed rulemaking preceding T.D.
ATF–53 and published in the Federal
Register (42 FR 30517) on June 15, 1977,
ATF noted that the wine industry
advocated that the then current
requirement that 95 percent of the
grapes used to make vintage wine be
grown in the labeled appellation area be
reduced to 75 percent. This mirrored the
requirement that to bear an appellation
of origin, at least 75 percent of the
grapes used to make a wine must be
grown in the appellation area indicated
on the label. The industry position,
according to ATF, was that ‘‘vintage
means only that the grapes were grown
in the specified year, and that the place
in which the grapes were grown is
unimportant.’’ ATF stated in that notice
that it did not agree, commenting as
follows
jlentini on DSK4TPTVN1PROD with PROPOSALS
A good year in one part of California, for
example, does not necessarily mean a good
year in another part, any more than a good
year in Burgundy means a good year in
Bordeaux. For a vintage to be meaningful to
consumers, they must have assurance that
the grapes were grown in the place stated on
the label. We believe that a 95 percent
requirement provides greater assurance than
a 75 percent requirement.
However, in T.D. ATF–53, the agency
modified its position somewhat stating
that it concurred with the industry
position that a vintage date should refer
only to the year of harvest. Accordingly,
a new regulatory provision regarding
appellations of origin, also adopted in
T.D. ATF–53, required that the
percentage of grapes required to come
from the labeled appellation area
depended upon whether the appellation
was a viticultural area (85 percent), a
State, county or foreign equivalent (75
percent), or a multicounty or multistate
appellation (100 percent), but in each
case without reference to vintage date
usage. The rulemaking record for T.D.
ATF–53 does not explain why ATF
decided that vintage wine must be
labeled with an appellation other than
a country, but it does indicate that the
agency believed that a vintage date
should provide consumers information
about harvest conditions.
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European Commission Petition
The European Commission submitted
a petition to TTB to amend § 4.27(a) to
allow the use of a country appellation
for vintage labeling. The petitioner
states that the current regulation
prohibiting a country appellation
presents a significant difficulty for its
member countries.
The petitioner notes that some of its
member countries are much smaller in
size than certain U.S. States, counties,
and even certain American viticultural
areas (AVAs). To illustrate this, it
compares the areas of Malta (246 sq.
km), Luxembourg (2,586 sq. km), and
Austria (83,871 sq. km) with the Lodi
AVA (2,230 sq. km) and the Ohio River
Valley AVA (67,000 sq. km). The
petitioner argues that there is no
convincing rationale for a rule that
allows vintage dating for a wine with an
appellation of ‘‘California’’ (423,970 sq.
km), but not for a wine labeled with the
appellation ‘‘Portugal’’ (92,391 sq. km).
The petitioner also contrasts the
vintage date rule in question with the
general varietal (grape type) labeling
rule contained in 27 CFR 4.23(a), under
which 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 § 4.25. Because
§ 4.25 includes countries within the
definition of an appellation of origin, a
wine labeled with a varietal designation
may be labeled with a country
appellation. The petitioner contends
that these regulatory rules are
inconsistent and that it would seem
more logical to apply a coherent
approach and allow vintage labeling for
wines labeled with a country
appellation.
Finally, the petitioner asserts that the
language in Article 7(1) of the 2006
agreement on trade in wine between the
United States and the European
Community (EC) supports the proposed
change. (See https://www.ttb.gov/
agreements/eu-wine-agreement.pdf.)
TTB notes that Article 7 concerns names
of origin, which include the country
names of the Member States of the
European Union. However, because the
use of vintage dates is not specifically
addressed in that provision, TTB does
not consider this assertion to be
particularly supportive of the proposed
change.
TTB Analysis
TTB believes that the petitioner has
generally presented persuasive
arguments for consideration of the
proposed change and that there are
three reasons why the proposed change
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would be consistent with the FAA Act
mandate to ensure that consumers have
adequate information about the quality
and identity of the product.
First, TTB believes that its most
recent rulemaking action regarding
vintage date requirements supports a
reconsideration of this issue since the
current proposal, like the earlier action,
would liberalize the vintage date
requirements in § 4.27. See T.D. TTB–
45, published in the Federal Register
(71 FR 25748) on May 2, 2006. In that
earlier rulemaking, TTB liberalized the
vintage date requirements by reducing
the percentage of wine derived from
grapes required to be harvested in the
labeled calendar year from 95 percent to
85 percent for wine labeled with an
appellation of origin other than a
country or a viticultural area (or its
foreign equivalent). The percentage
remained at 95 for wines bearing a
viticultural area (or its foreign
equivalent) as an appellation of origin.
Blending wine from different vintages
could result in a more consistent
product and provide a better value for
consumers, according to the proponents
of the earlier liberalization of vintage
date labeling.
Similarly, under the current proposal,
winemakers, domestic or foreign, would
have the flexibility to use grapes from a
wider area to produce more consistent
wines for consumers while still
providing the year date of harvest
information to the consumer.
Second, as noted in the public
comment discussion in the preamble of
T.D. TTB–45, not all consumers use
vintage dates as an indication of harvest
conditions. That discussion quoted two
commenters as stating that many
consumers, particularly those who
purchase moderately priced wines, use
the vintage date to ensure that they are
not purchasing a wine that is too old or
too young for their preferences. The
consumer makes this particular use of
the vintage date regardless of whether
the appellation of origin is a country or
a smaller region within a country.
Finally, TTB believes that the use of
a country appellation of origin on
vintage wine would not detract from the
statutory mandate to provide consumers
with adequate information as to the
identity and quality of the wines they
purchase. Even though the use of a
country appellation for a large country
such as the United States or Australia
might not be a useful indication of
harvest conditions, it would not
necessarily be misleading to consumers:
purchasers of a wine labeled ‘‘United
States’’ likely understand that harvest
conditions are not uniform for the entire
United States. On the other hand,
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Federal Register / Vol. 76, No. 214 / Friday, November 4, 2011 / Proposed Rules
vintage dates for smaller appellations,
such as Napa Valley or Bordeaux, will
still provide useful information to
consumers who do make purchases
based on harvest conditions attributable
to a particular vintage.
Based on the above, TTB believes the
petitioner’s proposal merits
consideration and public comment.
Accordingly, this document sets forth
proposed amendments to § 4.27 to allow
vintage labeling for wines labeled with
a country as an appellation of origin. In
addition, the proposed amendments to
§ 4.27 require a conforming amendment
in § 4.34(b)(5) to remove the reference to
the requirement that an appellation of
origin for vintage wine shall be other
than a country.
Public Participation
Comments Sought
TTB requests comments from
interested members of the public. TTB
is particularly interested in how
effectively the proposed changes will
serve the mandate under the FAA Act
of providing consumers with adequate
information about the identity and
quality of wines and preventing
consumer confusion. Please provide
specific information in support of your
comments.
jlentini on DSK4TPTVN1PROD with PROPOSALS
Submitting Comments
You may submit comments on this
notice by using one of the following
three methods:
• Federal e-Rulemaking Portal: You
may send comments via the online
comment form linked to this notice
within Docket No. TTB–2011–0008 on
‘‘Regulations.gov,’’ the Federal erulemaking portal, at https://
www.regulations.gov. A link to the
docket is available under Notice No. 122
on the TTB Web site at https://
www.ttb.gov/wine/winerulemaking.shtml. Supplemental files
may be attached to comments submitted
via Regulations.gov. For information on
how to use Regulations.gov, click on the
site’s Help or FAQ tabs.
• U.S. Mail: You may send comments
via postal mail to the Director,
Regulations and Rulings Division,
Alcohol and Tobacco Tax and Trade
Bureau, P.O. Box 14412, Washington,
DC 20044–4412.
• 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 200E, Washington, DC
20005.
Please submit your comments by the
closing date shown above in this notice.
Your comments must reference Notice
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No. 122 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 will not
acknowledge receipt of comments, and
will consider all comments as originals.
If you are commenting on behalf of an
association, business, or other entity,
your comment must include the entity’s
name as well as your name and position
title. If you comment via
Regulations.gov, please include the
entity’s name in the ‘‘Organization’’
blank of the comment form. If you
comment via postal mail, 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.
Confidentiality
All submitted comments and
attachments are part of the public record
and subject to disclosure. Do not
enclose any material in your comments
that you consider to be confidential or
that is inappropriate for public
disclosure.
Public Disclosure
On the Federal e-rulemaking portal,
Regulations.gov, TTB will post, and the
public may view, copies of this notice,
selected supporting materials, and any
electronic or mailed comments received
about this proposal. A direct link to the
Regulations.gov docket containing this
notice and the posted comments
received on it is available on the TTB
Web site at https://www.ttb.gov/wine/
wine-rulemaking.shtml under Notice
No. 122. You may also reach the docket
containing this notice and the posted
comments received on it through the
Regulations.gov search page at https://
www.regulations.gov. 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 it considers unsuitable for
posting.
You and other members of the public
may view copies of this notice, all
related petitions, maps and other
supporting materials, and any electronic
or mailed comments received about this
proposal by appointment at the TTB
Information Resource Center, 1310 G
Street NW., Washington, DC 20005. You
may also obtain copies for 20 cents per
8.5- x 11-inch page. Contact TTB’s
information specialist at the above
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68375
address or by telephone at 202–453–
2270 to schedule an appointment or to
request copies of comments or other
materials.
Regulatory Flexibility Act
TTB certifies under the provisions of
the Regulatory Flexibility Act (5 U.S.C.
601 et seq.) that this proposed rule will
not have a significant economic impact
on a substantial number of small
entities. The proposed amendments
merely provide optional, additional
flexibility in wine labeling decisions.
Accordingly, a regulatory flexibility
analysis is not required.
Executive Order 12866
This proposed rule is not a significant
regulatory action as defined by
Executive Order 12866. Therefore, it
requires no regulatory assessment.
Drafting Information
Jennifer Berry of the Regulations and
Rulings Division, Alcohol and Tobacco
Tax and Trade Bureau, drafted this
document.
List of Subjects in 27 CFR Part 4
Administrative practice and
procedure, Advertising, Customs duties
and inspection, Imports, Labeling,
Packaging and containers, Reporting
and recordkeeping requirements, Trade
practices, Wine.
Proposed Amendments to the
Regulations
For the reasons discussed in the
preamble, TTB proposes to amend 27
CFR, chapter I, part 4 as set forth below:
PART 4—LABELING AND
ADVERTISING OF WINE
1. The authority citation for 27 CFR
part 4 continues to read as follows:
Authority: 27 U.S.C. 205, unless otherwise
noted.
§ 4.27
[Amended]
2. Section 4.27 is amended:
a. In the second sentence of the
introductory text of paragraph (a), by
removing the words ‘‘other than a
country (which does not qualify for
vintage labeling)’’; and
b. In paragraph (a)(2), by removing the
words ‘‘country or’’.
3. Section 4.34(b)(5) is amended by
removing the last sentence.
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Federal Register / Vol. 76, No. 214 / Friday, November 4, 2011 / Proposed Rules
Signed: September 10, 2010.
John J. Manfreda,
Administrator.
Approved: October 8, 2011.
Timothy E. Skud,
Deputy Assistant Secretary, Tax, Trade, and
Tariff Policy.
[FR Doc. 2011–28645 Filed 11–3–11; 8:45 am]
BILLING CODE 4810–31–P
DEPARTMENT OF DEFENSE
Office of the Secretary
32 CFR Part 165
[DOD–2009–OS–0030/RIN 0790–AI45]
Recoupment of Nonrecurring Costs
(NCs) on Sales of U.S. Items
Office of the Under Secretary of
Defense (Comptroller)/Chief Financial
Officer, DoD.
ACTION: Proposed rule.
AGENCY:
This rule updates policy,
responsibilities, and procedures to
conform with section 21(e)(1)(B) of
Public Law 90–629, as amended, and
section 9701 of title 31, United States
Code (U.S.C.), for calculating and
assessing NC recoupment charges on
sales of items developed for or by the
Department of Defense to non-U.S.
Government customers.
DATES: Comments must be received by
January 3, 2012.
ADDRESSES: You may submit comments,
identified by docket number and/or RIN
number and title, by any of the
following methods:
• Federal Rulemaking Portal: https://
www.regulations.gov. Follow the
instructions for submitting comments.
• Mail: Federal Docket Management
System Office, 1160 Defense Pentagon,
Room 3C843, Washington, DC 20301–
1160.
Instructions: All submissions received
must include the agency name and
docket number or Regulatory
Information Number (RIN) for this
Federal Register document. The general
policy for comments and other
submissions from members of the public
is to make these submissions available
for public viewing on the Internet at
https://www.regulations.gov as they are
received without change, including any
personal identifiers or contact
information.
jlentini on DSK4TPTVN1PROD with PROPOSALS
SUMMARY:
FOR FURTHER INFORMATION CONTACT:
Claire Nelson, (703) 602–0250.
SUPPLEMENTARY INFORMATION:
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Executive Order 12866, ‘‘Regulatory
Planning and Review’’ and Executive
Order 13563 ‘‘Improving Regulation
and Regulatory Review’’
It has been certified that 32 CFR part
165 does not:
(1) Have an annual effect on the
economy of $100 million or more or
adversely affect in a material way the
economy; a section of the economy;
productivity; competition; jobs; the
environment; public health or safety; or
State, local, or Tribal governments or
communities;
(2) Create a serious inconsistency or
otherwise interfere with an action taken
or planned by another Agency;
(3) Materially alter the budgetary
impact of entitlements, grants, user fees,
or loan programs, or the rights and
obligations of recipients thereof; or
(4) Raise novel legal or policy issues
arising out of legal mandates, the
President’s priorities, or the principles
set forth in these Executive Orders.
Sec. 202, Public Law 104–4, ‘‘Unfunded
Mandates Reform Act’’
It has been certified that 32 CFR part
165 does not contain a Federal mandate
that may result in expenditure by State,
local and Tribal governments, in
aggregate, or by the private sector, of
$100 million or more in any one year.
Public Law 96–354, ‘‘Regulatory
Flexibility Act’’ (5 U.S.C. 601)
It has been certified that 32 CFR part
165 is not subject to the Regulatory
Flexibility Act (5 U.S.C. 601) because it
would not if promulgated, have a
significant economic impact on a
substantial number of small entities.
Public Law 96–511, ‘‘Paperwork
Reduction Act’’ (44 U.S.C. Chapter 35)
It has been certified that 32 CFR part
165 does not impose reporting or
recordkeeping requirements under the
Paperwork Reduction Act of 1995.
Executive Order 13132, ‘‘Federalism’’
It has been certified that 32 CFR part
165 does not have federalism
implications, as set forth in Executive
Order 13132. This rule does not have
substantial direct effects on:
(1) The States;
(2) The relationship between the
National Government and the States; or
(3) The distribution of power and
responsibilities among the various
levels of Government.
List of Subjects in 32 CFR Part 165
Armed forces, Arms and munitions,
Government contracts.
Accordingly 32 CFR part 165 is
revised to read as follows:
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PART 165—RECOUPMENT OF
NONRECURRING COSTS (NCS) ON
SALES OF U.S. ITEMS
Sec.
165.1
165.2
165.3
165.4
165.5
165.6
165.7
Purpose.
Applicability.
Definitions.
Policy.
Responsibilities.
Procedures.
Waivers (including reductions).
Authority: 31 U.S.C. 9701; 22 U.S.C.
2761(e).
§ 165.1
Purpose.
This part updates policy,
responsibilities, and procedures to
conform with section 21(e)(1)(B) of
Public Law 90–629, as amended, and
section 9701 of title 31, United States
Code (U.S.C.) for calculating and
assessing NC recoupment charges on
sales of items developed for or by the
Department of Defense to non-U.S.
Government customers.
§ 165.2
Applicability.
(a) This part applies to the Office of
the Secretary of Defense, the Military
Departments, the Office of the Chairman
of the Joint Chiefs of Staff and the Joint
Staff, the Combatant Commands, the
Office of the Inspector General of the
Department of Defense, the Defense
Agencies, the DoD Field Activities, and
all other organizational entities within
the Department of Defense (hereafter
referred to collectively as the ‘‘DoD
Components’’).
(b) This part does not apply to sales
of excess property when accountability
has been transferred to property
disposal activities and the property is
sold in open competition to the highest
bidder.
(c) The policies and procedures in
this part apply to all sales on or after the
effective date of this part, and supersede
application thresholds and charges
previously established. Previous
application thresholds and charges
continue to govern sales made prior to
the applicable effective date of this part.
Such previously established NC
recoupment thresholds and charges
shall be eliminated or revised in
accordance with this part.
§ 165.3
Definitions.
Cost pool. Represents the total cost to
be distributed across the specific
number of units, normally the number
of units produced plus those planned to
be produced. The nonrecurring
research, development, test, and
evaluation cost pool comprises the costs
described in definition for nonrecurring
research, development, test and
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]]>Agencies
[Federal Register Volume 76, Number 214 (Friday, November 4, 2011)]
[Proposed Rules]
[Pages 68373-68376]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2011-28645]
-----------------------------------------------------------------------
DEPARTMENT OF THE TREASURY
Alcohol and Tobacco Tax and Trade Bureau
27 CFR Part 4
[Docket No. TTB-2011-0008; Notice No. 122]
RIN 1513-AB84
Proposed Revision to Vintage Date Requirements
AGENCY: Alcohol and Tobacco Tax and Trade Bureau, Treasury.
ACTION: Notice of proposed rulemaking.
-----------------------------------------------------------------------
SUMMARY: The Alcohol and Tobacco Tax and Trade Bureau proposes to amend
its wine labeling regulations to allow a vintage date to appear on a
wine that is labeled with a country as an appellation of origin. The
proposal would provide greater grape sourcing and wine labeling
flexibility to winemakers, both domestic and foreign, while still
ensuring that consumers are provided with adequate information as to
the identity and quality of the wines they purchase.
DATES: Comments must be received on or before January 3, 2012.
ADDRESSES: You may send comments on this notice to one of the following
addresses:
https://www.regulations.gov (via the online comment form
for this notice as posted within Docket No. TTB-2011-0008 at
``Regulations.gov,'' the Federal e-rulemaking portal);
Director, Regulations and Rulings Division, Alcohol and
Tobacco Tax and Trade Bureau, P.O. Box 14412, Washington, DC 20044-
4412; or
Hand Delivery/Courier in Lieu of Mail: Alcohol and Tobacco
Tax and Trade Bureau, 1310 G Street NW., Suite 200E, Washington, DC
20005.
See the Public Participation section of this notice for specific
instructions and requirements for submitting comments, and for
information on how to request a public hearing.
You may view copies of this notice and any comments TTB receives
about this proposal at https://www.regulations.gov within Docket No.
TTB-2011-0008. A direct link to this docket is also available on the
TTB Web site at https://www.ttb.gov/wine/wine-rulemaking.shtml under
Notice No. 122. You may also view copies of this notice and any
comments received about this proposal by appointment at the TTB
Information Resource Center, 1310 G Street NW., Washington, DC 20005.
Please call 202-453-2270 to make an appointment.
FOR FURTHER INFORMATION CONTACT: Jennifer Berry, Alcohol and Tobacco
Tax and Trade Bureau, Regulations and Rulings Division, P.O. Box 18152,
Roanoke, VA, 24014; telephone 202-453-1039.
SUPPLEMENTARY INFORMATION:
Background on Wine Labeling
TTB Authority
Section 105(e) of the Federal Alcohol Administration Act (FAA Act),
27 U.S.C. 205(e), authorizes the Secretary of the Treasury to prescribe
regulations for the labeling of wine, distilled spirits, and malt
beverages. The FAA Act requires that these regulations, among other
things, prohibit consumer deception and the use of misleading
statements on labels, and ensure that labels provide the consumer with
adequate information as to the identity and quality of the product. The
Alcohol and Tobacco Tax and Trade Bureau (TTB) administers the FAA Act
and the regulations promulgated under it.
Current Vintage Date Requirements
Part 4 of the TTB regulations (27 CFR part 4) sets forth the
standards promulgated under the FAA Act for the labeling and
advertising of wine. Section 4.27 of the TTB regulations (27 CFR 4.27)
sets forth rules regarding the use of a vintage date on wine labels.
Section 4.27(a) provides that vintage wine is wine labeled with the
year of harvest of the grapes and that the wine ``must be labeled with
an appellation of origin other than a country (which does not qualify
for vintage labeling).'' Rules regarding appellation of origin labeling
are contained in Sec. 4.25 of the TTB regulations (27 CFR 4.25).
In addition, Sec. 4.27(a)(1) provides that for American or
imported wines labeled with a viticultural area appellation of origin
(or its foreign equivalent), at least 95 percent of the wine must have
been derived from grapes harvested in the labeled calendar year. For
American or imported wines labeled with an appellation of origin other
than a country or viticultural area (or its foreign equivalent), Sec.
4.27(a)(2) provides that at least 85 percent of the wine must have been
derived from grapes harvested in the labeled calendar year.
[[Page 68374]]
The requirement that vintage wine must be labeled with an
appellation of origin other than a country derives from T.D. ATF-53,
published in the Federal Register (43 FR 37672) by TTB's predecessor
agency, the Bureau of Alcohol, Tobacco and Firearms (ATF), on August
23, 1978. Prior to that time the applicable regulations required that
grapes used to make vintage wine must have been grown in the same
``viticultural area,'' a term then undefined by the regulations.
In amended Notice No. 304, a notice of proposed rulemaking
preceding T.D. ATF-53 and published in the Federal Register (42 FR
30517) on June 15, 1977, ATF noted that the wine industry advocated
that the then current requirement that 95 percent of the grapes used to
make vintage wine be grown in the labeled appellation area be reduced
to 75 percent. This mirrored the requirement that to bear an
appellation of origin, at least 75 percent of the grapes used to make a
wine must be grown in the appellation area indicated on the label. The
industry position, according to ATF, was that ``vintage means only that
the grapes were grown in the specified year, and that the place in
which the grapes were grown is unimportant.'' ATF stated in that notice
that it did not agree, commenting as follows
A good year in one part of California, for example, does not
necessarily mean a good year in another part, any more than a good
year in Burgundy means a good year in Bordeaux. For a vintage to be
meaningful to consumers, they must have assurance that the grapes
were grown in the place stated on the label. We believe that a 95
percent requirement provides greater assurance than a 75 percent
requirement.
However, in T.D. ATF-53, the agency modified its position somewhat
stating that it concurred with the industry position that a vintage
date should refer only to the year of harvest. Accordingly, a new
regulatory provision regarding appellations of origin, also adopted in
T.D. ATF-53, required that the percentage of grapes required to come
from the labeled appellation area depended upon whether the appellation
was a viticultural area (85 percent), a State, county or foreign
equivalent (75 percent), or a multicounty or multistate appellation
(100 percent), but in each case without reference to vintage date
usage. The rulemaking record for T.D. ATF-53 does not explain why ATF
decided that vintage wine must be labeled with an appellation other
than a country, but it does indicate that the agency believed that a
vintage date should provide consumers information about harvest
conditions.
European Commission Petition
The European Commission submitted a petition to TTB to amend Sec.
4.27(a) to allow the use of a country appellation for vintage labeling.
The petitioner states that the current regulation prohibiting a country
appellation presents a significant difficulty for its member countries.
The petitioner notes that some of its member countries are much
smaller in size than certain U.S. States, counties, and even certain
American viticultural areas (AVAs). To illustrate this, it compares the
areas of Malta (246 sq. km), Luxembourg (2,586 sq. km), and Austria
(83,871 sq. km) with the Lodi AVA (2,230 sq. km) and the Ohio River
Valley AVA (67,000 sq. km). The petitioner argues that there is no
convincing rationale for a rule that allows vintage dating for a wine
with an appellation of ``California'' (423,970 sq. km), but not for a
wine labeled with the appellation ``Portugal'' (92,391 sq. km).
The petitioner also contrasts the vintage date rule in question
with the general varietal (grape type) labeling rule contained in 27
CFR 4.23(a), under which 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. 4.25.
Because Sec. 4.25 includes countries within the definition of an
appellation of origin, a wine labeled with a varietal designation may
be labeled with a country appellation. The petitioner contends that
these regulatory rules are inconsistent and that it would seem more
logical to apply a coherent approach and allow vintage labeling for
wines labeled with a country appellation.
Finally, the petitioner asserts that the language in Article 7(1)
of the 2006 agreement on trade in wine between the United States and
the European Community (EC) supports the proposed change. (See https://www.ttb.gov/agreements/eu-wine-agreement.pdf.) TTB notes that Article 7
concerns names of origin, which include the country names of the Member
States of the European Union. However, because the use of vintage dates
is not specifically addressed in that provision, TTB does not consider
this assertion to be particularly supportive of the proposed change.
TTB Analysis
TTB believes that the petitioner has generally presented persuasive
arguments for consideration of the proposed change and that there are
three reasons why the proposed change would be consistent with the FAA
Act mandate to ensure that consumers have adequate information about
the quality and identity of the product.
First, TTB believes that its most recent rulemaking action
regarding vintage date requirements supports a reconsideration of this
issue since the current proposal, like the earlier action, would
liberalize the vintage date requirements in Sec. 4.27. See T.D. TTB-
45, published in the Federal Register (71 FR 25748) on May 2, 2006. In
that earlier rulemaking, TTB liberalized the vintage date requirements
by reducing the percentage of wine derived from grapes required to be
harvested in the labeled calendar year from 95 percent to 85 percent
for wine labeled with an appellation of origin other than a country or
a viticultural area (or its foreign equivalent). The percentage
remained at 95 for wines bearing a viticultural area (or its foreign
equivalent) as an appellation of origin. Blending wine from different
vintages could result in a more consistent product and provide a better
value for consumers, according to the proponents of the earlier
liberalization of vintage date labeling.
Similarly, under the current proposal, winemakers, domestic or
foreign, would have the flexibility to use grapes from a wider area to
produce more consistent wines for consumers while still providing the
year date of harvest information to the consumer.
Second, as noted in the public comment discussion in the preamble
of T.D. TTB-45, not all consumers use vintage dates as an indication of
harvest conditions. That discussion quoted two commenters as stating
that many consumers, particularly those who purchase moderately priced
wines, use the vintage date to ensure that they are not purchasing a
wine that is too old or too young for their preferences. The consumer
makes this particular use of the vintage date regardless of whether the
appellation of origin is a country or a smaller region within a
country.
Finally, TTB believes that the use of a country appellation of
origin on vintage wine would not detract from the statutory mandate to
provide consumers with adequate information as to the identity and
quality of the wines they purchase. Even though the use of a country
appellation for a large country such as the United States or Australia
might not be a useful indication of harvest conditions, it would not
necessarily be misleading to consumers: purchasers of a wine labeled
``United States'' likely understand that harvest conditions are not
uniform for the entire United States. On the other hand,
[[Page 68375]]
vintage dates for smaller appellations, such as Napa Valley or
Bordeaux, will still provide useful information to consumers who do
make purchases based on harvest conditions attributable to a particular
vintage.
Based on the above, TTB believes the petitioner's proposal merits
consideration and public comment. Accordingly, this document sets forth
proposed amendments to Sec. 4.27 to allow vintage labeling for wines
labeled with a country as an appellation of origin. In addition, the
proposed amendments to Sec. 4.27 require a conforming amendment in
Sec. 4.34(b)(5) to remove the reference to the requirement that an
appellation of origin for vintage wine shall be other than a country.
Public Participation
Comments Sought
TTB requests comments from interested members of the public. TTB is
particularly interested in how effectively the proposed changes will
serve the mandate under the FAA Act of providing consumers with
adequate information about the identity and quality of wines and
preventing consumer confusion. Please provide specific information in
support of your comments.
Submitting Comments
You may submit comments on this notice by using one of the
following three methods:
Federal e-Rulemaking Portal: You may send comments via the
online comment form linked to this notice within Docket No. TTB-2011-
0008 on ``Regulations.gov,'' the Federal e-rulemaking portal, at https://www.regulations.gov. A link to the docket is available under Notice
No. 122 on the TTB Web site at https://www.ttb.gov/wine/wine-rulemaking.shtml. Supplemental files may be attached to comments
submitted via Regulations.gov. For information on how to use
Regulations.gov, click on the site's Help or FAQ tabs.
U.S. Mail: You may send comments via postal mail to the
Director, Regulations and Rulings Division, Alcohol and Tobacco Tax and
Trade Bureau, P.O. Box 14412, Washington, DC 20044-4412.
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 200E, Washington, DC 20005.
Please submit your comments by the closing date shown above in this
notice. Your comments must reference Notice No. 122 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 will not acknowledge receipt of comments, and will
consider all comments as originals.
If you are commenting on behalf of an association, business, or
other entity, your comment must include the entity's name as well as
your name and position title. If you comment via Regulations.gov,
please include the entity's name in the ``Organization'' blank of the
comment form. If you comment via postal mail, 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.
Confidentiality
All submitted comments and attachments are part of the public
record and subject to disclosure. Do not enclose any material in your
comments that you consider to be confidential or that is inappropriate
for public disclosure.
Public Disclosure
On the Federal e-rulemaking portal, Regulations.gov, TTB will post,
and the public may view, copies of this notice, selected supporting
materials, and any electronic or mailed comments received about this
proposal. A direct link to the Regulations.gov docket containing this
notice and the posted comments received on it is available on the TTB
Web site at https://www.ttb.gov/wine/wine-rulemaking.shtml under Notice
No. 122. You may also reach the docket containing this notice and the
posted comments received on it through the Regulations.gov search page
at https://www.regulations.gov. 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 it
considers unsuitable for posting.
You and other members of the public may view copies of this notice,
all related petitions, maps and other supporting materials, and any
electronic or mailed comments received about this proposal by
appointment at the TTB Information Resource Center, 1310 G Street NW.,
Washington, DC 20005. You may also obtain copies for 20 cents per 8.5-
x 11-inch page. Contact TTB's information specialist at the above
address or by telephone at 202-453-2270 to schedule an appointment or
to request copies of comments or other materials.
Regulatory Flexibility Act
TTB certifies under the provisions of the Regulatory Flexibility
Act (5 U.S.C. 601 et seq.) that this proposed rule will not have a
significant economic impact on a substantial number of small entities.
The proposed amendments merely provide optional, additional flexibility
in wine labeling decisions. Accordingly, a regulatory flexibility
analysis is not required.
Executive Order 12866
This proposed rule is not a significant regulatory action as
defined by Executive Order 12866. Therefore, it requires no regulatory
assessment.
Drafting Information
Jennifer Berry of the Regulations and Rulings Division, Alcohol and
Tobacco Tax and Trade Bureau, drafted this document.
List of Subjects in 27 CFR Part 4
Administrative practice and procedure, Advertising, Customs duties
and inspection, Imports, Labeling, Packaging and containers, Reporting
and recordkeeping requirements, Trade practices, Wine.
Proposed Amendments to the Regulations
For the reasons discussed in the preamble, TTB proposes to amend 27
CFR, chapter I, part 4 as set forth below:
PART 4--LABELING AND ADVERTISING OF WINE
1. The authority citation for 27 CFR part 4 continues to read as
follows:
Authority: 27 U.S.C. 205, unless otherwise noted.
Sec. 4.27 [Amended]
2. Section 4.27 is amended:
a. In the second sentence of the introductory text of paragraph
(a), by removing the words ``other than a country (which does not
qualify for vintage labeling)''; and
b. In paragraph (a)(2), by removing the words ``country or''.
3. Section 4.34(b)(5) is amended by removing the last sentence.
[[Page 68376]]
Signed: September 10, 2010.
John J. Manfreda,
Administrator.
Approved: October 8, 2011.
Timothy E. Skud,
Deputy Assistant Secretary, Tax, Trade, and Tariff Policy.
[FR Doc. 2011-28645 Filed 11-3-11; 8:45 am]
BILLING CODE 4810-31-P
