Amendments To Streamline Importation of Distilled Spirits, Wine, Beer, Malt Beverages, Tobacco Products, Processed Tobacco, and Cigarette Papers and Tubes, and Facilitate Use of the International Trade Data System, 40403-40436 [2016-14359]
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Vol. 81
Tuesday,
No. 119
June 21, 2016
Part II
Department of the Treasury
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Alcohol and Tobacco Tax and Trade Bureau
27 CFR Parts 1, 4, 5, 7, et al.
Amendments To Streamline Importation of Distilled Spirits, Wine, Beer,
Malt Beverages, Tobacco Products, Processed Tobacco, and Cigarette
Papers and Tubes, and Facilitate Use of the International Trade Data
System; Proposed Rule
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40404
Federal Register / Vol. 81, No. 119 / Tuesday, June 21, 2016 / Proposed Rules
DEPARTMENT OF THE TREASURY
Alcohol and Tobacco Tax and Trade
Bureau
27 CFR Parts 1, 4, 5, 7, 26, 27, and 41
[Docket No. TTB–2016–0004; Notice No.
159]
RIN 1513–AC15
Amendments To Streamline
Importation of Distilled Spirits, Wine,
Beer, Malt Beverages, Tobacco
Products, Processed Tobacco, and
Cigarette Papers and Tubes, and
Facilitate Use of the International
Trade Data System
Alcohol and Tobacco Tax and
Trade Bureau, Treasury.
ACTION: Notice of proposed rulemaking.
AGENCY:
In this document, the Alcohol
and Tobacco Tax and Trade Bureau
(TTB) proposes to amend its regulations
governing the importation of distilled
spirits, wine, beer and malt beverages,
tobacco products, processed tobacco,
and cigarette papers and tubes. The
proposed amendments are intended to
clarify and streamline import
procedures, and support the
implementation of the International
Trade Data System and the filing of
import information electronically in
conjunction with an electronic import
filing with U.S. Customs and Border
Protection (CBP). The proposed
amendments include providing the
option for importers to file importrelated data electronically when filing
entry or entry summary data
electronically with CBP, as an
alternative to the current TTB
requirements that importers submit
paper documents to CBP upon
importation.
SUMMARY:
Comments must be received on
or before August 22, 2016.
ADDRESSES: Please send your comments
on this proposed rule to one of the
following addresses. Comments
submitted by other methods, including
email, will not be accepted.
• Internet: https://
www.regulations.gov (via the online
comment form for this document as
posted within Docket No. TTB–2016–
0004 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.
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DATES:
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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.
You may view copies of this
document, selected supporting
materials, and any comments TTB
receives about this proposal at https://
www.regulations.gov within Docket No.
TTB–2016–0004. A direct link to this
docket is posted on the TTB Web site at
https://www.ttb.gov/regulations_laws/
all_rulemaking.shtml under Notice No.
159. You also may view copies of this
document, all related supporting
materials, and any comments TTB
receives 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:
Karen Welch, Regulations and Rulings
Division, Alcohol and Tobacco Tax and
Trade Bureau, 1310 G Street NW., Box
12, Washington, DC 20005; telephone
(202) 453–1039, extension 046.
SUPPLEMENTARY INFORMATION:
Table of Contents
I. Background
A. TTB Authority
B. The International Trade Data System
C. Executive Order—Streamlining the
Export/Import Process for America’s
Businesses
D. Electronic Submission of TTB-Required
Information to CBP
E. Relationship to Other Notices of
Proposed Rulemaking
II. General Approach to Regulatory
Amendments
III. Proposed Changes to the Regulations
A. Filing of the Basic Permit Number by
Importers of Alcohol Beverages
B. Filing of a COLA Identification Number
or COLA Documents by Importers of
Alcohol Beverages
C. Removal of Requirement for Gin
Statements of Process
D. Possession and Retention of Certificates
of Age, Origin, or Identity Issued by
Foreign Governments for Importations of
Certain Wine and Distilled Spirits
E. Certification of Imported Vintage Wine
F. Possession of Certificates for Imported
Natural Wine
G. Removal of Requirement To Present to
CBP Certificates of Nonstandard Fill for
Wine and Distilled Spirits
H. Removal of Requirements Concerning
Liquor Bottles and Filing Certain
Applications in Triplicate
I. Filing of Data With Respect to Distilled
Spirits, Wine, and Beer Imported or
Brought Into the United States From the
U.S. Virgin Islands Subject to Tax
J. Entry of Distilled Spirits to Which an
Effective Tax Rate or Standard Effective
Tax Rate Applies
K. Distilled Spirits, Wine, and Beer
Imported or Brought Into the United
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States Without Payment of Tax in Bulk
Containers
L. Filing of Permit Number and
Information for Industrial Alcohol
Shipments to the United States From the
U.S. Virgin Islands
M. Filing of Permit Number and Data by
Government Agencies Importing
Distilled Spirits Free of Tax
N. Certificate Covering Distilled Spirits,
Wine, or Beer Brought Into the United
States From the U.S. Virgin Islands
O. Clarification of Record Retention
Requirements
P. Removal of Requirements for CBP To
Gauge or Inspect
Q. Filing of Data for Importation of
Tobacco Products Subject to Tax and
Processed Tobacco
R. Filing of Data for Importation of Tobacco
Products Without Payment of Tax
S. Entry for Warehousing of Distilled
Spirits, Wines, Beer, Tobacco Products,
and Cigarette Papers and Tubes
IV. Public Participation
A. Comments Invited
B. Submitting Comments
C. Confidentiality
D. Public Disclosure
V. Regulatory Analyses and Notices
A. Executive Order 12866
B. Regulatory Flexibility Act
C. Paperwork Reduction Act
VI. List of Subjects
VII. Amendments to the Regulations
I. Background
A. TTB Authority
The Alcohol and Tobacco Tax and
Trade Bureau (TTB) of the Department
of the Treasury regulates, among other
things, the importation of distilled
spirits, wine, and malt beverages 1
pursuant to the Federal Alcohol
Administration Act (FAA Act). TTB also
administers the provisions of the
Internal Revenue Code of 1986, as
amended (IRC), with respect to the
taxation of distilled spirits, wine, beer,2
tobacco products, processed tobacco,
and cigarette papers and tubes. These
statutory provisions are the basis of TTB
1 The FAA Act defines ‘‘malt beverage’’ as ‘‘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 27 U.S.C.
211(a)(7). Throughout this document, the term
‘‘malt beverage’’ is used in reference to the FAA Act
or regulations promulgated thereunder.
2 The IRC defines ‘‘beer’’ as ‘‘beer, ale, porter,
stout, and other similar fermented beverages
(including sake or similar products) of any name or
description containing one-half of 1 percent or more
of alcohol by volume, brewed or produced from
malt, wholly or in part, or from any substitute
therefor.’’ See 26 U.S.C. 5052(a). Throughout this
document, the term ‘‘beer’’ is used in reference to
the IRC or regulations promulgated thereunder.
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Federal Register / Vol. 81, No. 119 / Tuesday, June 21, 2016 / Proposed Rules
regulations that require importers to
submit certain information upon
importation.
Section 103(a) of the FAA Act (27
U.S.C. 203(a)) requires that a person
obtain a permit before engaging in
certain activities related to distilled
spirits, wine, and malt beverages,
including importation. This section of
the FAA Act states that it shall be
unlawful, except pursuant to a ‘‘basic
permit’’ issued by the Secretary of the
Treasury (the Secretary), to engage in
the business of importing into the
United States distilled spirits, wine, or
malt beverages. Section 103(a) of the
FAA Act also states that it is unlawful,
except pursuant to a basic permit, for
any person so engaged to sell, offer or
deliver for sale, contract to sell, or ship,
in interstate or foreign commerce,
directly or indirectly or through an
affiliate, distilled spirits, wine, or malt
beverages so imported. The terms
‘‘distilled spirits’’ and ‘‘wine,’’ when
used in the context of the FAA Act,
apply only to distilled spirits and wine
for nonindustrial use.
Additionally, section 105(e) of the
FAA Act (27 U.S.C. 205(e)) authorizes
the Secretary to prescribe regulations
relating to the packaging, marking,
branding, labeling, and size and fill of
containers of distilled spirits, wine, and
malt beverages. With regard to imported
commodities, the FAA Act 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 having
obtained a certificate of label approval
(COLA) and being in possession of that
COLA.
Chapter 51 of the IRC pertains to the
taxation and regulation of distilled
spirits (including spirits used for both
beverage and nonbeverage purposes),
wine, and beer (see 26 U.S.C. chapter
51). The IRC imposes a Federal excise
tax on all distilled spirits, wine, and
beer manufactured in or imported into
the United States. See, respectively, 26
U.S.C. 5001, 5041, and 5051. Section
7652 (26 U.S.C. 7652) imposes a tax on
distilled spirits, wine, and beer brought
into the United States from Puerto Rico
and the U.S. Virgin Islands. The tax is
equal to the internal revenue tax
imposed on like commodities produced
in the United States.
In general, the tax on distilled spirits,
wine, and beer either imported from
foreign countries or brought into the
United States from the U.S. Virgin
Islands is collected by CBP, along with
any import duties. Puerto Rico is within
the customs territory of the United
States, and, as a result, shipments of
such products from Puerto Rico do not
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pass through customs custody when
brought into the United States.
Furthermore, Puerto Rico is part of the
United States for purposes of the FAA
Act. See 27 U.S.C. 211(a)(1). This
proposed rule primarily addresses
amendments to the TTB regulations to
facilitate the electronic filing of
information with CBP, and, as a result,
distilled spirits, wine, and beer brought
into the United States from Puerto Rico
are not addressed in this document.
The IRC provides that, under limited
circumstances, products may be
withdrawn from customs custody
without payment of tax for transfer to
the bonded premises of an industry
member regulated by TTB. Proprietors
of distilled spirits plants must apply for
and receive notice of a registration
before commencing operations in the
United States. See 26 U.S.C. 5171.
Proprietors of bonded wine cellars must
also apply for and receive permission to
operate before commencing operations
in the United States. See 26 U.S.C. 5351.
Brewers must file a notice before
commencing business as a brewer in the
United States. See 26 U.S.C. 5401. TTB
assigns a registry number, referred to in
this document as the ‘‘IRC registry
number,’’ to each such distilled spirits
plant, bonded wine cellar, and brewery
at which operations are to be conducted.
The IRC registry number issued to
distilled spirits plants has been
historically referred to as the ‘‘distilled
spirits plant number.’’
Under sections 5232, 5364, and 5418
of the IRC (26 U.S.C. 5232, 5364, and
5418), distilled spirits may be imported
in bulk and released from customs
custody without payment of excise tax
for transfer in bond to a distilled spirits
plant; natural wine (as defined in 26
U.S.C. 5381) may be imported in bulk
and released from customs custody
without payment of excise tax for
transfer in bond to a bonded wine cellar;
and beer may be imported in bulk and
released from customs custody without
payment of excise tax for transfer in
bond to a brewery. Under these
circumstances, the proprietor of the
bonded premises becomes liable for the
tax on the product upon its release from
customs custody, and the applicable tax
is collected by TTB when the product is
removed from the distilled spirits plant,
bonded wine cellar, or brewery,
respectively.
The IRC also contains provisions
under which imported distilled spirits
may be entered free of tax by the United
States or any governmental agency of
the United States for nonbeverage
purposes. See 26 U.S.C. 5313; 5314(b).
Furthermore, industrial alcohol may
under certain circumstances be brought
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into the United States free of tax from
the U.S. Virgin Islands by qualified
industrial alcohol users. See 26 U.S.C.
5314(b).
Chapter 52 of the IRC contains excise
tax and related provisions pertaining to
tobacco products and cigarette papers
and tubes. Section 5701 of the IRC (26
U.S.C. 5701) imposes Federal excise tax
on such commodities manufactured in
or imported into the United States.
Section 7652 (26 U.S.C. 7652) imposes
a tax on tobacco products and cigarette
papers and tubes brought into the
United States from Puerto Rico and the
U.S. Virgin Islands. The tax is equal to
the internal revenue tax imposed on like
commodities produced in the United
States. Such commodities brought into
the United States from Puerto Rico are
not addressed in this document.
In general, the tax on tobacco
products and cigarette papers and tubes
either imported from foreign countries
or brought into the United States from
the U.S. Virgin Islands is collected by
CBP, along with any import duties.
Under 26 U.S.C. 5704, imported tobacco
products and cigarette papers and tubes
may be released from customs custody
without payment of tax for delivery to
the proprietor of an export warehouse 3
or to a manufacturer of tobacco products
or cigarette papers and tubes if such
commodities are not put up in packages,
in accordance with such regulations and
under such bond as the Secretary shall
prescribe. See 26 U.S.C. 5704(c).
Imported tobacco products and cigarette
papers and tubes previously exported
and returned may be released from
customs custody without payment of tax
for delivery to the original manufacturer
or to an export warehouse proprietor
authorized by such manufacturer to
receive the commodities, in accordance
with such regulations and under such
bond as the Secretary shall prescribe.
See 26 U.S.C. 5704(d).
Chapter 52 of the IRC also contains
provisions pertaining to the
manufacture and importation of
processed tobacco, which is not subject
to tax. Section 5712 of the IRC (26
U.S.C. 5712) requires that importers of
tobacco products or processed tobacco,
before engaging in such businesses,
apply for and obtain a permit.
TTB administers the FAA Act and
chapters 51 and 52 of the IRC pursuant
3 Under the IRC at 26 U.S.C. 5702(h), an export
warehouse is a bonded internal revenue warehouse
for the storage of tobacco products or cigarette
papers or tubes or any processed tobacco, upon
which the internal revenue tax has not been paid,
for subsequent shipment to a foreign country,
Puerto Rico, the U.S. Virgin Islands, or a possession
of the United States, or for consumption beyond the
jurisdiction of the internal revenue laws of the
United States.
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to section 1111(d) of the Homeland
Security Act of 2002, as codified at 6
U.S.C. 531(d). The Secretary has
delegated various authorities through
Treasury Department Order 120–01,
dated December 10, 2013 (superseding
Treasury Department Order 120–01,
dated January 24, 2003), to the TTB
Administrator to perform the functions
and duties in the administration and
enforcement of these provisions.
Responsibility for collecting the excise
taxes incident to the importation of
distilled spirits, wines, beer, tobacco
products, and cigarette papers and tubes
is vested by statute with the Secretary
of the Treasury. See 26 U.S.C. 7801.
TTB regulations provide that such taxes
are collected, accounted for, and
deposited as internal revenue
collections by customs in accordance
with customs requirements. See 27 CFR
27.48 and 41.62. Under the authority of
the Homeland Security Act of 2002, see
6 U.S.C. 212 and 215(1), the Secretary
has delegated these customs revenue
functions to the Secretary of Homeland
Security. See Treasury Department
Order 100–16, 68 FR 28322 (May 23,
2003).
TTB has authority under section 2(d)
of the FAA Act, Pub. L. 74–401 (1935)
‘‘to prescribe such rules and regulations
as may be necessary to carry out [its]
powers and duties’’ under the FAA Act.
In addition, as previously mentioned,
section 105(e) of the 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. Section 7805(a) of the
IRC (26 U.S.C. 7805(a)) provides the
general authority to the Secretary to
issue regulations to carry out the
provisions of the IRC.
The TTB regulations that implement
the basic permit requirements of the
FAA Act are set forth in part 1 of title
27 of the Code of Federal Regulations
(27 CFR part I).
The TTB regulations that implement
the labeling provisions of the FAA Act,
as they relate to wine, distilled spirits,
and malt beverages, are set forth 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). For imported
alcohol beverages specifically, these
regulations include several
requirements related to certification by
a foreign government of the origin and,
in some cases, age, vintage date, or
method of production of the alcohol
beverage.
Regulations implementing the
importation-related provisions of
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chapter 51 of the IRC are found in 27
CFR part 27. Specifically, this part
contains procedural and substantive
requirements that apply to the
importation of distilled spirits, wine,
and beer into the United States from
foreign countries, including
requirements related to recordkeeping
and reporting. Regulations
implementing the IRC as it applies to
distilled spirits, wine, and beer brought
into the United States from Puerto Rico
or the U.S. Virgin Islands are found in
27 CFR part 26.4
Regulations implementing the
importation-related provisions of
chapter 52 of the IRC are found in 27
CFR part 41. Specifically, this part
governs the importation of tobacco
products, cigarette papers and tubes,
and processed tobacco, including
requirements related to permits,
recordkeeping, and reporting. Part 41
includes provisions applicable to such
commodities brought into the United
States from Puerto Rico or the U.S.
Virgin Islands.
B. The International Trade Data System
The International Trade Data System
(ITDS) is an interagency program to
establish an electronic ‘‘single window’’
through which importers and exporters
may submit electronically the data
required by Federal government
agencies for clearing imports or exports.
Section 405 of the Security and
Accountability for Every Port Act of
2006 (SAFE Port Act) (Pub. L. 109–347)
mandates participation in ITDS by all
agencies that require documentation for
clearing or licensing the importation
and exportation of cargo. The purpose of
ITDS is to eliminate redundant
information requirements, to efficiently
regulate the flow of commerce, and to
effectively enforce laws and regulations
relating to international trade, by
establishing a single window, operated
by CBP, for the collection and
distribution of standard electronic
import and export data required by
Federal agencies.
Currently, importers and exporters
that are regulated by multiple agencies
or that import or export commodities
regulated by multiple agencies must
submit data to those agencies through
various channels, often in paper form.
Through the implementation of ITDS,
data will be entered into the Automated
Commercial Environment (ACE) and
then made available to each government
agency. The ‘‘single window’’ is
4 27 CFR part 26 also contains regulations
applicable to articles, which are generally defined
in § 26.11 as preparations unfit for beverage use.
Such articles are not within the scope of this
rulemaking.
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intended to streamline and harmonize
data requirements, thereby reducing
compliance burdens on importers and
exporters. Accordingly, TTB is
providing electronic filing options for
the importation of commodities
regulated by TTB.
C. Executive Order—Streamlining the
Export/Import Process for America’s
Businesses
On February 19, 2014, the President
issued Executive Order 13659,
‘‘Streamlining the Export/Import
Process for America’s Businesses.’’ 5 The
Executive Order mandated that agencies
be able to utilize ITDS by December 31,
2016. The Executive Order also directed
Federal agencies that use ITDS to review
their existing regulations for the import
and export of goods to determine
whether those regulations should be
modified to implement ITDS and further
improve and streamline existing
processes for import and export, and if
so, to initiate rulemaking to implement
those modifications.
D. Electronic Submission of TTBRequired Information to CBP
The TTB provisions applicable to
imports include requirements that
importers submit information or
documentation at importation to CBP.
That information can be submitted
electronically pursuant to 27 CFR 73.40.
That section provides that a regulated
entity may satisfy any requirement in
the TTB regulations to submit a form to
another agency by submitting the form
to that other agency by electronic
means, as long as that agency provides
for, and authorizes, the electronic
submission of the form and any
registration and other requirements to
use the electronic submission
functionality are met. In part 73, the
term ‘‘form’’ includes any
documentation required to be
submitted.
Section 73.40 was the result of
amendments to the TTB regulations
published in the Federal Register (79
FR 17029) on March 27, 2014, as a final
rule, T.D. TTB–119, and it generally
removes any regulatory barrier to the
submission of documents to CBP
electronically. TTB is issuing this
document to propose changes to each of
the TTB regulatory sections that address
the submission of information or
documentation at importation, in order
to update TTB regulatory processes for
imports and provide a specific
electronic filing option for the
5 See https://www.whitehouse.gov/the-pressoffice/2014/02/19/executive-order-streamliningexportimport-process-america-s-businesses.
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submission of certain TTB information
at importation using the Partner
Government Agency (PGA) Message Set.
Technical instructions on the
submission of data using TTB’s PGA
Message Set, including the formatting of
TTB’s PGA Message Set, are available in
‘‘ACE Filing Instructions for TTBRegulated Commodities’’ at Docket No.
TTB–2016–0004 on Regulations.gov.
Importers may test the usability and
functionality of the TTB PGA Message
Set through participation in a pilot
program announced by TTB in a
Federal Register notice, ‘‘Importation of
Distilled Spirits, Wine, Beer, Tobacco
Products, Processed Tobacco, and
Cigarette Papers and Tubes; Availability
of Pilot Program and Filing Instructions
to Test the Collection of Import Data for
Implementation of the International
Trade Data System,’’ (80 FR 47558,
August 7, 2015).
TTB notes that under this proposed
regulation, importers may elect not to
file any TTB data electronically.
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E. Relationship to Other Notices of
Proposed Rulemaking
In this rulemaking, TTB is proposing
amendments to certain regulations in 27
CFR parts 4, 5, and 7 to specifically
accommodate electronic filing.
Interested parties should note that, as
announced in the Department of the
Treasury’s semiannual regulatory
agenda (available online at
www.reginfo.gov), TTB plans to publish
a notice of proposed rulemaking titled
‘‘Modernization of the Alcohol Beverage
Labeling and Advertising Regulations,’’
in which TTB will propose broader
amendments to the regulations in 27
CFR parts 4, 5, and 7. Interested parties
should review and consider the
proposals in each document and
comment accordingly.
II. General Approach to Regulatory
Amendments
In a number of instances, the current
TTB regulations refer to the submission
of paper documents (sometimes in
triplicate) by importers to obtain release
of TTB-regulated products from customs
custody. These regulations were
promulgated in the context of an
environment in which paper copies
were the primary means of
communicating to customs officers that
importers had met certain IRC or FAA
Act requirements that apply at
importation. The paper documents
communicate to CBP, for example, that
TTB had reviewed, and authorized the
use of, a certain label on an alcohol
beverage and, as a result, the products
bearing the label were eligible for
release from customs custody.
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Implementation of ITDS provides
another means for the communication of
such information to take place––via the
submission and sharing of data
electronically. In general, the proposed
regulations set forth new information
submission requirements to better
support administration and enforcement
of the IRC and FAA Act with regard to
imports, and require information to be
submitted and/or made available
through one of the following methods:
(1) The electronic submission of TTBrequired data along with the submission
of the customs entry or entry summary,
as appropriate; or (2) the retention and
provision of information only upon
specific request by TTB or CBP.
With regard to electronic submissions
of information, there are generally two
methods: Electronic submission of data
directly and electronic submission of
documents as electronic images. In
many instances, TTB is proposing the
former, that is, to provide importers
with the option to submit required
information electronically rather than to
submit paper documents. The proposed
regulations also allow for the
submission of certain paper documents
through electronic means. In
circumstances in which the proposed
regulations require that the importer
make the document available to TTB or
CBP upon request, such documents may
be provided as an electronic image.
With regard to requests for
documentation by TTB or CBP, the
proposed regulations generally refer to
requests being made ‘‘by the appropriate
TTB officer or a customs officer.’’ The
regulations reference both TTB and CBP
because, in general, CBP may request
information or documentation as part of
the entry process, while TTB may
request information after release of the
shipment from customs custody to
verify compliance with import
requirements or as part of the review of
claims for refund or credit of tax. The
term ‘‘appropriate TTB officer’’ here
refers to TTB officers who have been
delegated the TTB Administrator’s
authority through the issuance of a TTB
Delegation Order. There is a delegation
order applicable to each part of the TTB
regulations that sets forth the
‘‘appropriate TTB officer’’ for each
reference in that part. The delegation
orders are available on the TTB Web site
at https://www.ttb.gov. The term
‘‘customs officer’’ is currently defined in
parts 26, 27, and 41 of the TTB
regulations, at 27 CFR 26.11, 27.11, and
41.11. TTB is proposing to update those
definitions. The proposed amendment
would replace references in §§ 26.11
and 27.11 to ‘‘the Customs Service’’
with references to U.S. Customs and
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Border Protection or CBP, where
appropriate. The proposed amendment
would also remove references to the
Secretary of the Treasury as well as the
reference in § 41.11 to the Secretary of
Homeland Security. It would also
remove the redundant references in
§§ 26.11 and 27.11 to commissioned,
warrant, and petty officers of the Coast
Guard because those officers are
authorized by law to perform the duties
of a customs officer, and so are included
in the definition without being
specifically named there. See 14 U.S.C.
143. The proposed amendment would
instead refer more broadly to ‘‘any agent
or other person authorized by law to
perform such duties.’’ The proposed
regulations also include the addition of
a definition of ‘‘customs officer’’ in parts
4, 5, and 7 (at 27 CFR 4.10, 5.11, and
7.10).
Finally, a number of current TTB
regulations refer to CBP actions and
processes, such as CBP’s release of a
shipment upon receipt of proper
documentation or CBP’s inspection of
shipments and its notation of
information on TTB forms. In this
document, TTB is proposing to remove
most references to actions that CBP will
take at entry and replace them with text
that sets forth the requirements that
apply to importers at entry.
III. Proposed Changes to the
Regulations
A. Filing of the Basic Permit Number by
Importers of Alcohol Beverages
As noted previously, the FAA Act
requires that an importer obtain a basic
permit to engage in the business of
importing into the United States
distilled spirits, wine, or malt beverages,
or to sell, offer or deliver for sale,
contract to sell, or ship, in interstate or
foreign commerce, directly or indirectly
or through an affiliate, distilled spirits,
wine, or malt beverages so imported.
TTB issues these basic permits.
Provisions addressing the FAA Act
basic permit are set forth in the TTB
regulations in part 1. The permit
requirement is restated in 27 CFR 1.20.
Consistent with 27 U.S.C. 203, the
regulations at 27 CFR 1.23 provide that
the basic permit requirement does not
apply to any agency of a State or
political subdivision thereof, or to any
officer or employee of any such agency.
Section 1.58 (27 CFR 1.58) requires
every person receiving a basic permit to
file the permit at the place of business
covered by the permit, so that it may be
available to be examined by the
appropriate TTB officer.
The basic permit requirement is also
cross-referenced in 27 CFR part 27,
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which generally sets forth the regulatory
provisions that apply to the importation
of distilled spirits, wine, and beer from
foreign countries under the IRC. Section
27.55 of the TTB regulations (27 CFR
27.55) restates the FAA Act basic permit
requirement. Neither the regulations in
part 1 nor the regulations in part 27
currently state the conditions under
which an importer obtaining release of
distilled spirits, wine, or malt beverages
subject to tax must provide the permit,
or evidence of having obtained the
permit, to CBP during importation.
Each FAA Act basic permit that TTB
issues has a number associated with it.
TTB is proposing to amend the
regulations at § 1.58 to require that, if
filing TTB data electronically, the
importer file the number of the FAA Act
basic permit with CBP. Requiring the
submission of the permit number would
allow the importer to demonstrate
compliance with the statutory
requirement that it has obtained the
required permit. Amending the
regulations to account for the
submission of the permit number also
would make clearer to the importer
what is required upon importation of
TTB-regulated alcohol beverages and
make more transparent and consistent
the application of the permit
requirement. Finally, the filing of the
permit number with the CBP entry
would allow TTB to more easily link
imported alcohol beverages to their
importers and specific importations to
the records importers keep and the
reports they submit to TTB. Revised
§ 1.58 also provides that, regardless of
the method of filing, every importer
must make the permit available upon
request by the appropriate TTB officer
or a customs officer. With regard to
these regulatory sections, TTB also
proposes to amend § 27.55 to crossreference § 1.58 and to cross-reference
27 CFR 1.10 for the definitions of the
terms ‘‘distilled spirits,’’ ‘‘wine,’’ and
‘‘malt beverage’’ that are particular to
the FAA Act. The proposed
amendments also alert the reader to the
FAA Act requirements to obtain a COLA
and any required foreign certificates.
TTB also proposes to clarify in § 27.55
that FAA Act requirements do not apply
to tourists importing distilled spirits,
wine, or malt beverages into the United
States for personal or other
noncommercial use.6 Finally, because
6 In this document, as in the longstanding
regulations in part 26, the term ‘‘tourists’’ is used
to refer to any individuals who are importing or
bringing into the United States distilled spirits,
wine, or malt beverages for personal or other
noncommercial use and who are not subject to the
FAA Act because they are not engaged in the
business of importing distilled spirits, wine, or malt
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bringing distilled spirits, wine, or malt
beverages into the United States for
personal or other noncommercial use.
there is currently no definition of ‘‘malt
beverage’’ in part 1, TTB proposes to
add the FAA Act definition to 27 CFR
1.10.
The FAA Act basic permit
requirement is also reflected in 27 CFR
part 26, which contains regulations
applicable to distilled spirits, wine, and
beer brought into the United States from
Puerto Rico and the U.S. Virgin Islands.
With respect to the U.S. Virgin Islands,
§ 26.202 of the TTB regulations (27 CFR
26.202), currently restates the FAA Act
basic permit requirement and provides
that those to whom the FAA Act basic
permit requirement applies must ‘‘file
with the district director of customs at
the port of entry a certified or
photostatic copy’’ of the permit.
TTB does not believe it is necessary
to continue requiring the submission of
the paper form or a copy of the paper
form as set forth in § 26.202. TTB
believes that requiring the TTB-issued
permit number of the importer to be
filed with CBP at the time of entry for
electronic filers will be sufficient to
enable CBP to make the initial
determination that importers are
compliant with the permit requirement
and to enable TTB to link the imported
consignment with a specific importer
for purposes of verifying compliance.
For importers that are not filing
electronically, TTB believes that the
FAA Act basic permit requirement can
be enforced by requiring that a copy of
the permit be made available upon
request. As a result, TTB is proposing to
amend the regulations at § 26.202 to
state that the FAA Act basic permit
number must be filed with the customs
entry or made available upon request, as
required under § 1.58. This change will
reduce the burden on persons bringing
alcohol beverages into the United States
from the U.S. Virgin Islands who will no
longer be required to submit a copy of
the permit. TTB is also removing
references to ‘‘the district director of
customs’’ where they appear in the
sections of part 26 pertaining to the U.S.
Virgin Islands, replacing them with
more general references to customs or
CBP.
TTB is also proposing to amend
§ 26.202 to alert the reader to the
definitions of the terms ‘‘distilled
spirits,’’ ‘‘wine,’’ and ‘‘malt beverage’’
that are particular to the FAA Act as
well as to the FAA Act requirements to
obtain a COLA and any required foreign
certificates. TTB is also proposing to
revise § 26.202 to clarify that no FAA
Act requirement applies to tourists
B. Filing of a COLA Identification
Number or COLA Documents by
Importers of Alcohol Beverages
As noted above, section 105(e) of the
FAA Act (27 U.S.C. 205(e)) sets forth
labeling requirements and, with respect
to imports, 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 having obtained and
being in possession of a COLA covering
the distilled spirits, wine, or malt
beverages and issued by the Secretary of
the Treasury.
To implement this requirement,
§§ 4.40, 5.51, and 7.31 of the TTB
regulations (27 CFR 4.40, 5.51, and 7.31)
currently state that no bottled wine,
distilled spirits, or malt beverages,
respectively, shall be released from
customs custody for consumption
unless an approved COLA covering the
label of the product has been deposited
with the appropriate customs officer at
the port of entry. With an approved
COLA, the brand or lot of wine, distilled
spirits, or malt beverages bearing labels
identical to those appearing on the
COLA may be released from customs
custody.
TTB believes it will not be necessary
to require the importer to deposit a
paper copy of the approved COLA upon
importation when filing TTB data
electronically. As is the case with the
FAA Act basic permit, each approved
COLA has a number associated with it.
Images of approved COLAs can be
accessed by entering the COLA
identification number into TTB’s online
database, the Public COLA Registry.7
Accordingly, TTB proposes to amend
§§ 4.40, 5.51, and 7.31 to require that,
upon importation, the importer either
file with the customs entry the TTBassigned identification number of the
COLA, when filing electronically, or
provide a copy of the COLA to CBP. The
proposed regulations also provide that
the bottles or containers must bear
labels identical to the labels appearing
on the face of the COLA, or labels with
changes authorized by the COLA form.
In the proposed regulatory text, TTB
has set forth the provisions described
here in one paragraph, paragraph (a),
which will replace the provisions
currently set forth in paragraphs (a) and
(b) of §§ 4.40, 5.51, and 7.31. Proposed
§§ 4.40, 5.51, and 7.31 also state that
beverages and they are not removing such products
from customs custody for sale or any other
commercial purpose.
7 For the Public COLA Registry, see https://
www.ttbonline.gov/colasonline/
publicSearchColasBasic.do.
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importers must apply for and obtain a
COLA before removing the bottled wine,
distilled spirits, or malt beverages from
customs custody, and cross-reference
the limited exceptions to the COLA
requirement that appear in part 27.
COLA requirements applicable to
alcohol beverages brought into the
United States from U.S. Virgin Islands
are set forth in § 26.202, along with the
FAA Act basic permit requirement
discussed above. Specifically, § 26.202
states that every person and any agency
of a State or political subdivision
thereof or any officer or employee of
such agency who brings liquors 8 into
the United States from the U.S. Virgin
Islands for nonindustrial use must file
the COLA with ‘‘the district director of
customs’’ at the port of entry. TTB is
proposing to modify this requirement by
adding the option to provide the TTBassigned identification number of the
COLA with the electronic filing of the
CBP entry. Further, with regard to the
format of the regulatory text, § 26.202 is
currently organized as a single
paragraph, with the FAA Act basic
permit and COLA requirements both
described in one sentence. TTB
proposes to set forth the FAA Act basic
permit and COLA requirements in
separate paragraphs, provide a
paragraph alerting the reader to the
scope of the FAA Act, provide a
paragraph to address foreign certificates
for certain wines and distilled spirits as
described below, and update the text to
improve readability.
Additional regulations in parts 26 and
27 currently address distinctive liquor
bottles. Persons importing liquor bottles
of distinctive shape or design into the
United States or bringing such bottles
into the United States from Puerto Rico
or the U.S. Virgin Islands, must obtain
approval of the distinctive liquor bottle
from TTB by filing an application for
label approval that includes a
photograph of the distinctive liquor
bottle, and furnishing a copy of the
COLA along with the photograph of the
distinctive liquor bottle ‘‘to Customs
officials at each affected port of entry
where the merchandise is examined.’’ 9
See 27 CFR 26.314 and 27.204. TTB has
determined that the electronic filing of
8 The term ‘‘liquors’’ is used throughout part 26,
and is defined in § 26.11 as ‘‘industrial spirits,
distilled spirits, liqueurs, cordials and similar
compounds, wines, and beer or any alcoholic
preparation fit for beverage use.’’
9 The term ‘‘liquor bottle’’ is defined at 27 CFR
26.11 and 27.11 as a ‘‘bottle made of glass or
earthenware, or of other suitable material approved
by the Food and Drug Administration, which has
been designed or is intended for use as a container
for distilled spirits for sale for beverage purposes
and which has been determined by the appropriate
TTB officer to adequately protect the revenue.’’
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the TTB-assigned identification number
for the approved COLA through ACE or,
when filing on paper, the provision of
a copy of the approved COLA to CBP at
the time of entry without the
photograph is sufficient to regulate the
importation of distinctive liquor bottles.
Accordingly, TTB proposes to amend
§§ 26.314 and 27.204 to remove the
requirement in these sections that the
COLA and a photograph of the bottle be
provided to CBP.
C. Removal of Requirement for Gin
Statements of Process
In Part 5, Subpart F—Requirements
for Withdrawal From Customs Custody
of Bottled Imported Distilled Spirits,
paragraph (d) of § 5.51 currently
requires that TTB Form 5100.31
covering labels for imported gin bearing
the word ‘‘distilled’’ as a part of the
designation be accompanied by a
statement prepared by the manufacturer
setting forth a step-by-step description
of the manufacturing process.
This is the only regulation in part 5
that requires a formula for a specific
type of imported distilled spirits
product. However, under current TTB
regulations at 27 CFR 5.33(g), a bottler
or importer must, upon request, submit
to TTB a complete and accurate
statement of the contents of the bottles
to which labels are to be or have been
affixed. Under this authority, TTB may
continue to require industry members to
submit a formula, including a
description of the manufacturing
process, for any alcohol beverage to TTB
for evaluation prior to the issuance of a
COLA. TTB Industry Circular 2007–4,
Pre-COLA Product Evaluation, currently
outlines these formula requirements.
In the proposed regulations, the
requirement that TTB Form 5100.31 be
accompanied by a statement of process
as set forth in paragraph (d) of § 5.51 is
removed, and the section is reorganized
accordingly. TTB will evaluate whether
formulas for these products should
continue to be submitted, prior to the
issuance of a COLA, through its
authority under § 5.33(g).
D. Possession and Retention of
Certificates of Age, Origin, or Identity
Issued by Foreign Governments for
Importations of Certain Wine and
Distilled Spirits
Along with the COLA requirements
discussed earlier, parts 4 and 5 of the
current TTB regulations also contain
certain requirements under which
importers must possess certifications by
duly authorized officials of foreign
governments that the wines or distilled
spirits being imported have been
produced using specific practices or in
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conformity with certain laws of the
country of origin in order for the labels
of those beverages to bear certain
designations. Specifically:
• Paragraph (a) of § 4.45 (27 CFR
4.45(a)) addresses certificates of origin
and identity for wine and requires that
the invoice for certain imported wine be
accompanied by a certificate issued by
a duly authorized official of the
appropriate foreign government
certifying as to the identity of the wine
and that the wine has been produced in
compliance with the laws of the
respective foreign government
regulating the production of such wine
for home consumption. Without a
required certificate, the wine will not be
released from customs custody.
• Paragraphs (a) through (e) of § 5.52
(27 CFR 5.52(a)–(e)) set forth similarly
worded certificate of origin
requirements for Scotch, Irish, and
Canadian whiskies; brandy, Cognac, and
rum; Tequila; other whiskies; and other
distilled spirits, respectively. The
required certificates must accompany
the invoice or be filed with the
application for release (in the case of
Tequila), or the spirits shall not be
released from customs custody.
Generally, the certificates must indicate
that the spirit has been produced in
compliance with the laws of the country
of origin regulating the manufacture of
the specific distilled spirits for home
consumption. In some cases, the
certificates must also address
production practices or age statements.
• Section 5.56 (27 CFR 5.56) provides
that distilled spirits imported in bulk for
bottling in the United States may not be
removed from the plant where bottled
unless the bottler possesses certificates
of age and certificates of origin required
under § 5.52 for the same spirits if
imported in bottles.
The common element among these
requirements is that the certificate must
generally accompany the wines or
distilled spirits (or accompany the
invoice applicable to such wines or
distilled spirits), except in the case of
bulk importations, where the U.S.
bottler must possess the certificate. TTB
believes that, rather than require
certificates of age, origin, or identity for
wine or distilled spirits imported in
bottles to be filed with CBP, the
purposes of the requirement can be met
by requiring the importer to have the
certificate in its possession, to be made
available upon request. The importer
may be required to attest to the
possession of the certificate at
importation. TTB now has timely access
to importation information through ACE
and has the specific expertise to
determine whether a certificate of age,
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origin, or identity is required for a
certain product and whether a
certificate is valid. Under the proposal,
TTB could, through post-release review
of the importation information,
determine whether the appropriate
certificate of age, origin, or identity is in
the possession of the importer. This
approach supports compliance in a way
that facilitates legitimate trade,
expedites the release of compliant wines
and distilled spirits from customs
custody, and allows enforcement
resources to be focused on identifying
noncompliance.
Accordingly, TTB is proposing to
amend §§ 4.45(a), and 5.52(a) through
(e), to state that products for which a
certification of age, origin, or identity is
required are not eligible for release from
customs custody and no person may
remove such products from customs
custody, unless the importer possesses
the relevant certificate (and
accompanying invoice, if required). The
proposed amendments are for clarity
only and do not change the intent of
those regulations, that is, that products
requiring a certificate of age, origin, or
identity may not enter the United States
for consumption unless covered by such
a certificate.
The revisions to § 4.45(a) will also
clarify that the certificate must only be
in the possession of the importer at the
time of removal from customs custody
in the case of wine imported in
containers.
TTB is proposing to add a new § 4.53
(new 27 CFR 4.53) to subpart F,
Requirements for Approval of Labels of
Wine Domestically Bottled or Packed, to
provide that wine imported in bulk and
bottled in the United States may not be
removed from the premises where
bottled unless the bottler possesses a
certificate if a certificate is required
under § 4.45 for like wine imported in
containers. TTB is also proposing
editorial changes to current § 5.56,
pertaining to certificates of age and
origin for distilled spirits imported in
bulk for bottling in the United States.
In order to ensure that the required
certificates are available for TTB
inspection, TTB is proposing in this
document to add provisions in the
regulations at § 5.56, in a new paragraph
(c) in § 4.45, in new § 4.53, and new
paragraph (f) in § 5.52 to address the
retention of the certificates addressed in
those sections. Under new paragraphs
(c) in § 4.45 and (f) in § 5.52, for the five
years following importation, upon
request by the appropriate TTB officer
or a customs officer, the importer must
provide a copy of any certificate of age,
origin, or identity relied upon for
removal of imported wine or distilled
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spirits, as applicable, from customs
custody. Similarly, under new § 4.53
and the revision to § 5.56, for the five
years following the removal of bottled
wine or distilled spirits from the bonded
wine cellar or distilled spirits plant
where bottled, upon request of the
appropriate TTB officer, the U.S. bottler
must provide a copy of any certificate of
age, origin, or identity required under
§§ 4.45 or 5.52 for like wine or distilled
spirits imported in containers.
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 may retain
electronic copies of certificates.
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 such certificates
upon demand. Furthermore, such
records are necessary to enforce the
requirements of the FAA Act. See, e.g.,
National Confectioners Ass’n v.
Califano, 569 F.2d 690, 693–94 (D.C.
Cir. 1978), which upheld the U.S. Food
and Drug Administration’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. Further,
as noted above, TTB has authority under
section 2(d) of the FAA Act, Pub. L. 74–
401 (1935) ‘‘to prescribe such rules and
regulations as may be necessary to carry
out [its] powers and duties’’ under the
FAA Act.
TTB is also proposing certain
clarifications to §§ 4.45 and 5.52. First,
references to ‘‘a duly authorized
official’’ of a foreign government would
be changed to ‘‘an official duly
authorized by’’ the appropriate foreign
government. Many foreign governments
authorize non-governmental or quasigovernmental bodies (like the Consejo
Regulador del Tequila in Mexico or the
´
Comite Interprofessionnel du Vin de
Champagne in France) to issue such
certificates for wines or distilled spirits,
and TTB’s practice has been to accept
certificates issued by such
organizations. Second, certain
certification requirements in §§ 4.45(a)
and 5.52(e) would be limited to
instances when the country of origin of
imported wine or distilled spirits
requires the issuance of a certificate of
age, origin, or identity, instead of when
the country of origin ‘‘authorizes’’ the
issuance of such certificates. This
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change conforms the regulations to
TTB’s practice.
E. Certification of Imported Vintage
Wine
Section 4.27 (27 CFR 4.27) requires
that wine labeled with the year of
harvest of the grapes, or vintage date,
meet certain requirements. Paragraph (c)
of § 4.27 currently states that imported
wine may bear a vintage date if, among
other conditions, the invoice for such
wine is accompanied by a certificate
issued by a duly authorized official of
the country of origin certifying that the
wine meets various criteria or, if
imported in bulk for bottling in the
United States, the American bottler
possesses such a certificate.
TTB believes that it is no longer
necessary to require this certificate.
TTB’s regulations do not impose a
certification requirement on imported
wine labeled with an appellation of
origin, and TTB believes that a
consistent approach is appropriate for
vintage wine.
Accordingly, TTB is proposing to
amend paragraph (c) of § 4.27 to remove
the requirement that the importer or
bottler of imported vintage wine possess
a certificate of vintage wine from the
appropriate foreign government.
Instead, the proposed regulations
require that, upon request by the
appropriate TTB officer or a customs
officer, 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 that the wine is
entitled to be labeled with the vintage
date. The remaining requirements
would be that the wine be of the vintage
shown, that the laws of the country
regulate the appearance of vintage dates
on the labels of wine produced for
consumption within the country of
origin, that the wine has been produced
in conformity with those laws, and that
the wine would be entitled to bear the
vintage date if it had been sold within
the country of origin.
F. Possession of Certificates for
Imported Natural Wine
TTB proposes to add a definition of
natural wine to § 26.11 and § 27.11,
applicable to all of parts 26 and 27. The
proposed definition of natural wine at
§ 26.11 and § 27.11 provides that natural
wine is made in accordance with a
production practice or procedure
authorized for natural wine by 27 CFR
part 24, or, in the case of natural wine
produced and imported subject to an
international agreement or treaty, those
practices and procedures acceptable to
the United States under that agreement
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or treaty. This is consistent with the
requirements of 26 U.S.C. 5382(a)(3)(A).
TTB also proposes amending 27 CFR
27.140, which generally requires
importers of natural wine to obtain a
certification regarding the production of
the wine from the country of origin.
(This requirement does not apply to
natural wine brought into the United
States from the U.S. Virgin Islands.)
TTB proposes to amend § 27.140 to
remove the definition of importer from
paragraph (a) of that section. The
existing regulatory definition applies
only to importers that are required to
have a basic permit under the FAA Act.
Although the certificate is also required
under § 4.45(b) for FAA Act purposes,
the IRC requirement applies to all
importers of natural wine, including
wine not subject to the FAA Act. TTB
proposes to amend paragraph (b)(1) of
§ 27.140 to state that the importer of
bottled wine must be in possession of
the certificate at the time of filing the
entry with CBP, and the bottler of bulk
wine must be in possession of the
certificate at the time the wine is
withdrawn from the premises where
bottled. Under proposed 27.140(b)(1),
natural wine certificates must be
retained for three years following
release from customs custody, and must
be made available to the appropriate
TTB officer or a customs officer upon
request.
TTB also proposes a technical
revision to the definition of proper
cellar treatment at § 27.140(a), and
proposes to remove the definition of
natural wine in § 27.140 from that
section. The proposed definition is
intended to describe which wine is
eligible to be imported or brought into
the United States in bulk without
payment of tax, as described in more
detail below.
For natural wine that is subject to the
FAA Act, current § 4.45(b) provides that
the importer of bottled wine must be in
possession of the certificate at the time
of the release of wine from customs
custody. Proposed § 4.45(c) provides
that the importer must retain the
certificate for five years following the
date of removal from customs custody,
and proposed § 4.53 provides that the
bottler of bulk wine must be in
possession of the certificate at the time
the wine is removed from the premises
where bottled and retain the certificate
for five years following such removal.
G. Removal of Requirement To Present
to CBP Certificates of Nonstandard Fill
for Wine and Distilled Spirits
The TTB regulations in 27 CFR parts
4 and 5 currently prescribe certain
standards of fill for wine and distilled
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spirits, respectively. (See 27 CFR 4.70–
4.72 and 5.45–5.47a.) Over the years, a
number of changes were made to these
standards, but the most significant
change was the adoption of metric
standards of fill for wine containers in
1974 (in T.D. ATF–12, 39 FR 45216) and
for distilled spirits containers in 1980
(in T.D. ATF–25, 41 FR 10217 and
11022). A later amendment to the metric
standards for distilled spirits containers
included a phase-out of the 500milliliter container size for distilled
spirits (in T.D. ATF–228, 51 FR 16167).
Wine and distilled spirits that were
bottled or packed before these standards
became mandatory are ‘‘grandfathered’’
and may continue to be marketed in the
United States. Imported wine and
distilled spirits must either have (1)
entered into customs custody before the
most recent standards became
mandatory (January 1, 1979, for wine
and January 1, 1980, for distilled spirits
or July 1, 1989, in the case of distilled
spirits in 500-milliliter containers) and
remained in their containers, or (2) been
bottled or packed before the most recent
standards became mandatory and a
statement signed by a duly authorized
official of the appropriate foreign
country attests to that fact.
Within part 4, subpart E,
Requirements for Withdrawal of Wine
From Customs Custody, § 4.46 (27 CFR
4.46) requires that imported wine in
containers not conforming to an
authorized standard of fill (and not
entered into customs custody before
January 1, 1979) be accompanied by a
certificate of nonstandard fill in order to
be withdrawn from customs custody.
Within part 5, subpart F, Requirements
for Withdrawal From Customs Custody
of Bottled Imported Distilled Spirits,
§ 5.53 (27 CFR 5.53) similarly requires
that imported distilled spirits in
containers not conforming to an
authorized standard of fill (and not
entered into customs custody before
January 1, 1980, or July 1, 1989, in the
case of distilled spirits in 500-milliliter
containers) be accompanied by the
certificate of nonstandard fill as a
requirement for withdrawal from
customs custody.
While importations of wine and
distilled spirits that were bottled or
packed before the most recent standards
became mandatory are rare, TTB does
occasionally receive COLA applications
stating nonstandard fill for wines and
distilled spirits. Therefore, TTB believes
that it is appropriate to retain the
exceptions for these products in the
regulations. However, because the
certification of nonstandard fill is
provided as part of the COLA
application, TTB believes it is not
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necessary to require the certificate upon
importation. Accordingly, TTB proposes
to remove §§ 4.46 and 5.53 from the
regulations, and to insert the exceptions
for the ‘‘grandfathered’’ wines and
distilled spirits—along with the
requirement for the certificate of
nonstandard fill for wines not entered
into customs custody before January 1,
1979 and distilled spirits not entered
into customs custody before January 1,
1980 or July 1, 1989 in the case of
distilled spirits in 500-milliliter
containers—into the general standards
of fill regulations in §§ 4.70 and 5.45. As
proposed, the required foreign
certificate is a document that must be
made available to TTB upon request.
TTB also proposes to remove the cross
reference to § 5.53 currently contained
in § 5.47a (27 CFR 5.47a).
Finally, TTB is clarifying that the
certificates are to be issued by ‘‘an
official duly authorized by’’ the
appropriate foreign government, to
provide for non-governmental or quasigovernmental bodies that may be
authorized by a foreign government to
issue such certificates.
These proposals concerning standards
of fill are only intended to make
changes to allow for the electronic filing
of information. Substantive changes to
standards of fill requirements are not
addressed in this document.
H. Removal of Requirements Concerning
Liquor Bottles and Filing Certain
Applications in Triplicate
Regulations in part 26 subpart P and
part 27 subpart N concern requirements
for liquor bottles. Sections 26.316 and
27.206 (27 CFR 26.316 and 27.206)
currently provide that a customs officer
will deny entry to any liquor bottle
containing distilled spirits upon advice
of the appropriate TTB officer who
deems the bottle to be deceptive.
Sections 26.318 and 27.208 (27 CFR
26.318 and 27.208) state that filled
liquor bottles not conforming to those
regulations will be denied entry into the
United States, but provide that TTB may
authorize such liquor bottles to be
brought into the United States upon a
letterhead application filed with TTB in
triplicate. Similarly, sections 26.319 and
27.209 provide that TTB may authorize
an importer to receive used liquor
bottles pursuant to regulations in 27
CFR part 31 upon a letterhead
application filed with TTB in triplicate.
TTB proposes to amend §§ 26.316 and
27.206 to replace the text that states that
the customs officer will deny entry of
disapproved liquor bottles with text
stating that disapproved bottles may not
be brought into the United States. These
amendments reflect the current
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environment where CBP may make
decisions to inspect shipments on a
case-by-case basis. Additionally, as
amended, § 26.316 specifically states its
provisions apply to bottles both from
Puerto Rico, which is within the
customs territory of the United States,
and from the U.S. Virgin Islands, which
is not. TTB also proposes to amend
§§ 26.318, 26.319, 27.208, and 27.209 to
remove the requirement that the
applications be made in triplicate. TTB
also proposes to update a crossreference made in §§ 26.319 and 27.209
from § 31.263 (27 CFR 31.263) to
§ 31.203 (27 CFR 31.203), and to make
§§ 26.318 and 27.208 more readable.
In addition, TTB is proposing to
remove requirements set forth in 27 CFR
26.331 and 27.221 that applications to
TTB for authorization to use alternate
methods or procedures in lieu of
methods or procedures prescribed by
those parts be submitted in triplicate.
I. Filing of Data With Respect to
Distilled Spirits, Wine, and Beer
Imported or Brought Into the United
States From the U.S. Virgin Islands
Subject to Tax
As noted above, the Federal excise tax
due on the importation of distilled
spirits, wine, and beer is collected by
CBP, along with any applicable duties.
See 27 CFR 27.48. Similarly, liquors
coming into the United States from the
U.S. Virgin Islands are generally subject
to a tax equal to the internal revenue tax
imposed upon the production in the
United States of like liquors. See 27 CFR
26.200. Such taxes are collected by CBP,
along with any applicable duties.
To help ensure appropriate tax
payment, TTB is proposing in this
rulemaking to require that importers file
and/or retain certain information
regarding distilled spirits, wine, and
beer imported into the United States or
brought into the United States from the
U.S. Virgin Islands subject to tax.
Specifically, TTB is proposing to amend
§§ 27.48 and 26.200 to require from
electronic filers of TTB data information
about the importer (name, FAA Act
basic permit number, address, and
employer identification number (EIN))
and the ultimate consignee (name and
address) as well as information
identifying the distilled spirits, wine, or
beer for IRC or FAA Act purposes and
the quantity of each product. Proposed
amendments to §§ 27.48 and 26.200 also
refer to the COLA requirement that may
apply under § 4.40, 5.51, or 7.31. For
importers filing TTB data electronically,
this information would be required to be
filed with CBP at the time of filing the
customs entry or entry summary, as
appropriate, along with any other
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information that is required by CBP for
purposes of determining and collecting
the Federal excise tax and administering
the provisions of the IRC and FAA Act.
The proposed text also includes a
clarification that, if any of the
information required by TTB is also
filed by the importer with CBP upon
entry or entry summary, as appropriate,
for purposes of meeting CBP
requirements, the submission of
information for CBP purposes will also
meet the TTB requirements. That is,
generally, the importer need not enter
the same information twice. TTB
understands that quantities of distilled
spirits are currently submitted to CBP in
proof liters and not in proof gallons, and
so proposes in §§ 27.48, 26.200, and
elsewhere to accept the filing of
quantities of distilled spirits in proof
liters, and to add a definition of ‘‘proof
liter’’ to §§ 27.11 and 26.11.
Regardless of the method of filing, the
importer must retain the information
required, any information provided to
CBP to meet CBP requirements, and any
supporting documentation, and make
such records available for inspection by
the appropriate TTB officer or a customs
officer.
TTB is also proposing a technical
correction to the definition of
‘‘importer’’ at § 26.11. As revised, an
importer is defined as any person who
brings distilled spirits, wines, or beer
into the United States from the Virgin
Islands. Other proposed technical
corrections update statutory references
at §§ 26.263 and 26.264, pertaining to
the determination of tax on beer and
wine, respectively.
J. Entry of Distilled Spirits To Which an
Effective Tax Rate or Standard Effective
Tax Rate Applies
Section 5010 of the IRC (26 U.S.C.
5010) provides a credit against the tax
imposed on distilled spirits for any
eligible wine or eligible nonbeverage
flavors used in the manufacture of the
distilled spirits. This credit results in an
effective tax rate, which is a reduced
rate of tax. For imported distilled
spirits, pursuant to section 5010(b)(2),
the wine content and flavors content of
the distilled spirits are established by
chemical analysis, certification, or other
methods set forth in regulations
prescribed by the Secretary. Sections
27.76 and 27.77 of the TTB regulations
(27 CFR 27.76 and 27.77) set forth the
methods by which the effective tax rates
are determined and applied to imported
distilled spirits. Section 26.204a (27
CFR 26.204a) sets forth the method by
which the effective tax rates are
determined and applied to distilled
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spirits brought into the United States
from the U.S. Virgin Islands.
An importer of distilled spirits may
obtain and apply an effective tax rate in
one of two ways. Under one approach,
provided in § 27.76, the importer
obtains from TTB a ‘‘statement of
eligibility’’ for each wine and flavor
used in the product, and then prepares
a ‘‘certificate of effective tax rate
computation’’ for each shipment. The
importer must file this certificate with
CBP at the port of entry at the time it
files the relevant entry summary. A
similar approach is also available to
persons bringing distilled spirits into
the United States from the U.S. Virgin
Islands, except that, instead of preparing
a specific certificate of effective tax rate
computation, the importer must submit
the information upon which the
effective tax rate is based, along with
other information about the shipment,
in a certificate specified in section
26.205 (27 CFR 26.205). Alternatively,
the importer may have a ‘‘standard
effective tax rate’’ established by TTB
pursuant to § 27.77. A standard effective
tax rate may be used continually for
each importation of a product because it
is based on the lowest quantities and
lowest alcohol content of eligible wine
and flavors used in making the
particular product. Under current
regulations, a copy of the standard
effective tax rate approval must be filed
with CBP at the port of entry at the time
of entry summary.
TTB believes it is no longer necessary
for the importer to submit the certificate
of effective tax rate computation or the
standard effective tax rate approval
document to CBP during the entry
process, provided that the importer
possesses one of these documents and
makes it available upon request. TTB
believes that the data already provided
by the importer to CBP during the entry
process regarding the tax applicable to
the imported distilled spirits is
sufficient for enforcement of the
effective tax rate provisions when
combined with the importer’s FAA Act
basic permit number and the COLA
identification number upon importation
(the filing of which are proposed in this
document). Therefore, TTB proposes to
amend §§ 27.76 and 27.77 to remove the
requirement that the importer submit
the certificate of effective tax rate or the
standard effective tax rate approval at
entry, although the importer must have
the certificate in its possession at the
time of filing the entry summary and a
copy must be provided to an
appropriate TTB officer or a customs
officer upon request. TTB also proposes
to specify, in a new paragraph (e) in
both § 27.76 and § 27.77, that the
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importer must retain a copy of the
certificate or approval in accordance
with the record retention requirements
in 27 CFR part 27 and provide it upon
request. For persons bringing distilled
spirits into the United States from the
U.S. Virgin Islands, the information will
continue to be entered into the
certificate specified in § 26.205. As with
imported distilled spirits, TTB also
proposes to specify, in a new paragraph
(c) in § 26.205, that the person bringing
the distilled spirits into the United
States must retain a copy of the
certificate and records to substantiate
information on the certificate, such as
information regarding an effective tax
rate, in accordance with the record
retention requirements in 27 CFR part
26 and provide them upon request.
When distilled spirits eligible for an
effective tax rate are removed from
customs custody in bulk without
payment of tax for transfer to a domestic
distilled spirits plant, current and
proposed §§ 27.76 and 27.77 provide
that the importer must furnish a copy of
the certificate or approval to the
proprietor of the distilled spirits plant to
which the distilled spirits are
transferred. Similarly, proposed
§ 26.205 requires that the certificate
showing information regarding liquors
brought into the United States from the
U.S. Virgin Islands, which would
include information related to the
effective tax rate if applicable, be
provided to the receiving distilled
spirits plant.
K. Distilled Spirits, Wine, and Beer
Imported or Brought Into the United
States Without Payment of Tax in Bulk
Containers
As noted above, under 26 U.S.C. 5232,
distilled spirits imported or brought into
the United States in bulk containers
may, under regulations prescribed by
the Secretary of the Treasury, be
withdrawn from customs custody and
transferred in such bulk containers or by
pipeline to the bonded premises of a
distilled spirits plant without payment
of the internal revenue tax. The person
operating the bonded premises of the
distilled spirits plant receiving the
spirits becomes liable for the tax upon
release of the spirits from customs
custody. Section 27.11 (27 CFR 27.11)
defines the term ‘‘bulk containers’’ as
any container having a capacity of more
than one gallon. Subpart L of part 27
and subpart Oa of part 26 currently
contain the provisions related to the
transfer of distilled spirits from customs
custody to the bonded premises of a
distilled spirits plant.
Prior to 1998, the IRC contained no
provisions allowing the importation of
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wine without payment of the excise tax
imposed by section 5041 or the
importation of beer without payment of
the excise tax imposed by section 5051.
Wine and beer could both be imported
in bulk or in any type of container, but
no provision existed in the IRC to defer
payment of the excise tax on
importation, or to permit the movement
of imported wine or beer, without
payment of tax, onto bonded wine cellar
premises or brewery premises, as
applicable, where it would be covered
by the TTB bond.
Effective April 1, 1998, sections 1421
and 1422 of the Taxpayer Relief Act of
1997, Public Law 105–34, amended the
IRC to authorize the transfer without
payment of tax of imported wine in bulk
containers from customs custody to a
bonded wine cellar and the transfer of
beer in bulk containers from customs
custody to a brewery premises. See 26
U.S.C. 5364 and 5418, respectively. A
subsequent provision enacted by section
6014 of the Internal Revenue
Restructuring and Reform Act of 1998,
Public Law 105–206, restricted bulk
imported wine to ‘‘Natural wine (as
defined in section 5381).’’
Under 26 U.S.C. 5364 and 5418, as
amended, the physical transfer of wine
or beer is accompanied by a transfer of
the excise tax liability existing for such
wine from the customs bond of the
importer to the wine or beer bond of the
receiving bonded wine cellar or
brewery, as the case may be. Excise tax
payment on such imported wine or beer
is deferred until the time when the wine
or beer is removed from the bonded
wine cellar or brewery, as applicable,
for consumption or sale. At that time,
the taxation provisions of section 5041
of the IRC apply to the wine and those
of section 5051 of the IRC apply to beer.
Accordingly, the proprietor of the
bonded wine cellar pays the tax by
return under the IRC and the TTB
provisions applicable to domestic wine
removed subject to tax, while the brewer
pays the tax by return under the IRC and
the TTB provisions applicable to
domestic beer removed subject to tax.
In March 1998, ATF issued two ATF
Procedures regarding the administration
of sections 1421 and 1422 of Public Law
105–34. The procedures are ATF
Procedure 98–2, concerning importation
and transfer of beer in bulk containers
to a brewery premises, and ATF
Procedure 98–3, concerning importation
and transfer of wine in bulk containers
to a bonded wine cellar. These two
procedures provide guidance and set
forth requirements applicable to
importers of wine and beer in bulk
containers and proprietors of the
domestic facilities receiving the bulk
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wine and beer, which have not yet been
incorporated into the TTB regulations.
With respect to importers, both
procedures require that, on release of
the bulk product from customs custody,
the importer prepare a transfer record
documenting the transfer of the product.
With respect to wine, ATF Procedure
98–3 provides that the transfer record
will identify the importer and show the
number of containers transferred and
quantity of wine within each container,
the origin of the wine, the customs entry
number, the amount of duty paid, the
kind of wine, and information
identifying the foreign producer. With
respect to beer, ATF Procedure 98–2
provides that the transfer record will
identify the importer and will show the
number of containers transferred and
quantity of beer within each container,
the foreign origin of the beer, the
customs entry number, the amount of
duty paid, the kind of beer, and
information identifying the foreign
brewer. Neither procedure requires the
information to be submitted to CBP as
part of the customs entry or entry
summary.
ATF Procedures 98–2 and 98–3 also
provide guidance to domestic
manufacturers who receive shipments of
bulk wine or beer. In this rulemaking,
TTB is not addressing such guidance,
because the primary intent of this
rulemaking is to address and prepare for
the submission by importers of
electronic importation information, and
procedural rules relating to the
operations of domestic recipients of the
shipments are beyond the scope of this
rulemaking. With regard to importers,
TTB is proposing to amend the
provisions of 27 CFR part 27 to expand
the scope of subpart L, and 27 CFR part
26 to expand the scope of subpart Oa,
which currently only address transfers
of bulk distilled spirits from customs
custody to the bonded premises of
distilled spirits plants. Specifically,
§ 27.171 of part 27 currently sets forth
general provisions regarding the
importation of bulk distilled spirits, and
§ 26.300 sets forth general provisions
regarding bringing bulk distilled spirits
into the United States from the U.S.
Virgin Islands. Under the proposed
regulations, the current texts of each
section will be designated as (a) and
new paragraphs (b) and (c) will set forth
the general provisions related to the
importation of bulk beer and wine
without payment of tax.
In subpart L of part 27, 27 CFR 27.172
currently requires a person importing
distilled spirits and transferring them
from customs custody to the bonded
premises of a distilled spirits plant
without payment of tax to prepare a
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transfer record for each conveyance and,
if the spirits are in packages, a package
gauge record that must be attached to
the transfer record. The transfer record
and the package gauge record must be
prepared in triplicate, and, upon release
of the spirits from customs custody, one
copy must be given to CBP, one copy
must be forwarded to the appropriate
TTB officer, and the original must be
forwarded to the consignee.
The specific requirements regarding
the transfer record’s contents are set
forth in 27 CFR 27.138. Under § 27.138,
the transfer record must be given a serial
number by the preparer and must
contain such information as the name
and IRC registry number of the distilled
spirits plant receiving the spirits from
customs custody, the country of origin,
the name of the foreign producer, the
kind of spirits, the age and proof of the
spirits, the proof gallons of the spirits,
and the type and number of containers
in the shipment. The specific
requirements regarding the package
gauge record’s contents are set forth in
27 CFR 27.139. Under § 27.139, the
package gauge record must contain
information about each package,
including the package identification or
serial number; the kind of spirits; the
gross weight, proof, and proof gallons of
the spirits; the name of the
warehouseman who received the spirits
from customs custody; and the name of
the importer. Similar provisions are set
forth for persons bringing distilled
spirits in bulk containers into the
United States from the U.S. Virgin
Islands for transfer to a distilled spirits
plant at §§ 26.301, 26.273a, and 26.273b
(27 CFR 26.301, 26.273a, and 26.273b).
TTB is proposing to amend §§ 27.172
and 26.301, which currently require the
preparation of the transfer record and
package gauge record for distilled
spirits, to include the transfer record
requirements for wine and beer. Both
sections as amended would require that
the transfer records be maintained by
the person importing the products or
bringing them in from the U.S. Virgin
Islands; the transfer record documents
would not be submitted to CBP. For
importers filing TTB data electronically,
certain information from each transfer
record would be submitted to CBP with
the filing of the entry or entry summary,
as appropriate. Under the proposal, the
information required would be the name
and address of the ultimate consignee,
the basic permit number and EIN (if
applicable) of the importer, the IRC
registry number of the ultimate
consignee, information identifying each
product for IRC and/or FAA Act
purposes, and the quantity in the
shipment.
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TTB is not proposing to amend the
regulations at 27 CFR 27.139 and
26.273b regarding the specific
information that must be contained in
the distilled spirits package gauge
record. However, TTB is proposing to
remove § 26.302 (27 CFR 26.302) and
incorporate the package gauge
requirements of that section into
amended § 26.301. The requirements of
§ 26.302 that refer to preparing copies of
documents in duplicate and filing such
copies would be removed entirely.
TTB is proposing to amend §§ 27.138
and 26.273a, the transfer record, to add
the specific information that is required
to be captured in the transfer record
regarding transfers of wine and beer in
bulk from customs custody to the
premises of the applicable TTB-bonded
premises. The information specified
includes the information now required
by ATF Procedure 98–3, with respect to
transfers of wine, and ATF Procedure
98–2, with respect to transfers of beer,
and adds the following data elements
applicable to both wine and beer: The
date the records are prepared, the name
and address of the bonded wine cellar
or brewery receiving the wine from
customs custody, and the IRC registry
number of the bonded wine cellar or
brewery receiving the wine or beer from
customs custody. As noted above, under
the proposed amendments to §§ 27.172
and 26.301, the transfer record would be
maintained by the importer (or person
bringing the spirits into the United
States from the U.S. Virgin Islands), and
from the transfer record only the name
and address of the ultimate consignee,
the IRC registry number, information
identifying each product for IRC and/or
FAA Act purposes, and the quantity in
the shipment would be required to be
submitted upon entry or entry summary,
as appropriate. TTB is also proposing to
add the customs entry number and
amount of duty paid to the specific
information that is required to be
captured in the transfer record regarding
transfers of distilled spirits in bulk from
customs custody to the premises of the
distilled spirits plant. TTB believes that
this information is important to track
shipments of distilled spirits transferred
without payment of tax.
TTB is proposing to no longer require
submission of the remaining data
elements currently required as part of
the transfer record or package gauge
record, as TTB believes that they are
either no longer necessary to be
submitted or that they can be requested
of an industry member as needed on a
case-by-case basis, if not otherwise
available through data the industry
member submits to CBP for purposes of
meeting CBP requirements.
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The proposed amendments at
§§ 27.172 and 26.301 clarify that if any
of the information required by TTB is
also filed by the importer with CBP
upon entry or entry summary, as
appropriate, for purposes of meeting
CBP requirements, the submission of
information for CBP purposes will also
meet the TTB requirements. In other
words, generally, when filing
information electronically, the importer
need not enter the same information
twice. Regardless of the method of
filing, the importer must retain records,
including supporting records to
substantiate the information it filed with
CBP, in accordance with the record
retention requirements of parts 27 and
26, and provide such records upon
request. Proposed §§ 27.172 and 26.301
also provide that all importers,
including importers that do not file TTB
data electronically, must maintain the
transfer record, specified information,
and supporting documentation, and
make those records available upon
request of the appropriate TTB officer or
a customs officer.
In addition, proposed §§ 27.172 and
26.301 state that the importer must also
provide a copy of the transfer record to
the recipient, if the recipient is not the
importer. The proposed text would
remove the current requirement in
§ 27.172 that the ‘‘original’’ transfer
record be forwarded to the transferee,
and help ensure that the domestic TTBbonded premises receive the record,
regardless of whether a shipment
originates in a foreign country or the
U.S. Virgin Islands. Current and
proposed §§ 27.76 and 27.77 require
that, when distilled spirits eligible for
an effective tax rate are transferred
without payment of tax, the importer
must furnish a copy of the relevant
approval or certificate to the domestic
DSP proprietor. Proposed § 26.205 also
requires that a certificate be forwarded
to the domestic TTB-bonded premises
in the case of distilled spirits, natural
wine, and beer transferred without
payment of tax.
TTB also proposes to amend the
definition of ‘‘bulk container’’ in 27 CFR
27.11 and 26.11 to include references to
bulk containers of wine (any container
larger than 60 liters) and to bulk
containers of beer (any container larger
than 1 barrel of 31 gallons). The
definition proposed for ‘‘bulk
container’’ of wine mirrors the
definition of that term in ATF Procedure
98–3 and in 27 CFR 24.11. (27 CFR part
24 contains the regulations applicable to
operations of domestic wine premises.)
The definition proposed for ‘‘bulk
container’’ of beer mirrors the definition
of that term set out in ATF Procedure
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98–2. TTB is also proposing to add a
definition of ‘‘natural wine’’ to §§ 27.11
and 26.11 to describe what wine may be
imported or brought into the United
States in bulk without payment of tax.
Finally, TTB proposes a number of
clarifying changes to the regulations
relating to imports in bulk. TTB
proposes to add definitions of ‘‘Bonded
wine cellar’’, ‘‘Brewery’’, and ‘‘IRC
registry number’’ to §§ 26.11 and 27.11.
In paragraph (c) of § 26.1, which sets out
the scope of the part 26 regulations, TTB
proposes to add a reference to bulk wine
and bulk beer coming into the United
States from the U.S. Virgin Islands. In
§ 26.273 (27 CFR 26.273), which refers
to the reporting and recording
requirements of proprietors of bonded
premises, TTB proposes to add
references to bonded wine cellars and
breweries. In § 27.120 (27 CFR 27.120),
TTB is updating the reference to
‘‘Regulation 3 (27 CFR part 3)’’ to
‘‘subpart E of part 1,’’ to reflect the
regulatory changes made in T.D. ATF–
373 (61 FR 26096). TTB also proposes
to update the title of § 27.175 to clarify
that it applies only to the receipt of
distilled spirits by proprietors of
distilled spirits plants.
This regulation, if finalized, would
supersede parallel provisions of ATF
Procedures 98–2 and 98–3.
L. Filing of Permit Number and
Information for Industrial Alcohol
Shipments to the United States From
the U.S. Virgin Islands
Section 5314(b)(1) of the IRC (26
U.S.C. 5314(b)(1)) authorizes, in certain
circumstances, distilled spirits
produced or manufactured in the U.S.
Virgin Islands to be brought into the
United States from the U.S. Virgin
Islands free of tax. Those circumstances
include: (1) When the alcohol has been
‘‘denatured’’ by the addition of
materials that make the spirits unfit for
beverage consumption; (2) when the
alcohol is withdrawn by, and for the use
of, the United States or any agency
thereof, any State, any political
subdivision of a State, or the District of
Columbia, for nonbeverage purposes;
and (3) when the alcohol is withdrawn
by an eligible person for certain
specified nonbeverage educational,
medical, or research purposes.
Regulations pertaining to the use of
denatured spirits are found in 27 CFR
part 20 (Distribution and Use of
Denatured Alcohol and Rum), and
regulations pertaining to the use of
undenatured tax-free spirits are in found
in 27 CFR part 22 (Distribution and Use
of Tax-Free Alcohol). Under regulations
in parts 20 and 22, TTB authorizes the
withdrawal and use of tax-free alcohol
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by issuing permits to eligible persons on
TTB Form 5150.9 and to government
entities on TTB Form 5150.33 (or
previous editions on Form 1444).
The distilled spirits described above
may be shipped tax-free to the United
States from the U.S. Virgin Islands
under the provisions of 27 CFR part 26.
Section 26.292 (27 CFR 26.292) requires
that the consignor or consignee file with
CBP the permit issued to the consignee
under part 20 or 22 as evidence that the
consignee is authorized to enter the
spirits free of tax. Sections 26.294 and
26.296 (27 CFR 26.294 and 26.296)
require that each shipment be
accompanied by a record of shipment,
consisting of an invoice, bill of lading,
or similar document that shows certain
specified information about the
shipment, such as the consignee’s name
and address and the total quantity of the
shipment.
As with FAA Act basic permits, TTB
assigns each of the permits referenced in
§ 26.292 a number so that TTB can track
the permit and its use. TTB proposes to
amend § 26.292 to require the consignor
or consignee, if filing TTB data
electronically, to provide the number
associated with the consignee’s permit
to CBP upon entry of the tax-free
distilled spirits instead of a copy of its
permit. The permit number would be
entered into ACE. The TTB permit
number would allow TTB to verify that
the consignee is authorized to enter
industrial spirits or specially denatured
spirits free of tax.
Revised 27 CFR 26.292 also provides
that, regardless of the method of filing,
the consignor or the consignee must
make the permit available upon request
by the appropriate TTB officer or a
customs officer.
TTB also proposes to amend §§ 26.294
and 26.296 to remove the statement that
paper documents must ‘‘accompany’’
shipments into the United States. As
amended, §§ 26.294 and 26.296 require
the consignor, if filing TTB data with
CBP electronically, to file certain
information from the record of shipment
with CBP, along with the filing of the
customs entry or entry summary, as
appropriate, and maintain the rest of the
information required in the record of
shipment as a record. Records
substantiating the information filed with
CBP also must be kept. As proposed,
§§ 26.294 and 26.296 also include the
clarification, that if any of the
information required by TTB to be
provided to CBP is also required by CBP
as part of the entry or entry summary,
the information provided to meet CBP
requirements is sufficient to also meet
TTB requirements, and it need not be
entered twice.
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M. Filing of Permit Number and Data by
Government Agencies Importing
Distilled Spirits Free of Tax
Under section 5313 of the IRC, the
United States Government or any of its
agencies may withdraw imported
distilled spirits for nonbeverage
purposes free of tax from customs
custody. As was mentioned above, TTB
issues permits to government entities
that wish to use tax-free distilled spirits.
Section 27.183 (27 CFR 27.183)
currently requires a government agency
withdrawing distilled spirits free of tax
from customs custody to provide a
photocopy of its permit to ‘‘the district
director of customs.’’ For the same
reasons as those discussed with regard
to shipments of distilled spirits from the
U.S. Virgin Islands, TTB proposes to
amend § 27.183 to require a government
agency, if filing TTB data with CBP
electronically, to file the number
associated with the TTB-issued permit
with CBP when the entry is filed. The
permit number would be entered into
ACE. If the government agency is not
filing TTB data electronically, it must
make a copy of the permit available to
the customs officer, upon request, at
entry or any subsequent time. TTB is
also removing numerous references to
‘‘the district director of customs’’ in part
27, replacing them with a more general
reference to CBP or removing the
reference entirely.
Section 27.184 (27 CFR 27.184)
currently requires identifying numbers
of containers and the quantity of tax-free
spirits to be recorded on entry
documents. TTB proposes to amend
§ 27.184 to remove references to entry
documents and simply require that the
total quantity be filed, along with the
number of the TTB-issued permit.
Finally, TTB also proposes to remove
§ 27.185 (27 CFR 27.185), Customs
release, as it describes customs
processes and inspection. As described
earlier, TTB is generally proposing to
remove most references to actions that
CBP will take at entry, and replace
them, where appropriate, with text that
clarifies the requirements that apply to
the importer at entry.
N. Certificate Covering Distilled Spirits,
Wine, or Beer Brought Into the United
States From the U.S. Virgin Islands
Section 26.205 (27 CFR 26.205)
currently requires that every person
bringing distilled spirits, wine, or beer
under part 26 into the United States
from the U.S. Virgin Islands, except
tourists, obtain a certificate in the
English language from the manufacturer.
The required information in the
certificate includes, among other things,
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the name and address of the consignee,
the kind and brand name, and the
quantity. Under paragraph (b) of
§ 26.205, the person bringing the
distilled spirits, wine, or beer into the
United States must file the certificate
and a record of gauge with CBP at the
port of entry with the entry summary.
Section 26.260 (27 CFR 26.260) also
requires the certificate to be filed with
CBP.
TTB proposes in this rulemaking to
amend § 26.205(b) to require that any
person bringing liquors into the United
States file information that appears on
the certificate as required by proposed
§ 26.200. TTB proposes to add a new
paragraph (c) to § 26.205, under which
information associated with the
certificate required under that section
must be maintained as a record and
made available upon request of the
appropriate TTB officer or a customs
officer. TTB proposes to amend § 26.260
to cross-reference the requirements set
forth in §§ 26.200, 26.204, and 26.205.
Finally, TTB proposes to add a new
paragraph (d) to § 26.205, to require that
for distilled spirits, natural wine, or beer
withdrawn from customs custody
without payment of tax, the importer
must furnish a copy of the certificate
described in § 26.205 to the proprietor
of the receiving distilled spirits plant,
bonded wine cellar, or brewery.
O. Clarification of Record Retention
Requirements
Sections 26.276 and 27.137 (27 CFR
26.276 and 27.137) currently set forth
certain recordkeeping requirements for
all documents or copies of documents
that support records required by parts
26 and 27, respectively. TTB proposes
to amend each of these sections to
provide that the length of time during
which the records must be kept is
measured from the time of withdrawal
from customs custody. TTB also
proposes to provide that the records
must be made available upon request of
the appropriate TTB officer or a customs
officer, rather than made available
during business hours as the texts of
these sections currently state. This
amendment would provide for
alternative means of providing such
records, such as by mail or email. TTB
also proposes to clarify that supporting
documents include data filed with CBP
pursuant to CBP requirements.
P. Removal of Requirements for CBP to
Gauge or Inspect
Certain TTB regulations currently
state that customs officers shall inspect
or gauge shipments of alcohol before
release. Section 26.261 (27 CFR 26.261)
states that CBP will regauge or inspect
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a consignment of liquors from the U.S.
Virgin Islands to the United States to
determine the tax due on the
consignment. Section 26.297 (27 CFR
26.297) states that CBP shall inspect
shipments of industrial spirits, specially
denatured spirits, completely denatured
alcohol, and products made with
denatured spirits coming into the
United States from the U.S. Virgin
Islands. Section 26.303 (27 CFR 26.303)
directs CBP to inspect shipments of bulk
distilled spirits brought into the United
States from the U.S. Virgin Islands and
being transferred free of tax. Similarly,
under § 27.173 (27 CFR 27.173) CBP
shall inspect imports of bulk distilled
spirits being transferred free of tax, and
enter certain information on the transfer
record. Finally, § 27.185 (27 CFR
27.185) requires CBP to inspect
imported distilled spirits being released
without payment of tax for use of the
United States. These inspections are
generally to detect losses in transit.
TTB proposes to remove these
provisions. TTB believes that it is not
now necessary to state that CBP will
gauge or inspect all such consignments
or shipments. TTB notes that persons
receiving the alcohol are subject to
regulation by TTB, and are required to
take action to determine if losses have
occurred. Accordingly, TTB proposes to
remove §§ 26.261, 26.297, 26.303,
27.173, and 27.185.
Q. Filing of Data for Importation of
Tobacco Products Subject to Tax and
Processed Tobacco
The Federal excise tax due incident to
the importation of tobacco products and
cigarette papers and tubes is collected
by CBP, along with any applicable
duties. Tobacco products and cigarette
papers and tubes coming into the
United States from the U.S. Virgin
Islands are generally subject to a tax
equal to the internal revenue tax
imposed upon the production in the
United States of like products. Such
taxes are collected by CBP, along with
any applicable duties. Processed
tobacco is not subject to tax but the
importation of processed tobacco is
subject to TTB regulation. Anyone
engaged in the business of importing
processed tobacco must obtain a permit,
issued by TTB, prior to engaging in such
business. See 26 U.S.C. 5712 and 5713.
Current 27 CFR 41.81 requires that,
when tobacco products and cigarette
papers and tubes are released from
customs custody for consumption,
importers must maintain certain
information about those shipments and,
if the customs form or the electronic
transmission of information allows for
the reporting of that information, file the
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information with CBP. The information
required to be submitted or maintained
under current § 41.81 includes, for
example, identification of the imported
product as it is classified under the IRC,
the quantity imported, and the tax due.
Although a permit is required to import
tobacco products subject to tax, the
regulations do not currently state the
conditions under which an importer
obtaining release of tobacco products
subject to tax must provide the permit
or proof of having obtained the permit
to CBP during importation. TTB is
proposing to update the information
required to be filed and recorded.
Under the proposed regulations, the
importer of tobacco products that files
TTB data electronically must still file
certain information identifying the
imported product as it is classified
under the IRC and the quantity
imported, as well as information
identifying the importer (by TTB permit
number and employer identification
number, or EIN) and the ultimate
consignee. With regard to the TTB
permit number and EIN, each permit to
import tobacco products issued by TTB
has a number associated with it.
Amending the regulations to provide for
the electronic submission of the permit
number by importers that file TTB data
electronically would make clearer to the
importer what is required upon
importation of TTB-regulated tobacco
products and make the permit
requirement more transparent and
consistent. It would also allow TTB to
link more easily specific importations to
the records importers keep and the
reports they submit to TTB. For
importers of cigarette papers and tubes,
the regulations set forth similar filing
requirements, but do not require
submission of a permit number because
importers of cigarette papers and tubes
are not required to obtain a TTB permit.
Proposed § 41.81 provides that any
information required by that section and
also filed with CBP as part of the entry
or entry summary for purposes of
meeting CBP requirements will also
satisfy the TTB requirement. That is,
generally, when filing information
electronically, the importer need not
enter the same information twice.
Whether or not the importer files TTB
data electronically, revised 27 CFR
41.81 provides that the importer must
retain the information required by
§ 41.81, any information provided to
CBP for purposes of meeting CBP
requirements, and any supporting
documentation and make such records
available upon request by the
appropriate TTB officer or a customs
officer.
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In this document, TTB is also
proposing to add a new section 27 CFR
41.265 to outline the process for
importing processed tobacco. The
requirements, as proposed, are similar
to those for importers of tobacco
products and cigarette papers and tubes.
That is, if filing TTB data electronically,
the importer must file with CBP certain
information identifying the importer (by
TTB permit number and employer
identification number, or EIN), the
ultimate consignee, and the import as
‘‘processed tobacco’’ and quantity. The
proposed regulation clarifies that any
information required by that section,
that is filed with CBP as part of the entry
or entry summary for purposes of
meeting CBP requirements, will also
satisfy the TTB requirement. Whether or
not the importer files TTB data
electronically, revised 27 CFR 41.265
provides that the importer must retain
the information required by this section,
any information submitted to CBP to
meet CBP requirements, and any
supporting documentation and make
such records available upon request by
the appropriate TTB officer or a customs
officer.
TTB is also proposing to amend 27
CFR 41.204, which concerns records
and reports. Currently, that section
states that every tobacco products
importer must keep records and submit
reports, when required, of the physical
receipt and disposition of tobacco
products. The proposed regulations
remove the reference to ‘‘physical’’
receipt and disposition. As proposed,
the importer would be responsible for
accounting for all tobacco products
released from customs custody under
the importer’s TTB permit, including
receipt and disposition. Proposed
§ 41.204 would also require
recordkeeping by importers of cigarette
papers and tubes.
R. Filing of Data for Importation of
Tobacco Products Without Payment of
Tax
As noted above, imported tobacco
products and cigarette papers and tubes
may be released from customs custody
without payment of tax for delivery to
a proprietor of an export warehouse, or
to a manufacturer of tobacco products or
cigarette papers and tubes if such
articles are not put up in packages, in
accordance with such regulations and
under such bond as the Secretary shall
prescribe. See 26 U.S.C. 5704(c).
Imported tobacco products and cigarette
papers and tubes previously exported
and returned may be released from
customs custody without payment of tax
for delivery to the original manufacturer
or an export warehouse proprietor
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authorized by such manufacturer to
receive the products, in accordance with
such regulations and under such bond
as the Secretary shall prescribe. See 26
U.S.C. 5704(d).
Section 41.86 (27 CFR 41.86)
addresses releases of tobacco products
and cigarette papers and tubes from
customs custody without payment of
tax. Section 41.86 requires that a
manufacturer or export warehouse
proprietor wanting to obtain release of
tobacco products or cigarette papers or
tubes, under the provisions of 26 U.S.C.
5704(c) and (d), for transfer under bond
to the manufacturer’s or export
warehouse proprietor’s premises must
prepare a notice of release on TTB F
5200.11 and file the form with the
appropriate TTB officer, who certifies
that the manufacturer or export
warehouse proprietor meets the
statutory requirements to obtain release.
The importer makes this document
available for the CBP officer, who
verifies that the TTB F 5200.11 has been
certified and provides a copy of the
form to the importer. After release, the
importer is currently required to send a
copy of the form to TTB. Section
41.86(b) recognizes the use of electronic
filing with CBP but does not specify
how the TTB F 5200.11 is to be used to
obtain the release electronically.
TTB proposes amending § 41.86 to
provide the option for the data required
on the TTB F 5200.11 to be submitted
to CBP electronically, rather than on a
paper form. Those not filing TTB data
electronically with CBP must continue
to use the paper form, be in possession
of the TTB-certified form at the time the
products are released from customs
custody, and make the form available to
a customs officer upon request. TTB
notes that the proposed regulations
would require, when applicable, two
data elements (the TTB Importer Permit
number and the recipient’s EIN) that do
not currently appear on the TTB F
5200.11. Amendments to the form
would be made to mirror any final
regulations. Section 41.86 would also be
amended to specify the circumstances
under which tobacco products and
cigarette papers and tubes may be
released from customs custody without
payment of tax and to include a specific
recordkeeping requirement, that
regardless of the method of filing, the
information required to be submitted to
CBP must be retained along with any
supporting documentation, and such
records must be available for inspection
upon request by the appropriate TTB
officer or a customs officer.
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S. Entry for Warehousing of Distilled
Spirits, Wines, Beer, Tobacco Products,
and Cigarette Papers and Tubes
Under the IRC at 26 U.S.C. 5061(d)(2),
for distilled spirits, wine, and beer
entered for warehousing (such as those
commodities imported and transferred
directly to a customs bonded warehouse
or foreign trade zone and subsequently
transferred between such warehouses),
the last day for payment of the tax shall
not be later than the 14th day after the
last day of the semimonthly period
during which the products are removed
from the first such warehouse, even if
the products are removed from that
customs bonded warehouse or foreign
trade zone for transfer to another
customs bonded warehouse or foreign
trade zone. There is an exception to this
rule for products that are shown to the
satisfaction of the Secretary to be
destined for export. The IRC at 26 U.S.C.
5703(b)(2) mirrors these provisions for
tobacco products and cigarette papers
and tubes. Neither of these statutory
requirements has yet been incorporated
into the TTB regulations in part 26, 27,
or 41. TTB proposes in this document
to add appropriate regulatory text in 27
CFR 26.200 (regarding distilled spirits,
wine, and beer brought into the United
States from the U.S. Virgin Islands),
27.45 (regarding the time of the
determination of the tax on beer), 27.48
(regarding the importation of distilled
spirits, wine, and beer), and new 41.84
(regarding the importation of tobacco
products) to reflect these statutory
provisions.
IV. Public Participation
A. Comments Invited
TTB invites comments from interested
members of the public on this proposed
rulemaking. Regarding the effective date
for these regulations, TTB solicits views
on the amount of time that importers
believe would be needed to develop
functionality to file TTB data
electronically. In the Interim Final Rule,
‘‘Automated Commercial Environment
(ACE) Filings for Electronic Entry/Entry
Summary (Cargo Release and Related
Entry),’’ 80 FR 61278, 61281 (2015), CBP
announced that it is considering a
‘‘proposal to eliminate hybrid filing.’’
That proposal would require importers
to choose between submitting CBP entry
and entry summary documentation
(including all required TTB and other
Partner Government Agency data) either
entirely electronically or entirely on
paper. CBP would no longer accept any
hybrid filings, except in limited
circumstances. This would mean that if
an importer files one paper document
not covered by the limited exceptions,
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acknowledge receipt of comments, and
considers 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 enter the
entity’s name in the ‘‘Organization’’
blank of the comment form. If you
comment via 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.
B. Submitting Comments
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the entire filing, including the report to
CBP, must be on paper. TTB is
interested in comments from the public
regarding how their implementation of
the TTB electronic filing processes
described in this document would be
impacted by a CBP decision to eliminate
hybrid filing.
TTB is currently allowing importers
that are prepared to file electronically to
do so through a pilot program
announced by TTB in a Federal Register
notice, ‘‘Importation of Distilled Spirits,
Wine, Beer, Tobacco Products,
Processed Tobacco, Cigarette Papers and
Tubes; Availability of Pilot Program and
Filing Instructions to Test the Collection
of Import Data for Implementation of the
International Trade Data System,’’ (80
FR 47558, August 7, 2015). Importers
participating in the pilot program are
doing so under an alternate method
published by TTB in Industry Circular
2015–1 on www.ttb.gov. TTB encourages
importers to participate in the pilot
program, test the usability and
functionality of the TTB PGA Message
Set, and provide comments.
D. Public Disclosure
Please submit your comments by the
closing date shown above in this
document. You may submit comments
in one of the following three ways:
• Federal e-Rulemaking Portal: You
may send comments via the online
comment form associated with this
document in Docket No. TTB–2016–
0004 on ‘‘Regulations.gov,’’ the Federal
e-rulemaking portal, at https://
www.regulations.gov. A direct link to
that docket is available under Notice
No. 159 on the TTB Web site at https://
www.ttb.gov/regulations_laws/all_
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 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.
Your comments must reference Notice
No. 159 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 accept
anonymous comments, does not
On the Federal e-rulemaking portal,
Regulations.gov, TTB will post, and the
public may view, copies of this
document and any electronic or mailed
comments we receive about it. A direct
link to the Regulations.gov docket
containing this document and the
posted comments received on it is
available on the TTB Web site at https://
www.ttb.gov/regulations_laws/all_
rulemaking.shtml under Notice No. 159.
You may also reach the docket
containing this document and its related
comments 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 the Bureau considers
unsuitable for posting.
You and other members of the public
may view copies of this notice of
proposed rulemaking and any electronic
or mailed comments TTB receives on it
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 11inch page. Contact the TTB 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.
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C. 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 confidential or
inappropriate for public disclosure.
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V. Regulatory Analysis and Notices
A. Executive Order 12866
It has been determined that this
proposed rule is not a significant
regulatory action as defined by
Executive Order 12866. Therefore, a
regulatory impact assessment is not
required.
B. 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
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.
Impact on Small Entities
While TTB believes the majority of
businesses subject to this proposed rule
are small businesses, the changes
proposed in this document will not
have a significant impact on those small
entities. Electronic filing will not be
required under the proposed changes.
For entities filing on paper, the
proposed changes will generally only
require that certain additional
information must be kept as a record.
Furthermore, the majority of changes
that TTB is proposing in this document
would provide importers with more
predictability regarding the data
required at importation, and the
proposed electronic filing option would
allow importers to more easily provide
information required to import alcohol
and tobacco products. This would
facilitate the movement of the
commodities from the port of entry into
U.S. commerce, and reduce the
possibility of cargo being delayed at the
port. As small entities typically have
fewer resources than large entities to
devote to regulatory compliance and
logistics, these benefits could have a
disproportionately positive effect for
small entities.
In addition, these changes will allow
importers the option to provide data
required by the U.S. government in
order to clear their imported goods
through a single window, rather than
the current practice of filling out
separate forms for commodities subject
to regulation by multiple Federal
agencies.
The changes in the proposed rule can
be divided into three classes with
respect to their impact on entities: (1)
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Providing an electronic filing alternative
to requirements to submit paper
documents to CBP as part of the
customs entry or entry summary filing;
(2) replacing reporting requirements
with recordkeeping requirements, under
which the importer must make
documents available upon request; and
(3) adding some filing requirements. An
example of the electronic filing
alternative is the proposal to address the
COLA. Current regulations require that
the COLA be ‘‘deposited with’’ CBP
before the alcohol beverages covered by
the COLA are released from customs
custody. TTB is proposing instead to
require that importers that file TTB data
electronically input the number of the
COLA with the filing of the customs
entry. Electronic filing provides a nonpaper alternative to submitting
information. It is likely that such an
alternative will be welcomed by
importers that prefer to file
electronically, as including paper
documents in shipments is likely more
burdensome than submitting data
electronically. Paper COLAs will
continue to be required from importers
that do not file TTB data electronically.
An example of replacing reporting
with recordkeeping is the proposal to
address foreign certificates, which
include certificates of age and origin for
certain distilled spirits; certification of
origin and identity for certain wine; and
certification of proper cellar treatment
of natural wine. In general, current
regulations require that the foreign
certificate ‘‘accompany’’ the
importation. TTB is proposing instead
that the importer obtain the certificate
prior to importation and only make it
available upon request. If filing TTB
data electronically, at the filing of the
entry or entry summary, the importer
would certify that it has complied and
will comply with these conditions. The
burden of including paper documents in
shipments is being removed for both
electronic and paper filers in these
instances.
An example of requiring new
information is the proposal that
importers that import alcohol or tobacco
products subject to tax and file TTB data
electronically provide at entry or entry
summary: The importer’s TTB permit
number; the importer’s EIN; the name
and address of the ultimate consignee;
the quantity of each product; and
information identifying each product for
IRC and/or FAA Act purposes.
Importers that do not file electronically
would be required to maintain records
of the information to be made available
upon request. TTB believes that the
impact of this change would be minimal
because much of this information is
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already submitted to CBP for CBP
purposes.
In conclusion, while the entities
affected by the proposed rule include a
substantial number of small entities, the
effects of the changes in this proposed
rule in general, and in particular the
provision of electronic filing
alternatives and the replacement of
reporting requirements with
recordkeeping requirements, are
expected to be positive for the affected
entities. The proposals generally
provide additional options for
complying with import requirements
and allow importers that prefer filing
electronically to meet TTB requirements
through electronic means.
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.
C. Paperwork Reduction Act
Regulations addressed in this
document contain current collections of
information that have been previously
reviewed and approved by the Office of
Management and Budget (OMB) in
accordance with the Paperwork
Reduction Act of 1995 (44 U.S.C.
3504(h)) and assigned control numbers
1513–0020, 1513–0025, 1513–0056,
1513–0059, 1513–0062, 1513–0064,
1513–0088, 1513–0106, and 1513–0119.
The specific regulatory sections in this
proposed rule that contain collections of
information, either current or proposed,
are §§ 1.58, 4.27, 4.40, 4.45, 4.53, 4.70,
5.45, 5.51, 5.52, 5.56, 7.31, 26.200,
26.205, 26.273a, 26.276, 26.292, 26.294,
26.296, 26.301, 26.302, 26.314, 26.318,
26.319, 26.331, 27.48, 27.76, 27.77,
27.137, 27.138, 27.140, 27.172, 27.204,
27.208, 27.209, 27.221, 41.81, 41.86,
41.204, and 41.265. 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
control number assigned by OMB.
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Several amendments proposed in this
document would allow importers to file
information required at importation
electronically, rather than on paper. In
many cases, the proposed regulations
require information that the importer
would already file as part of its customs
entry or entry summary in order to meet
CBP requirements and, in such cases,
the information submitted to CBP to
meet CBP requirements would also
satisfy the TTB requirements. In some
cases, new information is required to be
submitted at importation. Whether the
information is information currently
required to be submitted at importation
or whether it is a new requirement, the
importer has the option of filing the
TTB data electronically with CBP.
Regardless of the method of filing, the
importer must retain and provide the
information upon request. TTB has
submitted a revision to OMB control
number 1513–0064, Importers’ Records
and Reports, to include the information
that TTB is proposing to require
importers that file TTB data
electronically to submit electronically at
entry or entry summary, as well as the
information that must made available by
all importers upon request. Upon
revision of OMB control number 1513–
0064, that collection will include
information related to importers’
compliance with the Federal Alcohol
Administration Act (FAA Act) and with
the Internal Revenue Code of 1986
(IRC), as described below.
Under the proposed regulations,
persons who import, or bring into the
United States from the U.S. Virgin
Islands, distilled spirits, wine, or malt
beverages under an FAA Act basic
permit and who file TTB data
electronically would be required to
submit certain information to show
compliance with FAA Act provisions.
Under proposed § 1.58, every person
required to obtain a basic permit as an
importer must, when importing distilled
spirits, wine, or malt beverages under
that permit and filing TTB data
electronically, file the number of the
permit with CBP along with the filing of
the customs entry, and, regardless of the
method of filing, must make the permit
available upon request.
Further, current §§ 4.27, 4.45, and
5.52, require foreign certificates, which
include certification of vintage wine,
certification of origin and identity for
certain wine, certification of proper
cellar treatment of natural wine (as
required under 27 CFR 27.140), and
certification of age and origin for certain
distilled spirits. Under current
regulations, the importer must obtain
such certificates prior to importation;
importations of products subject to such
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requirements generally must be
accompanied by the certificates. Under
the proposed regulations at §§ 4.45 and
5.52, the importer must make the
applicable certificate available upon
request. If filing TTB data electronically,
as part of the customs filing, the
importer may be asked to make an
attestation that it has obtained a
certificate and will make it available
upon request. In addition, TTB proposes
to add § 4.53 to clarify that bottlers of
bulk imported wine must also possess a
certificate of origin or a certification of
proper cellar treatment of natural wine
(as required under 27 CFR 27.140),
when applicable, that provides the same
information as a certificate required for
importers of wine in bottles. Proposed
§§ 4.53 and 5.56 also specify the
applicable record retention
requirements for the certificates. TTB
proposes to remove the certification of
vintage wine requirement from § 4.27
and to require industry members to
demonstrate upon request that the wine
is entitled to be labeled with the vintage
date. (The natural wine certificate
required by §§ 4.45 and 27.140 is
currently included in the collection of
information assigned OMB control
number 1513–0119, Certification of
Proper Cellar Treatment for Imported
Natural Wine. TTB has submitted to
OMB a revision of that information
collection to make reference to § 4.45.)
The amendments proposed to §§ 4.70
and 5.45 would incorporate the
exceptions to the standards of fill for
imported wine and imported distilled
spirits (respectively), currently found in
§§ 4.46 and 5.53, stating that the
standards of fill do not apply to such
wine or distilled spirits bottled or
packed before January 1, 1979 (or before
July 1, 1989 in the case of distilled
spirits in 500 mL containers). Under the
proposed amendment, the currentlyrequired foreign certificate must be
made available to TTB upon request,
instead of accompanying the shipment.
For bottled distilled spirits, wine, or
malt beverages, the proposed
regulations also require from those filing
TTB data electronically the submission
of the TTB-assigned number of the
product’s valid certificate of label
approval (COLA). TTB proposes to
amend regulatory sections that currently
require the depositing of the COLA, TTB
Form 5100.31, with CBP at the port of
entry of a shipment, in order for the
bottled distilled spirits, wine, or malt
beverage to be released from customs
custody. As proposed, if the importer is
filing the TTB data electronically, the
importer would not deposit the COLA
with CBP but, rather, would file along
with the customs entry the TTB-
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assigned number of the approved COLA
that corresponds to the label on the
bottle of distilled spirits, wine, or malt
beverage. If the importer is not filing
TTB data electronically, a paper COLA
will continue to be required at entry.
Currently, the requirement that
importers deposit the applicable COLA
with CBP is set forth in §§ 4.40, 5.51,
and 7.31 and is covered by OMB control
number 1513–0020, Application for and
Certification/Exemption of Label/Bottle
Approval (TTB F 5100.31), which also
covers the information collected on the
form used to apply for the COLA. As
part of this rulemaking, TTB will
include the electronic submission of the
TTB-assigned COLA number in OMB
control number 1513–0064.
In addition to the FAA Act provisions
described above, under the proposed
amendments, persons who import, or
bring into the United States from the
U.S. Virgin Islands, distilled spirits,
wine, beer, tobacco products, processed
tobacco, or cigarette papers or tubes that
are either released from customs
custody subject to tax or without
payment of tax in bulk under certain
exemptions would be required to submit
and/or make available upon request
certain information to show compliance
with IRC provisions. The proposed
amendments that affect the collection of
information are described below.
Proposed amendments to §§ 26.200,
26.301, 27.48, 27.172, 41.81, 41.86, and
new 41.265 set forth new data elements
(in addition to the FAA Act basic permit
number, where applicable, as described
above) that must be filed with CBP
when filing TTB data electronically and,
regardless of the method of filing, be
kept as a record and made available
upon request. As noted above, in some
cases this information will already be
filed by the importer pursuant to CBP
guidelines (either mandated or provided
at the discretion of the importer) and, if
the importer files the information for
CBP purposes, the importer will satisfy
the TTB requirement without additional
action. In other cases, the information is
specific to the IRC or FAA Act and will
not already be filed by the importer with
CBP for CBP purposes. When using the
option to file TTB data electronically,
the data elements required by the
proposed amendments to §§ 26.200,
27.48, and 41.81 are as follows, with
some variation depending on the
products and circumstances covered
under the specific section: The number
of the importer’s FAA Act basic permit;
the importer’s name, address, and
employer identification number (EIN)
associated with that permit; the name
and address of the ultimate consignee;
the quantity of each product; and
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information identifying each product for
IRC and/or FAA Act purposes. The
proposed amendments also require
similar information for releases of
certain products from customs custody
without payment of tax under proposed
§§ 26.301, 27.172, and 41.86 and, for
releases of processed tobacco, which is
not subject to tax, under new § 41.265.
Sections 26.273a, 26.301, and 27.138
set forth the transfer records applicable
to distilled spirits, wine, and beer
withdrawn from customs custody
without payment of tax for delivery to
specified TTB-bonded facilities.
Distilled spirits transfer records are
currently covered by OMB control
number 1513–0056. The existing
regulations only cover distilled spirits
transfer records; the proposed
regulations add wine and beer transfer
records. For those who will file TTB
data electronically, the proposed
regulations also require the reporting of
information from the transfer records
with the CBP entry. The information
required to be recorded and reported, as
applicable, under the proposed
regulations includes the following, with
some variation depending on the
product: The date the record is
prepared; the name and address of the
bonded premises receiving the distilled
spirits, wine, or beer from customs
custody; the TTB-issued registry
number of the bonded premises
receiving the distilled spirits, wine, or
beer from customs custody; the number
of containers transferred and the
quantity in each container; the country
of origin; the customs entry number and
amount of duty paid; and the foreign
producer.
Current § 26.205 requires that
persons, other than tourists, bringing
liquors or articles under part 26 into the
United States from the Virgin Islands
obtain a certificate from the
manufacturer showing certain
information. TTB proposes to amend
that section to specify that a copy of the
certificate must be retained along with
other records needed to substantiate the
information in the certificate, and those
records must be made available upon
request. Proposed § 26.205 also requires
that the importers that file TTB data
electronically must file the information
included on the certificate in
accordance with the provisions of
§ 26.200.
This document also includes
proposals to amend the regulations in
part 26 and 27 relating to records of
shipments of industrial spirits, specially
denatured spirits, and completely
denatured spirits. Section 26.292
requires that a copy of the consignee’s
permit for shipments of industrial
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spirits or specially denatured spirits
brought into the United States from the
U.S. Virgin Islands be filed with CBP.
The proposed amendment to that
section provides that the permit number
be submitted electronically, if the
importer is filing TTB data
electronically, and must be made
available upon request. As discussed
below, amendments to §§ 26.294 and
26.296 require the reporting with the
CBP entry of the names and addresses
of the consignor and the consignee and
consignor as well as the total quantity
shipped.
Sections 26.318 and 27.208 address
requirements related to liquor bottles
being imported or brought into the
United States, and provide a letterhead
application process for importers that
wish to bring into the United States
filled liquor bottles that do not conform
to the regulatory requirements in part
26. The proposed amendments specify
that the proof of authorization must be
retained for a three-year period and
made available upon request.
TTB is also proposing to remove
references to submissions of information
in triplicate. See §§ 26.331, 27.209, and
27.221.
TTB is proposing to amend §§ 27.76
and 27.77 regarding the approval and
certification of wine and flavors content
and the approval of a standard effective
tax rate for importers. In both cases, the
amendments will remove the
requirement that a TTB approval letter
or certificate be filed with CBP. Under
the proposed regulations, the approval
letter or certificate would be made
available upon request. Proposed
§§ 27.76 and 27.77 also include record
retention requirements.
Finally, TTB is proposing to amend
§§ 26.276, 27.137, and 41.204, which
currently set forth certain recordkeeping
requirements for all documents or
copies of documents that support
records required by parts 26, 27, and 41,
respectively. TTB proposes to amend
sections §§ 26.276 and 27.137 to clarify
that: (1) The length of time for which
the records must be kept is measured
from the time of withdrawal from
customs custody; (2) the records must
be made available upon request of a
customs officer or the appropriate TTB
officer, rather than made available
during business hours as the texts of
these sections currently states; and (3)
supporting documents that must be kept
include data filed with CBP pursuant to
CBP requirements. TTB proposes to
amend § 41.204 to provide that
importers of tobacco products and
cigarette papers or tubes must keep
records of such products received and
disposed of, but also of any of these
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products released from customs custody
under the importer’s TTB permit.
(Current requirements of § 41.204 are
covered by OMB control number 1513–
0106. The proposed requirements are
being submitted to OMB control number
1513–0064.)
TTB believes that these proposed
requirements are necessary to ensure
that:
• Persons engaged in business as
importers are operating under the
permit required by Federal law to
engage in such operations;
• Applicable taxes are paid;
• Commodities released from customs
custody without payment of tax for
transfer in bond are eligible for such
release, are sent to eligible bonded
facilities, and are not diverted; and
• Labels applied to containers of
imported alcohol beverages comply
with FAA Act requirements.
TTB estimates that, as a result of the
amendments, the new annual burden
hours associated with OMB control
number 1513–0064 will change. The
new estimates are:
• Estimated number of respondents:
10,521.
• Estimated average annual burden
hours: 21,042.
The revision of 1513–0064 generally
consolidates the information required of
importers to be filed as part of the
customs entry or entry summary, or kept
as a record relating to the entry or entry
summary. Such consolidation entails
removing requirements that currently
appear in other information collections.
TTB has submitted to OMB a revision of
OMB control number 1513–0056, TTB
REC 5110/05, Distilled Spirits Plants—
Transaction and Supporting Records, to
remove references to §§ 26.273a, 26.301,
27.138, and 27.172 that would now be
captured under OMB control number
1513–0064, as described above. The
estimated number of respondents (620)
and estimated average annual burden
hours (13,516) for 1513–0056 remain
unchanged.
In addition, TTB has submitted to
OMB revisions of OMB control numbers
1513–0059, TTB REC 5150/3, Usual and
Customary Business Records Relating to
Tax-Free Alcohol, and 1513–0062, TTB
REC 5150/1, Usual and Customary
Business Records Relating to Denatured
Spirits. Proposed amendments to the
regulations at §§ 26.294 and 26.296
allow certain information relating to
shipments from the U.S. Virgin Islands
of industrial spirits, specially denatured
spirits or completely denatured spirits
to be filed electronically at the time of
filing the entry or entry summary, as
appropriate. Regardless of the method of
filing, the record of shipment must be
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retained and be made available upon
request. These electronic submissions
will be placed under OMB control
number 1513–0064. The estimated
number of respondents for OMB control
number 1513–0059 (5,268) and for OMB
control number 1513–0062 (3,430) and
the estimated average annual burden
hours for each (one, for usual and
customary business records) remain
unchanged. TTB has also submitted to
OMB a revision of OMB control number
1513–0088, TTB REC 5000/24, Alcohol,
Tobacco, and Firearms Related
Documents for Tax Returns and Claims,
to remove the information collections in
§§ 27.48, 27.137, and 41.81, which will
now be included in revised OMB
control number 1513–0064. OMB
control number 1513–0088 is also
revised to state that the information that
must be maintained as a record includes
all supporting documents, including
information submitted to CBP to meet
CBP requirements. Such information
must be retained for three years. The
estimated number of respondents for
OMB control number 1513–0088
(503,921) and the estimated average
annual burden hours for each (one, for
usual and customary business records)
remain unchanged.
As noted above, TTB has submitted
the revised information collection
requirements to the OMB for review.
Comments on these new recordkeeping
and reporting 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
OIRA_submissions@omb.eop.gov. 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 August 22, 2016. Comments are
specifically requested concerning:
• Whether the collections of
information submitted to OMB are
necessary for the proper performance of
the functions of the Alcohol and
Tobacco Tax and Trade Bureau,
including whether the information will
have practical utility;
• The accuracy of the estimated
burdens associated with the collections
of information submitted to OMB;
• How to enhance the quality, utility,
and clarity of the information to be
collected;
• How to minimize the burden of
complying with the proposed revisions
of the collections of information,
including the application of automated
collection techniques or other forms of
information technology; and
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• Estimates of capital or start-up costs
and costs of operation, maintenance,
and purchase of services to provide
information.
Lists of Subjects
27 CFR Part 1
Administrative practice and
procedure, Alcohol and alcoholic
beverages, Imports, Liquors, Packaging
and containers, Warehouses, Wine.
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 26
Alcohol and alcoholic beverages,
Caribbean Basin Initiative, Claims,
Customs duties and inspection,
Electronic funds transfers, Excise taxes,
Packaging and containers, Puerto Rico,
Reporting and recordkeeping
requirements, Surety bonds, Virgin
Islands, Warehouses.
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27 CFR Part 27
Alcohol and alcoholic beverages,
Beer, Cosmetics, Customs duties and
inspection, Electronic funds transfers,
Excise taxes, Imports, Labeling, Liquors,
Packaging and containers, Reporting
and recordkeeping requirements, Wine.
27 CFR Part 41
Cigars and cigarettes, Claims, Customs
duties and inspection, Electronic funds
transfers, Excise taxes, Imports,
Labeling, Packaging and containers,
Puerto Rico, Reporting and
recordkeeping requirements, Surety
bonds, Tobacco, Virgin Islands,
Warehouses.
Amendments to the Regulations
For the reasons discussed above in the
preamble, TTB proposes to amend 27
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CFR parts 1, 4, 5, 7, 26, 27, and 41 as
follows:
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
1. The authority citation for part 1
continues to read as follows:
■
Authority: 27 U.S.C. 203, 204, 206, 211
unless otherwise noted.
2. Section 1.10 is amended by adding
a definition of ‘‘Malt beverage’’ in
alphabetical order to read as follows:
■
§ 1.10
Meaning of terms.
*
*
*
*
*
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. Standards applying
to the use of processing methods and
flavors in malt beverage production
appear in § 7.11 of this chapter.
*
*
*
*
*
■ 3. Section 1.58 is revised to read as
follows:
§ 1.58
Filing of permits.
Every person receiving a basic permit
under the provisions of this part must
maintain the permit at the place of
business covered by the permit and
make it available upon the request of the
appropriate TTB officer. Every person
required to obtain a basic permit as an
importer under § 1.20 must, when
importing distilled spirits, wine, or malt
beverages under that permit and filing
TTB data electronically, file the number
of the permit with U.S. Customs and
Border Protection (CBP) along with the
filing of the customs entry. Regardless of
the method of filing, every importer
must make the permit available upon
request by the appropriate TTB officer
or a customs officer.
PART 4—LABELING AND
ADVERTISING OF WINE
4. The authority citation for part 4
continues to read as follows:
■
Authority: 27 U.S.C. 205, unless otherwise
noted.
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5. Section 4.10 is amended by adding
a definition of ‘‘Customs officer’’ in
alphabetical order to read as follows:
■
§ 4.10
Meaning of terms.
*
*
*
*
*
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.
*
*
*
*
*
■ 6. Section 4.27 is amended by revising
paragraph (c)(3) to read as follows:
§ 4.27
Vintage wine.
*
*
*
*
*
(c) * * *
(3) 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.
■ 7. Section 4.40 is amended by:
■ a. Revising paragraph (a);
■ b. Removing and reserving paragraph
(b); and
■ c. Adding an Office of Management
and Budget control number reference at
the end of the section.
The revision and addition read as
follows:
§ 4.40
Label approval and release.
(a) Certificate of label approval. 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 certificate of
label approval (COLA) and the
containers bear labels identical to the
labels appearing on the face of the
certificate, or labels with changes
authorized by the form. 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, and, 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 number of the valid
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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
time of entry. In addition, the importer
must provide a copy of the applicable
COLA upon request by the appropriate
TTB officer or a customs officer. The
COLA requirement imposed by this
section applies only to wine that is
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 wine.
*
*
*
*
*
Approved by the Office of Management and
Budget under control numbers 1513–0020
and 1513–0064)
8. Section 4.45 is amended by revising
paragraph (a) and by adding paragraph
(c) and an Office of Management and
Budget control number reference at the
end of the section to read as follows:
■
mstockstill on DSK3G9T082PROD with PROPOSALS2
§ 4.45 Certificates of origin, identity, and
proper cellar treatment.
(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 the
appropriate foreign government if that
country requires the issuance of such a
certificate for wine exported from that
country. The certificate must have been
issued by an official duly authorized by
the foreign government, and it 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) * * *
(c) Retention of certificates. 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.
(Approved by the Office of Management and
Budget under control numbers 1513–0064
and 1513–0119)
§ 4.46
[Removed]
9. Section 4.46 is removed.
10. Section 4.53 is added to subpart F
to read as follows:
■
■
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§ 4.53
Retention of certificates.
(Approved by the Office of Management and
Budget under control number 1513–0064)
11. Section 4.70 is amended by:
a. In paragraph (b)(3), removing the
word ‘‘or’’ following the semi-colon;
■ b. Redesignating paragraph (b)(4) as
paragraph (b)(5);
■ c. Adding new paragraph (b)(4), and
■ d. Adding an Office of Management
and Budget control number reference at
the end of the section.
The additions read as follows:
■
■
Application.
*
*
*
*
*
(b) * * *
(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; or
*
*
*
*
*
(Approved by the Office of Management and
Budget under control number 1513–0064)
PART 5—LABELING AND
ADVERTISING OF DISTILLED SPIRITS
12. The authority citation for part 5
continues to read as follows:
■
Authority: 26 U.S.C. 5301, 7805, 27 U.S.C.
205.
13. Section 5.11 is amended by adding
a definition of ‘‘Customs officer’’ in
alphabetical order to read as follows:
■
§ 5.11
Meaning of terms.
*
*
*
*
*
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.
*
*
*
*
*
PO 00000
Frm 00021
Fmt 4701
Sfmt 4702
14. Section 5.45 is revised to read as
follows:
■
Wine that would be required under
§ 4.45 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 for
consumption 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
that provides the same information as a
certificate required under § 4.45(a) and
(b) would provide for like wine
imported in bottles. The bottler of wine
imported in bulk must retain for five
years following the removal of such
wine from the bonded wine cellar where
bottled copies of the certificates
required by § 4.45(a) and (b), and must
provide them upon request of the
appropriate TTB officer.
§ 4.70
40423
§ 5.45
Application.
(a) Except as provided in paragraph
(b) of this section, no person engaged in
business as a distiller, rectifier,
importer, wholesaler, or warehouseman
and bottler, directly or indirectly, or
through an affiliate, shall 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 any
distilled spirits in bottles unless such
distilled spirits are bottled and packed
in conformity with §§ 5.46 through
5.47a.
(b) Section 5.47a does not apply to:
(1) Imported distilled spirits in the
original containers in which entered
into Customs custody on or before
December 31, 1979 (or on or before June
30, 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, 49 Stat. 981, as amended (27
U.S.C. 205); 26 U.S.C. 5301)
(Approved by the Office of Management and
Budget under control number 1513–0064)
§ 5.47a
[Amended]
15. Section 5.47a is amended in
paragraph (d) by removing the
parenthetical sentence at the end of the
paragraph.
■ 16. Section 5.51 is amended by:
■ a. Revising paragraph (a);
■ b. Removing and reserving paragraphs
(b) and (d); and
■ c. Adding an Office of Management
and Budget control number reference at
the end of the section.
The revision and addition read as
follows:
■
§ 5.51
Label approval and release.
(a) Certificate of label approval.
Distilled spirits, imported in bottles, 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 certificate of label approval (COLA)
and the bottles bear labels identical to
the labels appearing on the face of the
certificate, or labels with changes
authorized by the form. Any person
removing distilled spirits in bottles from
customs custody for consumption must
first apply for and obtain a COLA
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covering the distilled spirits from the
appropriate TTB officer, and, 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 imported distilled spirits
to be imported. If the importer is not
filing electronically, the importer must
provide a copy of the COLA to CBP at
time of entry. In addition, the importer
must provide a copy of the applicable
COLA upon request by the appropriate
TTB officer or a customs officer. The
COLA requirement imposed by this
section applies only to distilled spirits
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 distilled spirits.
*
*
*
*
*
(Approved by the Office of Management and
Budget under control numbers 1513–0020
and 1513–0064)
17. Section 5.52 is amended by:
a. Revising paragraphs (a), (b), (c), the
introductory text of paragraph (d), and
paragraph (e);
■ b. Adding paragraph (f); and
■ c. Adding an Office of Management
and Budget control number reference at
the end of the section.
The revisions and additions read as
follows:
■
■
mstockstill on DSK3G9T082PROD with PROPOSALS2
§ 5.52
Certificates of age and origin.
(a) Scotch, Irish, and Canadian
whiskies. (1) Scotch, Irish, and Canadian
whiskies, imported in bottles, are not
eligible for release from customs
custody, and no person may remove
such whiskies from customs custody,
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 British, Irish, or Canadian
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
bottle. The age certified shall be the
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period during which, after distillation
and before bottling, the distilled spirits
have been stored in oak containers.
(b) Brandy, Cognac, and rum. Brandy
(other than fruit brandies of a type not
customarily stored in oak containers) or
Cognac, imported in bottles, 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 bottle 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.
Rum imported in bottles 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 bottle. 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 bottles, 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) Tequila. (1) Tequila imported in
bottles 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
PO 00000
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Fmt 4701
Sfmt 4702
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 bottles 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 bottle. The age certified shall be the
period during which the Tequila has
been stored in oak containers after
distillation and before bottling.
(d) Other whiskies. Whisky, as
defined in § 5.22(b)(1), (4), (5), and (6),
imported in bottles, is not eligible for
release from customs custody, and no
person shall remove such whiskies from
customs custody unless that person has
obtained and is in possession of a
certificate issued by an official duly
authorized by the appropriate foreign
government certifying:
(1) * * *
(2) * * *
(e) Miscellaneous. Distilled spirits
(other than Scotch, Irish, and Canadian
whiskies, and Cognac) imported in
bottles are not eligible for release from
customs custody, and no person shall
remove such spirits from customs
custody 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.
(f) Retention of certificates. The
importer of distilled spirits imported in
bottles must retain for five years
following the removal of such spirits
from customs custody copies of the
certificates required by paragraphs (a)
through (e) of this section, and must
provide them upon request of the
appropriate TTB officer or a customs
officer.
(Approved by the Office of Management and
Budget under control number 1513–0064)
§ 5.53
[Removed]
18. Section 5.53 is removed.
19. Section 5.56 is revised to read as
follows:
■
■
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§ 5.56
Certificates of age and origin.
Distilled spirits that would be required
under § 5.52 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 plant where bottled
only if the bottler possesses a certificate
of age and/or a certificate of origin
applicable to the spirits that provides
the same information as a certificate
required under § 5.52 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 § 5.52(a)
through (e), and must provide them
upon request of the appropriate TTB
officer.
(Approved by the Office of Management and
Budget under control number 1513–0064)
PART 7—LABELING AND
ADVERTISING OF MALT BEVERAGES
20. The authority citation for part 7
continues to read as follows:
■
Authority: 27 U.S.C. 205.
21. Section 7.10 is amended by adding
a definition of ‘‘Customs officer’’ in
alphabetical order to read as follows:
■
§ 7.10
Meaning of terms.
*
*
*
*
*
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.
*
*
*
*
*
■ 22. Section 7.31 is amended by:
■ a. Revising paragraph (a);
■ b. Removing and reserving paragraph
(b); and
■ c. Adding an Office of Management
and Budget control number reference at
the end of the section.
The revision and addition read as
follows:
mstockstill on DSK3G9T082PROD with PROPOSALS2
§ 7.31
Label approval and release.
(a) Certificate of label approval. 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 certificate of label
approval (COLA) and the containers
bear labels identical to the labels
appearing on the face of the certificate,
or labels with changes authorized by the
form. Any person removing malt
beverages in containers from customs
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custody for consumption must first
apply for and obtain a COLA covering
the malt beverages from the appropriate
TTB officer, and, if filing electronically,
the importer must file with U.S Customs
and Border Protection (CBP), at the time
of filing the customs entry, the TTBassigned identification number of the
valid COLA covering 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
time of entry. In addition, the importer
must provide a copy of the applicable
COLA upon request by the appropriate
TTB officer or a customs officer. 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 malt
beverages.
*
*
*
*
*
(Approved by the Office of Management and
Budget under control numbers 1513–0020
and 1513–0064)
PART 26—LIQUORS AND ARTICLES
FROM PUERTO RICO AND THE VIRGIN
ISLANDS
23. The authority citation for part 26
is revised to read as follows:
■
Authority: 19 U.S.C. 81c; 26 U.S.C. 5001,
5007, 5008, 5010, 5041, 5051, 5061, 5111–
5114, 5121, 5122–5124, 5131–5132, 5207,
5232, 5271, 5275, 5301, 5314, 5555, 6001,
6109, 6301, 6302, 6804, 7101, 7102, 7651,
7652, 7805; 27 U.S.C. 203, 205; 31 U.S.C.
9301, 9303, 9304, 9306.
§ 26.1
[Amended]
24. In § 26.1, paragraph (c) is amended
by adding the words ‘‘, of Virgin Islands
wine in bulk containers from customs
custody to a bonded wine cellar
qualified under part 24 of this chapter,
and of Virgin Islands beer in bulk
containers from customs custody to a
brewery qualified under part 25 of this
chapter’’ before the semicolon at the end
of the paragraph.
■ 25. Section 26.11 is amended by:
■ a. Adding in alphabetical order
definitions of ‘‘Bonded wine cellar’’ and
‘‘Brewery’’;
■ b. Revising the definitions of ‘‘Bulk
container’’, ‘‘Customs officer’’, and
‘‘Importer’’; and
■ c. Adding in alphabetical order
definitions of ‘‘IRC registry number’’,
‘‘Natural wine’’, and ‘‘Proof liter’’.
The revisions and additions read as
follows:
■
§ 26.11
*
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*
Meaning of terms.
*
Frm 00023
*
Fmt 4701
*
Sfmt 4702
40425
Bonded wine cellar. Premises
established under part 24 of this
chapter.
*
*
*
*
*
Brewery. The land and buildings
described in the brewer’s notice, TTB
Form 5130.10, where beer is to be
produced and packaged.
Bulk container. When used in the
context of distilled spirits, the term
‘‘bulk container’’ means any container
having a capacity larger than one wine
gallon. When used in the context of
wine, the term ‘‘bulk container’’ means
any container having a capacity larger
than 60 liters. When used in the context
of beer, the term ‘‘bulk container’’
means any container having a capacity
larger than one barrel of 31 gallons.
*
*
*
*
*
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.
*
*
*
*
*
Importer. Any person who brings
distilled spirits, wines, or beer into the
United States from the Virgin Islands.
*
*
*
*
*
IRC registry number. The number
assigned by TTB to each distilled spirits
plant, bonded wine cellar, taxpaid wine
bottling house, bonded wine warehouse,
or brewery upon approval of an
application made pursuant to Internal
Revenue Code of 1986 requirements (26
U.S.C. 5171, 5351–5353, or 5401).
*
*
*
*
*
Natural wine. The product of the juice
or must of sound, ripe grapes or other
sound, ripe fruit (including berries)
made with any proper cellar treatment
and containing not more than 21
percent by weight (21 degrees Brix
dealcoholized wine) of total solids. For
purposes of this definition, proper cellar
treatment means a production practice
or procedure authorized for natural
wine by part 24 of this chapter, or, in
the case of natural wine produced and
imported subject to an international
agreement or treaty, those practices and
procedures acceptable to the United
States under that agreement or treaty.
*
*
*
*
*
Proof liter. A liter of liquid at 60
degrees Fahrenheit which 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.
*
*
*
*
*
■ 26. Section 26.200 is amended by
adding paragraphs (d), (e), (f), and (g),
by revising the authority citation, and
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by adding an Office of Management and
Budget control number reference at the
end of the section, to read as follows:
§ 26.200
Taxable status.
mstockstill on DSK3G9T082PROD with PROPOSALS2
*
*
*
*
*
(d) Internal revenue taxes payable on
liquors brought into the United States
from the Virgin Islands are collected by
U.S. Customs and Border Protection
(CBP) in accordance with CBP
requirements. The tax must be paid on
the basis of a return, and the customs
form (including any electronic
transmissions) by which the liquors are
duty- and tax-paid to CBP will be
treated as a return for purposes of this
part. The person bringing such liquors
into the United States, if filing
electronically, must file the information
specified in this section with the entry
or entry summary, as appropriate, along
with any other information that is
required by CBP to be filed with the
entry or entry summary for purposes of
administering the provisions of the
Internal Revenue Code and Federal
Alcohol Administration Act (FAA Act).
Any information required by this
section that is also required by, and
filed with, CBP as part of the entry or
entry summary for purposes of meeting
CBP requirements will satisfy the
requirements of this section. The
following information is required as
described under this section:
(1) The permit number of the valid
importer permit issued under the FAA
Act and the regulations issued pursuant
to the FAA Act (27 CFR part 1), if
applicable, as required by 27 CFR 1.20
and 1.58, and the importer’s name,
address, and employer identification
number (EIN) associated with that
permit;
(2) The TTB-assigned number of the
valid certificate of label approval
(COLA), if applicable, as required by 27
CFR 4.40 in the case of wine, 27 CFR
5.51 in the case of distilled spirits, and
27 CFR 7.31 in the case of malt
beverages;
(3) The name and address of the
ultimate consignee;
(4) The quantity of each product (for
distilled spirits, in proof liters or proof
gallons; for wine and beer, in liters or
gallons); and
(5) Information identifying each
product for Internal Revenue Code and/
or FAA Act purposes.
(e) Distilled spirits, natural wines, and
beer in bulk containers may be released
from customs custody without payment
of tax under the provisions of subpart
Oa of this part and thereafter removed
subject to tax from internal revenue
bonded premises. The tax will be
collected and paid under the provisions
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of parts 19, 24, and 25 of this chapter,
respectively.
(f) Entry for warehousing.—(1)
General. Except as provided in
paragraph (f)(2) of this section, in the
case of an entry for warehousing (that is,
products transferred directly to a
customs bonded warehouse or foreign
trade zone), the last day for payment of
the tax shall not be later than the 14th
day after the last day of the
semimonthly period during which the
products are removed from the first
such warehouse, even if the products
have been removed from that customs
bonded warehouse or foreign trade zone
for transfer to another customs bonded
warehouse or foreign trade zone.
(2) Entry for warehousing of products
intended for export. Paragraph (f)(1) of
this section does not apply to any
distilled spirits, wines, or beer entered
for warehousing and then removed for
transfer to another customs bonded
warehouse or foreign trade zone that is
shown to the satisfaction of the
Secretary to be destined for export.
(g) Records. Regardless of the method
of filing, the person bringing the liquors
into the United States must retain as a
record the information required by this
section, any information provided to
CBP to meet CBP requirements, and any
supporting documentation. These
records must be retained in accordance
with the record retention requirements
of § 26.276, and the records must be
made available upon request of the
appropriate TTB officer or a customs
officer.
(26 U.S.C. 5001, 5054, 5061, 5232, 5364,
5418, 7652)
(Approved by the Office of Management and
Budget under control number 1513–0064)
27. Section 26.201c is revised to read
as follows:
■
§ 26.201c Shipments of distilled spirits,
natural wine, and beer to the United States
without payment of tax.
Distilled spirits, natural wine, and
beer may be brought into the United
States from the Virgin Islands in bulk
containers without payment of tax for
transfer in bond from customs custody
to the bonded premises of a distilled
spirits plant in the case of distilled
spirits, a bonded wine cellar in the case
of natural wine, or a brewery in the case
of beer. Such shipments are subject to
the provisions of subpart Oa of this part.
■ 28. Section 26.202 is revised to read
as follows:
§ 26.202 Requirements of the Federal
Alcohol Administration Act.
(a) General. The Federal Alcohol
Administration Act (FAA Act) and the
regulations issued under the FAA Act
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(parts 1, 4, 5, and 7 of this chapter)
provide that any person, except an
agency of a State or political subdivision
thereof or any officer or employee of any
such agency, who brings into the United
States from the Virgin Islands distilled
spirits, wines, or malt beverages for
nonindustrial use must comply with the
permit and labeling requirements
described in this section. See 27 CFR
1.10 for the definitions of distilled
spirits, wine, and malt beverages under
the FAA Act. Tourists bringing distilled
spirits, wines, or malt beverages into the
United States for personal or other
noncommercial use are not subject to
the provisions of the FAA Act or
regulations issued pursuant to the FAA
Act (parts 1, 4, 5, and 7 of this chapter).
(b) FAA Act basic permit. Any person,
except an agency of a State or a political
subdivision thereof or any officer or
employee of any such agency, who
intends to engage in the business of
bringing distilled spirits, wines, or malt
beverages into the United States from
the Virgin Islands must, prior to
bringing such products into the United
States, obtain an importer’s basic
permit, in accordance with the
requirements of the FAA Act and
regulations issued pursuant to the FAA
Act, and must file with U.S. Customs
and Border Protection (CBP) the number
associated with this permit when filing
electronically as required under 27 CFR
1.58. Also, as required under § 1.58 of
this chapter, if the importer is not filing
electronically, the importer must have a
copy of the FAA Act basic permit and
make it available upon request of the
appropriate TTB officer or a customs
officer.
(c) Certificate of label approval. Any
person and any agency of a State or
political subdivision thereof or any
officer or employee of such agency,
removing for commercial purposes
containers of distilled spirits, wines, or
malt beverages from the Virgin Islands
from customs custody for consumption,
when filing electronically, must provide
the TTB-assigned identification number
of the valid certificate of label approval
(COLA) for the distilled spirits, wines,
or malt beverages with the filing of the
customs entry, in accordance with the
requirements of 27 CFR 4.40 in the case
of wine, 27 CFR 5.51 in the case of
distilled spirits, or 27 CFR 7.31 in the
case of malt beverages. Also, as required
under 27 CFR 4.40, 5.51, and 7.31, if the
importer is not filing electronically, the
importer must provide a copy of the
valid COLA to CBP at the time of entry.
(d) Foreign certificates. Any person
and any agency of a State or political
subdivision thereof or any officer or
employee of such agency, bringing into
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the United States from the Virgin
Islands for commercial purposes and for
consumption containers of distilled
spirits or wines that require a certificate
under 27 CFR 4.45(a) in the case of wine
or 27 CFR 5.52 in the case of distilled
spirits must be in possession of the
certificate (and accompanying invoice,
if applicable) at the time of release from
customs custody.
(Secs. 3, 5, 49 Stat. 978, as amended, 981, as
amended; 27 U.S.C. 203, 205)
29. Section 26.205 is amended by:
a. Revising paragraph (b),
b. Adding paragraphs (c) and (d), and
c. Revising the Office of Management
and Budget control number reference at
the end of the section.
The revisions and additions read as
follows:
■
■
■
■
§ 26.205
Certificate.
*
*
*
*
*
(b) The person bringing the liquors
into the United States must file the
information required under § 26.200, in
accordance with that section.
(c) The person bringing liquors into
the United States from the Virgin
Islands must maintain a copy of the
certificate described in paragraph (a) of
this section along with records to
substantiate the information on the
certificate, including information
required under § 26.204, in accordance
with the record retention requirements
of § 26.276 and must make them
available upon request of the
appropriate TTB officer or a customs
officer.
(d) For distilled spirits, natural wine,
or beer withdrawn from customs
custody under the provisions of subpart
Oa of this part, the importer must
furnish a copy of the certificate to the
proprietor of the receiving distilled
spirits plant, bonded wine cellar, or
brewery.
(Approved by the Office of Management and
Budget under control number 1513–0064)
*
*
*
*
*
30. Section 26.260 is revised to read
as follows:
■
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§ 26.260
Required information.
Persons (except tourists) bringing
liquors from the Virgin Islands into the
United States must file with U.S.
Customs and Border Protection, at the
time of filing the entry or entry
summary, as appropriate, the
information required under § 26.200, in
accordance with that section, and
provide any information collected by
any gauge under § 26.204 and any
information contained in the certificate
described in § 26.205, upon request, in
accordance with the provisions of
§§ 26.204 and 26.205(c).
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§ 26.261
[Removed and reserved]
31. Section 26.261 is removed and
reserved.
■ 32. Section 26.263 is revised to read
as follows:
■
§ 26.263
Determination of tax on beer.
If the certificate prescribed in § 26.205
covers beer, the beer tax will be
collected at the rates imposed by 26
U.S.C. 5051.
(68A Stat. 611, as amended; 26 U.S.C. 5051,
7652)
33. The authority citation at the end
of § 26.264 is revised to read as follows:
■
§ 26.264
*
*
Determination of tax on wine.
*
*
*
(68A Stat. 609, as amended; 26 U.S.C. 5041,
7652)
§ 26.273
[Amended]
34. Section 26.273 is amended, after
the word ‘‘plants’’, by adding ‘‘, bonded
wine cellars, and breweries’’.
■ 35. Section 26.273a is revised to read
as follows:
■
§ 26.273a
(7) The kind of wine; and
(8) The producer.
(c) Beer. The transfer record
prescribed in § 26.301 must identify the
importer and show the following:
(1) The date prepared;
(2) The name and address of the
brewery receiving the beer from customs
custody;
(3) The TTB-issued IRC registry
number of the brewery receiving the
beer from customs custody;
(4) The number of containers
transferred and quantity of beer in each
container;
(5) The country of origin of the beer;
(6) The customs entry number and
amount of duty paid;
(7) The kind of beer; and
(8) The brewer.
(Approved by the Office of Management and
Budget under control number 1513–0064)
(Sec. 807, Pub. L. 96–39, 93 Stat. 284 (26
U.S.C. 5207))
36. Section 26.276 is amended by
revising the first sentence and by adding
an OMB control number reference to the
end of the section, to read as follows:
■
Transfer record.
(a) Distilled spirits. The transfer
record for Virgin Islands spirits
prescribed in § 26.301 shall show the:
(1) Date prepared;
(2) Serial number of the transfer
record, beginning with ‘‘1’’ each January
1;
(3) Name of the proprietor and TTBissued IRC registry number of the plant
to which consigned;
(4) Name and address of the
consignor;
(5) Kind of spirits;
(6) Name of the producer;
(7) Age (in years, months and days) of
the spirits;
(8) Proof of the spirits;
(9) Type and serial number of
containers;
(10) Proof gallons of spirits in the
shipment; and
(11) The customs entry number and
amount of duty paid.
(b) Natural wine. The transfer record
prescribed in § 26.301 must identify the
importer and show the following:
(1) The date prepared;
(2) The name and address of the
bonded wine cellar receiving the wine
from customs custody;
(3) The TTB-issued IRC registry
number of the bonded wine cellar
receiving the wine from customs
custody;
(4) The number of containers
transferred and quantity of wine in each
container;
(5) The country of origin of the wine;
(6) The customs entry number and
amount of duty paid;
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§ 26.276
Retention.
All records required by this part,
documents or copies of documents
supporting these records (including data
filed with U.S. Customs and Border
Protection (CBP) pursuant to CBP
requirements), and file copies of reports
required by this part, must be retained
for not less than three years from the
date the shipment is released from
customs custody into the United States,
and during this period must be made
available upon request of the
appropriate TTB officer or a customs
officer. * * *
(Approved by the Office of Management and
Budget under control numbers 1513–0064
and 1513–0088)
37. Section 26.292 is revised to read
as follows:
■
§ 26.292
Consignee permit number.
If filing electronically, the consignor
or consignee must file with U.S.
Customs and Border Protection the
number associated with the consignee’s
permit issued under part 20 of this
chapter (for shipments of specially
denatured spirits) or part 22 of this
chapter (for shipments of industrial
spirits), along with the customs entry. If
not filing electronically, the consignor
or consignee must make the permit
available to the appropriate TTB officer
or a customs officer upon request.
(Approved by the Office of Management and
Budget under control number 1513–0064)
38. Section 26.294 is revised to read
as follows:
■
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§ 26.294
Federal Register / Vol. 81, No. 119 / Tuesday, June 21, 2016 / Proposed Rules
Record of shipment.
§ 26.296
(a) Filing information with U.S.
Customs and Border Protection. Each
person bringing industrial spirits or
specially denatured spirits into the
United States from the Virgin Islands,
who files electronically, must file with
U.S. Customs and Border Protection
(CBP) the information specified in this
paragraph, with the entry or entry
summary, as appropriate. Any
information required by this paragraph
that is also required by, and filed with,
CBP as part of the entry or entry
summary for purposes of meeting CBP
requirements will satisfy the
requirements of this paragraph. In
addition to the consignee’s permit
number or a copy of the consignee’s
permit as required by § 26.292, the
following information is required:
(1) The name and address of the
consignee;
(2) The name and address of the
consignor; and
(3) The total quantity shipped.
(b) Maintaining the record of
shipment. For each shipment of
industrial spirits or specially denatured
spirits from the Virgin Islands to the
United States, the importer shall possess
and maintain a record of shipment. The
record of shipment shall consist of an
invoice, bill of lading, or similar
document that shows the information
required in paragraph (a) of this section,
as well as the following:
(1) For each formula of specially
denatured spirits, the formula number
prescribed by part 21 of this chapter;
(2) For each formula of specially
denatured spirits, the total quantity in
liters or gallons and the serial numbers
or package identification numbers of
containers; and
(3) For industrial spirits, the total
quantity in proof liters or proof gallons
and the package identification numbers
of containers.
(c) Retaining records and making
them available upon request. The
person bringing industrial spirits or
specially denatured spirits into the
United States from the Virgin Islands
must maintain records to substantiate
the information required under
paragraph (a) of this section, and any
information provided to CBP to meet
CBP requirements, in accordance with
the record retention requirements of
§ 26.276. Such records also must be
made available upon request of the
appropriate TTB officer or a customs
officer.
§ 26.297
Record of shipment.
(Approved by the Office of Management and
Budget under control number 1513–0064)
(a) Filing information with U.S.
Customs and Border Protection. Each
person bringing completely denatured
alcohol or products made with
denatured spirits into the United States
from the Virgin Islands, who files
electronically, must file with U.S.
Customs and Border Protection (CBP)
the information specified in this
paragraph with the entry or entry
summary, as appropriate. Any
information required by this paragraph
that is also required by, and filed with,
CBP as part of the entry or entry
summary for purposes of meeting CBP
requirements will satisfy the
requirements of this paragraph. The
following information is required:
(1) The consignor’s name and address;
(2) The consignee’s name and address;
and
(3) The total quantity shipped.
(b) Maintaining additional
information as a record. For each
shipment of completely denatured
alcohol or products made with
denatured spirits from the Virgin
Islands to the United States, the
importer shall possess and maintain a
record of shipment. The record of
shipment shall consist of an invoice, bill
of lading, or similar document that
shows the information required under
paragraph (a) of this section, as well as
the following:
(1) The capacity and number of
containers;
(2) For each formulation of
completely denatured alcohol, the
words ‘‘Virgin Islands Completely
Denatured Alcohol’’ and the formula
number prescribed by part 21 of this
chapter; and
(3) For product made with denatured
spirits, the name, trade name, or brand
name of the product.
(c) Retaining records and making
them available upon request. The
person bringing completely denatured
alcohol or products made with
denatured spirits into the United States
from the Virgin Islands must maintain
records to substantiate the information
required under paragraph (a) of this
section and records as required under
paragraph (b) of this section, and any
information submitted to CBP to meet
CBP requirements, in accordance with
the record retention requirements of
§ 26.276. Such records also must be
made available upon request of the
appropriate TTB officer or a customs
officer.
39. Section 26.296 is revised to read
as follows:
(Approved by the Office of Management and
Budget under control number 1513–0064)
■
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[Removed]
40. Section § 26.297 and the
undesignated center heading
immediately before it are removed.
■
Subpart Oa—Transfer of Virgin Islands
Distilled Spirits, Natural Wines, and
Beer Without Payment of Tax, From
Customs Custody to Internal Revenue
Bond
41. The heading of subpart Oa is
revised as set forth above.
■ 42. Section 26.300 is amended by:
■ a. Revising the section heading;
■ b. Removing ‘‘(a)’’ and ‘‘(b)’’ from the
second sentence;
■ c. Designating the existing text as
paragraph (a);
■ d. Adding a heading to newly
designated paragraph (a); and
■ e. Adding paragraphs (b) and (c).
The revision and additions read as
follows:
■
§ 26.300
General provisions.
(a) Transfer of bulk distilled spirits
from customs custody to bonded
premises of a distilled spirits plant.
* * *
(b) Transfer of bulk natural wine from
customs custody to a bonded wine
cellar. Bulk natural wine, as defined in
§ 26.11, brought into the United States
from the Virgin Islands may, under the
provisions of this subpart, be withdrawn
by the proprietor of a bonded wine
cellar from customs custody and
transferred in bond in bulk containers to
the bonded wine cellar, without
payment of the internal revenue tax
imposed on such wine by 26 U.S.C.
7652. Wine so withdrawn and
transferred to a bonded wine cellar may
be withdrawn from a bonded wine
cellar’s internal revenue bond for any
purpose authorized by 26 U.S.C. chapter
51, in the same manner as domestic
wine. The proprietor of the bonded
wine cellar to which the wine is
transferred becomes liable for the tax on
wine withdrawn from customs custody
under 26 U.S.C. 5364. Upon release of
the wine from customs custody, the
person bringing in the wine is relieved
of the liability for the tax.
(c) Transfer of beer from customs
custody to brewery premises. Bulk beer
brought into the United States from the
Virgin Islands may, under the
provisions of this subpart, be withdrawn
by the proprietor of a bonded brewery
from customs custody and transferred in
bulk containers to the bonded brewery
premises, without payment of the
internal revenue tax imposed on such
beer by 26 U.S.C. 7652. Beer so
withdrawn and transferred to bonded
brewery premises may be withdrawn
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Federal Register / Vol. 81, No. 119 / Tuesday, June 21, 2016 / Proposed Rules
from a brewery’s internal revenue bond
for any purpose authorized by 26 U.S.C.
chapter 51, in the same manner as
domestic beer. The proprietor of the
bonded brewery to which the beer is
transferred becomes liable for the tax on
beer withdrawn from customs custody
under 26 U.S.C. 5418. Upon release of
the beer from customs custody, the
person bringing in the beer from the
Virgin Islands is relieved of the liability
for the tax.
■ 43. Section 26.301 is revised to read
as follows:
mstockstill on DSK3G9T082PROD with PROPOSALS2
§ 26.301
Record of shipment.
(a) Preparation of records. (1) The
importer bringing distilled spirits,
natural wines, or beer into the United
States from the Virgin Islands under this
subpart must prepare a transfer record
according to § 26.273a. A separate
transfer record must be prepared for
each conveyance. The importer bringing
in the distilled spirits, natural wines, or
beer must maintain these records and
any additional records necessary to
substantiate the information provided
under paragraph (b) of this section, in
accordance with the record retention
requirements of § 26.276, and must
make them available upon request of the
appropriate TTB officer or a customs
officer. The importer must also provide
a copy of the record to the recipient, if
the recipient is not the importer.
(2) For distilled spirits, if the spirits
are in packages, the person bringing the
spirits into the United States must be in
possession of a package gauge record for
each bulk container, as provided in
§ 26.273b, at the time the distilled
spirits are withdrawn from customs
custody. The package gauge record may
be prepared by the insular gauger at the
time of their withdrawal from an insular
bonded warehouse, as provided in
§ 26.204, or, if not prepared by the
insular gauger, the package gauge record
must be prepared by the insular
consignor.
(b) Reporting information for release
from customs custody. A person
bringing distilled spirits, natural wines,
or beer into the United States from the
Virgin Islands under this subpart, if
filing electronically, must file with U.S.
Customs and Border Protection (CBP)
the information specified in this section
at the time of filing the entry or entry
summary, as appropriate, along with
any other information that is required
by CBP to be filed with the entry or
entry summary for purposes of
administering the provisions of the
Internal Revenue Code and Federal
Alcohol Administration Act (FAA Act).
Any information required by this
section that is also required by, and
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filed with, CBP as part of the entry or
entry summary for purposes of meeting
CBP requirements will satisfy the
requirements of this section. Regardless
of the method of filing, the importer
must retain all of the information
required by this section and any
supporting documentation and make it
available for inspection by the
appropriate TTB officer or a customs
officer. The following information is
required:
(1) The number of the importer’s basic
permit issued under the FAA Act and
the regulations issued pursuant to the
FAA Act (27 CFR part 1), if applicable,
as required by 27 CFR 1.20, and the
importer’s employer identification
number (EIN) associated with that
permit;
(2) The name and address of the
ultimate consignee;
(3) The TTB-issued IRC registry
number of the ultimate consignee;
(4) The quantity of each distilled
spirit, natural wine, or beer in the
shipment (in proof liters or proof
gallons, for distilled spirits); and
(5) Information identifying each
product for Internal Revenue Code and/
or FAA Act purposes.
(c) The importer bringing the distilled
spirits, wines, or beer into the United
States must maintain records to
substantiate the information required
under paragraph (b) of this section in
accordance with the record retention
requirements of § 26.276 and must
provide them upon request of the
appropriate TTB officer or a customs
officer.
(Approved by the Office of Management and
Budget under control number 1513–0064)
§ 26.302
[Removed and Reserved]
44. Section 26.302 is removed and
reserved.
■
§ 26.303
[Removed and Reserved]
45. Section 26.303 is removed and
reserved.
■
§ 26.314
46. In § 26.314:
a. Redesignate paragraphs (b)(1)
through (5) as (b)(1)(i) through (v);
■ b. Designate the text after the
paragraph (b) heading as new paragraph
(b)(1);
■ c. Designate the undesignated
concluding paragraph as paragraph
(b)(2) and remove the last sentence; and
■ d. Remove the Office of Management
and Budget control number reference
from the end of the section and add in
its place the Office of Management and
Budget control number reference
‘‘(Approved by the Office of
■
■
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Frm 00027
Fmt 4701
Management and Budget under control
number 1513–0020)’’.
■ 47. Section 26.316 is revised to read
as follows:
§ 26.316 Bottles not constituting approved
containers.
The appropriate TTB officer is
authorized to disapprove any bottle,
including a bottle of less than 200 mL
capacity, for use as a liquor bottle which
he determines to be deceptive.
Disapproved bottles may not be brought
into the United States from the U.S.
Virgin Islands or from Puerto Rico.
■ 48. Section 26.318 is revised to read
as follows:
§ 26.318 Liquor bottles not eligible to be
brought into the United States.
(a) General. Except as provided in
paragraph (b) of this section, filled
liquor bottles that do not conform to the
provisions of this subpart may not be
brought into the United States from
Puerto Rico or the Virgin Islands.
(b) Exception. Upon receipt of a
letterhead application, the appropriate
TTB officer may, in nonrecurring cases,
authorize a person to bring into the
United States liquor bottles that do not
conform to the provisions of this part if
that TTB officer determines that the
nonconformance is due to an
unintentional error; the nonconforming
liquor bottle is determined not to be
deceptive, as provided in § 26.316; and
the entry of the nonconforming liquor
bottle will not jeopardize the revenue.
The person bringing such liquor bottles
into the United States under such TTB
authorization must maintain for not less
than three years from the date that the
liquor bottles were released from
customs custody proof of that
authorization and make it available
upon request by the appropriate TTB
officer or a customs officer.
(Approved by the Office of Management and
Budget under control number 1513–0064)
§ 26.319
[Amended]
Sfmt 4702
40429
[Amended]
49. Section 26.319 is amended by:
■ a. Removing the words ‘‘filed in
triplicate’’; and
■ b. Removing ‘‘§ 31.263’’ and adding in
its place ‘‘§ 31.203’’.
■
§ 26.331
[Amended]
50. Section 26.331 is amended by
removing the words ‘‘, in triplicate,’’
and by revising the Office of
Management and Budget control
number reference at the end of the
section to read, ‘‘(Approved by the
Office of Management and Budget under
control number 1513–0064)’’.
■
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PART 27—IMPORTATION OF
DISTILLED SPIRITS, WINES, AND
BEER
51. The authority citation for part 27
is revised to read as follows:
■
Authority: 5 U.S.C. 552(a), 19 U.S.C. 81c,
1202; 26 U.S.C. 5001, 5007, 5008, 5010, 5041,
5051, 5054, 5061, 5121, 5122–5124, 5201,
5205, 5207, 5232, 5273, 5301, 5313, 5382,
5555, 6109, 6302, 7805.
52. Section 27.11 is amended by:
a. Adding in alphabetical order
definitions of ‘‘Bonded wine cellar’’ and
‘‘Brewery’’;
■ b. Revising the definitions of ‘‘Bulk
container’’ and ‘‘Customs officer’’;
■ c. Removing the definition of ‘‘District
director of customs’’; and
■ d. Adding in alphabetical order
definitions of ‘‘IRC registry number’’,
‘‘Natural wine’’, and ‘‘Proof liter’’.
The revisions and additions read as
follows:
■
■
§ 27.11
Meaning of terms.
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*
*
*
*
*
Bonded wine cellar. Premises
established under part 24 of this
chapter.
Brewery. The land and buildings
described in the brewer’s notice, TTB
Form 5130.10, where beer is to be
produced and packaged.
Bulk container. When used in the
context of distilled spirits, the term
‘‘bulk container’’ means any container
having a capacity larger than one wine
gallon. When used in the context of
wine, the term ‘‘bulk container’’ means
any container having a capacity larger
than 60 liters. When used in the context
of beer, the term ‘‘bulk container’’
means any container having a capacity
larger than one barrel of 31 gallons.
*
*
*
*
*
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.
*
*
*
*
*
IRC registry number. The number
assigned by TTB to each distilled spirits
plant, bonded wine cellar, taxpaid wine
bottling house, bonded wine warehouse,
or brewery upon approval of an
application made pursuant to Internal
Revenue Code of 1986 requirements (26
U.S.C. 5171, 5351–5353, or 5401).
*
*
*
*
*
Natural wine. The product of the juice
or must of sound, ripe grapes or other
sound, ripe fruit (including berries)
made with any proper cellar treatment
and containing not more than 21
percent by weight (21 degrees Brix
dealcoholized wine) of total solids. For
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purposes of this definition, proper cellar
treatment means a production practice
or procedure authorized for natural
wine by part 24 of this chapter, or, in
the case of natural wine produced and
imported subject to an international
agreement or treaty, those practices and
procedures acceptable to the United
States under that agreement or treaty.
*
*
*
*
*
Proof liter. A liter of liquid at 60
degrees Fahrenheit which 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.
*
*
*
*
*
■ 53. Section 27.48 is revised to read as
follows:
§ 27.48 Imported distilled spirits, wines,
and beer.
(a) Distilled spirits, wines, and beer
imported subject to tax—(1) General.
Internal revenue taxes payable on
imported distilled spirits, wines, and
beer are collected, accounted for, and
deposited as internal revenue
collections by U.S. Customs and Border
Protection (CBP) in accordance with
CBP requirements. The tax must be paid
on the basis of a return, and the customs
form (including any electronic
transmissions) by which the distilled
spirits, wines, or beer are duty- and taxpaid to CBP will be treated as a return
for purposes of this part.
(2) Required information. In the case
of distilled spirits, wines, and beer
imported into the United States subject
to tax, the importer, if filing
electronically, must file the information
specified in this section with the entry
or entry summary, as appropriate, along
with any other information that is
required by CBP to be filed with the
entry or entry summary for purposes of
determining and collecting the Federal
excise tax and administering the
provisions of the Internal Revenue Code
and Federal Alcohol Administration Act
(FAA Act). Any information required by
this section that is also required by, and
filed with, CBP as part of the entry or
entry summary for purposes of meeting
CBP requirements will satisfy the
requirements of this section. For all
distilled spirits, wines, and beer
imported under this paragraph, the
following information is required:
(i) The number of the importer’s basic
permit issued under the FAA Act and
the regulations issued pursuant to the
FAA Act (27 CFR part 1), if applicable,
as required by 27 CFR 1.20 and 1.58,
and the importer’s name, address, and
employer identification number (EIN)
associated with that permit;
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(ii) The TTB-assigned number of the
valid certificate of label approval
(COLA), if applicable, as required by 27
CFR 4.40 in the case of wine, 27 CFR
5.51 in the case of distilled spirits, and
27 CFR 7.31 in the case of malt
beverages;
(iii) The name and address of the
ultimate consignee;
(iv) The quantity of each product (for
distilled spirits, in proof liters or proof
gallons; for beer and wine, in gallons or
liters); and
(v) Information identifying each
product for Internal Revenue Code and/
or FAA Act purposes, as applicable.
(b) Distilled spirits, natural wines, and
beer transferred without payment of tax
to internal revenue bond. Distilled
spirits, natural wine (as defined in
§ 27.11) and beer in bulk containers may
be released from customs custody
without payment of tax under the
provisions of subpart L of this part and
thereafter removed subject to tax from
distilled spirits plants, bonded wine
cellars, and breweries, respectively. The
tax will be collected and paid under the
provisions of part 19, 24 or 25 of this
chapter, respectively.
(c) Entry for warehousing—(1)
General. Except as provided in
paragraph (c)(2) of this section, in the
case of an entry for warehousing (that is,
products transferred directly to a
customs bonded warehouse or foreign
trade zone), the last day for payment of
the tax shall not be later than the 14th
day after the last day of the
semimonthly period during which the
products are removed from the first
such warehouse, even if the products
are removed from that customs bonded
warehouse or foreign trade zone for
transfer to another customs bonded
warehouse or foreign trade zone.
(2) Entry for warehousing of products
destined for export. Paragraph (c)(1) of
this section does not apply to any
distilled spirits, wines, or beer entered
for warehousing and then removed for
transfer to another custom bonded
warehouse or foreign trade zone that is
shown to the satisfaction of the
Secretary to be destined for export.
(d) Records. Regardless of the method
of filing, the importer must maintain as
a record the information required by
this section, any information provided
to CBP to meet CBP requirements, and
any supporting documentation. These
records must be maintained in
accordance with the record retention
requirements of § 27.137, and the
records must be made available upon
request of the appropriate TTB officer or
a customs officer.
(Approved by the Office of Management and
Budget under control number 1513–0064)
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(26 U.S.C. 5001, 5054, 5061, 5232, 5364,
5418)
■ 54. Section 27.55 and the
undesignated center heading preceding
it are revised to read as follows:
Federal Alcohol Administration Act
Requirements for Importation of
Distilled Spirits, Wines, and Malt
Beverages
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§ 27.55 Requirements of the Federal
Alcohol Administration Act.
(a) General. The Federal Alcohol
Administration Act (FAA Act) and the
regulations issued under the FAA Act
(parts 1, 4, 5, and 7 of this chapter)
provide that any person, except an
agency of a State or political subdivision
thereof or any officer or employee of any
such agency, who imports distilled
spirits, wines, or malt beverages for
nonindustrial use must comply with
certain permit and labeling
requirements as described in this
section. See 27 CFR 1.10 for the
definitions of distilled spirits, wine, and
malt beverages under the FAA Act.
Tourists importing distilled spirits,
wines, or malt beverages into the United
States for personal or other
noncommercial use are not subject to
the provisions of the FAA Act or
regulations issued pursuant to the FAA
Act (parts 1, 4, 5, and 7 of this chapter).
(b) FAA Act basic permit. Any person,
except an agency of a State or a political
subdivision thereof or any officer or
employee of any such agency, who
intends to engage in the business of
importing distilled spirits, wines, or
malt beverages into the United States
must, prior to importing such products
into the United States, obtain an
importer’s basic permit, in accordance
with the requirements of the FAA Act
and regulations issued pursuant to the
FAA Act, and must file with U.S.
Customs and Border Protection (CBP)
the number associated with this permit
with the filing of the customs entry
when filing electronically as required
under 27 CFR 1.58. Also, as required
under § 1.58 of this chapter, if the
importer is not filing electronically, the
importer must have a copy of the FAA
Act basic permit and make it available
upon request of the appropriate TTB
officer or a customs officer.
(c) Certificate of label approval. Any
person and any agency of a State or
political subdivision thereof or any
officer or employee of such agency,
removing for commercial purposes
containers of distilled spirits, wines, or
malt beverages from customs custody
for consumption, when filing
electronically, must provide the TTBassigned identification number of the
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valid certificate of label approval
(COLA) for the distilled spirits, wines,
or malt beverages with the filing of the
customs entry in accordance with the
requirements of 27 CFR 4.40 in the case
of wine, 27 CFR 5.51 in the case of
distilled spirits, or 27 CFR 7.31 in the
case of malt beverages. Also, as required
under 27 CFR 4.40, 5.51, and 7.31, if the
importer is not filing electronically, the
importer must provide a copy of the
valid COLA to CBP at time of entry.
(d) Foreign certificates. Every person
and any agency of a State or political
subdivision thereof or any officer or
employee of such agency, importing for
commercial purposes into the United
States for consumption containers of
distilled spirits or wines that require a
certificate under 27 CFR 4.45 in the case
of wine or 27 CFR 5.52 in the case of
distilled spirits must be in possession of
the certificate (and accompanying
invoice, if applicable) at the time of
release from customs custody.
■
(Sec. 3, 49 Stat. 978, as amended; 27 U.S.C.
203)
(Approved by the Office of Management and
Budget under control number 1513–0064)
55. Section 27.76 is amended by:
a. In paragraph (a), by removing ‘‘TTB
Form 5530.5 (1678)’’ and adding in its
place ‘‘TTB Form 5154.1 (formerly TTB
Form 5530.5 and ATF Form 1678)’’;
■ b. Revising paragraph (d);
■ c. Adding paragraph (e); and
■ d. Revising the OMB control number
reference at the end of the section.
The revision and additions read as
follows:
■
■
§ 27.76 Approval and certification of wine
and flavors content.
*
*
*
*
*
(d) At the time of filing the entry
summary, the importer must have the
certificate in its possession and make it
available upon request of the
appropriate TTB officer or a customs
officer. For distilled spirits withdrawn
from customs custody under the
provisions of subpart L of this part, the
importer must furnish a copy of the
certificate to the proprietor of the
distilled spirits plant to which the
distilled spirits are transferred.
(e) The importer must maintain a
copy of the certificate in accordance
with the record retention requirements
of § 27.137 and must make it available
upon request of the appropriate TTB
officer or a customs officer.
(Approved by the Office of Management and
Budget under control number 1513–0064)
*
*
*
*
*
56. Section 27.77 is amended by:
a. Revising the second sentence of
paragraph (d);
■ b. Adding paragraphs (e) and (f); and
■
■
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c. Revising the OMB control number
reference at the end of the section.
The revisions and additions read as
follows:
§ 27.77
Standard effective tax rate.
*
*
*
*
*
(d) * * * At the time of filing the
entry summary, the importer must have
the approval in its possession and make
it available upon request of the
appropriate TTB officer or a customs
officer. * * *.
(e) The importer must maintain a
copy of the approval in accordance with
the record retention requirements of
§ 27.137 and must make it available
upon request of the appropriate TTB
officer.
(f) For distilled spirits withdrawn
from customs custody under the
provisions of subpart L of this part, the
importer must furnish a copy of the
approval to the proprietor of the
distilled spirits plant to which the
distilled spirits are transferred.
§ 27.120
[AMENDED]
57. In § 27.120, remove ‘‘Regulation 3
(27 CFR part 3)’’ and add ‘‘subpart E of
part 1 of this chapter’’ in its place.
■ 58. In § 27.137, the first sentence is
revised and an Office of Management
and Budget control number reference is
added at the end of the section to read
as follows:
■
§ 27.137
Retention.
All records required by this part,
documents or copies of documents
supporting these records (including data
filed with U.S. Customs and Border
Protection (CBP) pursuant to CBP
requirements), and file copies of reports
required by this part, must be retained
for not less than three years following
each withdrawal from customs custody,
and during this period must be made
available upon request of the
appropriate TTB officer or a customs
officer.
*
*
*
*
*
(Approved by the Office of Management and
Budget under control number 1513–0064 and
1513–0088)
59. Section 27.138 is revised to read
as follows:
■
§ 27.138
Transfer record.
(a) Distilled spirits. The transfer
record prescribed in § 27.172 must
identify the importer and show the
following:
(1) The date prepared;
(2) Serial number of the transfer
record, beginning with ‘‘1’’ each January
1;
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(3) The name, address, and TTBissued IRC registry number (distilled
spirits plant number) of the proprietor
receiving the spirits from customs
custody;
(4) The country of origin of the
distilled spirits;
(5) The name of the foreign producer;
(6) The kind of spirits;
(7) The age, in years, months and days
of the spirits;
(8) The proof of the spirits;
(9) The type and number of
containers;
(10) The proof gallons of spirits in the
shipment; and
(11) The customs entry number and
the amount of duty paid.
(b) Wine. The transfer record
prescribed in § 27.172 must identify the
importer and show the following:
(1) The date prepared;
(2) The name and address of the
bonded wine cellar receiving the wine
from customs custody;
(3) The TTB-issued IRC registry
number of the bonded wine cellar
receiving the wine from customs
custody;
(4) The number of containers
transferred and quantity of wine in each
container;
(5) The country of origin of the wine;
(6) The customs entry number and
amount of duty paid;
(7) The kind of wine; and
(8) The foreign producer.
(c) Beer. The transfer record
prescribed in § 27.172 must identify the
importer and show the following:
(1) The date prepared;
(2) The name and address of the
brewery receiving the beer from customs
custody;
(3) The TTB-issued IRC registry
number of the brewery receiving the
beer from customs custody;
(4) The number of containers
transferred and quantity of beer in each
container;
(5) The country of origin of the beer;
(6) The customs entry number and the
amount of duty paid;
(7) The kind of beer; and
(8) The foreign brewer.
(Approved by the Office of Management and
Budget under control number 1513–0064)
60. Section 27.140 is amended by:
a. Removing from paragraph (a) the
definitions of ‘‘Importer’’ and ‘‘Natural
wine’’;
■ b. Revising in paragraph (a) the
definition of ‘‘Proper cellar treatment’’;
■ c. Revising the introductory text of
paragraph (b)(1), and
■ d. Adding an Office of Management
and Budget control number reference at
the end of the section.
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■
■
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The revisions and addition read as
follows:
The additions and revision read as
follows:
§ 27.140
wine.
§ 27.171
Certification requirements for
(a) * * *
Proper cellar treatment means a
production practice or procedure
authorized for natural wine by part 24
of this chapter, or, in the case of natural
wine produced and imported subject to
an international agreement or treaty,
those practices and procedures
acceptable to the United States under
that agreement or treaty.
(b) * * * (1) General. Except as
otherwise provided in paragraph (b)(2)
of this section, 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. The importer of bottled wine
must be in possession of the certificate
at the time of filing the entry with CBP,
and the bottler of bulk wine must be in
possession of the certificate at the time
the wine is withdrawn from the
premises where bottled. The importer or
bottler, as appropriate, must provide the
certificate upon request by the
appropriate TTB officer or a customs
officer. This requirement may be
satisfied by providing the original
certification, or a photocopy or
electronic copy of the certification. The
appropriate TTB officer or a customs
officer may request, and the importer or
bottler must provide, such information
for a period of three years from the date
that the product covered by the
certificate was released from customs
custody or removed from the bottler’s
premises, as applicable. The
certification:
*
*
*
*
*
(Approved by the Office of Management and
Budget under control numbers 1513–0064
and 1513–0119)
61. The heading of subpart L is
revised to read as follows:
■
Subpart L—Transfer of Distilled
Spirits, Natural Wines, and Beer
Without Payment of Tax, From
Customs Custody to Internal Revenue
Bond
62. Section 27.171 is amended by:
a. Removing ‘‘(a)’’ and ‘‘(b)’’ from the
second sentence;
■ b. Designating the existing text as
paragraph (a);
■ c. Adding a heading to paragraph (a);
■ d. Adding paragraphs (b) and (c); and
■ e. Revising the authority citation at
the end of the section.
■
■
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General provisions.
(a) Transfer of bulk distilled spirits
from customs custody to bonded
premises of a distilled spirits plant.
* * *
(b) Transfer of bulk natural wine from
customs custody to a bonded wine
cellar. Imported ‘‘natural wine,’’ as
defined in § 27.11, may, under the
provisions of this subpart, be withdrawn
in bulk by the proprietor of a bonded
wine cellar from customs custody and
transferred in bulk containers to the
bonded wine cellar without payment of
the internal revenue tax imposed on
wine by 26 U.S.C. 5041. Imported wine
so withdrawn and transferred may be
withdrawn from a bonded wine cellar’s
internal revenue bond for any purpose
authorized by 26 U.S.C. chapter 51, in
the same manner as domestic wine. The
proprietor of the bonded wine premises
to which imported wine is transferred
becomes liable for the tax on wine
withdrawn from customs custody under
26 U.S.C. 5364. Upon release of the
wine from customs custody, the
importer is relieved of the liability for
the tax.
(c) Transfer of beer from customs
custody to a brewery. Imported bulk
beer may, under the provisions of this
subpart, be withdrawn by the proprietor
of bonded brewery from customs
custody and transferred in bulk
containers to bonded brewery premises,
without payment of the internal revenue
tax imposed on beer by 26 U.S.C. 5051.
Imported beer so withdrawn and
transferred to bonded brewery premises
may be withdrawn from a brewery’s
internal revenue bond for any purpose
authorized by 26 U.S.C. chapter 51, in
the same manner as domestic beer. The
proprietor operating the bonded
brewery premises to which imported
beer is transferred becomes liable for the
tax on beer withdrawn from customs
custody under 26 U.S.C. 5418. Upon
release of the beer from customs
custody, the importer is relieved of the
liability for the tax.
(26 U.S.C. 5232, 5364, and 5418)
■ 63. Section 27.172 is revised to read
as follows:
§ 27.172 Preparation of records and
reporting of information for release of
distilled spirits, natural wines, and beer
without payment of tax.
(a) Preparation of records. (1) The
person importing distilled spirits,
natural wines, or beer under this
subpart must prepare a transfer record
according to § 27.138. A separate
transfer record must be prepared for
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each conveyance. The importer must
maintain these records and any records
to substantiate the information required
under paragraph (b) of this section, in
accordance with the record retention
requirements of § 27.137, and must
make them available upon request of the
appropriate TTB officer or a customs
officer. The importer must also provide
a copy of the record to the recipient, if
the recipient is not the importer.
(2) For distilled spirits, if the spirits
are in packages, the importer must
prepare a package gauge record
according to § 27.139 and maintain it
with the transfer record.
(b) Reporting information for release
from customs custody. In the case of
distilled spirits, natural wines, and beer
imported into the United States without
payment of tax under this subpart, the
importer, if filing electronically, must
file with U.S. Customs and Border
Protection (CBP) the information
specified in this section at the time of
filing the entry or entry summary, as
appropriate, along with any other
information that is required by CBP to
be filed with the entry or entry summary
for purposes of administering the
provisions of the Internal Revenue Code
and Federal Alcohol Administration Act
(FAA Act). Any information required by
this section that is also required by, and
filed with, CBP as part of the entry or
entry summary for purposes of meeting
CBP requirements will satisfy the
requirements of this section. Regardless
of the method of filing, the importer
must retain as a record the information
required by this section, any
information provided to CBP to meet
CBP requirements, and any supporting
documentation and make such records
available for inspection by the
appropriate TTB officer or a customs
officer. The following information is
required:
(1) The number of the importer’s basic
permit issued under the FAA Act and
the regulations issued pursuant to the
FAA Act (27 CFR part 1), if applicable,
as required by 27 CFR 1.20, and the
importer’s employer identification
number (EIN) associated with that
permit;
(2) The name and address of the
ultimate consignee;
(3) The TTB-issued IRC registry
number of the ultimate consignee;
(4) The quantity of each distilled
spirit, wine, or beer in the shipment (in
proof liters or proof gallons, for distilled
spirits); and
(5) Information identifying each
product for Internal Revenue Code and/
or FAA Act purposes.
(Approved by the Office of Management and
Budget under control number 1513–0064)
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§ 27.173
[Removed and Reserved]
64. Section 27.173 is removed and
reserved.
■ 65. In § 27.175, the section heading is
revised to read as follows:
■
§ 27.175 Receipt of distilled spirits by
consignee.
*
*
*
*
*
66. Section 27.183 is revised to read
as follows:
■
§ 27.183 Use of Government agency
permit, Form 5150.33.
Each Government agency must retain
the original of its permit, Form 5150.33,
on file. In the case of an agency holding
a single permit for use of its subagencies, an attachment to the permit
must list all locations authorized to
withdraw spirits free of tax from
customs custody. When withdrawing
spirits free of tax from a port of entry,
the agency, if filing electronically, must
file its TTB-issued permit number along
with the filing of any other information
required by U.S. Customs and Border
Protection to be filed with the customs
entry. If the agency is not filing
electronically, rather than file the TTBissued permit number, the agency must
make a copy of the permit available to
the customs officer upon request.
(Sec. 201, Pub. L. 85–859, 72 Stat. 1375, as
amended (26 U.S.C. 5313))
67. Section 27.184 is revised to read
as follows:
■
§ 27.184
■
[Removed]
68. Section 27.185 is removed.
§ 27.204
[Amended]
69. Section 27.204 is amended by:
a. Redesignating paragraphs (b)(1)
through (5) as (b)(1)(i) through (v);
■ b. Designate the text after the
paragraph (b) heading as new paragraph
(b)(1);
■ c. Designating the undesignated
concluding paragraph as paragraph
(b)(2) and removing the last sentence;
and
■ d. Adding an Office of Management
and Budget control number reference to
read ‘‘(Approved by the Office of
Management and Budget under control
number 1513–0020)’’ at the end of the
section.
■
■
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70. Section 27.206 is amended by
revising the last sentence to read as
follows:
■
§ 27.206 Bottles not constituting approved
containers.
* * * Disapproved bottles may not be
imported into the United States.
■ 71. Section 27.208 is revised to read
as follows:
§ 27.208 Liquor bottles not eligible for
release from customs custody.
Upon receipt of a letterhead
application, the appropriate TTB officer
may, in nonrecurring cases, authorize a
person to bring into the United States
liquor bottles that do not conform to the
provisions of this part if that TTB officer
determines that the nonconformance is
due to an unintentional error; the
nonconforming liquor bottle is
determined not to be deceptive, as
provided in § 27.206; and the entry of
the nonconforming liquor bottle will not
jeopardize the revenue. The person
bringing such liquor bottles into the
United States under TTB authorization
must maintain proof of such
authorization for not less than three
years from the date that the liquor
bottles were released from customs
custody and make it available upon
request by the appropriate TTB officer
or a customs officer.
(Approved by the Office of Management and
Budget under control number 1513–0064)
Information required for entry.
Government agencies importing taxfree spirits under this subpart must file,
along with filing the customs entry or
entry summary, the total quantity of the
spirits to be entered and, if filing
electronically, the permit number as
required under § 27.183.
§ 27.185
40433
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§ 27.209
[Amended]
72. Section 27.209 is amended by
removing the words ‘‘filed in triplicate’’;
by removing ‘‘§ 31.263’’ and adding in
its place ‘‘§ 31.203’’ and by removing
the Office of Management and Budget
control number reference at the end of
the section and adding in its place the
Office of Management and Budget
control number reference ‘‘(Approved
by the Office of Management and
Budget under control number 1513–
0064)’’.
■
§ 27.221
[Amended]
73. Section 27.221 is amended in the
introductory text of paragraph (a) by
removing the words ‘‘, in triplicate,’’
and by removing the Office of
Management and Budget control
number reference at the end of the
section and adding in its place the
Office of Management and Budget
control number reference ‘‘(Approved
by the Office of Management and
Budget under control number 1513–
0064)’’.
■
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PART 41—IMPORTATION OF
TOBACCO PRODUCTS, CIGARETTE
PAPERS AND TUBES, AND
PROCESSED TOBACCO
74. The authority citation for part 41
is revised to read as follows:
■
Authority: 26 U.S.C. 5701–5705, 5708,
5712, 5713, 5721–5723, 5741, 5754, 5761–
5763, 6301, 6109, 6302, 6313, 6402, 6404,
7101, 7212, 7342, 7606, 7651, 7652, 7805; 31
U.S.C. 9301, 9303, 9304, 9306.
75. Section 41.11 is amended by
revising the definition of ‘‘Customs
officer’’ to read as follows:
■
§ 41.11
Meaning of terms.
*
*
*
*
*
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.
*
*
*
*
*
■ 76. Section 41.81 is amended by
revising paragraphs (b) and (c) and
adding an Office of Management and
Budget control number reference at the
end of the section to read as follows:
§ 41.81
Taxpayment.
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*
*
*
*
*
(b) Method of payment. Except for
articles imported or brought into the
United States as provided in §§ 41.85
and 41.85a, the internal revenue tax
must be determined before the tobacco
products, cigarette papers, or cigarette
tubes are released from customs
custody. The tax must be paid on the
basis of a return, and the customs form
(including any electronic transmissions)
by which the tobacco products, cigarette
papers, or cigarette tubes are duty- and
tax-paid to CBP will be treated as a
return for purposes of this part.
(c) Required information. In the case
of tobacco products and cigarette papers
and tubes imported into the United
States for consumption, the importer, if
filing electronically, must file with U.S.
Customs and Border Protection (CBP)
the information specified in paragraphs
(c)(1) through (7) of this section at the
time of filing the entry or entry
summary, as appropriate, along with
any other information that is required
by CBP to be filed with the entry or
entry summary for purposes of
determining and collecting the Federal
excise tax and administering the
provisions of the Internal Revenue
Code. Any information required under
paragraphs (c)(1) through (7) of this
section that is required by, and filed
with, CBP as part of the entry or entry
summary for purposes of meeting CBP
requirements will also satisfy the
requirements of this section. Regardless
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of the method of filing, the importer
must retain as a record the information
required by this section, any
information provided to CBP to meet
CBP requirements, and any supporting
documentation and make such records
available upon request by the
appropriate TTB officer or a customs
officer.
(1) All tobacco products. For all
tobacco products, the following
information is required:
(i) The number of the tobacco product
importer permit that is issued under
subpart K of this part;
(ii) The employer identification
number (EIN) assigned to the importer
by the Internal Revenue Service and
provided by the importer on its permit
application to TTB made on TTB Form
5230.4;
(iii) The name and address of the
ultimate consignee;
(iv) The information specific to each
tobacco product set forth in paragraphs
(c)(2) through (6) of this section.
(2) Cigarettes. For cigarettes, in
addition to the information required in
paragraph (c)(1) of this section, the
importer must provide a description of
the product for Internal Revenue Code
purposes, including ‘‘cigarettes’’ and
either ‘‘small’’ (or ‘‘class A’’) or ‘‘large’’
(or ‘‘class B’’) and must also provide the
number of cigarettes.
(3) Cigars. For cigars, in addition to
the information required in paragraph
(c)(1) of this section, the importer must
provide:
(i) The number of cigars imported
under each Harmonized Tariff Schedule
of the United States (HTSUS) code
number;
(ii) The description of the cigars for
Internal Revenue Code purposes,
including ‘‘cigars’’ and either ‘‘large’’ or
‘‘small’’;
(iii) For large cigars with a sale price
of $763.222 or less per 1,000, the
number and sale price (the price for
which sold by the importer) per 1,000
of such cigars; and
(iv) For large cigars with a sale price
of more than $763.222 per 1,000, the
number of such cigars.
(4) Smokeless tobacco. For smokeless
tobacco, in addition to the information
required in paragraph (c)(1) of this
section, the importer must provide a
description of the product for Internal
Revenue Code purposes, as either
‘‘chewing tobacco’’ or ‘‘snuff’’ and will
state the number of pounds and ounces
or kilograms and grams of the product.
(5) Pipe tobacco. For pipe tobacco, in
addition to the information required in
paragraph (c)(1) of this section, the
importer must provide a description of
the product under the Internal Revenue
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Code, as ‘‘pipe tobacco,’’ and will also
state the number of pounds and ounces
or kilograms and grams of the product.
(6) Roll-your-own tobacco. For rollyour-own tobacco, in addition to the
information required in paragraph (c)(1)
of this section, the importer must
provide a description of the product for
Internal Revenue Code purposes, as
‘‘roll-your-own tobacco,’’ ‘‘cigarette
tobacco,’’ ‘‘cigarette wrapper,’’ ‘‘cigar
tobacco,’’ or ‘‘cigar wrapper.’’ The
importer must also state the number of
pounds and ounces or kilograms and
grams of the product.
(7) Cigarette papers and cigarette
tubes. For cigarette papers and cigarette
tubes, the importer must provide:
(i) The classification of the product
for Internal Revenue Code purposes,
including either ‘‘cigarette papers’’ or
‘‘cigarette tubes’’ and an indication of
whether the length of the papers or
tubes is over 61⁄2 inches;
(ii) The employer identification
number (EIN) assigned to the importer
by the Internal Revenue Service;
(iii) The name and address of the
ultimate consignee; and
(iv) The total taxable quantity of each.
*
*
*
*
*
(Approved by the Office of Management and
Budget under control number 1513–0064)
*
*
*
*
*
77. Section 41.84 is added to read as
follows:
■
§ 41.84
Entry for warehousing.
(a) General. Except as provided in
paragraph (b) of this section, in the case
of an entry for warehousing (that is,
tobacco products, cigarette papers, or
cigarette tubes transferred directly to a
customs bonded warehouse or foreign
trade zone), the last day for payment of
the tax shall not be later than the 14th
day after the last day of the
semimonthly period during which the
products are removed from the first
such warehouse, even if the tobacco
products, cigarette papers, or cigarette
tubes are removed from that customs
bonded warehouse or foreign trade zone
for transfer to another customs bonded
warehouse or foreign trade zone.
(b) Entry for warehousing of products
destined for export. Paragraph (a) of this
section does not apply to tobacco
products, cigarette papers, or cigarette
tubes entered for warehousing and then
removed for transfer to another custom
bonded warehouse or foreign trade zone
that are shown to the satisfaction of the
Secretary to be destined for export.
(26 U.S.C. 5703(b)(2)(B)(ii), (iii), and (iv))
78. Section 41.86 is revised to read as
follows:
■
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§ 41.86 Entry process for releases without
payment of tax.
(a)(1) General. Except as provided in
paragraph (c) of this section, in order for
tobacco products or cigarette papers or
tubes to be released from customs
custody without payment of tax under
internal revenue bond, as provided in
26 U.S.C. 5704(c) or (d), the information
required by this paragraph must be filed
electronically with U.S. Customs and
Border Protection (CBP). The
information must be filed with CBP at
the time of filing the entry or entry
summary, as appropriate, and it must be
filed along with any other information
that is required by CBP for purposes of
determining and collecting the Federal
excise tax and administering the
provisions of the Internal Revenue
Code. Any information required under
paragraph (a)(2) of this section that is
submitted to CBP as part of the entry or
entry summary for purposes of meeting
CBP requirements will also satisfy the
requirements of this section. Regardless
of the method of filing, the importer
must retain as a record the information
required by this section, any
information provided to CBP for CBP
purposes, and any supporting
documentation and such records must
be available for inspection upon request
by the appropriate TTB officer or a
customs officer.
(2) Information required. The
manufacturer of tobacco products or
cigarette papers or tubes or export
warehouse proprietor who wishes to
obtain the release of tobacco products or
cigarette papers or tubes as described in
paragraph (a)(1) of this section must
provide the following information, as
applicable:
(i) The number of the permit issued
under 27 CFR part 40 to the
manufacturer of tobacco products or
export warehouse proprietor, or the
TTB-assigned number of the
manufacturer of cigarette papers or
tubes, to whom the products are
shipped or consigned;
(ii) The employer identification
number (EIN), assigned by the Internal
Revenue Service, of the manufacturer of
tobacco products, the manufacturer of
cigarette papers or tubes, or the export
warehouse proprietor to whom the
products are shipped or consigned;
(iii) The name and address of the
ultimate consignee, consistent with the
name and address on the permit issued
under part 40 of this chapter;
(iv) For tobacco products, the number
of the permit, issued under subpart K of
this part, of the importer;
(v) For tobacco products, the
employer identification number (EIN)
assigned to the importer by the Internal
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Revenue Service and provided to TTB
by the importer on its permit
application to TTB on TTB Form
5230.4;
(vi) A description of the product
consistent with the tax classification of
the product under the Internal Revenue
Code as described in § 41.81 (for
example, ‘‘large cigars’’); and
(vii) The quantity of the product for
Federal excise tax purposes, by sticks or
by pounds and ounces (or kilograms and
grams), as applicable.
(b) Releases without payment of tax—
(1) Tobacco products or cigarette papers
or tubes put up in packages. Tobacco
products or cigarette papers or tubes put
up in packages, as defined at § 41.11,
may be released without payment of tax
only for delivery to the proprietor of an
export warehouse (as provided in 26
U.S.C. 5704(c)) or, if classified under
chapter 98, subchapter I of the
Harmonized Tariff Schedule of the
United States (relating to duty on
certain articles exported and returned),
for delivery to the original manufacturer
of such tobacco products or cigarette
papers or tubes or to the proprietor of
an export warehouse authorized by such
manufacturer to receive them (as
provided in 26 U.S.C. 5704(d)). If the
information required in paragraph
(a)(2)(i) through (iii) of this section is
not filed with the entry or entry
summary, as appropriate, or, if the
information required in paragraph (c) of
this section is not made available to CBP
upon request, the tobacco products,
cigarette papers, or cigarette tubes are
not eligible for release from customs
custody for consumption, and no person
may remove such products from
customs custody without payment of tax
and without meeting requirements
related to the release of tobacco
products, cigarette papers, or cigarette
tubes from customs custody subject to
tax.
(2) Tobacco products or cigarette
papers or tubes not put up in packages.
Tobacco products or cigarette papers or
tubes not put up in packages, as defined
at § 41.11, may not be released from
customs custody subject to tax, and no
person may obtain release of such
products from customs custody.
Tobacco products or cigarette papers or
tubes not put up on packages may be
released from customs custody without
payment of tax for delivery to the
proprietor of an export warehouse, or to
a manufacturer of tobacco products or
cigarette papers or tubes, as provided in
26 U.S.C. 5704(c). As a result, if the
information required in paragraphs
(a)(2)(i) through (iii) of this section is
not filed with the entry or entry
summary, as appropriate, or, if the
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40435
information required in paragraph (c) of
this section is not made available to CBP
upon request, tobacco products or
cigarette papers or tubes not put up in
packages are not eligible for release from
customs custody for consumption, and
no person may remove such product
from customs custody.
(c) Filing on paper. A manufacturer or
export warehouse proprietor who wants
to obtain the release of tobacco products
or cigarette papers and tubes from
customs custody without payment of tax
under its internal revenue bond, and
who does not file electronically, must
prepare a notice of release on TTB F
5200.11 and submit the form to the
appropriate TTB officer in accordance
with the instructions on the form. The
appropriate TTB officer will certify on
the TTB F 5200.11 that the
manufacturer or export warehouse
proprietor has TTB authorization to
receive the products. No one filing on
paper may obtain release of the products
under this section until they have
received the TTB F 5200.11 certified by
the appropriate TTB officer. The
manufacturer or export warehouse must
have possession of the TTB F 5200.11,
bearing TTB certification, at the time the
products are released from customs
custody and must make the form
available to a customs officer upon
request at such time. After release of the
products, the TTB F 5200.11 must be
retained by the manufacturer or export
warehouse proprietor and made
available to the appropriate TTB officer
or a customs officer upon request.
(Approved by the Office of Management and
Budget under control numbers 1513–0025
and 1513–0064)
79. Section 41.204 is revised to read
as follows:
■
§ 41.204
Records and reports in general.
Every importer of tobacco products or
cigarette papers or tubes must keep
records and, when required by this part,
submit reports of all tobacco products
released from customs custody under
the importer’s TTB permit, including
information on the release from customs
custody, the receipt, and the
disposition.
(Approved by the Office of Management and
Budget under control numbers 1513–0064
and 1513–0106)
80. Section 41.265 is added under the
undesignated center heading Operations
of Importers of Processed Tobacco to
read as follows:
■
§ 41.265 Processed tobacco importation
process.
(a) General. In the case of processed
tobacco imported into the United States,
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the importer, if filing electronically,
must file with U.S. Customs and Border
Protection (CBP) the information
specified in paragraph (b) of this section
at the time of filing the entry or entry
summary, as appropriate, along with
any other information that is required
by CBP to be filed as part of the entry
or entry summary for CBP purposes. If
the information required by this section
is required by, and filed with, CBP for
purposes of meeting CBP requirements,
such filing will also satisfy the
requirements of this section. Regardless
of the method of filing, the importer
must retain as a record the information
required by this section, any
information required as part of the entry
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or entry summary by CBP for CBP
purposes, and any supporting
documentation, and must make such
records available upon request by the
appropriate TTB officer or a customs
officer.
(b) Information required. The
following information is required, as
described in paragraph (a) of this
section:
(1) The number of the importer’s
permit issued under subpart K or M of
this part;
(2) The employer identification
number (EIN) assigned to the importer
by the Internal Revenue Service and
provided to TTB by the importer on its
permit application to TTB on TTB Form
5230.4;
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(3) The name and address of the
ultimate consignee;
(4) A description of the product as
‘‘processed tobacco’’ for Internal
Revenue Code purposes; and
(5) The quantity of processed tobacco.
(Approved by the Office of Management and
Budget under control number 1513–0064)
Signed: January 12, 2016.
John J. Manfreda,
Administrator.
Approved: March 30, 2016.
Timothy E. Skud,
Deputy Assistant Secretary (Tax, Trade and
Tariff Policy).
[FR Doc. 2016–14359 Filed 6–20–16; 8:45 am]
BILLING CODE 4810–31–U
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]]>Agencies
[Federal Register Volume 81, Number 119 (Tuesday, June 21, 2016)]
[Proposed Rules]
[Pages 40403-40436]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2016-14359]
[[Page 40403]]
Vol. 81
Tuesday,
No. 119
June 21, 2016
Part II
Department of the Treasury
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Alcohol and Tobacco Tax and Trade Bureau
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27 CFR Parts 1, 4, 5, 7, et al.
Amendments To Streamline Importation of Distilled Spirits, Wine, Beer,
Malt Beverages, Tobacco Products, Processed Tobacco, and Cigarette
Papers and Tubes, and Facilitate Use of the International Trade Data
System; Proposed Rule
Federal Register / Vol. 81 , No. 119 / Tuesday, June 21, 2016 /
Proposed Rules
[[Page 40404]]
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DEPARTMENT OF THE TREASURY
Alcohol and Tobacco Tax and Trade Bureau
27 CFR Parts 1, 4, 5, 7, 26, 27, and 41
[Docket No. TTB-2016-0004; Notice No. 159]
RIN 1513-AC15
Amendments To Streamline Importation of Distilled Spirits, Wine,
Beer, Malt Beverages, Tobacco Products, Processed Tobacco, and
Cigarette Papers and Tubes, and Facilitate Use of the International
Trade Data System
AGENCY: Alcohol and Tobacco Tax and Trade Bureau, Treasury.
ACTION: Notice of proposed rulemaking.
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SUMMARY: In this document, the Alcohol and Tobacco Tax and Trade Bureau
(TTB) proposes to amend its regulations governing the importation of
distilled spirits, wine, beer and malt beverages, tobacco products,
processed tobacco, and cigarette papers and tubes. The proposed
amendments are intended to clarify and streamline import procedures,
and support the implementation of the International Trade Data System
and the filing of import information electronically in conjunction with
an electronic import filing with U.S. Customs and Border Protection
(CBP). The proposed amendments include providing the option for
importers to file import-related data electronically when filing entry
or entry summary data electronically with CBP, as an alternative to the
current TTB requirements that importers submit paper documents to CBP
upon importation.
DATES: Comments must be received on or before August 22, 2016.
ADDRESSES: Please send your comments on this proposed rule to one of
the following addresses. Comments submitted by other methods, including
email, will not be accepted.
Internet: https://www.regulations.gov (via the online
comment form for this document as posted within Docket No. TTB-2016-
0004 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.
You may view copies of this document, selected supporting
materials, and any comments TTB receives about this proposal at https://www.regulations.gov within Docket No. TTB-2016-0004. A direct link to
this docket is posted on the TTB Web site at https://www.ttb.gov/regulations_laws/all_rulemaking.shtml under Notice No. 159. You also
may view copies of this document, all related supporting materials, and
any comments TTB receives 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: Karen Welch, Regulations and Rulings
Division, Alcohol and Tobacco Tax and Trade Bureau, 1310 G Street NW.,
Box 12, Washington, DC 20005; telephone (202) 453-1039, extension 046.
SUPPLEMENTARY INFORMATION:
Table of Contents
I. Background
A. TTB Authority
B. The International Trade Data System
C. Executive Order--Streamlining the Export/Import Process for
America's
Businesses
D. Electronic Submission of TTB-Required Information to CBP
E. Relationship to Other Notices of Proposed Rulemaking
II. General Approach to Regulatory Amendments
III. Proposed Changes to the Regulations
A. Filing of the Basic Permit Number by Importers of Alcohol
Beverages
B. Filing of a COLA Identification Number or COLA Documents by
Importers of Alcohol Beverages
C. Removal of Requirement for Gin Statements of Process
D. Possession and Retention of Certificates of Age, Origin, or
Identity Issued by Foreign Governments for Importations of Certain
Wine and Distilled Spirits
E. Certification of Imported Vintage Wine
F. Possession of Certificates for Imported Natural Wine
G. Removal of Requirement To Present to CBP Certificates of
Nonstandard Fill for Wine and Distilled Spirits
H. Removal of Requirements Concerning Liquor Bottles and Filing
Certain Applications in Triplicate
I. Filing of Data With Respect to Distilled Spirits, Wine, and
Beer Imported or Brought Into the United States From the U.S. Virgin
Islands Subject to Tax
J. Entry of Distilled Spirits to Which an Effective Tax Rate or
Standard Effective Tax Rate Applies
K. Distilled Spirits, Wine, and Beer Imported or Brought Into
the United States Without Payment of Tax in Bulk Containers
L. Filing of Permit Number and Information for Industrial
Alcohol Shipments to the United States From the U.S. Virgin Islands
M. Filing of Permit Number and Data by Government Agencies
Importing Distilled Spirits Free of Tax
N. Certificate Covering Distilled Spirits, Wine, or Beer Brought
Into the United States From the U.S. Virgin Islands
O. Clarification of Record Retention Requirements
P. Removal of Requirements for CBP To Gauge or Inspect
Q. Filing of Data for Importation of Tobacco Products Subject to
Tax and Processed Tobacco
R. Filing of Data for Importation of Tobacco Products Without
Payment of Tax
S. Entry for Warehousing of Distilled Spirits, Wines, Beer,
Tobacco Products, and Cigarette Papers and Tubes
IV. Public Participation
A. Comments Invited
B. Submitting Comments
C. Confidentiality
D. Public Disclosure
V. Regulatory Analyses and Notices
A. Executive Order 12866
B. Regulatory Flexibility Act
C. Paperwork Reduction Act
VI. List of Subjects
VII. Amendments to the Regulations
I. Background
A. TTB Authority
The Alcohol and Tobacco Tax and Trade Bureau (TTB) of the
Department of the Treasury regulates, among other things, the
importation of distilled spirits, wine, and malt beverages \1\ pursuant
to the Federal Alcohol Administration Act (FAA Act). TTB also
administers the provisions of the Internal Revenue Code of 1986, as
amended (IRC), with respect to the taxation of distilled spirits, wine,
beer,\2\ tobacco products, processed tobacco, and cigarette papers and
tubes. These statutory provisions are the basis of TTB
[[Page 40405]]
regulations that require importers to submit certain information upon
importation.
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\1\ The FAA Act defines ``malt beverage'' as ``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 27 U.S.C. 211(a)(7). Throughout this document,
the term ``malt beverage'' is used in reference to the FAA Act or
regulations promulgated thereunder.
\2\ The IRC defines ``beer'' as ``beer, ale, porter, stout, and
other similar fermented beverages (including sake or similar
products) of any name or description containing one-half of 1
percent or more of alcohol by volume, brewed or produced from malt,
wholly or in part, or from any substitute therefor.'' See 26 U.S.C.
5052(a). Throughout this document, the term ``beer'' is used in
reference to the IRC or regulations promulgated thereunder.
---------------------------------------------------------------------------
Section 103(a) of the FAA Act (27 U.S.C. 203(a)) requires that a
person obtain a permit before engaging in certain activities related to
distilled spirits, wine, and malt beverages, including importation.
This section of the FAA Act states that it shall be unlawful, except
pursuant to a ``basic permit'' issued by the Secretary of the Treasury
(the Secretary), to engage in the business of importing into the United
States distilled spirits, wine, or malt beverages. Section 103(a) of
the FAA Act also states that it is unlawful, except pursuant to a basic
permit, for any person so engaged to sell, offer or deliver for sale,
contract to sell, or ship, in interstate or foreign commerce, directly
or indirectly or through an affiliate, distilled spirits, wine, or malt
beverages so imported. The terms ``distilled spirits'' and ``wine,''
when used in the context of the FAA Act, apply only to distilled
spirits and wine for nonindustrial use.
Additionally, section 105(e) of the FAA Act (27 U.S.C. 205(e))
authorizes the Secretary to prescribe regulations relating to the
packaging, marking, branding, labeling, and size and fill of containers
of distilled spirits, wine, and malt beverages. With regard to imported
commodities, the FAA Act 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 having obtained a
certificate of label approval (COLA) and being in possession of that
COLA.
Chapter 51 of the IRC pertains to the taxation and regulation of
distilled spirits (including spirits used for both beverage and
nonbeverage purposes), wine, and beer (see 26 U.S.C. chapter 51). The
IRC imposes a Federal excise tax on all distilled spirits, wine, and
beer manufactured in or imported into the United States. See,
respectively, 26 U.S.C. 5001, 5041, and 5051. Section 7652 (26 U.S.C.
7652) imposes a tax on distilled spirits, wine, and beer brought into
the United States from Puerto Rico and the U.S. Virgin Islands. The tax
is equal to the internal revenue tax imposed on like commodities
produced in the United States.
In general, the tax on distilled spirits, wine, and beer either
imported from foreign countries or brought into the United States from
the U.S. Virgin Islands is collected by CBP, along with any import
duties. Puerto Rico is within the customs territory of the United
States, and, as a result, shipments of such products from Puerto Rico
do not pass through customs custody when brought into the United
States. Furthermore, Puerto Rico is part of the United States for
purposes of the FAA Act. See 27 U.S.C. 211(a)(1). This proposed rule
primarily addresses amendments to the TTB regulations to facilitate the
electronic filing of information with CBP, and, as a result, distilled
spirits, wine, and beer brought into the United States from Puerto Rico
are not addressed in this document.
The IRC provides that, under limited circumstances, products may be
withdrawn from customs custody without payment of tax for transfer to
the bonded premises of an industry member regulated by TTB. Proprietors
of distilled spirits plants must apply for and receive notice of a
registration before commencing operations in the United States. See 26
U.S.C. 5171. Proprietors of bonded wine cellars must also apply for and
receive permission to operate before commencing operations in the
United States. See 26 U.S.C. 5351. Brewers must file a notice before
commencing business as a brewer in the United States. See 26 U.S.C.
5401. TTB assigns a registry number, referred to in this document as
the ``IRC registry number,'' to each such distilled spirits plant,
bonded wine cellar, and brewery at which operations are to be
conducted. The IRC registry number issued to distilled spirits plants
has been historically referred to as the ``distilled spirits plant
number.''
Under sections 5232, 5364, and 5418 of the IRC (26 U.S.C. 5232,
5364, and 5418), distilled spirits may be imported in bulk and released
from customs custody without payment of excise tax for transfer in bond
to a distilled spirits plant; natural wine (as defined in 26 U.S.C.
5381) may be imported in bulk and released from customs custody without
payment of excise tax for transfer in bond to a bonded wine cellar; and
beer may be imported in bulk and released from customs custody without
payment of excise tax for transfer in bond to a brewery. Under these
circumstances, the proprietor of the bonded premises becomes liable for
the tax on the product upon its release from customs custody, and the
applicable tax is collected by TTB when the product is removed from the
distilled spirits plant, bonded wine cellar, or brewery, respectively.
The IRC also contains provisions under which imported distilled
spirits may be entered free of tax by the United States or any
governmental agency of the United States for nonbeverage purposes. See
26 U.S.C. 5313; 5314(b). Furthermore, industrial alcohol may under
certain circumstances be brought into the United States free of tax
from the U.S. Virgin Islands by qualified industrial alcohol users. See
26 U.S.C. 5314(b).
Chapter 52 of the IRC contains excise tax and related provisions
pertaining to tobacco products and cigarette papers and tubes. Section
5701 of the IRC (26 U.S.C. 5701) imposes Federal excise tax on such
commodities manufactured in or imported into the United States. Section
7652 (26 U.S.C. 7652) imposes a tax on tobacco products and cigarette
papers and tubes brought into the United States from Puerto Rico and
the U.S. Virgin Islands. The tax is equal to the internal revenue tax
imposed on like commodities produced in the United States. Such
commodities brought into the United States from Puerto Rico are not
addressed in this document.
In general, the tax on tobacco products and cigarette papers and
tubes either imported from foreign countries or brought into the United
States from the U.S. Virgin Islands is collected by CBP, along with any
import duties. Under 26 U.S.C. 5704, imported tobacco products and
cigarette papers and tubes may be released from customs custody without
payment of tax for delivery to the proprietor of an export warehouse
\3\ or to a manufacturer of tobacco products or cigarette papers and
tubes if such commodities are not put up in packages, in accordance
with such regulations and under such bond as the Secretary shall
prescribe. See 26 U.S.C. 5704(c). Imported tobacco products and
cigarette papers and tubes previously exported and returned may be
released from customs custody without payment of tax for delivery to
the original manufacturer or to an export warehouse proprietor
authorized by such manufacturer to receive the commodities, in
accordance with such regulations and under such bond as the Secretary
shall prescribe. See 26 U.S.C. 5704(d).
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\3\ Under the IRC at 26 U.S.C. 5702(h), an export warehouse is a
bonded internal revenue warehouse for the storage of tobacco
products or cigarette papers or tubes or any processed tobacco, upon
which the internal revenue tax has not been paid, for subsequent
shipment to a foreign country, Puerto Rico, the U.S. Virgin Islands,
or a possession of the United States, or for consumption beyond the
jurisdiction of the internal revenue laws of the United States.
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Chapter 52 of the IRC also contains provisions pertaining to the
manufacture and importation of processed tobacco, which is not subject
to tax. Section 5712 of the IRC (26 U.S.C. 5712) requires that
importers of tobacco products or processed tobacco, before engaging in
such businesses, apply for and obtain a permit.
TTB administers the FAA Act and chapters 51 and 52 of the IRC
pursuant
[[Page 40406]]
to section 1111(d) of the Homeland Security Act of 2002, as codified at
6 U.S.C. 531(d). The Secretary has delegated various authorities
through Treasury Department Order 120-01, dated December 10, 2013
(superseding Treasury Department Order 120-01, dated January 24, 2003),
to the TTB Administrator to perform the functions and duties in the
administration and enforcement of these provisions. Responsibility for
collecting the excise taxes incident to the importation of distilled
spirits, wines, beer, tobacco products, and cigarette papers and tubes
is vested by statute with the Secretary of the Treasury. See 26 U.S.C.
7801. TTB regulations provide that such taxes are collected, accounted
for, and deposited as internal revenue collections by customs in
accordance with customs requirements. See 27 CFR 27.48 and 41.62. Under
the authority of the Homeland Security Act of 2002, see 6 U.S.C. 212
and 215(1), the Secretary has delegated these customs revenue functions
to the Secretary of Homeland Security. See Treasury Department Order
100-16, 68 FR 28322 (May 23, 2003).
TTB has authority under section 2(d) of the FAA Act, Pub. L. 74-401
(1935) ``to prescribe such rules and regulations as may be necessary to
carry out [its] powers and duties'' under the FAA Act. In addition, as
previously mentioned, section 105(e) of the 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. Section
7805(a) of the IRC (26 U.S.C. 7805(a)) provides the general authority
to the Secretary to issue regulations to carry out the provisions of
the IRC.
The TTB regulations that implement the basic permit requirements of
the FAA Act are set forth in part 1 of title 27 of the Code of Federal
Regulations (27 CFR part I).
The TTB regulations that implement the labeling provisions of the
FAA Act, as they relate to wine, distilled spirits, and malt beverages,
are set forth 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). For imported alcohol beverages
specifically, these regulations include several requirements related to
certification by a foreign government of the origin and, in some cases,
age, vintage date, or method of production of the alcohol beverage.
Regulations implementing the importation-related provisions of
chapter 51 of the IRC are found in 27 CFR part 27. Specifically, this
part contains procedural and substantive requirements that apply to the
importation of distilled spirits, wine, and beer into the United States
from foreign countries, including requirements related to recordkeeping
and reporting. Regulations implementing the IRC as it applies to
distilled spirits, wine, and beer brought into the United States from
Puerto Rico or the U.S. Virgin Islands are found in 27 CFR part 26.\4\
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\4\ 27 CFR part 26 also contains regulations applicable to
articles, which are generally defined in Sec. 26.11 as preparations
unfit for beverage use. Such articles are not within the scope of
this rulemaking.
---------------------------------------------------------------------------
Regulations implementing the importation-related provisions of
chapter 52 of the IRC are found in 27 CFR part 41. Specifically, this
part governs the importation of tobacco products, cigarette papers and
tubes, and processed tobacco, including requirements related to
permits, recordkeeping, and reporting. Part 41 includes provisions
applicable to such commodities brought into the United States from
Puerto Rico or the U.S. Virgin Islands.
B. The International Trade Data System
The International Trade Data System (ITDS) is an interagency
program to establish an electronic ``single window'' through which
importers and exporters may submit electronically the data required by
Federal government agencies for clearing imports or exports. Section
405 of the Security and Accountability for Every Port Act of 2006 (SAFE
Port Act) (Pub. L. 109-347) mandates participation in ITDS by all
agencies that require documentation for clearing or licensing the
importation and exportation of cargo. The purpose of ITDS is to
eliminate redundant information requirements, to efficiently regulate
the flow of commerce, and to effectively enforce laws and regulations
relating to international trade, by establishing a single window,
operated by CBP, for the collection and distribution of standard
electronic import and export data required by Federal agencies.
Currently, importers and exporters that are regulated by multiple
agencies or that import or export commodities regulated by multiple
agencies must submit data to those agencies through various channels,
often in paper form. Through the implementation of ITDS, data will be
entered into the Automated Commercial Environment (ACE) and then made
available to each government agency. The ``single window'' is intended
to streamline and harmonize data requirements, thereby reducing
compliance burdens on importers and exporters. Accordingly, TTB is
providing electronic filing options for the importation of commodities
regulated by TTB.
C. Executive Order--Streamlining the Export/Import Process for
America's Businesses
On February 19, 2014, the President issued Executive Order 13659,
``Streamlining the Export/Import Process for America's Businesses.''
\5\ The Executive Order mandated that agencies be able to utilize ITDS
by December 31, 2016. The Executive Order also directed Federal
agencies that use ITDS to review their existing regulations for the
import and export of goods to determine whether those regulations
should be modified to implement ITDS and further improve and streamline
existing processes for import and export, and if so, to initiate
rulemaking to implement those modifications.
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\5\ See https://www.whitehouse.gov/the-press-office/2014/02/19/executive-order-streamlining-exportimport-process-america-s-businesses.
---------------------------------------------------------------------------
D. Electronic Submission of TTB-Required Information to CBP
The TTB provisions applicable to imports include requirements that
importers submit information or documentation at importation to CBP.
That information can be submitted electronically pursuant to 27 CFR
73.40. That section provides that a regulated entity may satisfy any
requirement in the TTB regulations to submit a form to another agency
by submitting the form to that other agency by electronic means, as
long as that agency provides for, and authorizes, the electronic
submission of the form and any registration and other requirements to
use the electronic submission functionality are met. In part 73, the
term ``form'' includes any documentation required to be submitted.
Section 73.40 was the result of amendments to the TTB regulations
published in the Federal Register (79 FR 17029) on March 27, 2014, as a
final rule, T.D. TTB-119, and it generally removes any regulatory
barrier to the submission of documents to CBP electronically. TTB is
issuing this document to propose changes to each of the TTB regulatory
sections that address the submission of information or documentation at
importation, in order to update TTB regulatory processes for imports
and provide a specific electronic filing option for the
[[Page 40407]]
submission of certain TTB information at importation using the Partner
Government Agency (PGA) Message Set. Technical instructions on the
submission of data using TTB's PGA Message Set, including the
formatting of TTB's PGA Message Set, are available in ``ACE Filing
Instructions for TTB-Regulated Commodities'' at Docket No. TTB-2016-
0004 on Regulations.gov. Importers may test the usability and
functionality of the TTB PGA Message Set through participation in a
pilot program announced by TTB in a Federal Register notice,
``Importation of Distilled Spirits, Wine, Beer, Tobacco Products,
Processed Tobacco, and Cigarette Papers and Tubes; Availability of
Pilot Program and Filing Instructions to Test the Collection of Import
Data for Implementation of the International Trade Data System,'' (80
FR 47558, August 7, 2015).
TTB notes that under this proposed regulation, importers may elect
not to file any TTB data electronically.
E. Relationship to Other Notices of Proposed Rulemaking
In this rulemaking, TTB is proposing amendments to certain
regulations in 27 CFR parts 4, 5, and 7 to specifically accommodate
electronic filing. Interested parties should note that, as announced in
the Department of the Treasury's semiannual regulatory agenda
(available online at www.reginfo.gov), TTB plans to publish a notice of
proposed rulemaking titled ``Modernization of the Alcohol Beverage
Labeling and Advertising Regulations,'' in which TTB will propose
broader amendments to the regulations in 27 CFR parts 4, 5, and 7.
Interested parties should review and consider the proposals in each
document and comment accordingly.
II. General Approach to Regulatory Amendments
In a number of instances, the current TTB regulations refer to the
submission of paper documents (sometimes in triplicate) by importers to
obtain release of TTB-regulated products from customs custody. These
regulations were promulgated in the context of an environment in which
paper copies were the primary means of communicating to customs
officers that importers had met certain IRC or FAA Act requirements
that apply at importation. The paper documents communicate to CBP, for
example, that TTB had reviewed, and authorized the use of, a certain
label on an alcohol beverage and, as a result, the products bearing the
label were eligible for release from customs custody. Implementation of
ITDS provides another means for the communication of such information
to take place--via the submission and sharing of data electronically.
In general, the proposed regulations set forth new information
submission requirements to better support administration and
enforcement of the IRC and FAA Act with regard to imports, and require
information to be submitted and/or made available through one of the
following methods: (1) The electronic submission of TTB-required data
along with the submission of the customs entry or entry summary, as
appropriate; or (2) the retention and provision of information only
upon specific request by TTB or CBP.
With regard to electronic submissions of information, there are
generally two methods: Electronic submission of data directly and
electronic submission of documents as electronic images. In many
instances, TTB is proposing the former, that is, to provide importers
with the option to submit required information electronically rather
than to submit paper documents. The proposed regulations also allow for
the submission of certain paper documents through electronic means. In
circumstances in which the proposed regulations require that the
importer make the document available to TTB or CBP upon request, such
documents may be provided as an electronic image.
With regard to requests for documentation by TTB or CBP, the
proposed regulations generally refer to requests being made ``by the
appropriate TTB officer or a customs officer.'' The regulations
reference both TTB and CBP because, in general, CBP may request
information or documentation as part of the entry process, while TTB
may request information after release of the shipment from customs
custody to verify compliance with import requirements or as part of the
review of claims for refund or credit of tax. The term ``appropriate
TTB officer'' here refers to TTB officers who have been delegated the
TTB Administrator's authority through the issuance of a TTB Delegation
Order. There is a delegation order applicable to each part of the TTB
regulations that sets forth the ``appropriate TTB officer'' for each
reference in that part. The delegation orders are available on the TTB
Web site at https://www.ttb.gov. The term ``customs officer'' is
currently defined in parts 26, 27, and 41 of the TTB regulations, at 27
CFR 26.11, 27.11, and 41.11. TTB is proposing to update those
definitions. The proposed amendment would replace references in
Sec. Sec. 26.11 and 27.11 to ``the Customs Service'' with references
to U.S. Customs and Border Protection or CBP, where appropriate. The
proposed amendment would also remove references to the Secretary of the
Treasury as well as the reference in Sec. 41.11 to the Secretary of
Homeland Security. It would also remove the redundant references in
Sec. Sec. 26.11 and 27.11 to commissioned, warrant, and petty officers
of the Coast Guard because those officers are authorized by law to
perform the duties of a customs officer, and so are included in the
definition without being specifically named there. See 14 U.S.C. 143.
The proposed amendment would instead refer more broadly to ``any agent
or other person authorized by law to perform such duties.'' The
proposed regulations also include the addition of a definition of
``customs officer'' in parts 4, 5, and 7 (at 27 CFR 4.10, 5.11, and
7.10).
Finally, a number of current TTB regulations refer to CBP actions
and processes, such as CBP's release of a shipment upon receipt of
proper documentation or CBP's inspection of shipments and its notation
of information on TTB forms. In this document, TTB is proposing to
remove most references to actions that CBP will take at entry and
replace them with text that sets forth the requirements that apply to
importers at entry.
III. Proposed Changes to the Regulations
A. Filing of the Basic Permit Number by Importers of Alcohol Beverages
As noted previously, the FAA Act requires that an importer obtain a
basic permit to engage in the business of importing into the United
States distilled spirits, wine, or malt beverages, or to sell, offer or
deliver for sale, contract to sell, or ship, in interstate or foreign
commerce, directly or indirectly or through an affiliate, distilled
spirits, wine, or malt beverages so imported. TTB issues these basic
permits.
Provisions addressing the FAA Act basic permit are set forth in the
TTB regulations in part 1. The permit requirement is restated in 27 CFR
1.20. Consistent with 27 U.S.C. 203, the regulations at 27 CFR 1.23
provide that the basic permit requirement does not apply to any agency
of a State or political subdivision thereof, or to any officer or
employee of any such agency. Section 1.58 (27 CFR 1.58) requires every
person receiving a basic permit to file the permit at the place of
business covered by the permit, so that it may be available to be
examined by the appropriate TTB officer.
The basic permit requirement is also cross-referenced in 27 CFR
part 27,
[[Page 40408]]
which generally sets forth the regulatory provisions that apply to the
importation of distilled spirits, wine, and beer from foreign countries
under the IRC. Section 27.55 of the TTB regulations (27 CFR 27.55)
restates the FAA Act basic permit requirement. Neither the regulations
in part 1 nor the regulations in part 27 currently state the conditions
under which an importer obtaining release of distilled spirits, wine,
or malt beverages subject to tax must provide the permit, or evidence
of having obtained the permit, to CBP during importation.
Each FAA Act basic permit that TTB issues has a number associated
with it. TTB is proposing to amend the regulations at Sec. 1.58 to
require that, if filing TTB data electronically, the importer file the
number of the FAA Act basic permit with CBP. Requiring the submission
of the permit number would allow the importer to demonstrate compliance
with the statutory requirement that it has obtained the required
permit. Amending the regulations to account for the submission of the
permit number also would make clearer to the importer what is required
upon importation of TTB-regulated alcohol beverages and make more
transparent and consistent the application of the permit requirement.
Finally, the filing of the permit number with the CBP entry would allow
TTB to more easily link imported alcohol beverages to their importers
and specific importations to the records importers keep and the reports
they submit to TTB. Revised Sec. 1.58 also provides that, regardless
of the method of filing, every importer must make the permit available
upon request by the appropriate TTB officer or a customs officer. With
regard to these regulatory sections, TTB also proposes to amend Sec.
27.55 to cross-reference Sec. 1.58 and to cross-reference 27 CFR 1.10
for the definitions of the terms ``distilled spirits,'' ``wine,'' and
``malt beverage'' that are particular to the FAA Act. The proposed
amendments also alert the reader to the FAA Act requirements to obtain
a COLA and any required foreign certificates. TTB also proposes to
clarify in Sec. 27.55 that FAA Act requirements do not apply to
tourists importing distilled spirits, wine, or malt beverages into the
United States for personal or other noncommercial use.\6\ Finally,
because there is currently no definition of ``malt beverage'' in part
1, TTB proposes to add the FAA Act definition to 27 CFR 1.10.
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\6\ In this document, as in the longstanding regulations in part
26, the term ``tourists'' is used to refer to any individuals who
are importing or bringing into the United States distilled spirits,
wine, or malt beverages for personal or other noncommercial use and
who are not subject to the FAA Act because they are not engaged in
the business of importing distilled spirits, wine, or malt beverages
and they are not removing such products from customs custody for
sale or any other commercial purpose.
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The FAA Act basic permit requirement is also reflected in 27 CFR
part 26, which contains regulations applicable to distilled spirits,
wine, and beer brought into the United States from Puerto Rico and the
U.S. Virgin Islands. With respect to the U.S. Virgin Islands, Sec.
26.202 of the TTB regulations (27 CFR 26.202), currently restates the
FAA Act basic permit requirement and provides that those to whom the
FAA Act basic permit requirement applies must ``file with the district
director of customs at the port of entry a certified or photostatic
copy'' of the permit.
TTB does not believe it is necessary to continue requiring the
submission of the paper form or a copy of the paper form as set forth
in Sec. 26.202. TTB believes that requiring the TTB-issued permit
number of the importer to be filed with CBP at the time of entry for
electronic filers will be sufficient to enable CBP to make the initial
determination that importers are compliant with the permit requirement
and to enable TTB to link the imported consignment with a specific
importer for purposes of verifying compliance. For importers that are
not filing electronically, TTB believes that the FAA Act basic permit
requirement can be enforced by requiring that a copy of the permit be
made available upon request. As a result, TTB is proposing to amend the
regulations at Sec. 26.202 to state that the FAA Act basic permit
number must be filed with the customs entry or made available upon
request, as required under Sec. 1.58. This change will reduce the
burden on persons bringing alcohol beverages into the United States
from the U.S. Virgin Islands who will no longer be required to submit a
copy of the permit. TTB is also removing references to ``the district
director of customs'' where they appear in the sections of part 26
pertaining to the U.S. Virgin Islands, replacing them with more general
references to customs or CBP.
TTB is also proposing to amend Sec. 26.202 to alert the reader to
the definitions of the terms ``distilled spirits,'' ``wine,'' and
``malt beverage'' that are particular to the FAA Act as well as to the
FAA Act requirements to obtain a COLA and any required foreign
certificates. TTB is also proposing to revise Sec. 26.202 to clarify
that no FAA Act requirement applies to tourists bringing distilled
spirits, wine, or malt beverages into the United States for personal or
other noncommercial use.
B. Filing of a COLA Identification Number or COLA Documents by
Importers of Alcohol Beverages
As noted above, section 105(e) of the FAA Act (27 U.S.C. 205(e))
sets forth labeling requirements and, with respect to imports, 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 having obtained and being in possession of a COLA
covering the distilled spirits, wine, or malt beverages and issued by
the Secretary of the Treasury.
To implement this requirement, Sec. Sec. 4.40, 5.51, and 7.31 of
the TTB regulations (27 CFR 4.40, 5.51, and 7.31) currently state that
no bottled wine, distilled spirits, or malt beverages, respectively,
shall be released from customs custody for consumption unless an
approved COLA covering the label of the product has been deposited with
the appropriate customs officer at the port of entry. With an approved
COLA, the brand or lot of wine, distilled spirits, or malt beverages
bearing labels identical to those appearing on the COLA may be released
from customs custody.
TTB believes it will not be necessary to require the importer to
deposit a paper copy of the approved COLA upon importation when filing
TTB data electronically. As is the case with the FAA Act basic permit,
each approved COLA has a number associated with it. Images of approved
COLAs can be accessed by entering the COLA identification number into
TTB's online database, the Public COLA Registry.\7\ Accordingly, TTB
proposes to amend Sec. Sec. 4.40, 5.51, and 7.31 to require that, upon
importation, the importer either file with the customs entry the TTB-
assigned identification number of the COLA, when filing electronically,
or provide a copy of the COLA to CBP. The proposed regulations also
provide that the bottles or containers must bear labels identical to
the labels appearing on the face of the COLA, or labels with changes
authorized by the COLA form.
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\7\ For the Public COLA Registry, see https://www.ttbonline.gov/colasonline/publicSearchColasBasic.do.
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In the proposed regulatory text, TTB has set forth the provisions
described here in one paragraph, paragraph (a), which will replace the
provisions currently set forth in paragraphs (a) and (b) of Sec. Sec.
4.40, 5.51, and 7.31. Proposed Sec. Sec. 4.40, 5.51, and 7.31 also
state that
[[Page 40409]]
importers must apply for and obtain a COLA before removing the bottled
wine, distilled spirits, or malt beverages from customs custody, and
cross-reference the limited exceptions to the COLA requirement that
appear in part 27.
COLA requirements applicable to alcohol beverages brought into the
United States from U.S. Virgin Islands are set forth in Sec. 26.202,
along with the FAA Act basic permit requirement discussed above.
Specifically, Sec. 26.202 states that every person and any agency of a
State or political subdivision thereof or any officer or employee of
such agency who brings liquors \8\ into the United States from the U.S.
Virgin Islands for nonindustrial use must file the COLA with ``the
district director of customs'' at the port of entry. TTB is proposing
to modify this requirement by adding the option to provide the TTB-
assigned identification number of the COLA with the electronic filing
of the CBP entry. Further, with regard to the format of the regulatory
text, Sec. 26.202 is currently organized as a single paragraph, with
the FAA Act basic permit and COLA requirements both described in one
sentence. TTB proposes to set forth the FAA Act basic permit and COLA
requirements in separate paragraphs, provide a paragraph alerting the
reader to the scope of the FAA Act, provide a paragraph to address
foreign certificates for certain wines and distilled spirits as
described below, and update the text to improve readability.
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\8\ The term ``liquors'' is used throughout part 26, and is
defined in Sec. 26.11 as ``industrial spirits, distilled spirits,
liqueurs, cordials and similar compounds, wines, and beer or any
alcoholic preparation fit for beverage use.''
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Additional regulations in parts 26 and 27 currently address
distinctive liquor bottles. Persons importing liquor bottles of
distinctive shape or design into the United States or bringing such
bottles into the United States from Puerto Rico or the U.S. Virgin
Islands, must obtain approval of the distinctive liquor bottle from TTB
by filing an application for label approval that includes a photograph
of the distinctive liquor bottle, and furnishing a copy of the COLA
along with the photograph of the distinctive liquor bottle ``to Customs
officials at each affected port of entry where the merchandise is
examined.'' \9\ See 27 CFR 26.314 and 27.204. TTB has determined that
the electronic filing of the TTB-assigned identification number for the
approved COLA through ACE or, when filing on paper, the provision of a
copy of the approved COLA to CBP at the time of entry without the
photograph is sufficient to regulate the importation of distinctive
liquor bottles. Accordingly, TTB proposes to amend Sec. Sec. 26.314
and 27.204 to remove the requirement in these sections that the COLA
and a photograph of the bottle be provided to CBP.
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\9\ The term ``liquor bottle'' is defined at 27 CFR 26.11 and
27.11 as a ``bottle made of glass or earthenware, or of other
suitable material approved by the Food and Drug Administration,
which has been designed or is intended for use as a container for
distilled spirits for sale for beverage purposes and which has been
determined by the appropriate TTB officer to adequately protect the
revenue.''
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C. Removal of Requirement for Gin Statements of Process
In Part 5, Subpart F--Requirements for Withdrawal From Customs
Custody of Bottled Imported Distilled Spirits, paragraph (d) of Sec.
5.51 currently requires that TTB Form 5100.31 covering labels for
imported gin bearing the word ``distilled'' as a part of the
designation be accompanied by a statement prepared by the manufacturer
setting forth a step-by-step description of the manufacturing process.
This is the only regulation in part 5 that requires a formula for a
specific type of imported distilled spirits product. However, under
current TTB regulations at 27 CFR 5.33(g), a bottler or importer must,
upon request, submit to TTB a complete and accurate statement of the
contents of the bottles to which labels are to be or have been affixed.
Under this authority, TTB may continue to require industry members to
submit a formula, including a description of the manufacturing process,
for any alcohol beverage to TTB for evaluation prior to the issuance of
a COLA. TTB Industry Circular 2007-4, Pre-COLA Product Evaluation,
currently outlines these formula requirements.
In the proposed regulations, the requirement that TTB Form 5100.31
be accompanied by a statement of process as set forth in paragraph (d)
of Sec. 5.51 is removed, and the section is reorganized accordingly.
TTB will evaluate whether formulas for these products should continue
to be submitted, prior to the issuance of a COLA, through its authority
under Sec. 5.33(g).
D. Possession and Retention of Certificates of Age, Origin, or Identity
Issued by Foreign Governments for Importations of Certain Wine and
Distilled Spirits
Along with the COLA requirements discussed earlier, parts 4 and 5
of the current TTB regulations also contain certain requirements under
which importers must possess certifications by duly authorized
officials of foreign governments that the wines or distilled spirits
being imported have been produced using specific practices or in
conformity with certain laws of the country of origin in order for the
labels of those beverages to bear certain designations. Specifically:
Paragraph (a) of Sec. 4.45 (27 CFR 4.45(a)) addresses
certificates of origin and identity for wine and requires that the
invoice for certain imported wine be accompanied by a certificate
issued by a duly authorized official of the appropriate foreign
government certifying as to the identity of the wine and that the wine
has been produced in compliance with the laws of the respective foreign
government regulating the production of such wine for home consumption.
Without a required certificate, the wine will not be released from
customs custody.
Paragraphs (a) through (e) of Sec. 5.52 (27 CFR 5.52(a)-
(e)) set forth similarly worded certificate of origin requirements for
Scotch, Irish, and Canadian whiskies; brandy, Cognac, and rum; Tequila;
other whiskies; and other distilled spirits, respectively. The required
certificates must accompany the invoice or be filed with the
application for release (in the case of Tequila), or the spirits shall
not be released from customs custody. Generally, the certificates must
indicate that the spirit has been produced in compliance with the laws
of the country of origin regulating the manufacture of the specific
distilled spirits for home consumption. In some cases, the certificates
must also address production practices or age statements.
Section 5.56 (27 CFR 5.56) provides that distilled spirits
imported in bulk for bottling in the United States may not be removed
from the plant where bottled unless the bottler possesses certificates
of age and certificates of origin required under Sec. 5.52 for the
same spirits if imported in bottles.
The common element among these requirements is that the certificate
must generally accompany the wines or distilled spirits (or accompany
the invoice applicable to such wines or distilled spirits), except in
the case of bulk importations, where the U.S. bottler must possess the
certificate. TTB believes that, rather than require certificates of
age, origin, or identity for wine or distilled spirits imported in
bottles to be filed with CBP, the purposes of the requirement can be
met by requiring the importer to have the certificate in its
possession, to be made available upon request. The importer may be
required to attest to the possession of the certificate at importation.
TTB now has timely access to importation information through ACE and
has the specific expertise to determine whether a certificate of age,
[[Page 40410]]
origin, or identity is required for a certain product and whether a
certificate is valid. Under the proposal, TTB could, through post-
release review of the importation information, determine whether the
appropriate certificate of age, origin, or identity is in the
possession of the importer. This approach supports compliance in a way
that facilitates legitimate trade, expedites the release of compliant
wines and distilled spirits from customs custody, and allows
enforcement resources to be focused on identifying noncompliance.
Accordingly, TTB is proposing to amend Sec. Sec. 4.45(a), and
5.52(a) through (e), to state that products for which a certification
of age, origin, or identity is required are not eligible for release
from customs custody and no person may remove such products from
customs custody, unless the importer possesses the relevant certificate
(and accompanying invoice, if required). The proposed amendments are
for clarity only and do not change the intent of those regulations,
that is, that products requiring a certificate of age, origin, or
identity may not enter the United States for consumption unless covered
by such a certificate.
The revisions to Sec. 4.45(a) will also clarify that the
certificate must only be in the possession of the importer at the time
of removal from customs custody in the case of wine imported in
containers.
TTB is proposing to add a new Sec. 4.53 (new 27 CFR 4.53) to
subpart F, Requirements for Approval of Labels of Wine Domestically
Bottled or Packed, to provide that wine imported in bulk and bottled in
the United States may not be removed from the premises where bottled
unless the bottler possesses a certificate if a certificate is required
under Sec. 4.45 for like wine imported in containers. TTB is also
proposing editorial changes to current Sec. 5.56, pertaining to
certificates of age and origin for distilled spirits imported in bulk
for bottling in the United States.
In order to ensure that the required certificates are available for
TTB inspection, TTB is proposing in this document to add provisions in
the regulations at Sec. 5.56, in a new paragraph (c) in Sec. 4.45, in
new Sec. 4.53, and new paragraph (f) in Sec. 5.52 to address the
retention of the certificates addressed in those sections. Under new
paragraphs (c) in Sec. 4.45 and (f) in Sec. 5.52, for the five years
following importation, upon request by the appropriate TTB officer or a
customs officer, the importer must provide a copy of any certificate of
age, origin, or identity relied upon for removal of imported wine or
distilled spirits, as applicable, from customs custody. Similarly,
under new Sec. 4.53 and the revision to Sec. 5.56, for the five years
following the removal of bottled wine or distilled spirits from the
bonded wine cellar or distilled spirits plant where bottled, upon
request of the appropriate TTB officer, the U.S. bottler must provide a
copy of any certificate of age, origin, or identity required under
Sec. Sec. 4.45 or 5.52 for like wine or distilled spirits imported in
containers.
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 may retain electronic copies of certificates.
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 such certificates upon demand.
Furthermore, such records are necessary to enforce the requirements of
the FAA Act. See, e.g., National Confectioners Ass'n v. Califano, 569
F.2d 690, 693-94 (D.C. Cir. 1978), which upheld the U.S. Food and Drug
Administration'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.
Further, as noted above, TTB has authority under section 2(d) of the
FAA Act, Pub. L. 74-401 (1935) ``to prescribe such rules and
regulations as may be necessary to carry out [its] powers and duties''
under the FAA Act.
TTB is also proposing certain clarifications to Sec. Sec. 4.45 and
5.52. First, references to ``a duly authorized official'' of a foreign
government would be changed to ``an official duly authorized by'' the
appropriate foreign government. Many foreign governments authorize non-
governmental or quasi-governmental bodies (like the Consejo Regulador
del Tequila in Mexico or the Comit[eacute] Interprofessionnel du Vin de
Champagne in France) to issue such certificates for wines or distilled
spirits, and TTB's practice has been to accept certificates issued by
such organizations. Second, certain certification requirements in
Sec. Sec. 4.45(a) and 5.52(e) would be limited to instances when the
country of origin of imported wine or distilled spirits requires the
issuance of a certificate of age, origin, or identity, instead of when
the country of origin ``authorizes'' the issuance of such certificates.
This change conforms the regulations to TTB's practice.
E. Certification of Imported Vintage Wine
Section 4.27 (27 CFR 4.27) requires that wine labeled with the year
of harvest of the grapes, or vintage date, meet certain requirements.
Paragraph (c) of Sec. 4.27 currently states that imported wine may
bear a vintage date if, among other conditions, the invoice for such
wine is accompanied by a certificate issued by a duly authorized
official of the country of origin certifying that the wine meets
various criteria or, if imported in bulk for bottling in the United
States, the American bottler possesses such a certificate.
TTB believes that it is no longer necessary to require this
certificate. TTB's regulations do not impose a certification
requirement on imported wine labeled with an appellation of origin, and
TTB believes that a consistent approach is appropriate for vintage
wine.
Accordingly, TTB is proposing to amend paragraph (c) of Sec. 4.27
to remove the requirement that the importer or bottler of imported
vintage wine possess a certificate of vintage wine from the appropriate
foreign government. Instead, the proposed regulations require that,
upon request by the appropriate TTB officer or a customs officer, 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 that the wine is entitled to be labeled with the vintage
date. The remaining requirements would be that the wine be of the
vintage shown, that the laws of the country regulate the appearance of
vintage dates on the labels of wine produced for consumption within the
country of origin, that the wine has been produced in conformity with
those laws, and that the wine would be entitled to bear the vintage
date if it had been sold within the country of origin.
F. Possession of Certificates for Imported Natural Wine
TTB proposes to add a definition of natural wine to Sec. 26.11 and
Sec. 27.11, applicable to all of parts 26 and 27. The proposed
definition of natural wine at Sec. 26.11 and Sec. 27.11 provides that
natural wine is made in accordance with a production practice or
procedure authorized for natural wine by 27 CFR part 24, or, in the
case of natural wine produced and imported subject to an international
agreement or treaty, those practices and procedures acceptable to the
United States under that agreement
[[Page 40411]]
or treaty. This is consistent with the requirements of 26 U.S.C.
5382(a)(3)(A).
TTB also proposes amending 27 CFR 27.140, which generally requires
importers of natural wine to obtain a certification regarding the
production of the wine from the country of origin. (This requirement
does not apply to natural wine brought into the United States from the
U.S. Virgin Islands.)
TTB proposes to amend Sec. 27.140 to remove the definition of
importer from paragraph (a) of that section. The existing regulatory
definition applies only to importers that are required to have a basic
permit under the FAA Act. Although the certificate is also required
under Sec. 4.45(b) for FAA Act purposes, the IRC requirement applies
to all importers of natural wine, including wine not subject to the FAA
Act. TTB proposes to amend paragraph (b)(1) of Sec. 27.140 to state
that the importer of bottled wine must be in possession of the
certificate at the time of filing the entry with CBP, and the bottler
of bulk wine must be in possession of the certificate at the time the
wine is withdrawn from the premises where bottled. Under proposed
27.140(b)(1), natural wine certificates must be retained for three
years following release from customs custody, and must be made
available to the appropriate TTB officer or a customs officer upon
request.
TTB also proposes a technical revision to the definition of proper
cellar treatment at Sec. 27.140(a), and proposes to remove the
definition of natural wine in Sec. 27.140 from that section. The
proposed definition is intended to describe which wine is eligible to
be imported or brought into the United States in bulk without payment
of tax, as described in more detail below.
For natural wine that is subject to the FAA Act, current Sec.
4.45(b) provides that the importer of bottled wine must be in
possession of the certificate at the time of the release of wine from
customs custody. Proposed Sec. 4.45(c) provides that the importer must
retain the certificate for five years following the date of removal
from customs custody, and proposed Sec. 4.53 provides that the bottler
of bulk wine must be in possession of the certificate at the time the
wine is removed from the premises where bottled and retain the
certificate for five years following such removal.
G. Removal of Requirement To Present to CBP Certificates of Nonstandard
Fill for Wine and Distilled Spirits
The TTB regulations in 27 CFR parts 4 and 5 currently prescribe
certain standards of fill for wine and distilled spirits, respectively.
(See 27 CFR 4.70-4.72 and 5.45-5.47a.) Over the years, a number of
changes were made to these standards, but the most significant change
was the adoption of metric standards of fill for wine containers in
1974 (in T.D. ATF-12, 39 FR 45216) and for distilled spirits containers
in 1980 (in T.D. ATF-25, 41 FR 10217 and 11022). A later amendment to
the metric standards for distilled spirits containers included a phase-
out of the 500-milliliter container size for distilled spirits (in T.D.
ATF-228, 51 FR 16167).
Wine and distilled spirits that were bottled or packed before these
standards became mandatory are ``grandfathered'' and may continue to be
marketed in the United States. Imported wine and distilled spirits must
either have (1) entered into customs custody before the most recent
standards became mandatory (January 1, 1979, for wine and January 1,
1980, for distilled spirits or July 1, 1989, in the case of distilled
spirits in 500-milliliter containers) and remained in their containers,
or (2) been bottled or packed before the most recent standards became
mandatory and a statement signed by a duly authorized official of the
appropriate foreign country attests to that fact.
Within part 4, subpart E, Requirements for Withdrawal of Wine From
Customs Custody, Sec. 4.46 (27 CFR 4.46) requires that imported wine
in containers not conforming to an authorized standard of fill (and not
entered into customs custody before January 1, 1979) be accompanied by
a certificate of nonstandard fill in order to be withdrawn from customs
custody. Within part 5, subpart F, Requirements for Withdrawal From
Customs Custody of Bottled Imported Distilled Spirits, Sec. 5.53 (27
CFR 5.53) similarly requires that imported distilled spirits in
containers not conforming to an authorized standard of fill (and not
entered into customs custody before January 1, 1980, or July 1, 1989,
in the case of distilled spirits in 500-milliliter containers) be
accompanied by the certificate of nonstandard fill as a requirement for
withdrawal from customs custody.
While importations of wine and distilled spirits that were bottled
or packed before the most recent standards became mandatory are rare,
TTB does occasionally receive COLA applications stating nonstandard
fill for wines and distilled spirits. Therefore, TTB believes that it
is appropriate to retain the exceptions for these products in the
regulations. However, because the certification of nonstandard fill is
provided as part of the COLA application, TTB believes it is not
necessary to require the certificate upon importation. Accordingly, TTB
proposes to remove Sec. Sec. 4.46 and 5.53 from the regulations, and
to insert the exceptions for the ``grandfathered'' wines and distilled
spirits--along with the requirement for the certificate of nonstandard
fill for wines not entered into customs custody before January 1, 1979
and distilled spirits not entered into customs custody before January
1, 1980 or July 1, 1989 in the case of distilled spirits in 500-
milliliter containers--into the general standards of fill regulations
in Sec. Sec. 4.70 and 5.45. As proposed, the required foreign
certificate is a document that must be made available to TTB upon
request. TTB also proposes to remove the cross reference to Sec. 5.53
currently contained in Sec. 5.47a (27 CFR 5.47a).
Finally, TTB is clarifying that the certificates are to be issued
by ``an official duly authorized by'' the appropriate foreign
government, to provide for non-governmental or quasi-governmental
bodies that may be authorized by a foreign government to issue such
certificates.
These proposals concerning standards of fill are only intended to
make changes to allow for the electronic filing of information.
Substantive changes to standards of fill requirements are not addressed
in this document.
H. Removal of Requirements Concerning Liquor Bottles and Filing Certain
Applications in Triplicate
Regulations in part 26 subpart P and part 27 subpart N concern
requirements for liquor bottles. Sections 26.316 and 27.206 (27 CFR
26.316 and 27.206) currently provide that a customs officer will deny
entry to any liquor bottle containing distilled spirits upon advice of
the appropriate TTB officer who deems the bottle to be deceptive.
Sections 26.318 and 27.208 (27 CFR 26.318 and 27.208) state that filled
liquor bottles not conforming to those regulations will be denied entry
into the United States, but provide that TTB may authorize such liquor
bottles to be brought into the United States upon a letterhead
application filed with TTB in triplicate. Similarly, sections 26.319
and 27.209 provide that TTB may authorize an importer to receive used
liquor bottles pursuant to regulations in 27 CFR part 31 upon a
letterhead application filed with TTB in triplicate. TTB proposes to
amend Sec. Sec. 26.316 and 27.206 to replace the text that states that
the customs officer will deny entry of disapproved liquor bottles with
text stating that disapproved bottles may not be brought into the
United States. These amendments reflect the current
[[Page 40412]]
environment where CBP may make decisions to inspect shipments on a
case-by-case basis. Additionally, as amended, Sec. 26.316 specifically
states its provisions apply to bottles both from Puerto Rico, which is
within the customs territory of the United States, and from the U.S.
Virgin Islands, which is not. TTB also proposes to amend Sec. Sec.
26.318, 26.319, 27.208, and 27.209 to remove the requirement that the
applications be made in triplicate. TTB also proposes to update a
cross-reference made in Sec. Sec. 26.319 and 27.209 from Sec. 31.263
(27 CFR 31.263) to Sec. 31.203 (27 CFR 31.203), and to make Sec. Sec.
26.318 and 27.208 more readable.
In addition, TTB is proposing to remove requirements set forth in
27 CFR 26.331 and 27.221 that applications to TTB for authorization to
use alternate methods or procedures in lieu of methods or procedures
prescribed by those parts be submitted in triplicate.
I. Filing of Data With Respect to Distilled Spirits, Wine, and Beer
Imported or Brought Into the United States From the U.S. Virgin Islands
Subject to Tax
As noted above, the Federal excise tax due on the importation of
distilled spirits, wine, and beer is collected by CBP, along with any
applicable duties. See 27 CFR 27.48. Similarly, liquors coming into the
United States from the U.S. Virgin Islands are generally subject to a
tax equal to the internal revenue tax imposed upon the production in
the United States of like liquors. See 27 CFR 26.200. Such taxes are
collected by CBP, along with any applicable duties.
To help ensure appropriate tax payment, TTB is proposing in this
rulemaking to require that importers file and/or retain certain
information regarding distilled spirits, wine, and beer imported into
the United States or brought into the United States from the U.S.
Virgin Islands subject to tax. Specifically, TTB is proposing to amend
Sec. Sec. 27.48 and 26.200 to require from electronic filers of TTB
data information about the importer (name, FAA Act basic permit number,
address, and employer identification number (EIN)) and the ultimate
consignee (name and address) as well as information identifying the
distilled spirits, wine, or beer for IRC or FAA Act purposes and the
quantity of each product. Proposed amendments to Sec. Sec. 27.48 and
26.200 also refer to the COLA requirement that may apply under Sec.
4.40, 5.51, or 7.31. For importers filing TTB data electronically, this
information would be required to be filed with CBP at the time of
filing the customs entry or entry summary, as appropriate, along with
any other information that is required by CBP for purposes of
determining and collecting the Federal excise tax and administering the
provisions of the IRC and FAA Act. The proposed text also includes a
clarification that, if any of the information required by TTB is also
filed by the importer with CBP upon entry or entry summary, as
appropriate, for purposes of meeting CBP requirements, the submission
of information for CBP purposes will also meet the TTB requirements.
That is, generally, the importer need not enter the same information
twice. TTB understands that quantities of distilled spirits are
currently submitted to CBP in proof liters and not in proof gallons,
and so proposes in Sec. Sec. 27.48, 26.200, and elsewhere to accept
the filing of quantities of distilled spirits in proof liters, and to
add a definition of ``proof liter'' to Sec. Sec. 27.11 and 26.11.
Regardless of the method of filing, the importer must retain the
information required, any information provided to CBP to meet CBP
requirements, and any supporting documentation, and make such records
available for inspection by the appropriate TTB officer or a customs
officer.
TTB is also proposing a technical correction to the definition of
``importer'' at Sec. 26.11. As revised, an importer is defined as any
person who brings distilled spirits, wines, or beer into the United
States from the Virgin Islands. Other proposed technical corrections
update statutory references at Sec. Sec. 26.263 and 26.264, pertaining
to the determination of tax on beer and wine, respectively.
J. Entry of Distilled Spirits To Which an Effective Tax Rate or
Standard Effective Tax Rate Applies
Section 5010 of the IRC (26 U.S.C. 5010) provides a credit against
the tax imposed on distilled spirits for any eligible wine or eligible
nonbeverage flavors used in the manufacture of the distilled spirits.
This credit results in an effective tax rate, which is a reduced rate
of tax. For imported distilled spirits, pursuant to section 5010(b)(2),
the wine content and flavors content of the distilled spirits are
established by chemical analysis, certification, or other methods set
forth in regulations prescribed by the Secretary. Sections 27.76 and
27.77 of the TTB regulations (27 CFR 27.76 and 27.77) set forth the
methods by which the effective tax rates are determined and applied to
imported distilled spirits. Section 26.204a (27 CFR 26.204a) sets forth
the method by which the effective tax rates are determined and applied
to distilled spirits brought into the United States from the U.S.
Virgin Islands.
An importer of distilled spirits may obtain and apply an effective
tax rate in one of two ways. Under one approach, provided in Sec.
27.76, the importer obtains from TTB a ``statement of eligibility'' for
each wine and flavor used in the product, and then prepares a
``certificate of effective tax rate computation'' for each shipment.
The importer must file this certificate with CBP at the port of entry
at the time it files the relevant entry summary. A similar approach is
also available to persons bringing distilled spirits into the United
States from the U.S. Virgin Islands, except that, instead of preparing
a specific certificate of effective tax rate computation, the importer
must submit the information upon which the effective tax rate is based,
along with other information about the shipment, in a certificate
specified in section 26.205 (27 CFR 26.205). Alternatively, the
importer may have a ``standard effective tax rate'' established by TTB
pursuant to Sec. 27.77. A standard effective tax rate may be used
continually for each importation of a product because it is based on
the lowest quantities and lowest alcohol content of eligible wine and
flavors used in making the particular product. Under current
regulations, a copy of the standard effective tax rate approval must be
filed with CBP at the port of entry at the time of entry summary.
TTB believes it is no longer necessary for the importer to submit
the certificate of effective tax rate computation or the standard
effective tax rate approval document to CBP during the entry process,
provided that the importer possesses one of these documents and makes
it available upon request. TTB believes that the data already provided
by the importer to CBP during the entry process regarding the tax
applicable to the imported distilled spirits is sufficient for
enforcement of the effective tax rate provisions when combined with the
importer's FAA Act basic permit number and the COLA identification
number upon importation (the filing of which are proposed in this
document). Therefore, TTB proposes to amend Sec. Sec. 27.76 and 27.77
to remove the requirement that the importer submit the certificate of
effective tax rate or the standard effective tax rate approval at
entry, although the importer must have the certificate in its
possession at the time of filing the entry summary and a copy must be
provided to an appropriate TTB officer or a customs officer upon
request. TTB also proposes to specify, in a new paragraph (e) in both
Sec. 27.76 and Sec. 27.77, that the
[[Page 40413]]
importer must retain a copy of the certificate or approval in
accordance with the record retention requirements in 27 CFR part 27 and
provide it upon request. For persons bringing distilled spirits into
the United States from the U.S. Virgin Islands, the information will
continue to be entered into the certificate specified in Sec. 26.205.
As with imported distilled spirits, TTB also proposes to specify, in a
new paragraph (c) in Sec. 26.205, that the person bringing the
distilled spirits into the United States must retain a copy of the
certificate and records to substantiate information on the certificate,
such as information regarding an effective tax rate, in accordance with
the record retention requirements in 27 CFR part 26 and provide them
upon request.
When distilled spirits eligible for an effective tax rate are
removed from customs custody in bulk without payment of tax for
transfer to a domestic distilled spirits plant, current and proposed
Sec. Sec. 27.76 and 27.77 provide that the importer must furnish a
copy of the certificate or approval to the proprietor of the distilled
spirits plant to which the distilled spirits are transferred.
Similarly, proposed Sec. 26.205 requires that the certificate showing
information regarding liquors brought into the United States from the
U.S. Virgin Islands, which would include information related to the
effective tax rate if applicable, be provided to the receiving
distilled spirits plant.
K. Distilled Spirits, Wine, and Beer Imported or Brought Into the
United States Without Payment of Tax in Bulk Containers
As noted above, under 26 U.S.C. 5232, distilled spirits imported or
brought into the United States in bulk containers may, under
regulations prescribed by the Secretary of the Treasury, be withdrawn
from customs custody and transferred in such bulk containers or by
pipeline to the bonded premises of a distilled spirits plant without
payment of the internal revenue tax. The person operating the bonded
premises of the distilled spirits plant receiving the spirits becomes
liable for the tax upon release of the spirits from customs custody.
Section 27.11 (27 CFR 27.11) defines the term ``bulk containers'' as
any container having a capacity of more than one gallon. Subpart L of
part 27 and subpart Oa of part 26 currently contain the provisions
related to the transfer of distilled spirits from customs custody to
the bonded premises of a distilled spirits plant.
Prior to 1998, the IRC contained no provisions allowing the
importation of wine without payment of the excise tax imposed by
section 5041 or the importation of beer without payment of the excise
tax imposed by section 5051. Wine and beer could both be imported in
bulk or in any type of container, but no provision existed in the IRC
to defer payment of the excise tax on importation, or to permit the
movement of imported wine or beer, without payment of tax, onto bonded
wine cellar premises or brewery premises, as applicable, where it would
be covered by the TTB bond.
Effective April 1, 1998, sections 1421 and 1422 of the Taxpayer
Relief Act of 1997, Public Law 105-34, amended the IRC to authorize the
transfer without payment of tax of imported wine in bulk containers
from customs custody to a bonded wine cellar and the transfer of beer
in bulk containers from customs custody to a brewery premises. See 26
U.S.C. 5364 and 5418, respectively. A subsequent provision enacted by
section 6014 of the Internal Revenue Restructuring and Reform Act of
1998, Public Law 105-206, restricted bulk imported wine to ``Natural
wine (as defined in section 5381).''
Under 26 U.S.C. 5364 and 5418, as amended, the physical transfer of
wine or beer is accompanied by a transfer of the excise tax liability
existing for such wine from the customs bond of the importer to the
wine or beer bond of the receiving bonded wine cellar or brewery, as
the case may be. Excise tax payment on such imported wine or beer is
deferred until the time when the wine or beer is removed from the
bonded wine cellar or brewery, as applicable, for consumption or sale.
At that time, the taxation provisions of section 5041 of the IRC apply
to the wine and those of section 5051 of the IRC apply to beer.
Accordingly, the proprietor of the bonded wine cellar pays the tax by
return under the IRC and the TTB provisions applicable to domestic wine
removed subject to tax, while the brewer pays the tax by return under
the IRC and the TTB provisions applicable to domestic beer removed
subject to tax.
In March 1998, ATF issued two ATF Procedures regarding the
administration of sections 1421 and 1422 of Public Law 105-34. The
procedures are ATF Procedure 98-2, concerning importation and transfer
of beer in bulk containers to a brewery premises, and ATF Procedure 98-
3, concerning importation and transfer of wine in bulk containers to a
bonded wine cellar. These two procedures provide guidance and set forth
requirements applicable to importers of wine and beer in bulk
containers and proprietors of the domestic facilities receiving the
bulk wine and beer, which have not yet been incorporated into the TTB
regulations. With respect to importers, both procedures require that,
on release of the bulk product from customs custody, the importer
prepare a transfer record documenting the transfer of the product. With
respect to wine, ATF Procedure 98-3 provides that the transfer record
will identify the importer and show the number of containers
transferred and quantity of wine within each container, the origin of
the wine, the customs entry number, the amount of duty paid, the kind
of wine, and information identifying the foreign producer. With respect
to beer, ATF Procedure 98-2 provides that the transfer record will
identify the importer and will show the number of containers
transferred and quantity of beer within each container, the foreign
origin of the beer, the customs entry number, the amount of duty paid,
the kind of beer, and information identifying the foreign brewer.
Neither procedure requires the information to be submitted to CBP as
part of the customs entry or entry summary.
ATF Procedures 98-2 and 98-3 also provide guidance to domestic
manufacturers who receive shipments of bulk wine or beer. In this
rulemaking, TTB is not addressing such guidance, because the primary
intent of this rulemaking is to address and prepare for the submission
by importers of electronic importation information, and procedural
rules relating to the operations of domestic recipients of the
shipments are beyond the scope of this rulemaking. With regard to
importers, TTB is proposing to amend the provisions of 27 CFR part 27
to expand the scope of subpart L, and 27 CFR part 26 to expand the
scope of subpart Oa, which currently only address transfers of bulk
distilled spirits from customs custody to the bonded premises of
distilled spirits plants. Specifically, Sec. 27.171 of part 27
currently sets forth general provisions regarding the importation of
bulk distilled spirits, and Sec. 26.300 sets forth general provisions
regarding bringing bulk distilled spirits into the United States from
the U.S. Virgin Islands. Under the proposed regulations, the current
texts of each section will be designated as (a) and new paragraphs (b)
and (c) will set forth the general provisions related to the
importation of bulk beer and wine without payment of tax.
In subpart L of part 27, 27 CFR 27.172 currently requires a person
importing distilled spirits and transferring them from customs custody
to the bonded premises of a distilled spirits plant without payment of
tax to prepare a
[[Page 40414]]
transfer record for each conveyance and, if the spirits are in
packages, a package gauge record that must be attached to the transfer
record. The transfer record and the package gauge record must be
prepared in triplicate, and, upon release of the spirits from customs
custody, one copy must be given to CBP, one copy must be forwarded to
the appropriate TTB officer, and the original must be forwarded to the
consignee.
The specific requirements regarding the transfer record's contents
are set forth in 27 CFR 27.138. Under Sec. 27.138, the transfer record
must be given a serial number by the preparer and must contain such
information as the name and IRC registry number of the distilled
spirits plant receiving the spirits from customs custody, the country
of origin, the name of the foreign producer, the kind of spirits, the
age and proof of the spirits, the proof gallons of the spirits, and the
type and number of containers in the shipment. The specific
requirements regarding the package gauge record's contents are set
forth in 27 CFR 27.139. Under Sec. 27.139, the package gauge record
must contain information about each package, including the package
identification or serial number; the kind of spirits; the gross weight,
proof, and proof gallons of the spirits; the name of the warehouseman
who received the spirits from customs custody; and the name of the
importer. Similar provisions are set forth for persons bringing
distilled spirits in bulk containers into the United States from the
U.S. Virgin Islands for transfer to a distilled spirits plant at
Sec. Sec. 26.301, 26.273a, and 26.273b (27 CFR 26.301, 26.273a, and
26.273b).
TTB is proposing to amend Sec. Sec. 27.172 and 26.301, which
currently require the preparation of the transfer record and package
gauge record for distilled spirits, to include the transfer record
requirements for wine and beer. Both sections as amended would require
that the transfer records be maintained by the person importing the
products or bringing them in from the U.S. Virgin Islands; the transfer
record documents would not be submitted to CBP. For importers filing
TTB data electronically, certain information from each transfer record
would be submitted to CBP with the filing of the entry or entry
summary, as appropriate. Under the proposal, the information required
would be the name and address of the ultimate consignee, the basic
permit number and EIN (if applicable) of the importer, the IRC registry
number of the ultimate consignee, information identifying each product
for IRC and/or FAA Act purposes, and the quantity in the shipment.
TTB is not proposing to amend the regulations at 27 CFR 27.139 and
26.273b regarding the specific information that must be contained in
the distilled spirits package gauge record. However, TTB is proposing
to remove Sec. 26.302 (27 CFR 26.302) and incorporate the package
gauge requirements of that section into amended Sec. 26.301. The
requirements of Sec. 26.302 that refer to preparing copies of
documents in duplicate and filing such copies would be removed
entirely.
TTB is proposing to amend Sec. Sec. 27.138 and 26.273a, the
transfer record, to add the specific information that is required to be
captured in the transfer record regarding transfers of wine and beer in
bulk from customs custody to the premises of the applicable TTB-bonded
premises. The information specified includes the information now
required by ATF Procedure 98-3, with respect to transfers of wine, and
ATF Procedure 98-2, with respect to transfers of beer, and adds the
following data elements applicable to both wine and beer: The date the
records are prepared, the name and address of the bonded wine cellar or
brewery receiving the wine from customs custody, and the IRC registry
number of the bonded wine cellar or brewery receiving the wine or beer
from customs custody. As noted above, under the proposed amendments to
Sec. Sec. 27.172 and 26.301, the transfer record would be maintained
by the importer (or person bringing the spirits into the United States
from the U.S. Virgin Islands), and from the transfer record only the
name and address of the ultimate consignee, the IRC registry number,
information identifying each product for IRC and/or FAA Act purposes,
and the quantity in the shipment would be required to be submitted upon
entry or entry summary, as appropriate. TTB is also proposing to add
the customs entry number and amount of duty paid to the specific
information that is required to be captured in the transfer record
regarding transfers of distilled spirits in bulk from customs custody
to the premises of the distilled spirits plant. TTB believes that this
information is important to track shipments of distilled spirits
transferred without payment of tax.
TTB is proposing to no longer require submission of the remaining
data elements currently required as part of the transfer record or
package gauge record, as TTB believes that they are either no longer
necessary to be submitted or that they can be requested of an industry
member as needed on a case-by-case basis, if not otherwise available
through data the industry member submits to CBP for purposes of meeting
CBP requirements.
The proposed amendments at Sec. Sec. 27.172 and 26.301 clarify
that if any of the information required by TTB is also filed by the
importer with CBP upon entry or entry summary, as appropriate, for
purposes of meeting CBP requirements, the submission of information for
CBP purposes will also meet the TTB requirements. In other words,
generally, when filing information electronically, the importer need
not enter the same information twice. Regardless of the method of
filing, the importer must retain records, including supporting records
to substantiate the information it filed with CBP, in accordance with
the record retention requirements of parts 27 and 26, and provide such
records upon request. Proposed Sec. Sec. 27.172 and 26.301 also
provide that all importers, including importers that do not file TTB
data electronically, must maintain the transfer record, specified
information, and supporting documentation, and make those records
available upon request of the appropriate TTB officer or a customs
officer.
In addition, proposed Sec. Sec. 27.172 and 26.301 state that the
importer must also provide a copy of the transfer record to the
recipient, if the recipient is not the importer. The proposed text
would remove the current requirement in Sec. 27.172 that the
``original'' transfer record be forwarded to the transferee, and help
ensure that the domestic TTB-bonded premises receive the record,
regardless of whether a shipment originates in a foreign country or the
U.S. Virgin Islands. Current and proposed Sec. Sec. 27.76 and 27.77
require that, when distilled spirits eligible for an effective tax rate
are transferred without payment of tax, the importer must furnish a
copy of the relevant approval or certificate to the domestic DSP
proprietor. Proposed Sec. 26.205 also requires that a certificate be
forwarded to the domestic TTB-bonded premises in the case of distilled
spirits, natural wine, and beer transferred without payment of tax.
TTB also proposes to amend the definition of ``bulk container'' in
27 CFR 27.11 and 26.11 to include references to bulk containers of wine
(any container larger than 60 liters) and to bulk containers of beer
(any container larger than 1 barrel of 31 gallons). The definition
proposed for ``bulk container'' of wine mirrors the definition of that
term in ATF Procedure 98-3 and in 27 CFR 24.11. (27 CFR part 24
contains the regulations applicable to operations of domestic wine
premises.) The definition proposed for ``bulk container'' of beer
mirrors the definition of that term set out in ATF Procedure
[[Page 40415]]
98-2. TTB is also proposing to add a definition of ``natural wine'' to
Sec. Sec. 27.11 and 26.11 to describe what wine may be imported or
brought into the United States in bulk without payment of tax.
Finally, TTB proposes a number of clarifying changes to the
regulations relating to imports in bulk. TTB proposes to add
definitions of ``Bonded wine cellar'', ``Brewery'', and ``IRC registry
number'' to Sec. Sec. 26.11 and 27.11. In paragraph (c) of Sec. 26.1,
which sets out the scope of the part 26 regulations, TTB proposes to
add a reference to bulk wine and bulk beer coming into the United
States from the U.S. Virgin Islands. In Sec. 26.273 (27 CFR 26.273),
which refers to the reporting and recording requirements of proprietors
of bonded premises, TTB proposes to add references to bonded wine
cellars and breweries. In Sec. 27.120 (27 CFR 27.120), TTB is updating
the reference to ``Regulation 3 (27 CFR part 3)'' to ``subpart E of
part 1,'' to reflect the regulatory changes made in T.D. ATF-373 (61 FR
26096). TTB also proposes to update the title of Sec. 27.175 to
clarify that it applies only to the receipt of distilled spirits by
proprietors of distilled spirits plants.
This regulation, if finalized, would supersede parallel provisions
of ATF Procedures 98-2 and 98-3.
L. Filing of Permit Number and Information for Industrial Alcohol
Shipments to the United States From the U.S. Virgin Islands
Section 5314(b)(1) of the IRC (26 U.S.C. 5314(b)(1)) authorizes, in
certain circumstances, distilled spirits produced or manufactured in
the U.S. Virgin Islands to be brought into the United States from the
U.S. Virgin Islands free of tax. Those circumstances include: (1) When
the alcohol has been ``denatured'' by the addition of materials that
make the spirits unfit for beverage consumption; (2) when the alcohol
is withdrawn by, and for the use of, the United States or any agency
thereof, any State, any political subdivision of a State, or the
District of Columbia, for nonbeverage purposes; and (3) when the
alcohol is withdrawn by an eligible person for certain specified
nonbeverage educational, medical, or research purposes.
Regulations pertaining to the use of denatured spirits are found in
27 CFR part 20 (Distribution and Use of Denatured Alcohol and Rum), and
regulations pertaining to the use of undenatured tax-free spirits are
in found in 27 CFR part 22 (Distribution and Use of Tax-Free Alcohol).
Under regulations in parts 20 and 22, TTB authorizes the withdrawal and
use of tax-free alcohol by issuing permits to eligible persons on TTB
Form 5150.9 and to government entities on TTB Form 5150.33 (or previous
editions on Form 1444).
The distilled spirits described above may be shipped tax-free to
the United States from the U.S. Virgin Islands under the provisions of
27 CFR part 26. Section 26.292 (27 CFR 26.292) requires that the
consignor or consignee file with CBP the permit issued to the consignee
under part 20 or 22 as evidence that the consignee is authorized to
enter the spirits free of tax. Sections 26.294 and 26.296 (27 CFR
26.294 and 26.296) require that each shipment be accompanied by a
record of shipment, consisting of an invoice, bill of lading, or
similar document that shows certain specified information about the
shipment, such as the consignee's name and address and the total
quantity of the shipment.
As with FAA Act basic permits, TTB assigns each of the permits
referenced in Sec. 26.292 a number so that TTB can track the permit
and its use. TTB proposes to amend Sec. 26.292 to require the
consignor or consignee, if filing TTB data electronically, to provide
the number associated with the consignee's permit to CBP upon entry of
the tax-free distilled spirits instead of a copy of its permit. The
permit number would be entered into ACE. The TTB permit number would
allow TTB to verify that the consignee is authorized to enter
industrial spirits or specially denatured spirits free of tax.
Revised 27 CFR 26.292 also provides that, regardless of the method
of filing, the consignor or the consignee must make the permit
available upon request by the appropriate TTB officer or a customs
officer.
TTB also proposes to amend Sec. Sec. 26.294 and 26.296 to remove
the statement that paper documents must ``accompany'' shipments into
the United States. As amended, Sec. Sec. 26.294 and 26.296 require the
consignor, if filing TTB data with CBP electronically, to file certain
information from the record of shipment with CBP, along with the filing
of the customs entry or entry summary, as appropriate, and maintain the
rest of the information required in the record of shipment as a record.
Records substantiating the information filed with CBP also must be
kept. As proposed, Sec. Sec. 26.294 and 26.296 also include the
clarification, that if any of the information required by TTB to be
provided to CBP is also required by CBP as part of the entry or entry
summary, the information provided to meet CBP requirements is
sufficient to also meet TTB requirements, and it need not be entered
twice.
M. Filing of Permit Number and Data by Government Agencies Importing
Distilled Spirits Free of Tax
Under section 5313 of the IRC, the United States Government or any
of its agencies may withdraw imported distilled spirits for nonbeverage
purposes free of tax from customs custody. As was mentioned above, TTB
issues permits to government entities that wish to use tax-free
distilled spirits. Section 27.183 (27 CFR 27.183) currently requires a
government agency withdrawing distilled spirits free of tax from
customs custody to provide a photocopy of its permit to ``the district
director of customs.'' For the same reasons as those discussed with
regard to shipments of distilled spirits from the U.S. Virgin Islands,
TTB proposes to amend Sec. 27.183 to require a government agency, if
filing TTB data with CBP electronically, to file the number associated
with the TTB-issued permit with CBP when the entry is filed. The permit
number would be entered into ACE. If the government agency is not
filing TTB data electronically, it must make a copy of the permit
available to the customs officer, upon request, at entry or any
subsequent time. TTB is also removing numerous references to ``the
district director of customs'' in part 27, replacing them with a more
general reference to CBP or removing the reference entirely.
Section 27.184 (27 CFR 27.184) currently requires identifying
numbers of containers and the quantity of tax-free spirits to be
recorded on entry documents. TTB proposes to amend Sec. 27.184 to
remove references to entry documents and simply require that the total
quantity be filed, along with the number of the TTB-issued permit.
Finally, TTB also proposes to remove Sec. 27.185 (27 CFR 27.185),
Customs release, as it describes customs processes and inspection. As
described earlier, TTB is generally proposing to remove most references
to actions that CBP will take at entry, and replace them, where
appropriate, with text that clarifies the requirements that apply to
the importer at entry.
N. Certificate Covering Distilled Spirits, Wine, or Beer Brought Into
the United States From the U.S. Virgin Islands
Section 26.205 (27 CFR 26.205) currently requires that every person
bringing distilled spirits, wine, or beer under part 26 into the United
States from the U.S. Virgin Islands, except tourists, obtain a
certificate in the English language from the manufacturer. The required
information in the certificate includes, among other things,
[[Page 40416]]
the name and address of the consignee, the kind and brand name, and the
quantity. Under paragraph (b) of Sec. 26.205, the person bringing the
distilled spirits, wine, or beer into the United States must file the
certificate and a record of gauge with CBP at the port of entry with
the entry summary. Section 26.260 (27 CFR 26.260) also requires the
certificate to be filed with CBP.
TTB proposes in this rulemaking to amend Sec. 26.205(b) to require
that any person bringing liquors into the United States file
information that appears on the certificate as required by proposed
Sec. 26.200. TTB proposes to add a new paragraph (c) to Sec. 26.205,
under which information associated with the certificate required under
that section must be maintained as a record and made available upon
request of the appropriate TTB officer or a customs officer. TTB
proposes to amend Sec. 26.260 to cross-reference the requirements set
forth in Sec. Sec. 26.200, 26.204, and 26.205. Finally, TTB proposes
to add a new paragraph (d) to Sec. 26.205, to require that for
distilled spirits, natural wine, or beer withdrawn from customs custody
without payment of tax, the importer must furnish a copy of the
certificate described in Sec. 26.205 to the proprietor of the
receiving distilled spirits plant, bonded wine cellar, or brewery.
O. Clarification of Record Retention Requirements
Sections 26.276 and 27.137 (27 CFR 26.276 and 27.137) currently set
forth certain recordkeeping requirements for all documents or copies of
documents that support records required by parts 26 and 27,
respectively. TTB proposes to amend each of these sections to provide
that the length of time during which the records must be kept is
measured from the time of withdrawal from customs custody. TTB also
proposes to provide that the records must be made available upon
request of the appropriate TTB officer or a customs officer, rather
than made available during business hours as the texts of these
sections currently state. This amendment would provide for alternative
means of providing such records, such as by mail or email. TTB also
proposes to clarify that supporting documents include data filed with
CBP pursuant to CBP requirements.
P. Removal of Requirements for CBP to Gauge or Inspect
Certain TTB regulations currently state that customs officers shall
inspect or gauge shipments of alcohol before release. Section 26.261
(27 CFR 26.261) states that CBP will regauge or inspect a consignment
of liquors from the U.S. Virgin Islands to the United States to
determine the tax due on the consignment. Section 26.297 (27 CFR
26.297) states that CBP shall inspect shipments of industrial spirits,
specially denatured spirits, completely denatured alcohol, and products
made with denatured spirits coming into the United States from the U.S.
Virgin Islands. Section 26.303 (27 CFR 26.303) directs CBP to inspect
shipments of bulk distilled spirits brought into the United States from
the U.S. Virgin Islands and being transferred free of tax. Similarly,
under Sec. 27.173 (27 CFR 27.173) CBP shall inspect imports of bulk
distilled spirits being transferred free of tax, and enter certain
information on the transfer record. Finally, Sec. 27.185 (27 CFR
27.185) requires CBP to inspect imported distilled spirits being
released without payment of tax for use of the United States. These
inspections are generally to detect losses in transit.
TTB proposes to remove these provisions. TTB believes that it is
not now necessary to state that CBP will gauge or inspect all such
consignments or shipments. TTB notes that persons receiving the alcohol
are subject to regulation by TTB, and are required to take action to
determine if losses have occurred. Accordingly, TTB proposes to remove
Sec. Sec. 26.261, 26.297, 26.303, 27.173, and 27.185.
Q. Filing of Data for Importation of Tobacco Products Subject to Tax
and Processed Tobacco
The Federal excise tax due incident to the importation of tobacco
products and cigarette papers and tubes is collected by CBP, along with
any applicable duties. Tobacco products and cigarette papers and tubes
coming into the United States from the U.S. Virgin Islands are
generally subject to a tax equal to the internal revenue tax imposed
upon the production in the United States of like products. Such taxes
are collected by CBP, along with any applicable duties. Processed
tobacco is not subject to tax but the importation of processed tobacco
is subject to TTB regulation. Anyone engaged in the business of
importing processed tobacco must obtain a permit, issued by TTB, prior
to engaging in such business. See 26 U.S.C. 5712 and 5713.
Current 27 CFR 41.81 requires that, when tobacco products and
cigarette papers and tubes are released from customs custody for
consumption, importers must maintain certain information about those
shipments and, if the customs form or the electronic transmission of
information allows for the reporting of that information, file the
information with CBP. The information required to be submitted or
maintained under current Sec. 41.81 includes, for example,
identification of the imported product as it is classified under the
IRC, the quantity imported, and the tax due. Although a permit is
required to import tobacco products subject to tax, the regulations do
not currently state the conditions under which an importer obtaining
release of tobacco products subject to tax must provide the permit or
proof of having obtained the permit to CBP during importation. TTB is
proposing to update the information required to be filed and recorded.
Under the proposed regulations, the importer of tobacco products
that files TTB data electronically must still file certain information
identifying the imported product as it is classified under the IRC and
the quantity imported, as well as information identifying the importer
(by TTB permit number and employer identification number, or EIN) and
the ultimate consignee. With regard to the TTB permit number and EIN,
each permit to import tobacco products issued by TTB has a number
associated with it. Amending the regulations to provide for the
electronic submission of the permit number by importers that file TTB
data electronically would make clearer to the importer what is required
upon importation of TTB-regulated tobacco products and make the permit
requirement more transparent and consistent. It would also allow TTB to
link more easily specific importations to the records importers keep
and the reports they submit to TTB. For importers of cigarette papers
and tubes, the regulations set forth similar filing requirements, but
do not require submission of a permit number because importers of
cigarette papers and tubes are not required to obtain a TTB permit.
Proposed Sec. 41.81 provides that any information required by that
section and also filed with CBP as part of the entry or entry summary
for purposes of meeting CBP requirements will also satisfy the TTB
requirement. That is, generally, when filing information
electronically, the importer need not enter the same information twice.
Whether or not the importer files TTB data electronically, revised
27 CFR 41.81 provides that the importer must retain the information
required by Sec. 41.81, any information provided to CBP for purposes
of meeting CBP requirements, and any supporting documentation and make
such records available upon request by the appropriate TTB officer or a
customs officer.
[[Page 40417]]
In this document, TTB is also proposing to add a new section 27 CFR
41.265 to outline the process for importing processed tobacco. The
requirements, as proposed, are similar to those for importers of
tobacco products and cigarette papers and tubes. That is, if filing TTB
data electronically, the importer must file with CBP certain
information identifying the importer (by TTB permit number and employer
identification number, or EIN), the ultimate consignee, and the import
as ``processed tobacco'' and quantity. The proposed regulation
clarifies that any information required by that section, that is filed
with CBP as part of the entry or entry summary for purposes of meeting
CBP requirements, will also satisfy the TTB requirement. Whether or not
the importer files TTB data electronically, revised 27 CFR 41.265
provides that the importer must retain the information required by this
section, any information submitted to CBP to meet CBP requirements, and
any supporting documentation and make such records available upon
request by the appropriate TTB officer or a customs officer.
TTB is also proposing to amend 27 CFR 41.204, which concerns
records and reports. Currently, that section states that every tobacco
products importer must keep records and submit reports, when required,
of the physical receipt and disposition of tobacco products. The
proposed regulations remove the reference to ``physical'' receipt and
disposition. As proposed, the importer would be responsible for
accounting for all tobacco products released from customs custody under
the importer's TTB permit, including receipt and disposition. Proposed
Sec. 41.204 would also require recordkeeping by importers of cigarette
papers and tubes.
R. Filing of Data for Importation of Tobacco Products Without Payment
of Tax
As noted above, imported tobacco products and cigarette papers and
tubes may be released from customs custody without payment of tax for
delivery to a proprietor of an export warehouse, or to a manufacturer
of tobacco products or cigarette papers and tubes if such articles are
not put up in packages, in accordance with such regulations and under
such bond as the Secretary shall prescribe. See 26 U.S.C. 5704(c).
Imported tobacco products and cigarette papers and tubes previously
exported and returned may be released from customs custody without
payment of tax for delivery to the original manufacturer or an export
warehouse proprietor authorized by such manufacturer to receive the
products, in accordance with such regulations and under such bond as
the Secretary shall prescribe. See 26 U.S.C. 5704(d).
Section 41.86 (27 CFR 41.86) addresses releases of tobacco products
and cigarette papers and tubes from customs custody without payment of
tax. Section 41.86 requires that a manufacturer or export warehouse
proprietor wanting to obtain release of tobacco products or cigarette
papers or tubes, under the provisions of 26 U.S.C. 5704(c) and (d), for
transfer under bond to the manufacturer's or export warehouse
proprietor's premises must prepare a notice of release on TTB F 5200.11
and file the form with the appropriate TTB officer, who certifies that
the manufacturer or export warehouse proprietor meets the statutory
requirements to obtain release. The importer makes this document
available for the CBP officer, who verifies that the TTB F 5200.11 has
been certified and provides a copy of the form to the importer. After
release, the importer is currently required to send a copy of the form
to TTB. Section 41.86(b) recognizes the use of electronic filing with
CBP but does not specify how the TTB F 5200.11 is to be used to obtain
the release electronically.
TTB proposes amending Sec. 41.86 to provide the option for the
data required on the TTB F 5200.11 to be submitted to CBP
electronically, rather than on a paper form. Those not filing TTB data
electronically with CBP must continue to use the paper form, be in
possession of the TTB-certified form at the time the products are
released from customs custody, and make the form available to a customs
officer upon request. TTB notes that the proposed regulations would
require, when applicable, two data elements (the TTB Importer Permit
number and the recipient's EIN) that do not currently appear on the TTB
F 5200.11. Amendments to the form would be made to mirror any final
regulations. Section 41.86 would also be amended to specify the
circumstances under which tobacco products and cigarette papers and
tubes may be released from customs custody without payment of tax and
to include a specific recordkeeping requirement, that regardless of the
method of filing, the information required to be submitted to CBP must
be retained along with any supporting documentation, and such records
must be available for inspection upon request by the appropriate TTB
officer or a customs officer.
S. Entry for Warehousing of Distilled Spirits, Wines, Beer, Tobacco
Products, and Cigarette Papers and Tubes
Under the IRC at 26 U.S.C. 5061(d)(2), for distilled spirits, wine,
and beer entered for warehousing (such as those commodities imported
and transferred directly to a customs bonded warehouse or foreign trade
zone and subsequently transferred between such warehouses), the last
day for payment of the tax shall not be later than the 14th day after
the last day of the semimonthly period during which the products are
removed from the first such warehouse, even if the products are removed
from that customs bonded warehouse or foreign trade zone for transfer
to another customs bonded warehouse or foreign trade zone. There is an
exception to this rule for products that are shown to the satisfaction
of the Secretary to be destined for export. The IRC at 26 U.S.C.
5703(b)(2) mirrors these provisions for tobacco products and cigarette
papers and tubes. Neither of these statutory requirements has yet been
incorporated into the TTB regulations in part 26, 27, or 41. TTB
proposes in this document to add appropriate regulatory text in 27 CFR
26.200 (regarding distilled spirits, wine, and beer brought into the
United States from the U.S. Virgin Islands), 27.45 (regarding the time
of the determination of the tax on beer), 27.48 (regarding the
importation of distilled spirits, wine, and beer), and new 41.84
(regarding the importation of tobacco products) to reflect these
statutory provisions.
IV. Public Participation
A. Comments Invited
TTB invites comments from interested members of the public on this
proposed rulemaking. Regarding the effective date for these
regulations, TTB solicits views on the amount of time that importers
believe would be needed to develop functionality to file TTB data
electronically. In the Interim Final Rule, ``Automated Commercial
Environment (ACE) Filings for Electronic Entry/Entry Summary (Cargo
Release and Related Entry),'' 80 FR 61278, 61281 (2015), CBP announced
that it is considering a ``proposal to eliminate hybrid filing.'' That
proposal would require importers to choose between submitting CBP entry
and entry summary documentation (including all required TTB and other
Partner Government Agency data) either entirely electronically or
entirely on paper. CBP would no longer accept any hybrid filings,
except in limited circumstances. This would mean that if an importer
files one paper document not covered by the limited exceptions,
[[Page 40418]]
the entire filing, including the report to CBP, must be on paper. TTB
is interested in comments from the public regarding how their
implementation of the TTB electronic filing processes described in this
document would be impacted by a CBP decision to eliminate hybrid
filing.
TTB is currently allowing importers that are prepared to file
electronically to do so through a pilot program announced by TTB in a
Federal Register notice, ``Importation of Distilled Spirits, Wine,
Beer, Tobacco Products, Processed Tobacco, Cigarette Papers and Tubes;
Availability of Pilot Program and Filing Instructions to Test the
Collection of Import Data for Implementation of the International Trade
Data System,'' (80 FR 47558, August 7, 2015). Importers participating
in the pilot program are doing so under an alternate method published
by TTB in Industry Circular 2015-1 on www.ttb.gov. TTB encourages
importers to participate in the pilot program, test the usability and
functionality of the TTB PGA Message Set, and provide comments.
B. Submitting Comments
Please submit your comments by the closing date shown above in this
document. You may submit comments in one of the following three ways:
Federal e-Rulemaking Portal: You may send comments via the
online comment form associated with this document in Docket No. TTB-
2016-0004 on ``Regulations.gov,'' the Federal e-rulemaking portal, at
https://www.regulations.gov. A direct link to that docket is available
under Notice No. 159 on the TTB Web site at https://www.ttb.gov/regulations_laws/all_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 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.
Your comments must reference Notice No. 159 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 accept anonymous comments, does not acknowledge receipt of
comments, and considers 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 enter the entity's name in the ``Organization'' blank of the
comment form. If you comment via 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.
C. 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 confidential or inappropriate for public
disclosure.
D. Public Disclosure
On the Federal e-rulemaking portal, Regulations.gov, TTB will post,
and the public may view, copies of this document and any electronic or
mailed comments we receive about it. A direct link to the
Regulations.gov docket containing this document and the posted comments
received on it is available on the TTB Web site at https://www.ttb.gov/regulations_laws/all_rulemaking.shtml under Notice No. 159. You may
also reach the docket containing this document and its related comments
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 the Bureau considers unsuitable for
posting.
You and other members of the public may view copies of this notice
of proposed rulemaking and any electronic or mailed comments TTB
receives on it 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 the TTB 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.
V. Regulatory Analysis and Notices
A. Executive Order 12866
It has been determined that this proposed rule is not a significant
regulatory action as defined by Executive Order 12866. Therefore, a
regulatory impact assessment is not required.
B. 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 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.
Impact on Small Entities
While TTB believes the majority of businesses subject to this
proposed rule are small businesses, the changes proposed in this
document will not have a significant impact on those small entities.
Electronic filing will not be required under the proposed changes. For
entities filing on paper, the proposed changes will generally only
require that certain additional information must be kept as a record.
Furthermore, the majority of changes that TTB is proposing in this
document would provide importers with more predictability regarding the
data required at importation, and the proposed electronic filing option
would allow importers to more easily provide information required to
import alcohol and tobacco products. This would facilitate the movement
of the commodities from the port of entry into U.S. commerce, and
reduce the possibility of cargo being delayed at the port. As small
entities typically have fewer resources than large entities to devote
to regulatory compliance and logistics, these benefits could have a
disproportionately positive effect for small entities.
In addition, these changes will allow importers the option to
provide data required by the U.S. government in order to clear their
imported goods through a single window, rather than the current
practice of filling out separate forms for commodities subject to
regulation by multiple Federal agencies.
The changes in the proposed rule can be divided into three classes
with respect to their impact on entities: (1)
[[Page 40419]]
Providing an electronic filing alternative to requirements to submit
paper documents to CBP as part of the customs entry or entry summary
filing; (2) replacing reporting requirements with recordkeeping
requirements, under which the importer must make documents available
upon request; and (3) adding some filing requirements. An example of
the electronic filing alternative is the proposal to address the COLA.
Current regulations require that the COLA be ``deposited with'' CBP
before the alcohol beverages covered by the COLA are released from
customs custody. TTB is proposing instead to require that importers
that file TTB data electronically input the number of the COLA with the
filing of the customs entry. Electronic filing provides a non-paper
alternative to submitting information. It is likely that such an
alternative will be welcomed by importers that prefer to file
electronically, as including paper documents in shipments is likely
more burdensome than submitting data electronically. Paper COLAs will
continue to be required from importers that do not file TTB data
electronically.
An example of replacing reporting with recordkeeping is the
proposal to address foreign certificates, which include certificates of
age and origin for certain distilled spirits; certification of origin
and identity for certain wine; and certification of proper cellar
treatment of natural wine. In general, current regulations require that
the foreign certificate ``accompany'' the importation. TTB is proposing
instead that the importer obtain the certificate prior to importation
and only make it available upon request. If filing TTB data
electronically, at the filing of the entry or entry summary, the
importer would certify that it has complied and will comply with these
conditions. The burden of including paper documents in shipments is
being removed for both electronic and paper filers in these instances.
An example of requiring new information is the proposal that
importers that import alcohol or tobacco products subject to tax and
file TTB data electronically provide at entry or entry summary: The
importer's TTB permit number; the importer's EIN; the name and address
of the ultimate consignee; the quantity of each product; and
information identifying each product for IRC and/or FAA Act purposes.
Importers that do not file electronically would be required to maintain
records of the information to be made available upon request. TTB
believes that the impact of this change would be minimal because much
of this information is already submitted to CBP for CBP purposes.
In conclusion, while the entities affected by the proposed rule
include a substantial number of small entities, the effects of the
changes in this proposed rule in general, and in particular the
provision of electronic filing alternatives and the replacement of
reporting requirements with recordkeeping requirements, are expected to
be positive for the affected entities. The proposals generally provide
additional options for complying with import requirements and allow
importers that prefer filing electronically to meet TTB requirements
through electronic means.
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.
C. Paperwork Reduction Act
Regulations addressed in this document contain current collections
of information that have been previously reviewed and approved by the
Office of Management and Budget (OMB) in accordance with the Paperwork
Reduction Act of 1995 (44 U.S.C. 3504(h)) and assigned control numbers
1513-0020, 1513-0025, 1513-0056, 1513-0059, 1513-0062, 1513-0064, 1513-
0088, 1513-0106, and 1513-0119. The specific regulatory sections in
this proposed rule that contain collections of information, either
current or proposed, are Sec. Sec. 1.58, 4.27, 4.40, 4.45, 4.53, 4.70,
5.45, 5.51, 5.52, 5.56, 7.31, 26.200, 26.205, 26.273a, 26.276, 26.292,
26.294, 26.296, 26.301, 26.302, 26.314, 26.318, 26.319, 26.331, 27.48,
27.76, 27.77, 27.137, 27.138, 27.140, 27.172, 27.204, 27.208, 27.209,
27.221, 41.81, 41.86, 41.204, and 41.265. 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 control number assigned by OMB.
Several amendments proposed in this document would allow importers
to file information required at importation electronically, rather than
on paper. In many cases, the proposed regulations require information
that the importer would already file as part of its customs entry or
entry summary in order to meet CBP requirements and, in such cases, the
information submitted to CBP to meet CBP requirements would also
satisfy the TTB requirements. In some cases, new information is
required to be submitted at importation. Whether the information is
information currently required to be submitted at importation or
whether it is a new requirement, the importer has the option of filing
the TTB data electronically with CBP. Regardless of the method of
filing, the importer must retain and provide the information upon
request. TTB has submitted a revision to OMB control number 1513-0064,
Importers' Records and Reports, to include the information that TTB is
proposing to require importers that file TTB data electronically to
submit electronically at entry or entry summary, as well as the
information that must made available by all importers upon request.
Upon revision of OMB control number 1513-0064, that collection will
include information related to importers' compliance with the Federal
Alcohol Administration Act (FAA Act) and with the Internal Revenue Code
of 1986 (IRC), as described below.
Under the proposed regulations, persons who import, or bring into
the United States from the U.S. Virgin Islands, distilled spirits,
wine, or malt beverages under an FAA Act basic permit and who file TTB
data electronically would be required to submit certain information to
show compliance with FAA Act provisions. Under proposed Sec. 1.58,
every person required to obtain a basic permit as an importer must,
when importing distilled spirits, wine, or malt beverages under that
permit and filing TTB data electronically, file the number of the
permit with CBP along with the filing of the customs entry, and,
regardless of the method of filing, must make the permit available upon
request.
Further, current Sec. Sec. 4.27, 4.45, and 5.52, require foreign
certificates, which include certification of vintage wine,
certification of origin and identity for certain wine, certification of
proper cellar treatment of natural wine (as required under 27 CFR
27.140), and certification of age and origin for certain distilled
spirits. Under current regulations, the importer must obtain such
certificates prior to importation; importations of products subject to
such
[[Page 40420]]
requirements generally must be accompanied by the certificates. Under
the proposed regulations at Sec. Sec. 4.45 and 5.52, the importer must
make the applicable certificate available upon request. If filing TTB
data electronically, as part of the customs filing, the importer may be
asked to make an attestation that it has obtained a certificate and
will make it available upon request. In addition, TTB proposes to add
Sec. 4.53 to clarify that bottlers of bulk imported wine must also
possess a certificate of origin or a certification of proper cellar
treatment of natural wine (as required under 27 CFR 27.140), when
applicable, that provides the same information as a certificate
required for importers of wine in bottles. Proposed Sec. Sec. 4.53 and
5.56 also specify the applicable record retention requirements for the
certificates. TTB proposes to remove the certification of vintage wine
requirement from Sec. 4.27 and to require industry members to
demonstrate upon request that the wine is entitled to be labeled with
the vintage date. (The natural wine certificate required by Sec. Sec.
4.45 and 27.140 is currently included in the collection of information
assigned OMB control number 1513-0119, Certification of Proper Cellar
Treatment for Imported Natural Wine. TTB has submitted to OMB a
revision of that information collection to make reference to Sec.
4.45.)
The amendments proposed to Sec. Sec. 4.70 and 5.45 would
incorporate the exceptions to the standards of fill for imported wine
and imported distilled spirits (respectively), currently found in
Sec. Sec. 4.46 and 5.53, stating that the standards of fill do not
apply to such wine or distilled spirits bottled or packed before
January 1, 1979 (or before July 1, 1989 in the case of distilled
spirits in 500 mL containers). Under the proposed amendment, the
currently-required foreign certificate must be made available to TTB
upon request, instead of accompanying the shipment.
For bottled distilled spirits, wine, or malt beverages, the
proposed regulations also require from those filing TTB data
electronically the submission of the TTB-assigned number of the
product's valid certificate of label approval (COLA). TTB proposes to
amend regulatory sections that currently require the depositing of the
COLA, TTB Form 5100.31, with CBP at the port of entry of a shipment, in
order for the bottled distilled spirits, wine, or malt beverage to be
released from customs custody. As proposed, if the importer is filing
the TTB data electronically, the importer would not deposit the COLA
with CBP but, rather, would file along with the customs entry the TTB-
assigned number of the approved COLA that corresponds to the label on
the bottle of distilled spirits, wine, or malt beverage. If the
importer is not filing TTB data electronically, a paper COLA will
continue to be required at entry. Currently, the requirement that
importers deposit the applicable COLA with CBP is set forth in
Sec. Sec. 4.40, 5.51, and 7.31 and is covered by OMB control number
1513-0020, Application for and Certification/Exemption of Label/Bottle
Approval (TTB F 5100.31), which also covers the information collected
on the form used to apply for the COLA. As part of this rulemaking, TTB
will include the electronic submission of the TTB-assigned COLA number
in OMB control number 1513-0064.
In addition to the FAA Act provisions described above, under the
proposed amendments, persons who import, or bring into the United
States from the U.S. Virgin Islands, distilled spirits, wine, beer,
tobacco products, processed tobacco, or cigarette papers or tubes that
are either released from customs custody subject to tax or without
payment of tax in bulk under certain exemptions would be required to
submit and/or make available upon request certain information to show
compliance with IRC provisions. The proposed amendments that affect the
collection of information are described below.
Proposed amendments to Sec. Sec. 26.200, 26.301, 27.48, 27.172,
41.81, 41.86, and new 41.265 set forth new data elements (in addition
to the FAA Act basic permit number, where applicable, as described
above) that must be filed with CBP when filing TTB data electronically
and, regardless of the method of filing, be kept as a record and made
available upon request. As noted above, in some cases this information
will already be filed by the importer pursuant to CBP guidelines
(either mandated or provided at the discretion of the importer) and, if
the importer files the information for CBP purposes, the importer will
satisfy the TTB requirement without additional action. In other cases,
the information is specific to the IRC or FAA Act and will not already
be filed by the importer with CBP for CBP purposes. When using the
option to file TTB data electronically, the data elements required by
the proposed amendments to Sec. Sec. 26.200, 27.48, and 41.81 are as
follows, with some variation depending on the products and
circumstances covered under the specific section: The number of the
importer's FAA Act basic permit; the importer's name, address, and
employer identification number (EIN) associated with that permit; the
name and address of the ultimate consignee; the quantity of each
product; and information identifying each product for IRC and/or FAA
Act purposes. The proposed amendments also require similar information
for releases of certain products from customs custody without payment
of tax under proposed Sec. Sec. 26.301, 27.172, and 41.86 and, for
releases of processed tobacco, which is not subject to tax, under new
Sec. 41.265.
Sections 26.273a, 26.301, and 27.138 set forth the transfer records
applicable to distilled spirits, wine, and beer withdrawn from customs
custody without payment of tax for delivery to specified TTB-bonded
facilities. Distilled spirits transfer records are currently covered by
OMB control number 1513-0056. The existing regulations only cover
distilled spirits transfer records; the proposed regulations add wine
and beer transfer records. For those who will file TTB data
electronically, the proposed regulations also require the reporting of
information from the transfer records with the CBP entry. The
information required to be recorded and reported, as applicable, under
the proposed regulations includes the following, with some variation
depending on the product: The date the record is prepared; the name and
address of the bonded premises receiving the distilled spirits, wine,
or beer from customs custody; the TTB-issued registry number of the
bonded premises receiving the distilled spirits, wine, or beer from
customs custody; the number of containers transferred and the quantity
in each container; the country of origin; the customs entry number and
amount of duty paid; and the foreign producer.
Current Sec. 26.205 requires that persons, other than tourists,
bringing liquors or articles under part 26 into the United States from
the Virgin Islands obtain a certificate from the manufacturer showing
certain information. TTB proposes to amend that section to specify that
a copy of the certificate must be retained along with other records
needed to substantiate the information in the certificate, and those
records must be made available upon request. Proposed Sec. 26.205 also
requires that the importers that file TTB data electronically must file
the information included on the certificate in accordance with the
provisions of Sec. 26.200.
This document also includes proposals to amend the regulations in
part 26 and 27 relating to records of shipments of industrial spirits,
specially denatured spirits, and completely denatured spirits. Section
26.292 requires that a copy of the consignee's permit for shipments of
industrial
[[Page 40421]]
spirits or specially denatured spirits brought into the United States
from the U.S. Virgin Islands be filed with CBP. The proposed amendment
to that section provides that the permit number be submitted
electronically, if the importer is filing TTB data electronically, and
must be made available upon request. As discussed below, amendments to
Sec. Sec. 26.294 and 26.296 require the reporting with the CBP entry
of the names and addresses of the consignor and the consignee and
consignor as well as the total quantity shipped.
Sections 26.318 and 27.208 address requirements related to liquor
bottles being imported or brought into the United States, and provide a
letterhead application process for importers that wish to bring into
the United States filled liquor bottles that do not conform to the
regulatory requirements in part 26. The proposed amendments specify
that the proof of authorization must be retained for a three-year
period and made available upon request.
TTB is also proposing to remove references to submissions of
information in triplicate. See Sec. Sec. 26.331, 27.209, and 27.221.
TTB is proposing to amend Sec. Sec. 27.76 and 27.77 regarding the
approval and certification of wine and flavors content and the approval
of a standard effective tax rate for importers. In both cases, the
amendments will remove the requirement that a TTB approval letter or
certificate be filed with CBP. Under the proposed regulations, the
approval letter or certificate would be made available upon request.
Proposed Sec. Sec. 27.76 and 27.77 also include record retention
requirements.
Finally, TTB is proposing to amend Sec. Sec. 26.276, 27.137, and
41.204, which currently set forth certain recordkeeping requirements
for all documents or copies of documents that support records required
by parts 26, 27, and 41, respectively. TTB proposes to amend sections
Sec. Sec. 26.276 and 27.137 to clarify that: (1) The length of time
for which the records must be kept is measured from the time of
withdrawal from customs custody; (2) the records must be made available
upon request of a customs officer or the appropriate TTB officer,
rather than made available during business hours as the texts of these
sections currently states; and (3) supporting documents that must be
kept include data filed with CBP pursuant to CBP requirements. TTB
proposes to amend Sec. 41.204 to provide that importers of tobacco
products and cigarette papers or tubes must keep records of such
products received and disposed of, but also of any of these products
released from customs custody under the importer's TTB permit. (Current
requirements of Sec. 41.204 are covered by OMB control number 1513-
0106. The proposed requirements are being submitted to OMB control
number 1513-0064.)
TTB believes that these proposed requirements are necessary to
ensure that:
Persons engaged in business as importers are operating
under the permit required by Federal law to engage in such operations;
Applicable taxes are paid;
Commodities released from customs custody without payment
of tax for transfer in bond are eligible for such release, are sent to
eligible bonded facilities, and are not diverted; and
Labels applied to containers of imported alcohol beverages
comply with FAA Act requirements.
TTB estimates that, as a result of the amendments, the new annual
burden hours associated with OMB control number 1513-0064 will change.
The new estimates are:
Estimated number of respondents: 10,521.
Estimated average annual burden hours: 21,042.
The revision of 1513-0064 generally consolidates the information
required of importers to be filed as part of the customs entry or entry
summary, or kept as a record relating to the entry or entry summary.
Such consolidation entails removing requirements that currently appear
in other information collections. TTB has submitted to OMB a revision
of OMB control number 1513-0056, TTB REC 5110/05, Distilled Spirits
Plants--Transaction and Supporting Records, to remove references to
Sec. Sec. 26.273a, 26.301, 27.138, and 27.172 that would now be
captured under OMB control number 1513-0064, as described above. The
estimated number of respondents (620) and estimated average annual
burden hours (13,516) for 1513-0056 remain unchanged.
In addition, TTB has submitted to OMB revisions of OMB control
numbers 1513-0059, TTB REC 5150/3, Usual and Customary Business Records
Relating to Tax-Free Alcohol, and 1513-0062, TTB REC 5150/1, Usual and
Customary Business Records Relating to Denatured Spirits. Proposed
amendments to the regulations at Sec. Sec. 26.294 and 26.296 allow
certain information relating to shipments from the U.S. Virgin Islands
of industrial spirits, specially denatured spirits or completely
denatured spirits to be filed electronically at the time of filing the
entry or entry summary, as appropriate. Regardless of the method of
filing, the record of shipment must be retained and be made available
upon request. These electronic submissions will be placed under OMB
control number 1513-0064. The estimated number of respondents for OMB
control number 1513-0059 (5,268) and for OMB control number 1513-0062
(3,430) and the estimated average annual burden hours for each (one,
for usual and customary business records) remain unchanged. TTB has
also submitted to OMB a revision of OMB control number 1513-0088, TTB
REC 5000/24, Alcohol, Tobacco, and Firearms Related Documents for Tax
Returns and Claims, to remove the information collections in Sec. Sec.
27.48, 27.137, and 41.81, which will now be included in revised OMB
control number 1513-0064. OMB control number 1513-0088 is also revised
to state that the information that must be maintained as a record
includes all supporting documents, including information submitted to
CBP to meet CBP requirements. Such information must be retained for
three years. The estimated number of respondents for OMB control number
1513-0088 (503,921) and the estimated average annual burden hours for
each (one, for usual and customary business records) remain unchanged.
As noted above, TTB has submitted the revised information
collection requirements to the OMB for review. Comments on these new
recordkeeping and reporting 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
OIRA_submissions@omb.eop.gov. 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 August 22, 2016. Comments
are specifically requested concerning:
Whether the collections of information submitted to OMB
are necessary for the proper performance of the functions of the
Alcohol and Tobacco Tax and Trade Bureau, including whether the
information will have practical utility;
The accuracy of the estimated burdens associated with the
collections of information submitted to OMB;
How to enhance the quality, utility, and clarity of the
information to be collected;
How to minimize the burden of complying with the proposed
revisions of the collections of information, including the application
of automated collection techniques or other forms of information
technology; and
[[Page 40422]]
Estimates of capital or start-up costs and costs of
operation, maintenance, and purchase of services to provide
information.
Lists of Subjects
27 CFR Part 1
Administrative practice and procedure, Alcohol and alcoholic
beverages, Imports, Liquors, Packaging and containers, Warehouses,
Wine.
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 26
Alcohol and alcoholic beverages, Caribbean Basin Initiative,
Claims, Customs duties and inspection, Electronic funds transfers,
Excise taxes, Packaging and containers, Puerto Rico, Reporting and
recordkeeping requirements, Surety bonds, Virgin Islands, Warehouses.
27 CFR Part 27
Alcohol and alcoholic beverages, Beer, Cosmetics, Customs duties
and inspection, Electronic funds transfers, Excise taxes, Imports,
Labeling, Liquors, Packaging and containers, Reporting and
recordkeeping requirements, Wine.
27 CFR Part 41
Cigars and cigarettes, Claims, Customs duties and inspection,
Electronic funds transfers, Excise taxes, Imports, Labeling, Packaging
and containers, Puerto Rico, Reporting and recordkeeping requirements,
Surety bonds, Tobacco, Virgin Islands, Warehouses.
Amendments to the Regulations
For the reasons discussed above in the preamble, TTB proposes to
amend 27 CFR parts 1, 4, 5, 7, 26, 27, and 41 as follows:
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
0
1. The authority citation for part 1 continues to read as follows:
Authority: 27 U.S.C. 203, 204, 206, 211 unless otherwise noted.
0
2. Section 1.10 is amended by adding a definition of ``Malt beverage''
in alphabetical order to read as follows:
Sec. 1.10 Meaning of terms.
* * * * *
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. Standards applying to the use of processing
methods and flavors in malt beverage production appear in Sec. 7.11 of
this chapter.
* * * * *
0
3. Section 1.58 is revised to read as follows:
Sec. 1.58 Filing of permits.
Every person receiving a basic permit under the provisions of this
part must maintain the permit at the place of business covered by the
permit and make it available upon the request of the appropriate TTB
officer. Every person required to obtain a basic permit as an importer
under Sec. 1.20 must, when importing distilled spirits, wine, or malt
beverages under that permit and filing TTB data electronically, file
the number of the permit with U.S. Customs and Border Protection (CBP)
along with the filing of the customs entry. Regardless of the method of
filing, every importer must make the permit available upon request by
the appropriate TTB officer or a customs officer.
PART 4--LABELING AND ADVERTISING OF WINE
0
4. The authority citation for part 4 continues to read as follows:
Authority: 27 U.S.C. 205, unless otherwise noted.
0
5. Section 4.10 is amended by adding a definition of ``Customs
officer'' in alphabetical order to read as follows:
Sec. 4.10 Meaning of terms.
* * * * *
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.
* * * * *
0
6. Section 4.27 is amended by revising paragraph (c)(3) to read as
follows:
Sec. 4.27 Vintage wine.
* * * * *
(c) * * *
(3) 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.
0
7. Section 4.40 is amended by:
0
a. Revising paragraph (a);
0
b. Removing and reserving paragraph (b); and
0
c. Adding an Office of Management and Budget control number reference
at the end of the section.
The revision and addition read as follows:
Sec. 4.40 Label approval and release.
(a) Certificate of label approval. 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 certificate of label approval (COLA) and the containers bear
labels identical to the labels appearing on the face of the
certificate, or labels with changes authorized by the form. 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, and, 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 number of the valid
[[Page 40423]]
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 time of entry. In addition,
the importer must provide a copy of the applicable COLA upon request by
the appropriate TTB officer or a customs officer. The COLA requirement
imposed by this section applies only to wine that is 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 wine.
* * * * *
Approved by the Office of Management and Budget under control
numbers 1513-0020 and 1513-0064)
0
8. Section 4.45 is amended by revising paragraph (a) and by adding
paragraph (c) and an Office of Management and Budget control number
reference at the end of the section to read as follows:
Sec. 4.45 Certificates of origin, identity, and proper cellar
treatment.
(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 the appropriate
foreign government if that country requires the issuance of such a
certificate for wine exported from that country. The certificate must
have been issued by an official duly authorized by the foreign
government, and it 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) * * *
(c) Retention of certificates. 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.
(Approved by the Office of Management and Budget under control
numbers 1513-0064 and 1513-0119)
Sec. 4.46 [Removed]
0
9. Section 4.46 is removed.
0
10. Section 4.53 is added to subpart F to read as follows:
Sec. 4.53 Retention of certificates.
Wine that would be required under Sec. 4.45 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 for consumption 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 that provides the same information as a
certificate required under Sec. 4.45(a) and (b) would provide for like
wine imported in bottles. The bottler of wine imported in bulk must
retain for five years following the removal of such wine from the
bonded wine cellar where bottled copies of the certificates required by
Sec. 4.45(a) and (b), and must provide them upon request of the
appropriate TTB officer.
(Approved by the Office of Management and Budget under control
number 1513-0064)
0
11. Section 4.70 is amended by:
0
a. In paragraph (b)(3), removing the word ``or'' following the semi-
colon;
0
b. Redesignating paragraph (b)(4) as paragraph (b)(5);
0
c. Adding new paragraph (b)(4), and
0
d. Adding an Office of Management and Budget control number reference
at the end of the section.
The additions read as follows:
Sec. 4.70 Application.
* * * * *
(b) * * *
(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; or
* * * * *
(Approved by the Office of Management and Budget under control
number 1513-0064)
PART 5--LABELING AND ADVERTISING OF DISTILLED SPIRITS
0
12. The authority citation for part 5 continues to read as follows:
Authority: 26 U.S.C. 5301, 7805, 27 U.S.C. 205.
0
13. Section 5.11 is amended by adding a definition of ``Customs
officer'' in alphabetical order to read as follows:
Sec. 5.11 Meaning of terms.
* * * * *
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.
* * * * *
0
14. Section 5.45 is revised to read as follows:
Sec. 5.45 Application.
(a) Except as provided in paragraph (b) of this section, no person
engaged in business as a distiller, rectifier, importer, wholesaler, or
warehouseman and bottler, directly or indirectly, or through an
affiliate, shall 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 any distilled spirits in bottles
unless such distilled spirits are bottled and packed in conformity with
Sec. Sec. 5.46 through 5.47a.
(b) Section 5.47a does not apply to:
(1) Imported distilled spirits in the original containers in which
entered into Customs custody on or before December 31, 1979 (or on or
before June 30, 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, 49 Stat. 981, as amended (27 U.S.C. 205); 26 U.S.C. 5301)
(Approved by the Office of Management and Budget under control
number 1513-0064)
Sec. 5.47a [Amended]
0
15. Section 5.47a is amended in paragraph (d) by removing the
parenthetical sentence at the end of the paragraph.
0
16. Section 5.51 is amended by:
0
a. Revising paragraph (a);
0
b. Removing and reserving paragraphs (b) and (d); and
0
c. Adding an Office of Management and Budget control number reference
at the end of the section.
The revision and addition read as follows:
Sec. 5.51 Label approval and release.
(a) Certificate of label approval. Distilled spirits, imported in
bottles, 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 certificate of
label approval (COLA) and the bottles bear labels identical to the
labels appearing on the face of the certificate, or labels with changes
authorized by the form. Any person removing distilled spirits in
bottles from customs custody for consumption must first apply for and
obtain a COLA
[[Page 40424]]
covering the distilled spirits from the appropriate TTB officer, and,
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 imported distilled spirits to be
imported. If the importer is not filing electronically, the importer
must provide a copy of the COLA to CBP at time of entry. In addition,
the importer must provide a copy of the applicable COLA upon request by
the appropriate TTB officer or a customs officer. The COLA requirement
imposed by this section applies only to distilled spirits 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 distilled spirits.
* * * * *
(Approved by the Office of Management and Budget under control
numbers 1513-0020 and 1513-0064)
0
17. Section 5.52 is amended by:
0
a. Revising paragraphs (a), (b), (c), the introductory text of
paragraph (d), and paragraph (e);
0
b. Adding paragraph (f); and
0
c. Adding an Office of Management and Budget control number reference
at the end of the section.
The revisions and additions read as follows:
Sec. 5.52 Certificates of age and origin.
(a) Scotch, Irish, and Canadian whiskies. (1) Scotch, Irish, and
Canadian whiskies, imported in bottles, are not eligible for release
from customs custody, and no person may remove such whiskies from
customs custody, 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 British, Irish, or Canadian 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 bottle. 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, Cognac, and rum. Brandy (other than fruit brandies of a
type not customarily stored in oak containers) or Cognac, imported in
bottles, 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 bottle 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. Rum imported in bottles
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 bottle. 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 bottles, 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) Tequila. (1) Tequila imported in bottles 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 bottles 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 bottle.
The age certified shall be the period during which the Tequila has been
stored in oak containers after distillation and before bottling.
(d) Other whiskies. Whisky, as defined in Sec. 5.22(b)(1), (4),
(5), and (6), imported in bottles, is not eligible for release from
customs custody, and no person shall remove such whiskies from customs
custody unless that person has obtained and is in possession of a
certificate issued by an official duly authorized by the appropriate
foreign government certifying:
(1) * * *
(2) * * *
(e) Miscellaneous. Distilled spirits (other than Scotch, Irish, and
Canadian whiskies, and Cognac) imported in bottles are not eligible for
release from customs custody, and no person shall remove such spirits
from customs custody 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.
(f) Retention of certificates. The importer of distilled spirits
imported in bottles must retain for five years following the removal of
such spirits from customs custody copies of the certificates required
by paragraphs (a) through (e) of this section, and must provide them
upon request of the appropriate TTB officer or a customs officer.
(Approved by the Office of Management and Budget under control
number 1513-0064)
Sec. 5.53 [Removed]
0
18. Section 5.53 is removed.
0
19. Section 5.56 is revised to read as follows:
[[Page 40425]]
Sec. 5.56 Certificates of age and origin.
Distilled spirits that would be required under Sec. 5.52 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 plant where bottled only if the bottler possesses a certificate of
age and/or a certificate of origin applicable to the spirits that
provides the same information as a certificate required under Sec.
5.52 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 Sec. 5.52(a) through (e), and
must provide them upon request of the appropriate TTB officer.
(Approved by the Office of Management and Budget under control
number 1513-0064)
PART 7--LABELING AND ADVERTISING OF MALT BEVERAGES
0
20. The authority citation for part 7 continues to read as follows:
Authority: 27 U.S.C. 205.
0
21. Section 7.10 is amended by adding a definition of ``Customs
officer'' in alphabetical order to read as follows:
Sec. 7.10 Meaning of terms.
* * * * *
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.
* * * * *
0
22. Section 7.31 is amended by:
0
a. Revising paragraph (a);
0
b. Removing and reserving paragraph (b); and
0
c. Adding an Office of Management and Budget control number reference
at the end of the section.
The revision and addition read as follows:
Sec. 7.31 Label approval and release.
(a) Certificate of label approval. 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 certificate of label approval
(COLA) and the containers bear labels identical to the labels appearing
on the face of the certificate, or labels with changes authorized by
the form. 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, and, 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 covering 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 time of entry. In addition, the importer must provide a copy
of the applicable COLA upon request by the appropriate TTB officer or a
customs officer. 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 malt beverages.
* * * * *
(Approved by the Office of Management and Budget under control
numbers 1513-0020 and 1513-0064)
PART 26--LIQUORS AND ARTICLES FROM PUERTO RICO AND THE VIRGIN
ISLANDS
0
23. The authority citation for part 26 is revised to read as follows:
Authority: 19 U.S.C. 81c; 26 U.S.C. 5001, 5007, 5008, 5010,
5041, 5051, 5061, 5111-5114, 5121, 5122-5124, 5131-5132, 5207, 5232,
5271, 5275, 5301, 5314, 5555, 6001, 6109, 6301, 6302, 6804, 7101,
7102, 7651, 7652, 7805; 27 U.S.C. 203, 205; 31 U.S.C. 9301, 9303,
9304, 9306.
Sec. 26.1 [Amended]
0
24. In Sec. 26.1, paragraph (c) is amended by adding the words ``, of
Virgin Islands wine in bulk containers from customs custody to a bonded
wine cellar qualified under part 24 of this chapter, and of Virgin
Islands beer in bulk containers from customs custody to a brewery
qualified under part 25 of this chapter'' before the semicolon at the
end of the paragraph.
0
25. Section 26.11 is amended by:
0
a. Adding in alphabetical order definitions of ``Bonded wine cellar''
and ``Brewery'';
0
b. Revising the definitions of ``Bulk container'', ``Customs officer'',
and ``Importer''; and
0
c. Adding in alphabetical order definitions of ``IRC registry number'',
``Natural wine'', and ``Proof liter''.
The revisions and additions read as follows:
Sec. 26.11 Meaning of terms.
* * * * *
Bonded wine cellar. Premises established under part 24 of this
chapter.
* * * * *
Brewery. The land and buildings described in the brewer's notice,
TTB Form 5130.10, where beer is to be produced and packaged.
Bulk container. When used in the context of distilled spirits, the
term ``bulk container'' means any container having a capacity larger
than one wine gallon. When used in the context of wine, the term ``bulk
container'' means any container having a capacity larger than 60
liters. When used in the context of beer, the term ``bulk container''
means any container having a capacity larger than one barrel of 31
gallons.
* * * * *
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.
* * * * *
Importer. Any person who brings distilled spirits, wines, or beer
into the United States from the Virgin Islands.
* * * * *
IRC registry number. The number assigned by TTB to each distilled
spirits plant, bonded wine cellar, taxpaid wine bottling house, bonded
wine warehouse, or brewery upon approval of an application made
pursuant to Internal Revenue Code of 1986 requirements (26 U.S.C. 5171,
5351-5353, or 5401).
* * * * *
Natural wine. The product of the juice or must of sound, ripe
grapes or other sound, ripe fruit (including berries) made with any
proper cellar treatment and containing not more than 21 percent by
weight (21 degrees Brix dealcoholized wine) of total solids. For
purposes of this definition, proper cellar treatment means a production
practice or procedure authorized for natural wine by part 24 of this
chapter, or, in the case of natural wine produced and imported subject
to an international agreement or treaty, those practices and procedures
acceptable to the United States under that agreement or treaty.
* * * * *
Proof liter. A liter of liquid at 60 degrees Fahrenheit which
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.
* * * * *
0
26. Section 26.200 is amended by adding paragraphs (d), (e), (f), and
(g), by revising the authority citation, and
[[Page 40426]]
by adding an Office of Management and Budget control number reference
at the end of the section, to read as follows:
Sec. 26.200 Taxable status.
* * * * *
(d) Internal revenue taxes payable on liquors brought into the
United States from the Virgin Islands are collected by U.S. Customs and
Border Protection (CBP) in accordance with CBP requirements. The tax
must be paid on the basis of a return, and the customs form (including
any electronic transmissions) by which the liquors are duty- and tax-
paid to CBP will be treated as a return for purposes of this part. The
person bringing such liquors into the United States, if filing
electronically, must file the information specified in this section
with the entry or entry summary, as appropriate, along with any other
information that is required by CBP to be filed with the entry or entry
summary for purposes of administering the provisions of the Internal
Revenue Code and Federal Alcohol Administration Act (FAA Act). Any
information required by this section that is also required by, and
filed with, CBP as part of the entry or entry summary for purposes of
meeting CBP requirements will satisfy the requirements of this section.
The following information is required as described under this section:
(1) The permit number of the valid importer permit issued under the
FAA Act and the regulations issued pursuant to the FAA Act (27 CFR part
1), if applicable, as required by 27 CFR 1.20 and 1.58, and the
importer's name, address, and employer identification number (EIN)
associated with that permit;
(2) The TTB-assigned number of the valid certificate of label
approval (COLA), if applicable, as required by 27 CFR 4.40 in the case
of wine, 27 CFR 5.51 in the case of distilled spirits, and 27 CFR 7.31
in the case of malt beverages;
(3) The name and address of the ultimate consignee;
(4) The quantity of each product (for distilled spirits, in proof
liters or proof gallons; for wine and beer, in liters or gallons); and
(5) Information identifying each product for Internal Revenue Code
and/or FAA Act purposes.
(e) Distilled spirits, natural wines, and beer in bulk containers
may be released from customs custody without payment of tax under the
provisions of subpart Oa of this part and thereafter removed subject to
tax from internal revenue bonded premises. The tax will be collected
and paid under the provisions of parts 19, 24, and 25 of this chapter,
respectively.
(f) Entry for warehousing.--(1) General. Except as provided in
paragraph (f)(2) of this section, in the case of an entry for
warehousing (that is, products transferred directly to a customs bonded
warehouse or foreign trade zone), the last day for payment of the tax
shall not be later than the 14th day after the last day of the
semimonthly period during which the products are removed from the first
such warehouse, even if the products have been removed from that
customs bonded warehouse or foreign trade zone for transfer to another
customs bonded warehouse or foreign trade zone.
(2) Entry for warehousing of products intended for export.
Paragraph (f)(1) of this section does not apply to any distilled
spirits, wines, or beer entered for warehousing and then removed for
transfer to another customs bonded warehouse or foreign trade zone that
is shown to the satisfaction of the Secretary to be destined for
export.
(g) Records. Regardless of the method of filing, the person
bringing the liquors into the United States must retain as a record the
information required by this section, any information provided to CBP
to meet CBP requirements, and any supporting documentation. These
records must be retained in accordance with the record retention
requirements of Sec. 26.276, and the records must be made available
upon request of the appropriate TTB officer or a customs officer.
(26 U.S.C. 5001, 5054, 5061, 5232, 5364, 5418, 7652)
(Approved by the Office of Management and Budget under control
number 1513-0064)
0
27. Section 26.201c is revised to read as follows:
Sec. 26.201c Shipments of distilled spirits, natural wine, and beer
to the United States without payment of tax.
Distilled spirits, natural wine, and beer may be brought into the
United States from the Virgin Islands in bulk containers without
payment of tax for transfer in bond from customs custody to the bonded
premises of a distilled spirits plant in the case of distilled spirits,
a bonded wine cellar in the case of natural wine, or a brewery in the
case of beer. Such shipments are subject to the provisions of subpart
Oa of this part.
0
28. Section 26.202 is revised to read as follows:
Sec. 26.202 Requirements of the Federal Alcohol Administration Act.
(a) General. The Federal Alcohol Administration Act (FAA Act) and
the regulations issued under the FAA Act (parts 1, 4, 5, and 7 of this
chapter) provide that any person, except an agency of a State or
political subdivision thereof or any officer or employee of any such
agency, who brings into the United States from the Virgin Islands
distilled spirits, wines, or malt beverages for nonindustrial use must
comply with the permit and labeling requirements described in this
section. See 27 CFR 1.10 for the definitions of distilled spirits,
wine, and malt beverages under the FAA Act. Tourists bringing distilled
spirits, wines, or malt beverages into the United States for personal
or other noncommercial use are not subject to the provisions of the FAA
Act or regulations issued pursuant to the FAA Act (parts 1, 4, 5, and 7
of this chapter).
(b) FAA Act basic permit. Any person, except an agency of a State
or a political subdivision thereof or any officer or employee of any
such agency, who intends to engage in the business of bringing
distilled spirits, wines, or malt beverages into the United States from
the Virgin Islands must, prior to bringing such products into the
United States, obtain an importer's basic permit, in accordance with
the requirements of the FAA Act and regulations issued pursuant to the
FAA Act, and must file with U.S. Customs and Border Protection (CBP)
the number associated with this permit when filing electronically as
required under 27 CFR 1.58. Also, as required under Sec. 1.58 of this
chapter, if the importer is not filing electronically, the importer
must have a copy of the FAA Act basic permit and make it available upon
request of the appropriate TTB officer or a customs officer.
(c) Certificate of label approval. Any person and any agency of a
State or political subdivision thereof or any officer or employee of
such agency, removing for commercial purposes containers of distilled
spirits, wines, or malt beverages from the Virgin Islands from customs
custody for consumption, when filing electronically, must provide the
TTB-assigned identification number of the valid certificate of label
approval (COLA) for the distilled spirits, wines, or malt beverages
with the filing of the customs entry, in accordance with the
requirements of 27 CFR 4.40 in the case of wine, 27 CFR 5.51 in the
case of distilled spirits, or 27 CFR 7.31 in the case of malt
beverages. Also, as required under 27 CFR 4.40, 5.51, and 7.31, if the
importer is not filing electronically, the importer must provide a copy
of the valid COLA to CBP at the time of entry.
(d) Foreign certificates. Any person and any agency of a State or
political subdivision thereof or any officer or employee of such
agency, bringing into
[[Page 40427]]
the United States from the Virgin Islands for commercial purposes and
for consumption containers of distilled spirits or wines that require a
certificate under 27 CFR 4.45(a) in the case of wine or 27 CFR 5.52 in
the case of distilled spirits must be in possession of the certificate
(and accompanying invoice, if applicable) at the time of release from
customs custody.
(Secs. 3, 5, 49 Stat. 978, as amended, 981, as amended; 27 U.S.C.
203, 205)
0
29. Section 26.205 is amended by:
0
a. Revising paragraph (b),
0
b. Adding paragraphs (c) and (d), and
0
c. Revising the Office of Management and Budget control number
reference at the end of the section.
The revisions and additions read as follows:
Sec. 26.205 Certificate.
* * * * *
(b) The person bringing the liquors into the United States must
file the information required under Sec. 26.200, in accordance with
that section.
(c) The person bringing liquors into the United States from the
Virgin Islands must maintain a copy of the certificate described in
paragraph (a) of this section along with records to substantiate the
information on the certificate, including information required under
Sec. 26.204, in accordance with the record retention requirements of
Sec. 26.276 and must make them available upon request of the
appropriate TTB officer or a customs officer.
(d) For distilled spirits, natural wine, or beer withdrawn from
customs custody under the provisions of subpart Oa of this part, the
importer must furnish a copy of the certificate to the proprietor of
the receiving distilled spirits plant, bonded wine cellar, or brewery.
(Approved by the Office of Management and Budget under control
number 1513-0064)
* * * * *
0
30. Section 26.260 is revised to read as follows:
Sec. 26.260 Required information.
Persons (except tourists) bringing liquors from the Virgin Islands
into the United States must file with U.S. Customs and Border
Protection, at the time of filing the entry or entry summary, as
appropriate, the information required under Sec. 26.200, in accordance
with that section, and provide any information collected by any gauge
under Sec. 26.204 and any information contained in the certificate
described in Sec. 26.205, upon request, in accordance with the
provisions of Sec. Sec. 26.204 and 26.205(c).
Sec. 26.261 [Removed and reserved]
0
31. Section 26.261 is removed and reserved.
0
32. Section 26.263 is revised to read as follows:
Sec. 26.263 Determination of tax on beer.
If the certificate prescribed in Sec. 26.205 covers beer, the beer
tax will be collected at the rates imposed by 26 U.S.C. 5051.
(68A Stat. 611, as amended; 26 U.S.C. 5051, 7652)
0
33. The authority citation at the end of Sec. 26.264 is revised to
read as follows:
Sec. 26.264 Determination of tax on wine.
* * * * *
(68A Stat. 609, as amended; 26 U.S.C. 5041, 7652)
Sec. 26.273 [Amended]
0
34. Section 26.273 is amended, after the word ``plants'', by adding ``,
bonded wine cellars, and breweries''.
0
35. Section 26.273a is revised to read as follows:
Sec. 26.273a Transfer record.
(a) Distilled spirits. The transfer record for Virgin Islands
spirits prescribed in Sec. 26.301 shall show the:
(1) Date prepared;
(2) Serial number of the transfer record, beginning with ``1'' each
January 1;
(3) Name of the proprietor and TTB-issued IRC registry number of
the plant to which consigned;
(4) Name and address of the consignor;
(5) Kind of spirits;
(6) Name of the producer;
(7) Age (in years, months and days) of the spirits;
(8) Proof of the spirits;
(9) Type and serial number of containers;
(10) Proof gallons of spirits in the shipment; and
(11) The customs entry number and amount of duty paid.
(b) Natural wine. The transfer record prescribed in Sec. 26.301
must identify the importer and show the following:
(1) The date prepared;
(2) The name and address of the bonded wine cellar receiving the
wine from customs custody;
(3) The TTB-issued IRC registry number of the bonded wine cellar
receiving the wine from customs custody;
(4) The number of containers transferred and quantity of wine in
each container;
(5) The country of origin of the wine;
(6) The customs entry number and amount of duty paid;
(7) The kind of wine; and
(8) The producer.
(c) Beer. The transfer record prescribed in Sec. 26.301 must
identify the importer and show the following:
(1) The date prepared;
(2) The name and address of the brewery receiving the beer from
customs custody;
(3) The TTB-issued IRC registry number of the brewery receiving the
beer from customs custody;
(4) The number of containers transferred and quantity of beer in
each container;
(5) The country of origin of the beer;
(6) The customs entry number and amount of duty paid;
(7) The kind of beer; and
(8) The brewer.
(Approved by the Office of Management and Budget under control
number 1513-0064)
(Sec. 807, Pub. L. 96-39, 93 Stat. 284 (26 U.S.C. 5207))
0
36. Section 26.276 is amended by revising the first sentence and by
adding an OMB control number reference to the end of the section, to
read as follows:
Sec. 26.276 Retention.
All records required by this part, documents or copies of documents
supporting these records (including data filed with U.S. Customs and
Border Protection (CBP) pursuant to CBP requirements), and file copies
of reports required by this part, must be retained for not less than
three years from the date the shipment is released from customs custody
into the United States, and during this period must be made available
upon request of the appropriate TTB officer or a customs officer. * * *
(Approved by the Office of Management and Budget under control
numbers 1513-0064 and 1513-0088)
0
37. Section 26.292 is revised to read as follows:
Sec. 26.292 Consignee permit number.
If filing electronically, the consignor or consignee must file with
U.S. Customs and Border Protection the number associated with the
consignee's permit issued under part 20 of this chapter (for shipments
of specially denatured spirits) or part 22 of this chapter (for
shipments of industrial spirits), along with the customs entry. If not
filing electronically, the consignor or consignee must make the permit
available to the appropriate TTB officer or a customs officer upon
request.
(Approved by the Office of Management and Budget under control
number 1513-0064)
0
38. Section 26.294 is revised to read as follows:
[[Page 40428]]
Sec. 26.294 Record of shipment.
(a) Filing information with U.S. Customs and Border Protection.
Each person bringing industrial spirits or specially denatured spirits
into the United States from the Virgin Islands, who files
electronically, must file with U.S. Customs and Border Protection (CBP)
the information specified in this paragraph, with the entry or entry
summary, as appropriate. Any information required by this paragraph
that is also required by, and filed with, CBP as part of the entry or
entry summary for purposes of meeting CBP requirements will satisfy the
requirements of this paragraph. In addition to the consignee's permit
number or a copy of the consignee's permit as required by Sec. 26.292,
the following information is required:
(1) The name and address of the consignee;
(2) The name and address of the consignor; and
(3) The total quantity shipped.
(b) Maintaining the record of shipment. For each shipment of
industrial spirits or specially denatured spirits from the Virgin
Islands to the United States, the importer shall possess and maintain a
record of shipment. The record of shipment shall consist of an invoice,
bill of lading, or similar document that shows the information required
in paragraph (a) of this section, as well as the following:
(1) For each formula of specially denatured spirits, the formula
number prescribed by part 21 of this chapter;
(2) For each formula of specially denatured spirits, the total
quantity in liters or gallons and the serial numbers or package
identification numbers of containers; and
(3) For industrial spirits, the total quantity in proof liters or
proof gallons and the package identification numbers of containers.
(c) Retaining records and making them available upon request. The
person bringing industrial spirits or specially denatured spirits into
the United States from the Virgin Islands must maintain records to
substantiate the information required under paragraph (a) of this
section, and any information provided to CBP to meet CBP requirements,
in accordance with the record retention requirements of Sec. 26.276.
Such records also must be made available upon request of the
appropriate TTB officer or a customs officer.
(Approved by the Office of Management and Budget under control
number 1513-0064)
0
39. Section 26.296 is revised to read as follows:
Sec. 26.296 Record of shipment.
(a) Filing information with U.S. Customs and Border Protection.
Each person bringing completely denatured alcohol or products made with
denatured spirits into the United States from the Virgin Islands, who
files electronically, must file with U.S. Customs and Border Protection
(CBP) the information specified in this paragraph with the entry or
entry summary, as appropriate. Any information required by this
paragraph that is also required by, and filed with, CBP as part of the
entry or entry summary for purposes of meeting CBP requirements will
satisfy the requirements of this paragraph. The following information
is required:
(1) The consignor's name and address;
(2) The consignee's name and address; and
(3) The total quantity shipped.
(b) Maintaining additional information as a record. For each
shipment of completely denatured alcohol or products made with
denatured spirits from the Virgin Islands to the United States, the
importer shall possess and maintain a record of shipment. The record of
shipment shall consist of an invoice, bill of lading, or similar
document that shows the information required under paragraph (a) of
this section, as well as the following:
(1) The capacity and number of containers;
(2) For each formulation of completely denatured alcohol, the words
``Virgin Islands Completely Denatured Alcohol'' and the formula number
prescribed by part 21 of this chapter; and
(3) For product made with denatured spirits, the name, trade name,
or brand name of the product.
(c) Retaining records and making them available upon request. The
person bringing completely denatured alcohol or products made with
denatured spirits into the United States from the Virgin Islands must
maintain records to substantiate the information required under
paragraph (a) of this section and records as required under paragraph
(b) of this section, and any information submitted to CBP to meet CBP
requirements, in accordance with the record retention requirements of
Sec. 26.276. Such records also must be made available upon request of
the appropriate TTB officer or a customs officer.
(Approved by the Office of Management and Budget under control
number 1513-0064)
Sec. 26.297 [Removed]
0
40. Section Sec. 26.297 and the undesignated center heading
immediately before it are removed.
Subpart Oa--Transfer of Virgin Islands Distilled Spirits, Natural
Wines, and Beer Without Payment of Tax, From Customs Custody to
Internal Revenue Bond
0
41. The heading of subpart Oa is revised as set forth above.
0
42. Section 26.300 is amended by:
0
a. Revising the section heading;
0
b. Removing ``(a)'' and ``(b)'' from the second sentence;
0
c. Designating the existing text as paragraph (a);
0
d. Adding a heading to newly designated paragraph (a); and
0
e. Adding paragraphs (b) and (c).
The revision and additions read as follows:
Sec. 26.300 General provisions.
(a) Transfer of bulk distilled spirits from customs custody to
bonded premises of a distilled spirits plant. * * *
(b) Transfer of bulk natural wine from customs custody to a bonded
wine cellar. Bulk natural wine, as defined in Sec. 26.11, brought into
the United States from the Virgin Islands may, under the provisions of
this subpart, be withdrawn by the proprietor of a bonded wine cellar
from customs custody and transferred in bond in bulk containers to the
bonded wine cellar, without payment of the internal revenue tax imposed
on such wine by 26 U.S.C. 7652. Wine so withdrawn and transferred to a
bonded wine cellar may be withdrawn from a bonded wine cellar's
internal revenue bond for any purpose authorized by 26 U.S.C. chapter
51, in the same manner as domestic wine. The proprietor of the bonded
wine cellar to which the wine is transferred becomes liable for the tax
on wine withdrawn from customs custody under 26 U.S.C. 5364. Upon
release of the wine from customs custody, the person bringing in the
wine is relieved of the liability for the tax.
(c) Transfer of beer from customs custody to brewery premises. Bulk
beer brought into the United States from the Virgin Islands may, under
the provisions of this subpart, be withdrawn by the proprietor of a
bonded brewery from customs custody and transferred in bulk containers
to the bonded brewery premises, without payment of the internal revenue
tax imposed on such beer by 26 U.S.C. 7652. Beer so withdrawn and
transferred to bonded brewery premises may be withdrawn
[[Page 40429]]
from a brewery's internal revenue bond for any purpose authorized by 26
U.S.C. chapter 51, in the same manner as domestic beer. The proprietor
of the bonded brewery to which the beer is transferred becomes liable
for the tax on beer withdrawn from customs custody under 26 U.S.C.
5418. Upon release of the beer from customs custody, the person
bringing in the beer from the Virgin Islands is relieved of the
liability for the tax.
0
43. Section 26.301 is revised to read as follows:
Sec. 26.301 Record of shipment.
(a) Preparation of records. (1) The importer bringing distilled
spirits, natural wines, or beer into the United States from the Virgin
Islands under this subpart must prepare a transfer record according to
Sec. 26.273a. A separate transfer record must be prepared for each
conveyance. The importer bringing in the distilled spirits, natural
wines, or beer must maintain these records and any additional records
necessary to substantiate the information provided under paragraph (b)
of this section, in accordance with the record retention requirements
of Sec. 26.276, and must make them available upon request of the
appropriate TTB officer or a customs officer. The importer must also
provide a copy of the record to the recipient, if the recipient is not
the importer.
(2) For distilled spirits, if the spirits are in packages, the
person bringing the spirits into the United States must be in
possession of a package gauge record for each bulk container, as
provided in Sec. 26.273b, at the time the distilled spirits are
withdrawn from customs custody. The package gauge record may be
prepared by the insular gauger at the time of their withdrawal from an
insular bonded warehouse, as provided in Sec. 26.204, or, if not
prepared by the insular gauger, the package gauge record must be
prepared by the insular consignor.
(b) Reporting information for release from customs custody. A
person bringing distilled spirits, natural wines, or beer into the
United States from the Virgin Islands under this subpart, if filing
electronically, must file with U.S. Customs and Border Protection (CBP)
the information specified in this section at the time of filing the
entry or entry summary, as appropriate, along with any other
information that is required by CBP to be filed with the entry or entry
summary for purposes of administering the provisions of the Internal
Revenue Code and Federal Alcohol Administration Act (FAA Act). Any
information required by this section that is also required by, and
filed with, CBP as part of the entry or entry summary for purposes of
meeting CBP requirements will satisfy the requirements of this section.
Regardless of the method of filing, the importer must retain all of the
information required by this section and any supporting documentation
and make it available for inspection by the appropriate TTB officer or
a customs officer. The following information is required:
(1) The number of the importer's basic permit issued under the FAA
Act and the regulations issued pursuant to the FAA Act (27 CFR part 1),
if applicable, as required by 27 CFR 1.20, and the importer's employer
identification number (EIN) associated with that permit;
(2) The name and address of the ultimate consignee;
(3) The TTB-issued IRC registry number of the ultimate consignee;
(4) The quantity of each distilled spirit, natural wine, or beer in
the shipment (in proof liters or proof gallons, for distilled spirits);
and
(5) Information identifying each product for Internal Revenue Code
and/or FAA Act purposes.
(c) The importer bringing the distilled spirits, wines, or beer
into the United States must maintain records to substantiate the
information required under paragraph (b) of this section in accordance
with the record retention requirements of Sec. 26.276 and must provide
them upon request of the appropriate TTB officer or a customs officer.
(Approved by the Office of Management and Budget under control
number 1513-0064)
Sec. 26.302 [Removed and Reserved]
0
44. Section 26.302 is removed and reserved.
Sec. 26.303 [Removed and Reserved]
0
45. Section 26.303 is removed and reserved.
Sec. 26.314 [Amended]
0
46. In Sec. 26.314:
0
a. Redesignate paragraphs (b)(1) through (5) as (b)(1)(i) through (v);
0
b. Designate the text after the paragraph (b) heading as new paragraph
(b)(1);
0
c. Designate the undesignated concluding paragraph as paragraph (b)(2)
and remove the last sentence; and
0
d. Remove the Office of Management and Budget control number reference
from the end of the section and add in its place the Office of
Management and Budget control number reference ``(Approved by the
Office of Management and Budget under control number 1513-0020)''.
0
47. Section 26.316 is revised to read as follows:
Sec. 26.316 Bottles not constituting approved containers.
The appropriate TTB officer is authorized to disapprove any bottle,
including a bottle of less than 200 mL capacity, for use as a liquor
bottle which he determines to be deceptive. Disapproved bottles may not
be brought into the United States from the U.S. Virgin Islands or from
Puerto Rico.
0
48. Section 26.318 is revised to read as follows:
Sec. 26.318 Liquor bottles not eligible to be brought into the United
States.
(a) General. Except as provided in paragraph (b) of this section,
filled liquor bottles that do not conform to the provisions of this
subpart may not be brought into the United States from Puerto Rico or
the Virgin Islands.
(b) Exception. Upon receipt of a letterhead application, the
appropriate TTB officer may, in nonrecurring cases, authorize a person
to bring into the United States liquor bottles that do not conform to
the provisions of this part if that TTB officer determines that the
nonconformance is due to an unintentional error; the nonconforming
liquor bottle is determined not to be deceptive, as provided in Sec.
26.316; and the entry of the nonconforming liquor bottle will not
jeopardize the revenue. The person bringing such liquor bottles into
the United States under such TTB authorization must maintain for not
less than three years from the date that the liquor bottles were
released from customs custody proof of that authorization and make it
available upon request by the appropriate TTB officer or a customs
officer.
(Approved by the Office of Management and Budget under control
number 1513-0064)
Sec. 26.319 [Amended]
0
49. Section 26.319 is amended by:
0
a. Removing the words ``filed in triplicate''; and
0
b. Removing ``Sec. 31.263'' and adding in its place ``Sec. 31.203''.
Sec. 26.331 [Amended]
0
50. Section 26.331 is amended by removing the words ``, in
triplicate,'' and by revising the Office of Management and Budget
control number reference at the end of the section to read, ``(Approved
by the Office of Management and Budget under control number 1513-
0064)''.
[[Page 40430]]
PART 27--IMPORTATION OF DISTILLED SPIRITS, WINES, AND BEER
0
51. The authority citation for part 27 is revised to read as follows:
Authority: 5 U.S.C. 552(a), 19 U.S.C. 81c, 1202; 26 U.S.C. 5001,
5007, 5008, 5010, 5041, 5051, 5054, 5061, 5121, 5122-5124, 5201,
5205, 5207, 5232, 5273, 5301, 5313, 5382, 5555, 6109, 6302, 7805.
0
52. Section 27.11 is amended by:
0
a. Adding in alphabetical order definitions of ``Bonded wine cellar''
and ``Brewery'';
0
b. Revising the definitions of ``Bulk container'' and ``Customs
officer'';
0
c. Removing the definition of ``District director of customs''; and
0
d. Adding in alphabetical order definitions of ``IRC registry number'',
``Natural wine'', and ``Proof liter''.
The revisions and additions read as follows:
Sec. 27.11 Meaning of terms.
* * * * *
Bonded wine cellar. Premises established under part 24 of this
chapter.
Brewery. The land and buildings described in the brewer's notice,
TTB Form 5130.10, where beer is to be produced and packaged.
Bulk container. When used in the context of distilled spirits, the
term ``bulk container'' means any container having a capacity larger
than one wine gallon. When used in the context of wine, the term ``bulk
container'' means any container having a capacity larger than 60
liters. When used in the context of beer, the term ``bulk container''
means any container having a capacity larger than one barrel of 31
gallons.
* * * * *
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.
* * * * *
IRC registry number. The number assigned by TTB to each distilled
spirits plant, bonded wine cellar, taxpaid wine bottling house, bonded
wine warehouse, or brewery upon approval of an application made
pursuant to Internal Revenue Code of 1986 requirements (26 U.S.C. 5171,
5351-5353, or 5401).
* * * * *
Natural wine. The product of the juice or must of sound, ripe
grapes or other sound, ripe fruit (including berries) made with any
proper cellar treatment and containing not more than 21 percent by
weight (21 degrees Brix dealcoholized wine) of total solids. For
purposes of this definition, proper cellar treatment means a production
practice or procedure authorized for natural wine by part 24 of this
chapter, or, in the case of natural wine produced and imported subject
to an international agreement or treaty, those practices and procedures
acceptable to the United States under that agreement or treaty.
* * * * *
Proof liter. A liter of liquid at 60 degrees Fahrenheit which
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.
* * * * *
0
53. Section 27.48 is revised to read as follows:
Sec. 27.48 Imported distilled spirits, wines, and beer.
(a) Distilled spirits, wines, and beer imported subject to tax--(1)
General. Internal revenue taxes payable on imported distilled spirits,
wines, and beer are collected, accounted for, and deposited as internal
revenue collections by U.S. Customs and Border Protection (CBP) in
accordance with CBP requirements. The tax must be paid on the basis of
a return, and the customs form (including any electronic transmissions)
by which the distilled spirits, wines, or beer are duty- and tax-paid
to CBP will be treated as a return for purposes of this part.
(2) Required information. In the case of distilled spirits, wines,
and beer imported into the United States subject to tax, the importer,
if filing electronically, must file the information specified in this
section with the entry or entry summary, as appropriate, along with any
other information that is required by CBP to be filed with the entry or
entry summary for purposes of determining and collecting the Federal
excise tax and administering the provisions of the Internal Revenue
Code and Federal Alcohol Administration Act (FAA Act). Any information
required by this section that is also required by, and filed with, CBP
as part of the entry or entry summary for purposes of meeting CBP
requirements will satisfy the requirements of this section. For all
distilled spirits, wines, and beer imported under this paragraph, the
following information is required:
(i) The number of the importer's basic permit issued under the FAA
Act and the regulations issued pursuant to the FAA Act (27 CFR part 1),
if applicable, as required by 27 CFR 1.20 and 1.58, and the importer's
name, address, and employer identification number (EIN) associated with
that permit;
(ii) The TTB-assigned number of the valid certificate of label
approval (COLA), if applicable, as required by 27 CFR 4.40 in the case
of wine, 27 CFR 5.51 in the case of distilled spirits, and 27 CFR 7.31
in the case of malt beverages;
(iii) The name and address of the ultimate consignee;
(iv) The quantity of each product (for distilled spirits, in proof
liters or proof gallons; for beer and wine, in gallons or liters); and
(v) Information identifying each product for Internal Revenue Code
and/or FAA Act purposes, as applicable.
(b) Distilled spirits, natural wines, and beer transferred without
payment of tax to internal revenue bond. Distilled spirits, natural
wine (as defined in Sec. 27.11) and beer in bulk containers may be
released from customs custody without payment of tax under the
provisions of subpart L of this part and thereafter removed subject to
tax from distilled spirits plants, bonded wine cellars, and breweries,
respectively. The tax will be collected and paid under the provisions
of part 19, 24 or 25 of this chapter, respectively.
(c) Entry for warehousing--(1) General. Except as provided in
paragraph (c)(2) of this section, in the case of an entry for
warehousing (that is, products transferred directly to a customs bonded
warehouse or foreign trade zone), the last day for payment of the tax
shall not be later than the 14th day after the last day of the
semimonthly period during which the products are removed from the first
such warehouse, even if the products are removed from that customs
bonded warehouse or foreign trade zone for transfer to another customs
bonded warehouse or foreign trade zone.
(2) Entry for warehousing of products destined for export.
Paragraph (c)(1) of this section does not apply to any distilled
spirits, wines, or beer entered for warehousing and then removed for
transfer to another custom bonded warehouse or foreign trade zone that
is shown to the satisfaction of the Secretary to be destined for
export.
(d) Records. Regardless of the method of filing, the importer must
maintain as a record the information required by this section, any
information provided to CBP to meet CBP requirements, and any
supporting documentation. These records must be maintained in
accordance with the record retention requirements of Sec. 27.137, and
the records must be made available upon request of the appropriate TTB
officer or a customs officer.
(Approved by the Office of Management and Budget under control
number 1513-0064)
[[Page 40431]]
(26 U.S.C. 5001, 5054, 5061, 5232, 5364, 5418)
0
54. Section 27.55 and the undesignated center heading preceding it are
revised to read as follows:
Federal Alcohol Administration Act Requirements for Importation of
Distilled Spirits, Wines, and Malt Beverages
Sec. 27.55 Requirements of the Federal Alcohol Administration Act.
(a) General. The Federal Alcohol Administration Act (FAA Act) and
the regulations issued under the FAA Act (parts 1, 4, 5, and 7 of this
chapter) provide that any person, except an agency of a State or
political subdivision thereof or any officer or employee of any such
agency, who imports distilled spirits, wines, or malt beverages for
nonindustrial use must comply with certain permit and labeling
requirements as described in this section. See 27 CFR 1.10 for the
definitions of distilled spirits, wine, and malt beverages under the
FAA Act. Tourists importing distilled spirits, wines, or malt beverages
into the United States for personal or other noncommercial use are not
subject to the provisions of the FAA Act or regulations issued pursuant
to the FAA Act (parts 1, 4, 5, and 7 of this chapter).
(b) FAA Act basic permit. Any person, except an agency of a State
or a political subdivision thereof or any officer or employee of any
such agency, who intends to engage in the business of importing
distilled spirits, wines, or malt beverages into the United States
must, prior to importing such products into the United States, obtain
an importer's basic permit, in accordance with the requirements of the
FAA Act and regulations issued pursuant to the FAA Act, and must file
with U.S. Customs and Border Protection (CBP) the number associated
with this permit with the filing of the customs entry when filing
electronically as required under 27 CFR 1.58. Also, as required under
Sec. 1.58 of this chapter, if the importer is not filing
electronically, the importer must have a copy of the FAA Act basic
permit and make it available upon request of the appropriate TTB
officer or a customs officer.
(c) Certificate of label approval. Any person and any agency of a
State or political subdivision thereof or any officer or employee of
such agency, removing for commercial purposes containers of distilled
spirits, wines, or malt beverages from customs custody for consumption,
when filing electronically, must provide the TTB-assigned
identification number of the valid certificate of label approval (COLA)
for the distilled spirits, wines, or malt beverages with the filing of
the customs entry in accordance with the requirements of 27 CFR 4.40 in
the case of wine, 27 CFR 5.51 in the case of distilled spirits, or 27
CFR 7.31 in the case of malt beverages. Also, as required under 27 CFR
4.40, 5.51, and 7.31, if the importer is not filing electronically, the
importer must provide a copy of the valid COLA to CBP at time of entry.
(d) Foreign certificates. Every person and any agency of a State or
political subdivision thereof or any officer or employee of such
agency, importing for commercial purposes into the United States for
consumption containers of distilled spirits or wines that require a
certificate under 27 CFR 4.45 in the case of wine or 27 CFR 5.52 in the
case of distilled spirits must be in possession of the certificate (and
accompanying invoice, if applicable) at the time of release from
customs custody.
(Sec. 3, 49 Stat. 978, as amended; 27 U.S.C. 203)
0
55. Section 27.76 is amended by:
0
a. In paragraph (a), by removing ``TTB Form 5530.5 (1678)'' and adding
in its place ``TTB Form 5154.1 (formerly TTB Form 5530.5 and ATF Form
1678)'';
0
b. Revising paragraph (d);
0
c. Adding paragraph (e); and
0
d. Revising the OMB control number reference at the end of the section.
The revision and additions read as follows:
Sec. 27.76 Approval and certification of wine and flavors content.
* * * * *
(d) At the time of filing the entry summary, the importer must have
the certificate in its possession and make it available upon request of
the appropriate TTB officer or a customs officer. For distilled spirits
withdrawn from customs custody under the provisions of subpart L of
this part, the importer must furnish a copy of the certificate to the
proprietor of the distilled spirits plant to which the distilled
spirits are transferred.
(e) The importer must maintain a copy of the certificate in
accordance with the record retention requirements of Sec. 27.137 and
must make it available upon request of the appropriate TTB officer or a
customs officer.
(Approved by the Office of Management and Budget under control
number 1513-0064)
* * * * *
0
56. Section 27.77 is amended by:
0
a. Revising the second sentence of paragraph (d);
0
b. Adding paragraphs (e) and (f); and
0
c. Revising the OMB control number reference at the end of the section.
The revisions and additions read as follows:
Sec. 27.77 Standard effective tax rate.
* * * * *
(d) * * * At the time of filing the entry summary, the importer
must have the approval in its possession and make it available upon
request of the appropriate TTB officer or a customs officer. * * *.
(e) The importer must maintain a copy of the approval in accordance
with the record retention requirements of Sec. 27.137 and must make it
available upon request of the appropriate TTB officer.
(f) For distilled spirits withdrawn from customs custody under the
provisions of subpart L of this part, the importer must furnish a copy
of the approval to the proprietor of the distilled spirits plant to
which the distilled spirits are transferred.
(Approved by the Office of Management and Budget under control
number 1513-0064)
Sec. 27.120 [AMENDED]
0
57. In Sec. 27.120, remove ``Regulation 3 (27 CFR part 3)'' and add
``subpart E of part 1 of this chapter'' in its place.
0
58. In Sec. 27.137, the first sentence is revised and an Office of
Management and Budget control number reference is added at the end of
the section to read as follows:
Sec. 27.137 Retention.
All records required by this part, documents or copies of documents
supporting these records (including data filed with U.S. Customs and
Border Protection (CBP) pursuant to CBP requirements), and file copies
of reports required by this part, must be retained for not less than
three years following each withdrawal from customs custody, and during
this period must be made available upon request of the appropriate TTB
officer or a customs officer.
* * * * *
(Approved by the Office of Management and Budget under control
number 1513-0064 and 1513-0088)
0
59. Section 27.138 is revised to read as follows:
Sec. 27.138 Transfer record.
(a) Distilled spirits. The transfer record prescribed in Sec.
27.172 must identify the importer and show the following:
(1) The date prepared;
(2) Serial number of the transfer record, beginning with ``1'' each
January 1;
[[Page 40432]]
(3) The name, address, and TTB-issued IRC registry number
(distilled spirits plant number) of the proprietor receiving the
spirits from customs custody;
(4) The country of origin of the distilled spirits;
(5) The name of the foreign producer;
(6) The kind of spirits;
(7) The age, in years, months and days of the spirits;
(8) The proof of the spirits;
(9) The type and number of containers;
(10) The proof gallons of spirits in the shipment; and
(11) The customs entry number and the amount of duty paid.
(b) Wine. The transfer record prescribed in Sec. 27.172 must
identify the importer and show the following:
(1) The date prepared;
(2) The name and address of the bonded wine cellar receiving the
wine from customs custody;
(3) The TTB-issued IRC registry number of the bonded wine cellar
receiving the wine from customs custody;
(4) The number of containers transferred and quantity of wine in
each container;
(5) The country of origin of the wine;
(6) The customs entry number and amount of duty paid;
(7) The kind of wine; and
(8) The foreign producer.
(c) Beer. The transfer record prescribed in Sec. 27.172 must
identify the importer and show the following:
(1) The date prepared;
(2) The name and address of the brewery receiving the beer from
customs custody;
(3) The TTB-issued IRC registry number of the brewery receiving the
beer from customs custody;
(4) The number of containers transferred and quantity of beer in
each container;
(5) The country of origin of the beer;
(6) The customs entry number and the amount of duty paid;
(7) The kind of beer; and
(8) The foreign brewer.
(Approved by the Office of Management and Budget under control
number 1513-0064)
0
60. Section 27.140 is amended by:
0
a. Removing from paragraph (a) the definitions of ``Importer'' and
``Natural wine'';
0
b. Revising in paragraph (a) the definition of ``Proper cellar
treatment'';
0
c. Revising the introductory text of paragraph (b)(1), and
0
d. Adding an Office of Management and Budget control number reference
at the end of the section.
The revisions and addition read as follows:
Sec. 27.140 Certification requirements for wine.
(a) * * *
Proper cellar treatment means a production practice or procedure
authorized for natural wine by part 24 of this chapter, or, in the case
of natural wine produced and imported subject to an international
agreement or treaty, those practices and procedures acceptable to the
United States under that agreement or treaty.
(b) * * * (1) General. Except as otherwise provided in paragraph
(b)(2) of this section, 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. The importer of bottled wine must
be in possession of the certificate at the time of filing the entry
with CBP, and the bottler of bulk wine must be in possession of the
certificate at the time the wine is withdrawn from the premises where
bottled. The importer or bottler, as appropriate, must provide the
certificate upon request by the appropriate TTB officer or a customs
officer. This requirement may be satisfied by providing the original
certification, or a photocopy or electronic copy of the certification.
The appropriate TTB officer or a customs officer may request, and the
importer or bottler must provide, such information for a period of
three years from the date that the product covered by the certificate
was released from customs custody or removed from the bottler's
premises, as applicable. The certification:
* * * * *
(Approved by the Office of Management and Budget under control
numbers 1513-0064 and 1513-0119)
0
61. The heading of subpart L is revised to read as follows:
Subpart L--Transfer of Distilled Spirits, Natural Wines, and Beer
Without Payment of Tax, From Customs Custody to Internal Revenue
Bond
0
62. Section 27.171 is amended by:
0
a. Removing ``(a)'' and ``(b)'' from the second sentence;
0
b. Designating the existing text as paragraph (a);
0
c. Adding a heading to paragraph (a);
0
d. Adding paragraphs (b) and (c); and
0
e. Revising the authority citation at the end of the section.
The additions and revision read as follows:
Sec. 27.171 General provisions.
(a) Transfer of bulk distilled spirits from customs custody to
bonded premises of a distilled spirits plant. * * *
(b) Transfer of bulk natural wine from customs custody to a bonded
wine cellar. Imported ``natural wine,'' as defined in Sec. 27.11, may,
under the provisions of this subpart, be withdrawn in bulk by the
proprietor of a bonded wine cellar from customs custody and transferred
in bulk containers to the bonded wine cellar without payment of the
internal revenue tax imposed on wine by 26 U.S.C. 5041. Imported wine
so withdrawn and transferred may be withdrawn from a bonded wine
cellar's internal revenue bond for any purpose authorized by 26 U.S.C.
chapter 51, in the same manner as domestic wine. The proprietor of the
bonded wine premises to which imported wine is transferred becomes
liable for the tax on wine withdrawn from customs custody under 26
U.S.C. 5364. Upon release of the wine from customs custody, the
importer is relieved of the liability for the tax.
(c) Transfer of beer from customs custody to a brewery. Imported
bulk beer may, under the provisions of this subpart, be withdrawn by
the proprietor of bonded brewery from customs custody and transferred
in bulk containers to bonded brewery premises, without payment of the
internal revenue tax imposed on beer by 26 U.S.C. 5051. Imported beer
so withdrawn and transferred to bonded brewery premises may be
withdrawn from a brewery's internal revenue bond for any purpose
authorized by 26 U.S.C. chapter 51, in the same manner as domestic
beer. The proprietor operating the bonded brewery premises to which
imported beer is transferred becomes liable for the tax on beer
withdrawn from customs custody under 26 U.S.C. 5418. Upon release of
the beer from customs custody, the importer is relieved of the
liability for the tax.
(26 U.S.C. 5232, 5364, and 5418)
0
63. Section 27.172 is revised to read as follows:
Sec. 27.172 Preparation of records and reporting of information for
release of distilled spirits, natural wines, and beer without payment
of tax.
(a) Preparation of records. (1) The person importing distilled
spirits, natural wines, or beer under this subpart must prepare a
transfer record according to Sec. 27.138. A separate transfer record
must be prepared for
[[Page 40433]]
each conveyance. The importer must maintain these records and any
records to substantiate the information required under paragraph (b) of
this section, in accordance with the record retention requirements of
Sec. 27.137, and must make them available upon request of the
appropriate TTB officer or a customs officer. The importer must also
provide a copy of the record to the recipient, if the recipient is not
the importer.
(2) For distilled spirits, if the spirits are in packages, the
importer must prepare a package gauge record according to Sec. 27.139
and maintain it with the transfer record.
(b) Reporting information for release from customs custody. In the
case of distilled spirits, natural wines, and beer imported into the
United States without payment of tax under this subpart, the importer,
if filing electronically, must file with U.S. Customs and Border
Protection (CBP) the information specified in this section at the time
of filing the entry or entry summary, as appropriate, along with any
other information that is required by CBP to be filed with the entry or
entry summary for purposes of administering the provisions of the
Internal Revenue Code and Federal Alcohol Administration Act (FAA Act).
Any information required by this section that is also required by, and
filed with, CBP as part of the entry or entry summary for purposes of
meeting CBP requirements will satisfy the requirements of this section.
Regardless of the method of filing, the importer must retain as a
record the information required by this section, any information
provided to CBP to meet CBP requirements, and any supporting
documentation and make such records available for inspection by the
appropriate TTB officer or a customs officer. The following information
is required:
(1) The number of the importer's basic permit issued under the FAA
Act and the regulations issued pursuant to the FAA Act (27 CFR part 1),
if applicable, as required by 27 CFR 1.20, and the importer's employer
identification number (EIN) associated with that permit;
(2) The name and address of the ultimate consignee;
(3) The TTB-issued IRC registry number of the ultimate consignee;
(4) The quantity of each distilled spirit, wine, or beer in the
shipment (in proof liters or proof gallons, for distilled spirits); and
(5) Information identifying each product for Internal Revenue Code
and/or FAA Act purposes.
(Approved by the Office of Management and Budget under control
number 1513-0064)
Sec. 27.173 [Removed and Reserved]
0
64. Section 27.173 is removed and reserved.
0
65. In Sec. 27.175, the section heading is revised to read as follows:
Sec. 27.175 Receipt of distilled spirits by consignee.
* * * * *
0
66. Section 27.183 is revised to read as follows:
Sec. 27.183 Use of Government agency permit, Form 5150.33.
Each Government agency must retain the original of its permit, Form
5150.33, on file. In the case of an agency holding a single permit for
use of its sub-agencies, an attachment to the permit must list all
locations authorized to withdraw spirits free of tax from customs
custody. When withdrawing spirits free of tax from a port of entry, the
agency, if filing electronically, must file its TTB-issued permit
number along with the filing of any other information required by U.S.
Customs and Border Protection to be filed with the customs entry. If
the agency is not filing electronically, rather than file the TTB-
issued permit number, the agency must make a copy of the permit
available to the customs officer upon request.
(Sec. 201, Pub. L. 85-859, 72 Stat. 1375, as amended (26 U.S.C.
5313))
0
67. Section 27.184 is revised to read as follows:
Sec. 27.184 Information required for entry.
Government agencies importing tax-free spirits under this subpart
must file, along with filing the customs entry or entry summary, the
total quantity of the spirits to be entered and, if filing
electronically, the permit number as required under Sec. 27.183.
Sec. 27.185 [Removed]
0
68. Section 27.185 is removed.
Sec. 27.204 [Amended]
0
69. Section 27.204 is amended by:
0
a. Redesignating paragraphs (b)(1) through (5) as (b)(1)(i) through
(v);
0
b. Designate the text after the paragraph (b) heading as new paragraph
(b)(1);
0
c. Designating the undesignated concluding paragraph as paragraph
(b)(2) and removing the last sentence; and
0
d. Adding an Office of Management and Budget control number reference
to read ``(Approved by the Office of Management and Budget under
control number 1513-0020)'' at the end of the section.
0
70. Section 27.206 is amended by revising the last sentence to read as
follows:
Sec. 27.206 Bottles not constituting approved containers.
* * * Disapproved bottles may not be imported into the United
States.
0
71. Section 27.208 is revised to read as follows:
Sec. 27.208 Liquor bottles not eligible for release from customs
custody.
Upon receipt of a letterhead application, the appropriate TTB
officer may, in nonrecurring cases, authorize a person to bring into
the United States liquor bottles that do not conform to the provisions
of this part if that TTB officer determines that the nonconformance is
due to an unintentional error; the nonconforming liquor bottle is
determined not to be deceptive, as provided in Sec. 27.206; and the
entry of the nonconforming liquor bottle will not jeopardize the
revenue. The person bringing such liquor bottles into the United States
under TTB authorization must maintain proof of such authorization for
not less than three years from the date that the liquor bottles were
released from customs custody and make it available upon request by the
appropriate TTB officer or a customs officer.
(Approved by the Office of Management and Budget under control
number 1513-0064)
Sec. 27.209 [Amended]
0
72. Section 27.209 is amended by removing the words ``filed in
triplicate''; by removing ``Sec. 31.263'' and adding in its place
``Sec. 31.203'' and by removing the Office of Management and Budget
control number reference at the end of the section and adding in its
place the Office of Management and Budget control number reference
``(Approved by the Office of Management and Budget under control number
1513-0064)''.
Sec. 27.221 [Amended]
0
73. Section 27.221 is amended in the introductory text of paragraph (a)
by removing the words ``, in triplicate,'' and by removing the Office
of Management and Budget control number reference at the end of the
section and adding in its place the Office of Management and Budget
control number reference ``(Approved by the Office of Management and
Budget under control number 1513-0064)''.
[[Page 40434]]
PART 41--IMPORTATION OF TOBACCO PRODUCTS, CIGARETTE PAPERS AND
TUBES, AND PROCESSED TOBACCO
0
74. The authority citation for part 41 is revised to read as follows:
Authority: 26 U.S.C. 5701-5705, 5708, 5712, 5713, 5721-5723,
5741, 5754, 5761-5763, 6301, 6109, 6302, 6313, 6402, 6404, 7101,
7212, 7342, 7606, 7651, 7652, 7805; 31 U.S.C. 9301, 9303, 9304,
9306.
0
75. Section 41.11 is amended by revising the definition of ``Customs
officer'' to read as follows:
Sec. 41.11 Meaning of terms.
* * * * *
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.
* * * * *
0
76. Section 41.81 is amended by revising paragraphs (b) and (c) and
adding an Office of Management and Budget control number reference at
the end of the section to read as follows:
Sec. 41.81 Taxpayment.
* * * * *
(b) Method of payment. Except for articles imported or brought into
the United States as provided in Sec. Sec. 41.85 and 41.85a, the
internal revenue tax must be determined before the tobacco products,
cigarette papers, or cigarette tubes are released from customs custody.
The tax must be paid on the basis of a return, and the customs form
(including any electronic transmissions) by which the tobacco products,
cigarette papers, or cigarette tubes are duty- and tax-paid to CBP will
be treated as a return for purposes of this part.
(c) Required information. In the case of tobacco products and
cigarette papers and tubes imported into the United States for
consumption, the importer, if filing electronically, must file with
U.S. Customs and Border Protection (CBP) the information specified in
paragraphs (c)(1) through (7) of this section at the time of filing the
entry or entry summary, as appropriate, along with any other
information that is required by CBP to be filed with the entry or entry
summary for purposes of determining and collecting the Federal excise
tax and administering the provisions of the Internal Revenue Code. Any
information required under paragraphs (c)(1) through (7) of this
section that is required by, and filed with, CBP as part of the entry
or entry summary for purposes of meeting CBP requirements will also
satisfy the requirements of this section. Regardless of the method of
filing, the importer must retain as a record the information required
by this section, any information provided to CBP to meet CBP
requirements, and any supporting documentation and make such records
available upon request by the appropriate TTB officer or a customs
officer.
(1) All tobacco products. For all tobacco products, the following
information is required:
(i) The number of the tobacco product importer permit that is
issued under subpart K of this part;
(ii) The employer identification number (EIN) assigned to the
importer by the Internal Revenue Service and provided by the importer
on its permit application to TTB made on TTB Form 5230.4;
(iii) The name and address of the ultimate consignee;
(iv) The information specific to each tobacco product set forth in
paragraphs (c)(2) through (6) of this section.
(2) Cigarettes. For cigarettes, in addition to the information
required in paragraph (c)(1) of this section, the importer must provide
a description of the product for Internal Revenue Code purposes,
including ``cigarettes'' and either ``small'' (or ``class A'') or
``large'' (or ``class B'') and must also provide the number of
cigarettes.
(3) Cigars. For cigars, in addition to the information required in
paragraph (c)(1) of this section, the importer must provide:
(i) The number of cigars imported under each Harmonized Tariff
Schedule of the United States (HTSUS) code number;
(ii) The description of the cigars for Internal Revenue Code
purposes, including ``cigars'' and either ``large'' or ``small'';
(iii) For large cigars with a sale price of $763.222 or less per
1,000, the number and sale price (the price for which sold by the
importer) per 1,000 of such cigars; and
(iv) For large cigars with a sale price of more than $763.222 per
1,000, the number of such cigars.
(4) Smokeless tobacco. For smokeless tobacco, in addition to the
information required in paragraph (c)(1) of this section, the importer
must provide a description of the product for Internal Revenue Code
purposes, as either ``chewing tobacco'' or ``snuff'' and will state the
number of pounds and ounces or kilograms and grams of the product.
(5) Pipe tobacco. For pipe tobacco, in addition to the information
required in paragraph (c)(1) of this section, the importer must provide
a description of the product under the Internal Revenue Code, as ``pipe
tobacco,'' and will also state the number of pounds and ounces or
kilograms and grams of the product.
(6) Roll-your-own tobacco. For roll-your-own tobacco, in addition
to the information required in paragraph (c)(1) of this section, the
importer must provide a description of the product for Internal Revenue
Code purposes, as ``roll-your-own tobacco,'' ``cigarette tobacco,''
``cigarette wrapper,'' ``cigar tobacco,'' or ``cigar wrapper.'' The
importer must also state the number of pounds and ounces or kilograms
and grams of the product.
(7) Cigarette papers and cigarette tubes. For cigarette papers and
cigarette tubes, the importer must provide:
(i) The classification of the product for Internal Revenue Code
purposes, including either ``cigarette papers'' or ``cigarette tubes''
and an indication of whether the length of the papers or tubes is over
6\1/2\ inches;
(ii) The employer identification number (EIN) assigned to the
importer by the Internal Revenue Service;
(iii) The name and address of the ultimate consignee; and
(iv) The total taxable quantity of each.
* * * * *
(Approved by the Office of Management and Budget under control
number 1513-0064)
* * * * *
0
77. Section 41.84 is added to read as follows:
Sec. 41.84 Entry for warehousing.
(a) General. Except as provided in paragraph (b) of this section,
in the case of an entry for warehousing (that is, tobacco products,
cigarette papers, or cigarette tubes transferred directly to a customs
bonded warehouse or foreign trade zone), the last day for payment of
the tax shall not be later than the 14th day after the last day of the
semimonthly period during which the products are removed from the first
such warehouse, even if the tobacco products, cigarette papers, or
cigarette tubes are removed from that customs bonded warehouse or
foreign trade zone for transfer to another customs bonded warehouse or
foreign trade zone.
(b) Entry for warehousing of products destined for export.
Paragraph (a) of this section does not apply to tobacco products,
cigarette papers, or cigarette tubes entered for warehousing and then
removed for transfer to another custom bonded warehouse or foreign
trade zone that are shown to the satisfaction of the Secretary to be
destined for export.
(26 U.S.C. 5703(b)(2)(B)(ii), (iii), and (iv))
0
78. Section 41.86 is revised to read as follows:
[[Page 40435]]
Sec. 41.86 Entry process for releases without payment of tax.
(a)(1) General. Except as provided in paragraph (c) of this
section, in order for tobacco products or cigarette papers or tubes to
be released from customs custody without payment of tax under internal
revenue bond, as provided in 26 U.S.C. 5704(c) or (d), the information
required by this paragraph must be filed electronically with U.S.
Customs and Border Protection (CBP). The information must be filed with
CBP at the time of filing the entry or entry summary, as appropriate,
and it must be filed along with any other information that is required
by CBP for purposes of determining and collecting the Federal excise
tax and administering the provisions of the Internal Revenue Code. Any
information required under paragraph (a)(2) of this section that is
submitted to CBP as part of the entry or entry summary for purposes of
meeting CBP requirements will also satisfy the requirements of this
section. Regardless of the method of filing, the importer must retain
as a record the information required by this section, any information
provided to CBP for CBP purposes, and any supporting documentation and
such records must be available for inspection upon request by the
appropriate TTB officer or a customs officer.
(2) Information required. The manufacturer of tobacco products or
cigarette papers or tubes or export warehouse proprietor who wishes to
obtain the release of tobacco products or cigarette papers or tubes as
described in paragraph (a)(1) of this section must provide the
following information, as applicable:
(i) The number of the permit issued under 27 CFR part 40 to the
manufacturer of tobacco products or export warehouse proprietor, or the
TTB-assigned number of the manufacturer of cigarette papers or tubes,
to whom the products are shipped or consigned;
(ii) The employer identification number (EIN), assigned by the
Internal Revenue Service, of the manufacturer of tobacco products, the
manufacturer of cigarette papers or tubes, or the export warehouse
proprietor to whom the products are shipped or consigned;
(iii) The name and address of the ultimate consignee, consistent
with the name and address on the permit issued under part 40 of this
chapter;
(iv) For tobacco products, the number of the permit, issued under
subpart K of this part, of the importer;
(v) For tobacco products, the employer identification number (EIN)
assigned to the importer by the Internal Revenue Service and provided
to TTB by the importer on its permit application to TTB on TTB Form
5230.4;
(vi) A description of the product consistent with the tax
classification of the product under the Internal Revenue Code as
described in Sec. 41.81 (for example, ``large cigars''); and
(vii) The quantity of the product for Federal excise tax purposes,
by sticks or by pounds and ounces (or kilograms and grams), as
applicable.
(b) Releases without payment of tax--(1) Tobacco products or
cigarette papers or tubes put up in packages. Tobacco products or
cigarette papers or tubes put up in packages, as defined at Sec.
41.11, may be released without payment of tax only for delivery to the
proprietor of an export warehouse (as provided in 26 U.S.C. 5704(c))
or, if classified under chapter 98, subchapter I of the Harmonized
Tariff Schedule of the United States (relating to duty on certain
articles exported and returned), for delivery to the original
manufacturer of such tobacco products or cigarette papers or tubes or
to the proprietor of an export warehouse authorized by such
manufacturer to receive them (as provided in 26 U.S.C. 5704(d)). If the
information required in paragraph (a)(2)(i) through (iii) of this
section is not filed with the entry or entry summary, as appropriate,
or, if the information required in paragraph (c) of this section is not
made available to CBP upon request, the tobacco products, cigarette
papers, or cigarette tubes are not eligible for release from customs
custody for consumption, and no person may remove such products from
customs custody without payment of tax and without meeting requirements
related to the release of tobacco products, cigarette papers, or
cigarette tubes from customs custody subject to tax.
(2) Tobacco products or cigarette papers or tubes not put up in
packages. Tobacco products or cigarette papers or tubes not put up in
packages, as defined at Sec. 41.11, may not be released from customs
custody subject to tax, and no person may obtain release of such
products from customs custody. Tobacco products or cigarette papers or
tubes not put up on packages may be released from customs custody
without payment of tax for delivery to the proprietor of an export
warehouse, or to a manufacturer of tobacco products or cigarette papers
or tubes, as provided in 26 U.S.C. 5704(c). As a result, if the
information required in paragraphs (a)(2)(i) through (iii) of this
section is not filed with the entry or entry summary, as appropriate,
or, if the information required in paragraph (c) of this section is not
made available to CBP upon request, tobacco products or cigarette
papers or tubes not put up in packages are not eligible for release
from customs custody for consumption, and no person may remove such
product from customs custody.
(c) Filing on paper. A manufacturer or export warehouse proprietor
who wants to obtain the release of tobacco products or cigarette papers
and tubes from customs custody without payment of tax under its
internal revenue bond, and who does not file electronically, must
prepare a notice of release on TTB F 5200.11 and submit the form to the
appropriate TTB officer in accordance with the instructions on the
form. The appropriate TTB officer will certify on the TTB F 5200.11
that the manufacturer or export warehouse proprietor has TTB
authorization to receive the products. No one filing on paper may
obtain release of the products under this section until they have
received the TTB F 5200.11 certified by the appropriate TTB officer.
The manufacturer or export warehouse must have possession of the TTB F
5200.11, bearing TTB certification, at the time the products are
released from customs custody and must make the form available to a
customs officer upon request at such time. After release of the
products, the TTB F 5200.11 must be retained by the manufacturer or
export warehouse proprietor and made available to the appropriate TTB
officer or a customs officer upon request.
(Approved by the Office of Management and Budget under control
numbers 1513-0025 and 1513-0064)
0
79. Section 41.204 is revised to read as follows:
Sec. 41.204 Records and reports in general.
Every importer of tobacco products or cigarette papers or tubes
must keep records and, when required by this part, submit reports of
all tobacco products released from customs custody under the importer's
TTB permit, including information on the release from customs custody,
the receipt, and the disposition.
(Approved by the Office of Management and Budget under control
numbers 1513-0064 and 1513-0106)
0
80. Section 41.265 is added under the undesignated center heading
Operations of Importers of Processed Tobacco to read as follows:
Sec. 41.265 Processed tobacco importation process.
(a) General. In the case of processed tobacco imported into the
United States,
[[Page 40436]]
the importer, if filing electronically, must file with U.S. Customs and
Border Protection (CBP) the information specified in paragraph (b) of
this section at the time of filing the entry or entry summary, as
appropriate, along with any other information that is required by CBP
to be filed as part of the entry or entry summary for CBP purposes. If
the information required by this section is required by, and filed
with, CBP for purposes of meeting CBP requirements, such filing will
also satisfy the requirements of this section. Regardless of the method
of filing, the importer must retain as a record the information
required by this section, any information required as part of the entry
or entry summary by CBP for CBP purposes, and any supporting
documentation, and must make such records available upon request by the
appropriate TTB officer or a customs officer.
(b) Information required. The following information is required, as
described in paragraph (a) of this section:
(1) The number of the importer's permit issued under subpart K or M
of this part;
(2) The employer identification number (EIN) assigned to the
importer by the Internal Revenue Service and provided to TTB by the
importer on its permit application to TTB on TTB Form 5230.4;
(3) The name and address of the ultimate consignee;
(4) A description of the product as ``processed tobacco'' for
Internal Revenue Code purposes; and
(5) The quantity of processed tobacco.
(Approved by the Office of Management and Budget under control
number 1513-0064)
Signed: January 12, 2016.
John J. Manfreda,
Administrator.
Approved: March 30, 2016.
Timothy E. Skud,
Deputy Assistant Secretary (Tax, Trade and Tariff Policy).
[FR Doc. 2016-14359 Filed 6-20-16; 8:45 am]
BILLING CODE 4810-31-U
