[Federal Register: August 24, 2005 (Volume 70, Number 163)]
[Rules and Regulations]
[Page 49479-49486]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr24au05-1]
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Rules and Regulations
Federal Register
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[[Page 49479]]
DEPARTMENT OF THE TREASURY
Alcohol and Tobacco Tax and Trade Bureau
27 CFR Parts 4, 24 and 27
[T.D. TTB-31]
RIN 1513-AB00
Certification Requirements for Imported Natural Wine (2005R-002P)
AGENCY: Alcohol and Tobacco Tax and Trade Bureau, Treasury.
ACTION: Temporary rule; Treasury decision.
-----------------------------------------------------------------------
SUMMARY: This temporary rule implements the new certification
requirements regarding production practices and procedures for imported
natural wine contained in section 2002 of the Miscellaneous Trade and
Technical Corrections Act of 2004, which amended section 5382 of the
Internal Revenue Code of 1986. We are amending the wine regulations to
incorporate these changes. We also are soliciting comments from all
interested parties on the implementation of these new requirements
through a notice of proposed rulemaking published elsewhere in this
issue of the Federal Register.
DATES: Temporary rule effective August 24, 2005.
FOR FURTHER INFORMATION CONTACT: Gail Davis, International Trade
Division, Alcohol and Tobacco Tax and Trade Bureau (202-927-8110).
SUPPLEMENTARY INFORMATION:
Background
This temporary rule implements section 2002 of the Miscellaneous
Trade and Technical Corrections Act of 2004, Public Law 108-429, 118
Stat. 2434 (``the Act''), signed by President Bush on December 3, 2004.
Section 2002 of the Act revised section 5382(a) of the Internal Revenue
Code of 1986 (IRC), 26 U.S.C. 5382(a), which sets forth standards
regarding what constitutes proper cellar treatment of natural wine. The
Alcohol and Tobacco Tax and Trade Bureau (TTB) is responsible for the
administration of the IRC provisions relating to wine.
The revision of section 5382(a) took effect on January 1, 2005, and
involved the following two principal substantive changes: (1) The
addition of a new paragraph (1)(B) to provide that, in the case of wine
produced and imported subject to an international agreement or treaty,
proper cellar treatment of natural wine includes those practices and
procedures acceptable to the United States under the agreement or
treaty; and (2) the addition of a paragraph (3) setting forth a new
certification requirement regarding production practices and procedures
for imported natural wine produced after December 31, 2004. The new
certification provision directs the Secretary of the Treasury to accept
the practices and procedures used to produce the wine if, at the time
of importation, one of the following conditions is met:
1. The Secretary has on file or is provided with a certification
from the government of the producing country, accompanied by an
affirmed laboratory analysis, that the practices and procedures used to
produce the wine constitute proper cellar treatment under regulations
prescribed by the Secretary;
2. The Secretary has on file or is provided with a certification
required by an international agreement or treaty covering proper cellar
treatment, or the wine is covered by an international agreement or
treaty covering proper cellar treatment that does not require a
certification; or
3. In the case of an importer that owns or controls or that has an
affiliate that owns or controls a winery operating under a basic permit
issued by the Secretary, the importer certifies that the practices and
procedures used to produce the wine constitute proper cellar treatment
under regulations prescribed by the Secretary. For purposes of this
provision, the new paragraph (3) text also defines ``affiliate'' as
having the meaning contained in section 117(a)(4) of the Federal
Alcohol Administration Act (27 U.S.C. 211(a)(4)) and as including ``a
winery's parent or subsidiary or any other entity in which the winery's
parent or subsidiary has an ownership interest.''
Based on the January 1, 2005, effective date of the section 2002
statutory change and the fact that the new requirements apply to
natural wine produced on or after that date, TTB believes that proper
administration and enforcement of those requirements necessitates the
adoption of implementing regulations as a temporary rule with immediate
effect. TTB believes that such implementing action will ensure that
affected industry members have sufficient advance knowledge of the
regulatory requirements, and TTB notes in this regard that, given the
``produced'' statutory standard, the vast majority of, if not all, wine
importers will not have to meet the certification requirements until
the summer of 2005.
Public Meeting; Submission of Comments
TTB held a public meeting regarding these new requirements on
December 15, 2004, in Washington, DC, which was announced in Notice No.
26, published in the Federal Register (69 FR 71873) on December 10,
2004. The purpose of the meeting was to advise the public of TTB's
plans for implementation of the certification requirements and to
answer questions from the public regarding these provisions. TTB also
encouraged, both at the meeting and in Notice No. 26, the submission of
written comments regarding its implementation plans. The public comment
period ended January 15, 2005.
TTB received eleven comments regarding implementation of the new
requirements. Comments were received from: Allied Domecq, on behalf of
Allied Domecq Wines USA; the government of Australia; the California
Fine Wine Alliance; the government of Canada; the Comit[eacute]
Europ[eacute]en des Entreprises Vins; the Distilled Spirits Council of
the United States; the F[eacute]d[eacute]ration des Exportateurs de
Vins et Spiritueux de France; Green Mountain Beverage; Kalik Lewin, on
behalf of the Wine Institute; the National Association of Beverage
Importers, Inc.; and the government of New Zealand.
TTB took into consideration the comments of the parties mentioned
above in drafting this document. The principal points made by the
comment submitters, TTB's responses regarding
[[Page 49480]]
those comments, and TTB's observations on other aspects of the
implementing regulatory texts are set forth below.
The regulatory text to implement the section 2002 statutory changes
is set forth in this document as a new Sec. 27.140 within subpart I
(Importer's Records and Reports) of part 27 of the TTB regulations,
which concerns the importation of distilled spirits, wines, and beer.
The document includes conforming cross-reference changes to
Sec. Sec. 24.301 and 24.302 of the TTB regulations (27 CFR 24.301 and
24.302), which concern records applicable to imported bulk still and
effervescent wines received in bond.
The document also includes a new requirement in our regulations
promulgated under the labeling provisions of the Federal Alcohol
Administration Act (FAA Act), 27 U.S.C. 205(e). This new provision is
in a new paragraph (b) of 27 CFR 4.45, and provides that importers must
submit copies of certifications to TTB for use in enforcing the
labeling provisions of the FAA Act. These certifications will be made
available to the public on the TTB Web site.
1. Filing of Certifications
During the public meeting, TTB stated its intention not to require
presentation of the certification as part of the customs entry process.
TTB took this position based on the view that compliance with the
statutory requirement could be adequately assured if importers simply
maintain the certifications in their records where TTB officers can
inspect them as may be necessary.
Most of the comment submitters addressing this issue agreed with
TTB's position, stating that it will be less burdensome to importers.
However, two of them dissented. One contended that the statute requires
importers to provide the certification, or at least proof that the
certification is on file, to U.S. Customs and Border Protection at the
time of importation. The second dissenting comment submitter argued
that importers should file certifications with TTB, which would then
maintain them in a database that would be available to other importers.
On the other hand, another commenter urged TTB to confirm that the
affirmed laboratory analyses would be treated as confidential
information, asserting that such analyses would necessarily include
sensitive proprietary information.
TTB does not agree that the statutory language requires the
certification to be presented as part of the customs entry process.
Instead, we believe that the requirements of the amended IRC provision
will be satisfied if importers maintain copies of the certifications in
their records. Moreover, noting that the statute requires that the
Secretary have ``on file'' or be ``provided with'' a certification, we
believe the ``provided with'' standard is satisfied by a retention
requirement because, under 27 CFR 27.137, any record required under
part 27 must be retained and made available to TTB for inspection.
Finally, we believe the record retention approach will be least
burdensome for both the U.S. Government and the industry.
However, as stated above, we have decided to require importers to
submit a copy of the certification to TTB under regulations promulgated
under the FAA Act. Section 105(e) of the FAA Act, 27 U.S.C. 205(e),
authorizes TTB, as the delegate of the Secretary of the Treasury, to
issue regulations that will ensure that alcohol beverage labels provide
adequate information to consumers as to the identity and quality of the
product. Pursuant to this authority, we have issued regulations
requiring both domestic and imported wines to be labeled with
information regarding the class and type designation of the product.
See 27 CFR part 4, subparts C and D. These regulations also set forth
rules regarding the blending and cellar treatment of wine. See 27 CFR
4.22.
An importer's inability to provide a certification regarding proper
cellar treatment may indicate that the wine has been treated in a
fashion that would change the class and type designation under the
pertinent regulations in part 4. Moreover, Congress by amending section
5382 has indicated an increased concern with such treatment.
Consequently, TTB will also require importers to submit certifications
of natural wine as part of the label approval process and TTB may use
such information for purposes of verifying the appropriate class and
type designation of the wine under the labeling provisions of part 4.
While TTB is requiring that the certification be submitted as part
of the label approval process, labels for wines for which a
certification is not yet available will be provisionally approved
pending submission of the certification prior to the time of release
from Customs custody. Certifications that are submitted subsequent to
provisional approval must include the label approval number.
Certifications submitted subsequent to provisional approval of the
label approval should be submitted to the Director, Knowledge
Management Staff, with the mailing address as Alcohol and Tobacco Tax
and Trade Bureau, 1310 G Street NW., Suite 200E, Attention: Wine
Certification Docket, Washington, DC 20220.
Furthermore, an importer may rely on a certificate of label
approval approved prior to the effective date of this regulatory
change. In such a case, the importer consequently would not be required
to obtain a new certificate of label approval, but must instead submit
the required certification to the Director, Knowledge Management Staff,
at the address indicated above before the wine in question is released
from Customs custody.
The temporary rule also provides that certifications submitted
under section Sec. 4.45 shall be made available to the public on the
TTB Internet Web site at http://www.ttb.gov, in the same way that approved
labels are made available to the public. Consistent with the objectives
of the FAA Act, TTB believes that making this information available to
the public provides assurance to consumers that the wine was produced
in accordance with acceptable practices. However, in order to minimize
implementation time and costs, certifications will be displayed on a
separate Web page. The certifications on the Web will be indexed to the
label approval by the label approval number.
We do not agree with the comment that suggested that the affirmed
laboratory analyses necessarily included sensitive proprietary
information that should be kept confidential. Unlike formulas, which
include sensitive and confidential data about the formulation of
products, the laboratory analysis merely sets out in summary form the
percentage alcohol by volume, the total sulphur dioxide content (ppm),
and the volatile acidity of the product. This is information that could
be obtained by anyone who bought a bottle of the product in the
marketplace and submitted the sample to a private laboratory for
analysis.
In many cases, the alcohol content of the wine is already on the
label. TTB does not believe that the information included in the
analysis is confidential or proprietary, and thus we have concluded
that it may be made available to the public.
Several comment submitters asked if the importer must obtain a
certification for each shipment, or merely for the initial shipment of
a specific wine. Others proposed that once one importer has imported a
specific wine, other importers should be able to use the same
certification.
[[Page 49481]]
TTB believes if an importer has an original or copy of the
certification in his or her possession at the time of the initial
importation the statutory requirement will be met for multiple
shipments of the same wine (that is, wine of the same brand, class or
type, producer, and cellar treatment). Thus, the importer could import
additional shipments of the same wine without obtaining a new
certification, as long as the certification for the initial shipment is
maintained in his or her records and continues to accurately apply to
the wine in the subsequent shipments. In addition, because importers
may use either an original or copy of a certification, different
importers may use copies of the same certification.
2. Wines Produced Under an International Agreement
Some comment submitters requested clarification on the scope of the
provision regarding wine produced and imported subject to an
international agreement or treaty. In response, the TTB position is
that wines fall under this provision if they are imported from a
country that has ratified an agreement that provides for acceptance by
the United States of the enological practices of the exporting country.
On the other hand, wines covered by agreements that do not provide for
acceptance of enological practices will not qualify for inclusion under
this provision.
The comments also revealed some confusion over whether TTB would
require some type of government certification for wines falling under
this provision. In response, TTB notes that while the statute does
mention a certification in this context, it refers only to a
``certification, if any, as may be required by an international
agreement or treaty under paragraph (1)(B).'' TTB does not believe that
it is necessary to require retention of a certification if the terms of
such an international agreement or treaty do not require a
certification, because the existence of the agreement or treaty is
sufficient for purposes of verification of the statutory standard by
TTB. However, a different approach appears to be necessary under the
terms of the statute if the international agreement or treaty provides
for a certification. Accordingly, in this case the regulatory text
requires the importer to have only the certification required under the
agreement or treaty.
3. Importers Affiliated With a U.S. Winery
A number of commenters requested clarification of what qualifies as
an ``affiliate,'' while others stated that the statutory definition of
affiliate is clear and does not need explanation. One commenter
interpreted this provision as permitting an importer in this category
to self-certify only wines produced by an affiliated winery. Another
commenter questioned whether TTB would allow self-certification by an
importer when the importer is controlled by the winery rather than the
other way around.
TTB has included in the regulatory text a definition of
``affiliate'' that includes the terms of section 117(a)(4) of the
Federal Alcohol Administration (FAA) Act as well as the additional
definitional language added by section 2002 of the Act. The following
points are noted regarding this definition:
The language added by section 2002 of the Act is included
with the first part of the FAA Act definition because it appears to be
more relevant there.
We have added the word ``controlling'' before the words
``ownership interest'' to ensure consistency with the ``control''
concept in the existing FAA Act definition. In this regard, we do not
believe that Congress intended to create an ambiguity by having a
definition that contradicts its own terms.
TTB believes that the statute allows an importer that has an
affiliate that owns or controls a winery operating under a basic permit
issued by the Secretary to self-certify any natural wine he or she
imports, not just wine produced by its affiliated winery. With regard
to the other comment, TTB believes that the statutory language does not
provide for self-certification when the winery controls the importer.
4. Definition of Natural Wine
As the new requirements apply only to ``natural'' wine, a number of
comment submitters requested that TTB clarify the definition of natural
wine. For example, some commenters questioned whether non-grape wines,
wines under 7 percent alcohol by volume, or wines that are not
``standard'' wines are included in the definition.
TTB has included in the Sec. 27.140 text the definition of natural
wine currently found in 27 CFR 24.10, which is based on the definition
contained in section 5381 of the IRC. Although Congress had the
opportunity to amend the definition of natural wine for purposes of the
amendment made by section 2002 of the Act, it did not do so.
Accordingly, the current definition of natural wine, which includes
some wines made from fruits other than grapes as well as wines under 7
percent alcohol by volume, applies in this regulatory context. Whether
a wine falls within the definition of ``natural'' wine or not depends
on how it is produced. Because the definition of ``standard'' wine
under section 24.10 includes ``natural wine,'' a wine that is not a
``standard wine'' cannot be a ``natural wine.''
Two comment submitters asked if the alcohol content limitations in
the definition of natural wine refer to ``acquired'' or ``actual''
alcohol, or to ``total'' alcohol (which includes the alcohol equivalent
of residual sugar contained in the wine). Consistent with the approach
taken throughout the U.S. wine regulations, the alcohol content
limitations contained in the definition of natural wine have reference
to the wine's ``actual'' alcohol by volume content, which does not
include the alcohol equivalent of the residual sugar.
5. Certifying Government Agencies and Laboratories
A few comment submitters suggested that TTB allow the required
government certification to be from a quasi-governmental organization
having a regulatory role in the country of origin. They pointed out
that in some countries such organizations have significant regulatory
authority. They also suggested that TTB should accept analyses not just
from government laboratories, but also from laboratories that have been
certified by the country of origin to conduct the analyses.
TTB is aware of the fact that quasi-governmental organizations play
a significant role in regulating some countries' wine industries. For
this reason, TTB will accept the required certification from either a
governmental or government-approved entity, provided that the entity
has oversight or control over enological practices in the producing
country under the laws of the producing country. Likewise, TTB
understands that government laboratories in some countries may not
easily be able to handle the additional work required by this
certification requirement. TTB will therefore accept a laboratory
analysis conducted by a laboratory certified by the government of the
producing country.
TTB expects that each country exporting wine to the United States
that is subject to the government certification and laboratory analysis
requirements of the statute will make available to TTB and the general
public a list of its governmental or government-approved certifying
entities and a list of its government or government-certified
laboratories. To assist importers in verifying that the certification
and laboratory analysis are from a proper source, TTB will maintain a
list
[[Page 49482]]
containing all such available information on its Internet Web site.
6. Other Issues
In addition to the points made above in connection with the
submitted comments, TTB notes the following in regard to the new Sec.
27.140 text:
1. The definition of ``produced'' refers to removal from the
fermenter. TTB believes that this constitutes an objective standard
that identifies a specific, definable point in the wine production
process.
2. The definition of ``proper cellar treatment'' includes language
regarding international agreements and treaties, to reflect the effect
of the addition of new paragraph (1)(B) to section 5382(a).
3. TTB must be able to determine if wine imported after December
31, 2004, was produced on or before that date, particularly since
significant quantities of wine produced both before and after the
statutory cutoff date will be imported. However, TTB also recognizes
that, as time goes on, the proportion of imported wine that consists of
post-2004 production will increase, with a consequent increase in the
recordkeeping burden on importers. In order to reduce the potential
burden on importers, the regulatory text merely requires the
maintenance of records (which the importer would already have in the
normal course of business) to show that the wine was produced before
December 31, 2004.
Paperwork Reduction Act
The collections of information contained in this temporary rule
have been reviewed by the Office of Management and Budget (OMB) in
accordance with the Paperwork Reduction Act of 1995 (44 U.S.C. 3507)
and, pending the receipt of public comments, approved under OMB control
number 1513-0119. An agency may not conduct or sponsor, and a person is
not required to respond to, a collection of information unless the
collection of information displays a valid control number.
The collections of information in this regulation are in Sec. 4.45
and Sec. 27.140. The first information collection involves consumer
information under the Federal Alcohol Administration Act. The second
information collection is required by the Internal Revenue Code of 1986
in connection with the importation of wine from foreign countries.
Failure to provide the required information may result in
administrative sanctions against the importer. The likely respondents
are individuals and business or other for-profit institutions,
including partnership, associations, and corporations.
Estimated total annual reporting and/or recordkeeping
burden: 6,600 hours.
Estimated average annual burden per respondent/
recordkeeper: 1.65 hours.
Estimated number of respondents and/or recordkeeping:
4,000.
Estimated annual number of responses: 20,000.
Please refer to the related notice of proposed rulemaking published
elsewhere in this issue of the Federal Register for the procedures for
submitting comments on the collection of information.
Regulatory Flexibility Act
For applicability of the Regulatory Flexibility Act (5 U.S.C. 601
et seq.), please refer to the cross-referenced notice of proposed
rulemaking published elsewhere in this issue of the Federal Register.
Pursuant to section 7805(f) of the Internal Revenue Code, we will
submit this temporary rule to the Chief Counsel for Advocacy of the
Small Business Administration for comment on the impact of the
temporary regulations.
Executive Order 12866
We have determined that this temporary rule is not a significant
regulatory action as defined in Executive Order 12866. Therefore, a
regulatory assessment is not required.
Inapplicability of Prior Notice and Comment and Delayed Effective Date
Requirements
With respect to the provisions of these regulations that implement
section 5382 of the Internal Revenue Code, it has been determined that
sections 553(b) and (d)(3) of the Administrative Procedure Act (5
U.S.C. chapter 5) do not apply. With respect to section 5382 and the
provisions of these regulations issued under the authority of the
Federal Alcohol Administration Act, it has been determined, pursuant to
5 U.S.C. 553(b)(B) and (d), that good cause exists to issue these
regulations without prior notice and public procedure, and without a
delayed effective date. Because foreign wine subject to these
regulations will begin entering the United States shortly, it is
impracticable and contrary to the public interest to issue these
regulations for prior notice and comment, and with a delayed effective
date.
Although we are not required to issue a prior notice of proposed
rulemaking, we are soliciting comments from all interested parties on
the implementation of these new requirements through a concurrent
notice of proposed rulemaking published elsewhere in this issue of the
Federal Register.
Drafting Information
The principal author of this document was Jennifer K. Berry,
Regulations and Procedures Division, Alcohol and Tobacco Tax and Trade
Bureau. However, other personnel participated in its development.
List of Subjects
27 CFR Part 4
Advertising, Customs duties and inspection, Imports, Labeling,
Packaging and containers, Reporting and recordkeeping requirements,
Trade practices, Wine.
27 CFR Part 24
Administrative practice and procedure, Claims, Electronic fund
transfers, Excise taxes, Exports, Food additives, Fruit juices,
Labeling, Liquors, Packaging and containers, Reporting and
recordkeeping requirements, Research, Scientific equipment, Spices and
flavoring, Surety bonds, Vinegar, Warehouses, Wine.
27 CFR Part 27
Alcohol and alcoholic beverages, Beer, Customs duties and
inspection, Electronic funds transfers, Excise taxes, Imports,
Labeling, Liquors, Packaging and containers, Reporting and
recordkeeping requirements, Wine.
Amendments to the Regulations
0
For the reasons discussed in the preamble, TTB amends 27 CFR parts 4,
24, and 27 as follows:
PART 4--LABELING AND ADVERTISING OF WINE
0
1. The authority citation for part 4 continues to read as follows:
Authority: 27 U.S.C. 205, unless otherwise noted.
0
2. Section 4.45 is amended by revising the section heading, designating
the existing text as paragraph (a), adding a heading to newly
designated paragraph (a), and adding a new paragraph (b) to read as
follows:
Sec. 4.45 Certificates of origin, identity and proper cellar
treatment.
(a) Origin and identity. * * *
(b) Certification of proper cellar treatment of natural wine--(1)
General. An importer of wine may be required to have in his or her
possession at the time of release of the wine from customs custody a
certification or may have to
[[Page 49483]]
comply with other conditions prescribed in Sec. 27.140 of this chapter
regarding proper cellar treatment. If imported wine requires a
certification under Sec. 27.140, the importer must provide a copy of
that certification to TTB as follows:
(i) The importer must attach a copy of the certification to the
application for a certificate of label approval for the wine in
question submitted under Sec. 13.21 of this chapter; or
(ii) If a certification for the wine in question was not available
when the importer submitted the application for label approval, the
importer must submit a copy of the certification to the appropriate TTB
officer prior to release from customs custody of the first shipment of
the wine.
(2) Validity of certification. A certification submitted under
paragraph (b)(1) of this section is valid as long as the wine is of the
same brand and class or type, was made by the same producer, was
subjected to the same cellar treatment, and conforms to the statements
made on the certification. Accordingly, if the cellar treatment of the
wine changes and a new certification under Sec. 27.140 is required, an
importer is required to submit a new certification for the wine even
though it is subject to the same label approval.
(3) Use of certification. TTB may use the information from a
certification for purposes of verifying the appropriate class and type
designation of the wine under the labeling provisions of this part. TTB
will make certifications submitted under paragraph (b)(1) of this
section available to the public on the TTB Internet Web site at
http://www.ttb.gov.
PART 24--WINE
0
3. The authority citation for part 24 continues to read as follows:
Authority: 5 U.S.C. 552(a); 26 U.S.C. 5001, 5008, 5041, 5042,
5044, 5061, 5062, 5081, 5111-5113, 5121, 5122, 5142, 5143, 5173,
5206, 5214, 5215, 5351, 5353, 5354, 5356, 5357, 5361, 5362, 5364-
5373, 5381-5388, 5391, 5392, 5511, 5551, 5552, 5661, 5662, 5684,
6065, 6091, 6109, 6301, 6302, 6311, 6651, 6676, 7011, 7302, 7342,
7502, 7503, 7606, 7805, 7851; 31 U.S.C. 9301, 9303, 9304, 9306.
0
4. Section 24.301 is amended by removing the word ``and'' at the end of
paragraph (i), removing the period at the end of paragraph (j) and
adding, in its place, a semicolon followed by the word ``and'', and
adding a new paragraph (k) to read as follows:
Sec. 24.301 Bulk still wine record.
* * * * *
(k) If the proprietor is an importer of wine to which the
provisions of Sec. 27.140 of this chapter apply, any certification or
other records required at the time of release from customs custody
under that section.
0
5. Section 24.302 is amended by removing the word ``and'' at the end of
paragraph (h), removing the period at the end of paragraph (i) and
adding, in its place, a semicolon followed by the word ``and'', and
adding a new paragraph (j) to read as follows:
Sec. 24.302 Effervescent wine record.
* * * * *
(j) If the proprietor is an importer of wine to which the
provisions of Sec. 27.140 of this chapter apply, any certification or
other records required at the time of release from customs custody
under that section.
PART 27--IMPORTATION OF DISTILLED SPIRITS, WINES, AND BEER
0
6. 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, 5111, 5112, 5114, 5121,
5122, 5124, 5201, 5205, 5207, 5232, 5273, 5301, 5313, 5382, 5555,
6302, 7805.
0
7. Subpart I, Importer's Records and Reports, is amended by adding a
new Sec. 27.140 to read as follows:
Sec. 27.140 Certification requirements for wine.
(a) Definitions. When used in this section, the following terms
have the meaning indicated:
Affiliate means any one of two or more persons if one of such
persons has actual or legal control, directly or indirectly, whether by
stock ownership or otherwise, of the other or others of such persons,
and includes a winery's parent or subsidiary or any other entity in
which the winery's parent or subsidiary has a controlling ownership
interest. An affiliate also means any one of two or more persons
subject to common control, actual or legal, directly or indirectly,
whether by stock ownership or otherwise.
Importer means any person importing wine who must obtain a permit
as provided in Sec. 27.55.
Natural wine means the product of the juice or must of sound, ripe
grapes or other sound, ripe fruit (including berries) made with any
cellar treatment authorized by subparts F and L of part 24 of this
chapter and containing not more than 21 percent by weight (21 degrees
Brix de-alcoholized wine) of total solids.
Produced, when used with reference to wine, means removed from the
fermenter.
Proper cellar treatment means a production practice or procedure
authorized by subparts F and L of part 24 of this chapter and, 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) Certification--(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 certification:
(i) Must be from a governmental or government-approved entity
having oversight or control over enological practices in the producing
country under the laws of that country;
(ii) Must include the results of a laboratory analysis of the wine
conducted either by a government laboratory of the producing country or
by a laboratory certified by the government of the producing country;
and
(iii) Must be in the possession of the importer at the time of
release of the wine from customs custody and may cover multiple
importations provided that the wine in each case is of the same brand
and class or type, was made by the same producer, was subjected to the
same cellar treatment, and conforms to the statements made on the
certification.
(2) Alternative certifications and exemptions--(i) The following
are alternatives to the producing country certification and laboratory
analysis requirement described in paragraph (b)(1) of this section:
(A) In the case of natural wine produced and imported subject to an
international agreement or treaty specifying that the practices and
procedures used to produce the wine are acceptable to the United
States, no producing country certification and laboratory analysis is
required, unless that international agreement or treaty requires a
certification, in which case the importer must have in his or her
possession at the time of release of the wine from customs custody an
original or copy of that certification.
(B) If an importer of natural wine or its affiliate owns or
controls a winery operating under a basic permit issued under part 1 of
this chapter, in lieu of a producing country certification and
laboratory analysis, the importer may
[[Page 49484]]
self-certify that the practices and procedures used to produce the wine
constitute proper cellar treatment. The self-certification must be
either in the format set forth in paragraph (c) of this section with
blocks 1 through 4 completed or in an alternative format that sets
forth the same information, and it must be in the possession of the
importer at the time of release of the wine from customs custody. In
the case of self-certification the importer also must have at the time
of release from customs custody records to establish that the
requirements for self-certification are met.
(ii) The following are exempt from any certification requirement
under this section:
(A) Natural wine produced before January 1, 2005. However, in this
case, the importer must have in his or her possession at the time of
release of the wine from customs custody records to establish that the
wine was produced before January 1, 2005.
(B) Importations of natural wine that are of a personal, non-
commercial nature. Examples of non-commercial importations include
importations by travelers, gift shipments between individuals, and
importations by diplomats for embassy or consular use.
(C) Importations of natural wine that constitute commercial
samples. Commercial samples include sales samples, samples for trade
shows, and samples for laboratory analysis.
(D) Imported natural wine held on board international passenger
carriers, such as cruise ships or airliners.
(c) Form. The format for certification referred to in paragraph (b)
of this section is the following:
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[[Page 49485]]
[GRAPHIC] [TIFF OMITTED] TR24AU05.000
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[[Page 49486]]
(d) Preparation of Certification. The following rules apply for the
completion of the certification set forth in paragraph (c) of this
section:
(1) Block 1 must state the legal name and address (including
country) of the producer of the wine.
(2) Block 2 must include a complete description of the wine,
including its brand name, year of production, class or type, and
country of origin.
(3) The importer must check the applicable box in block 3:
(i) The importer must check box 3a and ensure that blocks 4 and 5
are completed if no alternative certification applies to the wine under
paragraph (b)(2)(i) of this section.
(ii) If paragraph (b)(2)(i)(B) applies to the wine, the importer
must check box 3b and complete the certification in block 4.
(4) If the certification is submitted subsequent to approval of a
label, the importer must complete block 6 by including the TTB
identification number from the certificate of label approval, TTB Form
5100.31.
Signed: August 4, 2005.
John J. Manfreda,
Administrator.
Approved: August 4, 2005.
Timothy E. Skud,
Deputy Assistant Secretary (Tax, Trade, and Tariff Policy).
[FR Doc. 05-16772 Filed 8-23-05; 8:45 am]
BILLING CODE 4810-31-U