Last time, in Part 10 of our series on the TTB’s “Notice No. 176” – the “Modernization of the Labeling and Advertising Regulations for Wine, Distilled Spirits, and Malt Beverages” we covered proposed changes to the distilled standards of identity and labeling practices.
In Part 11 we review a different commodity, beer/malt beverages, and look at the changes to the labeling labeling standards, COLA processes, and some other specific regulatory changes and definitions.
The proposed updated regulations will change beer/malt beverages labeling practices and other regulations in the following ways:
- Definitions will be added to the terms “keg collar” and “tap cover” to allow mandatory label information to appear on those items subject to certain conditions.
- The definition of “bottler” will be amended and the definition of “packer” will be removed consistent with amendments to remove any distinction in name and address statements between “bottling” in containers of capacity of 1 gallon or less and “packing” in containers in excess of 1 gallon.
- The term “misbranding” is removed and replaced with a simple understanding that containers should be labeled in accordance with the regulations.
- The regs will contain a proposed section 7.4(a)(3) clarifying the regulations in Part 7 do not apply to domestically bottled malt beverages that are not and will not be sold or shipped, or delivered for sale or shipment, or otherwise introduced in, interstate or foreign commerce. This is consistent with TTB Ruling 2013-1.
- For the first time the TTB is proposing to include regulations in Part 7 that explicitly refer readers to the regulations in Part 4 for sake and similar products that meet the definition of wine under the FAA Act and to the FDA food labeling regulations for alcohol beverage products that do not fall under the definition of malt beverages, wine, or distilled spirits found in the FAA Act.
- A new section 7.6 will be added consistent with TTB Ruling 2008-3 clarifying certain brewery products are not subject to the labeling requirements of Part 7 because they do not fall under the definition of malt beverage under the FAA Act. This will include products classified as beer under the Internal Revenue Code (IRC) definition in 26 USC 5052(a) that do not meet the definition of a malt beverage as found in the FAA Act at 27 USC 211(a(7). The differences between this IRC “beer” and the FAA Act malt beverages are basically: 1) the IRC doesn’t require beer to be fermented from malted barley; 2) the IRC doesn’t require the use of hops in the beverage; 3) the definition of beer in the IRC provides the product must contain one half of 1% or more of alcohol by volume compared to the fact that there is no minimum alcohol content for malt beverage under the FAA Act. Accordingly products not brewed from barley could be beer under the IRC but wouldn’t be malted beverages under the FAA Act.
- A proposed section 7.21(c) will reiterate the findings of TTB Ruling 2013-1 that intrastate shipments won’t require COLAs, but also the TTB is seeking comment as to whether or not their practices should change in allowing for certificates of label exemption for malt beverages given that some states may have requirements for some form of certificate from the TTB for intrastate beverages without understanding that the TTB would not normally issue an exemption certificate for malt beverages, thus inconveniencing brewers in those states.
- A proposed section 7.51 will reiterate the rule about labels needing to be securely affixed so that they cannot be removed without the application of water or other solvents, but a proposed new section 7.51(b) is proposed that would allow for keg collars to not need to be so firmly adhered provided the name of the brewery is embossed or printed on the keg or on a sticker on the keg. In adopting this new interpretation the TTB expressly calls out the fact that it is responding to the concerns of brewers who discussed how time-consuming it was to scrape labels off kegs each time a keg is reused.
Tomorrow we will conclude our section on malt beverages and beer and discuss the proposed TTB changes to regulations concerning labeling practices that are misleading, the classes of malt beverages, and mandatory label information.