[Federal Register Volume 86, Number 162 (Wednesday, August 25, 2021)]
[Proposed Rules]
[Pages 47429-47433]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2021-18205]
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DEPARTMENT OF THE TREASURY
Alcohol and Tobacco Tax and Trade Bureau
27 CFR Part 5
[Docket No. TTB-2021-0008; Notice No. 205]
RIN 1513-AC61
Proposed Addition of Singani to the Standards of Identity for
Distilled Spirits
AGENCY: Alcohol and Tobacco Tax and Trade Bureau, Treasury.
ACTION: Notice of proposed rulemaking.
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SUMMARY: The Alcohol and Tobacco Tax and Trade Bureau (TTB) proposes to
amend the regulations that set forth the standards of identity for
distilled spirits to include Singani as a type of brandy that is a
distinctive product of Bolivia. This proposal follows a joint petition
submitted by the Plurinational State of Bolivia and Singani 63, Inc.,
and subsequent discussions with the Office of the United States Trade
Representative. TTB invites comments on this proposed amendment to its
regulations, including comments on its proposal to authorize a minimum
bottling proof of 35 percent alcohol by volume (or 70[deg] proof) for
Singani.
DATES: Comments must be received on or before October 25, 2021.
ADDRESSES: You may electronically submit comments to TTB on this
proposal, and view copies of this document, its supporting materials,
and any comments TTB receives on it within Docket No. TTB-2021-0008 as
posted at https://www.regulations.gov. A direct link to that docket is
available on the TTB website at https://www.ttb.gov/distilled-spirits/notices-of-proposed-rulemaking under Notice No. 205. Alternatively, you
may submit comments via postal mail to the Director, Regulations and
Ruling Division, Alcohol and Tobacco Tax and Trade Bureau, 1310 G
Street NW, Box 12, Washington, DC 20005. Please see the Public
Participation section of this document for further information on the
comments requested regarding this proposal and on the submission,
confidentiality, and public disclosure of comments.
FOR FURTHER INFORMATION CONTACT: Trevar D. Kolodny, Regulations and
Rulings Division, Alcohol and Tobacco Tax and Trade Bureau, 1310 G
Street NW, Box 12, Washington, DC 20005; telephone 202-453-2226.
SUPPLEMENTARY INFORMATION:
[[Page 47430]]
Background on the Labeling of Distilled Spirits
TTB Authority
Section 105(e) of the Federal Alcohol Administration Act (FAA Act),
codified in the United States Code at 27 U.S.C. 205(e), authorizes the
Secretary of the Treasury (the Secretary) to prescribe regulations
relating to the packaging, marking, branding, labeling, and size and
fill of containers of alcohol beverages that will prohibit consumer
deception and provide consumers with adequate information as to the
identity and quality of the product. Section 105(e) of the FAA Act also
generally requires bottlers and importers of alcohol beverages to
obtain certificates of label approval (COLAs) prior to bottling or
importing alcohol beverages for sale in interstate commerce.
TTB administers the FAA Act pursuant to section 1111(d) of the
Homeland Security Act of 2002, codified at 6 U.S.C. 531(d). The
Secretary has delegated various authorities through Treasury Department
Order 120-01 (Revised), 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 this law.
Part 5 of title 27 of the Code of Federal Regulations (27 CFR part
5) sets forth the regulations implementing those provisions of section
105(e) of the FAA Act as they pertain to distilled spirits.
Certificates of Label Approval
TTB regulations at 27 CFR 5.51 prohibit the release of bottled
distilled spirits from customs custody for consumption unless the
person removing the distilled spirits has obtained and is in possession
of a COLA covering the product. The bottles must bear labels identical
to the labels appearing on the face of the certificate, or labels with
changes authorized by TTB. The TTB regulations at 27 CFR 5.55 also
generally prohibit the bottling or removal of distilled spirits from a
distilled spirits plant unless the proprietor possesses a COLA covering
the labels on the bottle.
Classes and Types of Spirits
The TTB regulations at 27 CFR 5.22 establish standards of identity
for distilled spirits products and categorize these products according
to various classes and types. As used in Sec. 5.22, the term ``class''
refers to a general category of spirits. Currently, there are 12
different classes of distilled spirits set out in Sec. 5.22, such as
whisky, rum, gin, and brandy. As used in Sec. 5.22, the term ``type''
refers to a subcategory within a class of spirits. For example,
``Cognac'' and ``Pisco'' are types of brandy, and ``Cacha[ccedil]a'' is
a type of rum.
The TTB labeling regulations at 27 CFR 5.32(a)(2) and 5.35 require
that the class and type of distilled spirits appear on the product's
label. These regulations provide that the class and type must be stated
in conformity with Sec. 5.22 of the TTB regulations if defined
therein. Otherwise, Sec. 5.35 requires that the product must be
designated in accordance with trade and consumer understanding thereof,
or, if no such understanding exists, by a distinctive or fanciful name,
and in either case (with limited exceptions), followed by a truthful
and adequate statement of composition.
Classification of Singani
``Singani'' is a term recognized by the Plurinational State of
Bolivia (Bolivia) as a designation for an alcohol beverage product that
is distilled from grape wine or grape pomace and produced in certain
delimited parts of Bolivia. Under current TTB distilled spirits
labeling regulations, Singani products are generally classified as
brandies. Section 5.22(d) sets forth the standard of identity for
brandy as follows:
Class 4; brandy. ``Brandy'' is an alcoholic distillate from the
fermented juice, mash, or wine of fruit, or from the residue
thereof, produced at less than 190[deg] proof in such manner that
the distillate possesses the taste, aroma, and characteristics
generally attributed to the product, and bottled at not less than
80[deg] proof. Brandy, or mixtures thereof, not conforming to any of
the standards in paragraphs (d)(1) through (9) of this section shall
be designated as ``brandy'', and such designation shall be
immediately followed by a truthful and adequate statement of
composition.
In Sec. 5.22, paragraphs (d)(1) through (9) categorize the
specific types of brandy. As described by petitioners Singani 63, Inc.
(Singani 63) and Bolivia, Singani may meet the criteria of several of
these types of brandy, such as ``fruit brandy'' under paragraph (d)(1),
or ``pomace brandy'' (including ``grappa brandy'') under paragraph
(d)(5), depending on the amount of pomace used.
In Sec. 5.22, paragraph (d)(1) states that fruit brandy, derived
from grapes, shall be designated as ``grape brandy'' or ``brandy.''
That regulation also generally requires brandies derived from grapes
(other than neutral brandy, pomace brandy, marc brandy, grappa brandy,
Pisco, Pisco Per[uacute], or Pisco Chileno) that have been aged in oak
barrels for less than two years to be labeled as ``immature.'' The
Bolivian standards submitted by petitioners contain no aging
requirements, and petitioners' submissions suggest that, unlike many
grape brandies, Singani is generally not aged in wood. Accordingly,
under current TTB regulations, a Singani product classified as a grape
brandy under paragraph (d)(1) would need to be labeled as an immature
brandy unless it was aged in oak barrels for at least two years.
According to information submitted by the petitioners, under the
standards set forth by Bolivia, certain categories of Singani may have
a minimum alcohol content by volume of as low as 35 percent. However,
under Sec. 5.22(d), all brandy must be bottled at not less than
80[deg] proof, or 40 percent alcohol by volume. Thus, under TTB's
current regulations, only Singani products bottled at a minimum alcohol
content by volume of 40 percent may be labeled as any of the types of
brandy specifically defined under the standard of identity in Sec.
5.22(d). A Singani product bottled at less than 40 percent alcohol by
volume could be labeled as a ``diluted'' brandy in accordance with
Ruling 75-32 of the Bureau of Alcohol, Tobacco and Firearms (ATF)
(TTB's predecessor agency), or as a distilled spirits specialty product
bearing a statement of composition and fanciful name as required under
Sec. 5.35(a). Possible statements of composition for such a specialty
product could include ``spirits distilled from grapes'' or ``grape
spirits.''
Singani Petitions and Letters
Petitions and Related Letters
TTB received a petition from Singani 63, a distilled spirits
importer, dated November 18, 2014, proposing that TTB amend its
regulations to recognize Singani as a type of brandy that is a
distinctive product of Bolivia. In support of this petition, Bolivia
submitted letters to TTB in December 2015 and January 2017. Singani 63
also submitted a letter to TTB in June 2017 that provided additional
information related to the petition.
In its petition, Singani 63 stated that TTB's recognition of
Singani as a distinctive product would benefit consumers by informing
them that the product was produced and labeled in compliance with
Bolivia's laws. It also asserted that Singani is a product that is
distinct from other types of brandy. Furthermore, both Singani 63 and
Bolivia indicated that Bolivia had established a legal standard for
Singani as an exclusively Bolivian product.
[[Page 47431]]
In response to these submissions, TTB issued letters in February
and October of 2017, in which TTB addressed the petitioner's request
for rulemaking and identified several deficiencies in the petition and
its supporting documents. For instance, TTB noted that the submitted
documents lacked substantiating information regarding Bolivia's
standards for the production of Singani. Accordingly, TTB did not
undertake rulemaking at that time to amend its regulations as proposed
in Singani 63's petition.
TTB subsequently received a joint petition from Singani 63 and
Bolivia in November 2018, again proposing that TTB recognize Singani as
a type of brandy that is a distinctive product of Bolivia. The 2018
joint petition contained additional information in support of its
regulatory proposal, including official translations of Bolivian laws
and decrees governing the production of Singani.
2020 U.S.-Bolivian Exchange of Letters on Unique Distilled Spirits
Following discussions between officials of Bolivia and the Office
of the United States Trade Representative (USTR), and after
consultations between USTR and TTB, the United States Trade
Representative and Bolivia's Minister of Foreign Affairs exchanged
letters on January 6, 2020. The exchange of letters agreed upon a
procedure that could potentially lead each party to recognize as
distinctive certain distilled spirits products produced in the other
party's territory.
The exchange of letters provides that the United States shall
endeavor to publish a Notice of Proposed Rulemaking to promulgate a
regulation that would provide that Singani is a type of brandy that is
a distinctive product of Bolivia. The exchange of letters further
provides that if, following this proposed rule, the United States
publishes a final rule announcing the promulgation of a regulation
establishing Singani as a type of brandy that is a distinctive product
of Bolivia, then Bolivia shall, within thirty (30) days thereafter,
recognize Bourbon Whiskey and Tennessee Whiskey as distinctive products
of the United States. Following such recognition, Bolivia shall
prohibit the sale within Bolivia of any product as Bourbon, Bourbon
Whiskey, or Tennessee Whiskey, if it has not been manufactured in the
United States in accordance with the laws and regulations of the United
States governing the manufacture of Bourbon Whiskey and Tennessee
Whiskey. These protections also apply to products spelled as ``Bourbon
Whisky'' or ``Tennessee Whisky.''
Singani Production
The Bolivian decrees and regulations submitted with the 2018 joint
petition, which are included in the rulemaking docket, establish that
Bolivia defines ``Singani'' as a brandy product of Bolivia. Of the
Bolivian decrees and regulations submitted, Bolivian Standard NB 324001
contains the most specific standards for Singani. Among other
requirements, NB 324001 requires that Singani be obtained exclusively
from vitis vinifera grapes grown in the traditional ``zones of origin''
at a minimum altitude of 1,600 meters above sea level. NB 324001 lists
several different categories of Singani, some of which have more
specific requirements, such as requiring the product to be made from
Muscat of Alexandria grapes specifically. NB 324001 classifies Singani
in the group ``Brandies and liquors.''
In a prior rulemaking, TTB has distinguished Singani from Pisco,
which is a type of grape brandy manufactured in Peru or Chile in
accordance with the laws and regulations of those countries. In 2013,
TTB updated its labeling regulations to add Pisco as a type of brandy
that is manufactured only in Peru and Chile. In regard to brandy
produced in Bolivia, TTB determined that it would not recognize Pisco
as a type of brandy produced in that country. See T.D. TTB-113 (78 FR
28739, May 16, 2013). TTB stated that Bolivia maintains standards for
Singani but not for Pisco, and cited other evidence suggesting that
Pisco and Singani are different products.
TTB Regulatory Proposal
After reviewing the petitions, the regulations on the standards of
identity in 27 CFR part 5, TTB's Certificate of Label Approval (COLA)
database, the exchange of letters between USTR and Bolivia's Minister
of Foreign Affairs, and the relevant laws and regulations of Bolivia,
TTB has determined that amending the standards of identity regulations
at Sec. 5.22 to recognize Singani as a distinctive product of Bolivia
merits consideration and public comment, as invited in this notice of
proposed rulemaking.
TTB believes that Singani generally meets the U.S. standard for
brandy and should be classified as a type of brandy. TTB also believes
that evidence suggests that the generally recognized geographical
limits of the Singani-producing areas do not extend beyond the
boundaries of Bolivia, and that Singani production is not associated
with any areas outside of Bolivia. Moreover, the results of a search of
TTB's COLA database did not show any approved COLAs that use the term
``Singani'' as the brand name or fanciful name, or as part of the brand
name or fanciful name, for distilled spirits produced outside Bolivia.
Therefore, this document proposes to amend the standard of identity
in Sec. 5.22(d) by adding Singani as a type of brandy derived from
grapes that is manufactured in Bolivia in compliance with the laws and
regulations of Bolivia governing the manufacture of Singani for
consumption in that country. If TTB recognizes Singani as a type of
brandy as proposed, it would be permissible for Singani imported and
sold within the United States to simply be labeled as ``Singani''
without the term ``brandy'' on the label, in the same way that products
labeled with such type designations as ``Cognac'' or ``Pisco'' are not
required to also bear the designation ``brandy.''
The other geographically distinctive types of brandy defined in
Sec. 5.22(d), Cognac and Pisco, are defined as grape brandies distinct
to their respective places of origin. However, given that Singani could
also meet the criteria of other types of brandies (such as pomace
brandy under Sec. 5.22(d)(5), depending on the amount of pomace used),
the proposed regulatory language describes Singani as ``brandy derived
from grapes'' rather than as a ``grape brandy.''
TTB notes that the Bolivian standard allows products designated as
Singani to have an alcohol content ranging from 35 to 45 percent
alcohol by volume, depending on the type of Singani produced. Because
the Bolivian standard allows Singani to have an alcohol content as low
as 35 percent alcohol by volume (or 70[deg] proof), TTB is proposing to
exempt Singani from the general requirement that brandy be bottled at
not less than 80[deg] proof (40 percent alcohol by volume) and is
instead proposing a standard for Singani that would include products
bottled at not less than 70[deg] proof (35 percent alcohol by volume)
in accordance with the laws and regulations of Bolivia. TTB regulations
have not previously authorized bottling proofs for a type of product
that are below the minimum prescribed for the product's class
designation, even when a foreign standard permits a lower proof, so TTB
is soliciting comment on authorizing this standard for Singani.
In addition, the regulation at Sec. 5.22(d)(1) generally requires
that brandy derived from grapes that has been stored in oak containers
for less than two years must be labeled with the word ``immature.''
However, it also lists
[[Page 47432]]
several types of brandy (specifically neutral brandy, pomace brandy,
marc brandy, grappa brandy, Pisco, Pisco Per[uacute], and Pisco
Chileno) that are exempt from this requirement. Because the Bolivian
standards for Singani contain no specific aging requirements, TTB is
proposing to amend Sec. 5.22(d)(1) to clarify that Singani is likewise
exempt from the requirement that it be labeled with the word
``immature.''
Effect on Currently Approved Labels
If finalized, this amendment to the TTB regulations would revoke by
operation of regulation any COLA that uses the term ``Singani'' as a
designation for a distilled spirits product that was not manufactured
in Bolivia in accordance with the laws and regulations of Bolivia
governing the manufacture of Singani for consumption in that country.
TTB has searched its COLA database and does not believe that this
rulemaking will affect any existing labels.
Public Participation
Comments Invited
TTB invites comments from interested members of the public on this
proposed rule, including on whether the proposed amendment would have
an adverse impact on owners of U.S. trademarks and on the extent to
which distilled spirits labeled as ``Singani'' are produced outside
Bolivia. Although information currently before TTB suggests that all
distilled spirits currently sold in the United States with ``Singani''
on the label are produced in Bolivia, comments on the extent of
production of Singani outside Bolivia, and on whether any existing
labels will be affected by this proposal, will assist TTB in
determining whether Singani should be recognized as a distinctive
product of Bolivia.
TTB is also soliciting comments on its proposal to authorize a
minimum bottling proof of 35 percent alcohol by volume (or 70[deg]
proof) for Singani. Because Bolivian standards authorize this 70[deg]
proof minimum, TTB is proposing to authorize the same minimum for
purposes of the TTB regulations, even though Sec. 5.22(d) generally
requires that brandies be bottled at not less than 80[deg] proof.
Submitting Comments
You may submit comments on this proposal as an individual or on
behalf of a business or other organization via the Regulations.gov
website or via postal mail, as described in the ADDRESSES section of
this document. Your comment must reference Notice No. 205 and must be
submitted or postmarked by the closing date shown in the DATES section
of this document. You may upload or include attachments with your
comment. You also may submit a comment requesting a public hearing on
this proposal. The TTB Administrator reserves the right to determine
whether to hold a public hearing. If TTB schedules a public hearing, it
will publish a notice of the date, time, and place for the hearing in
the Federal Register.
Confidentiality and Disclosure of Comments
All submitted comments and attachments are part of the rulemaking
record and are subject to public disclosure. Do not enclose any
material in your comments that you consider confidential or that is
inappropriate for disclosure.
TTB will post, and you may view, copies of this document, its
supporting materials, and any comments TTB receives about this proposal
within the related Regulations.gov docket. In general, TTB will post
comments as submitted, and it will not redact any identifying or
contact information from the body of a comment or attachment.
Please contact TTB's Regulations and Rulings division by email
using the web form available at https://www.ttb.gov/contact-rrd, or by
telephone at 202-453-2265, if you have any questions regarding comments
on this proposal or to request copies of this document, its supporting
materials, or the comments received in response.
Regulatory Analysis and Notices
Regulatory Flexibility Act
Pursuant to the requirements of the Regulatory Flexibility Act (5
U.S.C. chapter 6), TTB certifies that this proposed rule, if adopted,
would not have a significant economic impact on a substantial number of
small entities. The proposed rule only amends the standards of identity
for brandy at 27 CFR 5.22(d) and imposes no new reporting,
recordkeeping, or other administrative requirements. Therefore, no
regulatory flexibility analysis is required.
Executive Order 12866
It has been determined that this proposed rule is not a significant
regulatory action as defined by Executive Order 12866 of September 30,
1993. Therefore, no regulatory assessment is required.
Drafting Information
Trevar D. Kolodny of the Regulations and Rulings Division, Alcohol
and Tobacco Tax and Trade Bureau, drafted this notice of proposed
rulemaking.
List of Subjects in 27 CFR Part 5
Advertising, Alcohol and alcoholic beverages, Consumer protection,
Customs duties and inspection, Imports, Labeling, Liquors, Packaging
and containers, and Reporting and recordkeeping requirements.
Proposed Regulatory Amendment
For the reasons discussed in the preamble, TTB proposes to amend
title 27, chapter I, part 5, Code of Federal Regulations, as follows:
PART 5--LABELING AND ADVERTISING OF DISTILLED SPIRITS
0
1. The authority citation for part 5 continues to read as follows:
Authority: 26 U.S.C. 5301, 7805, 27 U.S.C. 205.
Subpart C--Standards of Identity for Distilled Spirits
0
2. Section 5.22 is amended by:
0
a. Revising paragraph (d) introductory text;
0
b. In paragraph (d)(1), revising the third sentence; and
0
c. Adding new paragraph (d)(10).
The revisions and addition read as follows:
Sec. 5.22 The standards of identity.
* * * * *
(d) Class 4; brandy. ``Brandy'' is an alcoholic distillate from the
fermented juice, mash, or wine of fruit, or from the residue thereof,
produced at less than 190[deg] proof in such manner that the distillate
possesses the taste, aroma, and characteristics generally attributed to
the product, and bottled at not less than 80[deg] proof except as
otherwise provided in paragraph (d)(10) of this section. Brandy, or
mixtures thereof, not conforming to any of the standards in paragraphs
(d)(1) through (10) of this section shall be designated as ``brandy'',
and such designation shall be immediately followed by a truthful and
adequate statement of composition.
(1) * * * Fruit brandy, derived from grapes, shall be designated as
``grape brandy'' or ``brandy'', except that in the case of brandy
(other than neutral brandy, pomace brandy, marc brandy, grappa brandy,
Pisco, Pisco Per[uacute], Pisco Chileno, or Singani) distilled from the
fermented juice, mash, or wine of grapes, or the residue thereof, which
has been stored in oak containers for less than 2 years, the statement
of class and type shall be immediately preceded, in
[[Page 47433]]
the same size and kind of type, by the word ``immature''. * * *
* * * * *
(10) ``Singani'' is brandy derived from grapes that is manufactured
in Bolivia in accordance with the laws and regulations of Bolivia
governing the manufacture of Singani for consumption in that country,
and includes Singani bottled at not less than 70[deg] proof in
accordance with such laws and regulations.
* * * * *
Signed: July 21, 2021.
Mary G. Ryan,
Administrator.
Approved: July 23, 2021.
Timothy E. Skud,
Deputy Assistant Secretary (Tax, Trade, and Tariff Policy).
[FR Doc. 2021-18205 Filed 8-24-21; 8:45 am]
BILLING CODE 4810-31-P