On April 2, 2020, the Alcohol and Tobacco Tax and Trade Bureau (TTB) issued a final rule, Modernization of the Labeling and Advertising Regulations for Wine, Distilled Spirits, and Malt Beverages. 85 Fed. Reg. 18,704 (April 2, 2020) (Modernization Rule).
The Modernization Rule follows TTB’s proposed rule of November 2018, 83 Fed. Reg. 60,562, which proposed organizational and definitional changes intended to liberalize and clarify TTB’s regulations pertaining to the labeling and advertising of beverage alcohol products. This 2020 rulemaking appears to be an intermediate step, as TTB adopts some of the proposed changes, rejects others, and explains that the remaining issues remain under consideration and will be the subject of future rulemaking. Accordingly, although this document is a final rule, it is likely that in the future, TTB will issue a second final rule that addresses the remaining proposals. The rule is largely comprised of various unrelated regulatory updates; accordingly, we have highlighted some of them below.
Changes Adopted (Effective May 4, 2020)
- The tolerance for the alcohol content of distilled spirits products has been expanded to plus or minus 0.3 percentage points above or below the labeled alcohol content. 27 CFR § 5.37(b).
- Brand labels for distilled spirits products may now bear the required information (brand name, alcohol content, and class or type designation) in the same field of vision, meaning that it may be placed anywhere as long all such information can be viewed on a single side of a container. 27 CFR § 5.11.
- All distilled spirits products, except neutral spirits, may now bear statements of age or maturity if such products are aged in oak barrels and subject to limited treatment post-dumping. 27 CFR § 5.40(d).
- “[D]istillation” is defined as “a single run through a pot still or…column of a column (reflux) still” for the purpose of multiple-distillation claims. 27 CFR § 5.42(b)(6).
- Vodka products are no longer prohibited from having a distinctive character, aroma, taste, or color. 27 CFR § 5.22(a)(1).
- A standard for “agave spirits” is adopted, containing “tequila” and “mezcal.” 27 CFR § 5.22(g).
- TTB has codified a process for creation of personalized labels without resubmission and approval by TTB. 27 CFR §§ 4.54, 5.57, 7.43.
- Advertisements for wine, distilled spirits, and malt beverages may bear the advertisers phone number, website, or email address rather than city and State. 27 CFR §§ 4.62, 5.63, 7.52.
- Wine that is imported in containers of more than 5 liters not bearing a vintage date may bear a vintage date provided the domestic bottler has substantiating documentation. 27 CFR § 4.27.
- Malt beverage labels and advertisements are no longer prohibited from bearing strength claims, such as “strong,” or “full strength.” 83 Fed. Reg. at 18,719.
Proposed Changes Rejected
- TTB has elected not to adopt the definition of “oak barrel” as a “cylindrical oak drum of approximately 50 gallons…” 85 Fed. Reg. at 18,711.
- No changes will be made regarding statements of composition, specifically, the proposals to require: (1) the listing of separate components of an “intermediate” flavoring; (2) distilled spirits and wine used in a finished product to be listed in order of predominance; and (3) a full statement of the composition for cocktails. 85 Fed. Reg. 18,712.
- TTB will not adopt a proposed restriction on cross-commodity terms, including the use of a name of a class or type designation from one commodity on the label of a different commodity, such as a homophone or coined word simulating or imitating a class or type designation. 83 Fed. Reg. at 18,709.
- Also rejected was a proposed limitation requiring age statements to refer solely to time a product is aged in the first barrel. Age statements may account for all time spent in oak containers, including time spent in subsequent oak containers after the first. 27 CFR § 5.40(d).
- Moreover, TTB will not adopt a proposal that whisky meeting the standard for a certain type designation would be required to be labeled as such. 83 Fed. Reg. at 18,716.
As noted above, many issues are still being considered by TTB and may be addressed in future rulemaking. These include a proposal to reorganize and recodify 27 CFR Parts 4, 5, and 7, and establish a separate Part 14 relating to advertising.