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THE

DUSTY BACK CORNERS OF

27 CFR 5 & 19 WRITTEN BY JOHN MCKEE

I

am a distillery owner, not an attorney, so take this with a grain of salt, but how many times have you read TTB 27 CFR Parts 5 and 19? Do you have copies in the bathrooms at your distillery? Do you know what CFR stands for? If your answers are “Less than four,” “No,” and “Huh?” then consider getting a copy. Title 27, parts 5 and 19 are the Code of Federal Regulations sections relating to “Labeling and Advertising of Distilled Spirits” and “Distilled Spirits Plants.” They outline the rules by which we can operate. I’m sure that most of you are aware of the “Restrictions as to locations” or “Filing of operations or unit bonds” regulations, but I thought it might be fun to look at some of the dustier corners and see what we might find.

5.39

PRESENCE OF NEUTRAL SPIRITS AND COLORING, FLAVORING, AND BLENDING MATERIALS Considering the innovative spirit of our industry, this one needs to be reviewed by anyone using chips and staves. Specifically “(c) Treatment with wood”: “The words ‘colored and flavored with wood ____ (insert chips, slabs, etc., as appropriate)’ shall be stated as a part of the class and type designation for whisky…” That means that if you are using barrel inserts you may need to change your labels.

19.122

CHANGE IN CONSTRUCTION OR USE OF BUILDINGS AND EQUIPMENT Have you been growing or remodeled to accommodate more square footage? If so, did you submit a “letterhead notice before making any material changes”? If not, you had better follow up.

WWW.ARTISANSPIRITMAG.COM

19.29

19.418

EXEMPTIONS FOR NATIONAL DEFENSE AND DISASTERS

AUTHORIZED WITHDRAWALS WITHOUT PAYMENT OF TAX

Are you sick of doing paperwork? Then get the feds to issue you an exemption for National Defense and disasters. You still have to pay your FET, but you can get an exemption to “any provision of the internal revenue laws” relating to distilled spirits. Should Nicole Austin at Kings County Distillery in Brooklyn have applied for this privilege after the disaster declaration of Superstorm Sandy (DR-4085)?

If you do not want to pay your FET, put your spirits on a “whaling boat.” This one takes a little bit to get to, but follow (a)(4) “Supplies for certain vessels and aircraft, authorized under 19 U.S.C 1309 (a)(1) (B)” which says, “vessels of the United States employed in the fisheries or in the whaling business.” Greenpeace has obviously not read this section of 27 CFR 19 in a long time.

19.55

19.292

OTHER BUSINESS

You received your DSP and you thought you were good to go, right? Wrong. Even though you have your license to operate, you must “file on letterhead notice” when beginning or resuming operations, otherwise you are in violation.

At Garrison Brothers Distillery, Dan Garrison has a funny story about being fined because he had chickens roaming outside that were determined to be “other business” that had not been declared in his license application. If you are performing other business at your DSP, declare it and get it authorized.

NOTICE OF OPERATIONS

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