A PRIMER ON EXPORTING AND IMPORTING DISTILLED SPIRITS BY BETHANY K. HATEF
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s your craft distilling business grows, you may be thinking about ways to better use your distillery capacity. One way to maximize use of your physical plant and to expand the markets you serve is to get into the business of either exporting or importing distilled spirits. If you are considering exporting your distilled spirits, or if you’ve identified brands of distilled spirits from other countries with a potential customer base in your local or regional market, you’ll need to understand the key regulatory requirements associated with such exportation or importation. To export or import distilled spirits, a distillery must comply with a number of US government requirements. Several federal agencies have requirements relating to the importation and exportation of alcohol beverages, including the Alcohol and Tobacco Tax and Trade Bureau (TTB), Customs and Border Protection (CBP), and the Department of Commerce. Of course, distillers seeking to import or export products also need to understand the laws and regulations of the nations they will be selling to or purchasing from. This article addresses the primary US alcohol regulatory requirements applying to companies seeking to export and/or import distilled spirits.
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KEY US ALCOHOL REGULATORY REQUIREMENTS FOR EXPORTING DISTILLED SPIRITS The specific export requirements that apply to alcohol beverages vary based on several factors, including the specific commodity at issue (e.g., beer vs. wine vs. distilled spirits), whether the company exporting the product is also the producer of the product, and whether the product will be exported with or without tax payment. Distilled spirits may be exported without payment of federal excise taxes if they are actually exported to a foreign country, used as supplies on vessels and aircraft, or transferred to a foreign trade zone. Distilled spirits also may be shipped, without tax payment, to the US armed forces for use overseas. A distiller intending to export spirits without tax payment must file a form TTB F 5100.11 with TTB. A distiller may also apply for and obtain approval from TTB for an alternative procedure allowing the distiller to maintain its export documentation at the distillery, rather than submit such documentation to TTB. Under this alternative procedure, the distiller may submit monthly summary reports to TTB (and can
do so electronically), thus simplifying the administrative burden of the export process. Exports of distilled spirits with no tax paid must be properly labeled. Specifically, each container or case of spirits must be marked with the word “Export” prior to removal of the spirits from the distillery. The distiller also must maintain (and submit to TTB) proof of exportation of the products. Such proof can consist of, for example, a customs certificate of lading and clearance. Distilled spirits also can be exported after tax payment. To export taxpaid distilled spirits, the distiller must obtain a Wholesaler’s Basic Permit from TTB and otherwise comply with TTB’s export regulations located at 27 C.F.R. Part 28. Tax-paid distilled spirits intended for export must be marked in the same way as spirits removed from a distillery for sale or use in the US. If a wholesaler is selling spirits for export, it must notify the producer that the spirits are to be exported and provide certain paperwork to the distiller upon removal for exportation. The distiller then must file this paperwork with TTB to execute a claim for “drawback” DISTILLERS (i.e., a refund CONSIDERING of the excise EXPORTING THEIR taxes paid on spirits PRODUCTS ALSO that are SHOULD BECOME then exFAMILIAR WITH ANY ported). A distillREQUIREMENTS OF er seekTHE COUNTRIES TO ing drawWHICH THEY WILL back must SEND THEIR provide proof that the prodPRODUCTS. ucts were actually exported. Aside from the export requirements imposed by TTB on alcohol beverages exported from the US, distillers
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