27 C.F.R. Subpart Y—Distilled Spirits For Fuel Use
Title 27 - Alcohol, Tobacco Products and Firearms
This subpart implements 26 U.S.C. 5181, which authorizes the establishment of distilled spirits plants solely for producing, processing and storing, and using or distributing distilled spirits to be used exclusively for fuel use. This subpart relates to the qualification and operation of such distilled spirits plants. Distilled spirits plants established under this subpart are designated as alcohol fuel plants. (Sec. 232, Pub. L. 96–223, 94 Stat. 278 (26 U.S.C. 5181)) All provisions of subparts A through X of this part and all provisions of 26 U.S.C. Chapter 51 are hereby waived except: (a) Any provision specifically incorporated by reference in this subpart and the cited authority for that provision; (b) Any provision requiring the payment of tax; (c) Any provisions dealing with penalty, seizure, or forfeiture which is applicable to distilled spirits; and (d) 26 U.S.C. 5181. (Sec. 232, Pub. L. 93–224, 94 Stat. 278 (26 U.S.C. 5181)) The proprietor, on specific approval by the appropriate TTB officer as provided in this paragraph, may use an alternate method or procedure in lieu of a method or procedure specifically prescribed in this subpart or subparts A through X of this part where the provisions of those subparts have been incorporated by reference in this subpart. The appropriate TTB officer may approve an alternate method or procedure, subject to stated conditions, when he finds that— (a) Good cause has been shown for the use of the alternate method or procedure; (b) The alternate method or procedure is within the purpose of, and consistent with the effect intended by, the specifically prescribed method or procedure, and affords equivalent security to the revenue; and (c) The alternate method or procedure will not be contrary to any applicable provision of law, and will not result in an increase in cost to the Government or hinder the effective administration of this part. No alternate method or procedure relating to the giving of any bond, to the assessment, payment or collection of tax, will be authorized under this section. Where the proprietor desires to employ an alternate method or procedure, he shall submit a written application to do so to the appropriate TTB officer. The application will specifically describe the proposed alternate method or procedure, and will set forth the reasons therefor. The proprietor shall not employ any alternate method or procedure until the application has been approved. The proprietor shall, during the period of authorization of an alternate method or procedure, comply with the terms of the approved application. Authorization for any alternate method or procedure may be withdrawn whenever in the judgment of the appropriate TTB officer the revenue is jeopardized or the effective administration of this part is hindered by the continuation of such authorization. As used in this section, alternate methods or procedures include alternate construction or equipment. The proprietor shall retain, as part of the records available for examination by appropriate TTB officer, any application approved by the appropriate TTB officer under the provisions of this section. (Sec. 232, Pub. L. 96–223, 94 Stat. 278 (26 U.S.C. 5181)) The appropriate TTB officer may approve construction, equipment, and methods of operation other than as specified in this part, where he finds that an emergency exists and the proposed variations from the specified requirements are necessary, and the proposed variations— (a) Will afford the security and protection to the revenue intended by the prescribed specifications; (b) Will not hinder the effective administration of this part; and (c) Will not be contrary to any applicable provisions of law. Variations from requirements granted under this section are conditioned on compliance with the procedures, conditions, and limitations with respect thereto set forth in the approval of the application. Failure to comply in good faith with such procedures, conditions, and limitations will automatically terminate the authority for such variations and the proprietor thereupon shall fully comply with the prescribed requirements of regulations from which the variations were authorized. Authority for any variation may be withdrawn whenever in the judgment of the appropriate TTB officer the revenue is jeopardized or the effective administration of this part is hindered by the continuation of such variation. Where the proprietor desires to employ such variation, he shall submit a written application to do so to the appropriate TTB officer. The application will describe the proposed variations and set forth the reasons therefor. Variations will not be employed until the application has been approved, except when the emergency requires immediate action to correct a situation that is threatening to life or property. Such corrective action may then be taken concurrent with the filing of the application and notification of the appropriate TTB officer, via telephone. The proprietor shall retain, as part of the records available for examination by appropriate TTB officers, any application approved by the appropriate TTB officer under the provisions of this section. (Sec. 232, Pub. L. 96–223, 94 Stat. 278 (26 U.S.C. 5181)) Distilled spirits may be withdrawn free of tax from the premises of an alcohol fuel plant exclusively for fuel use in accordance with this subpart. Payment of tax will be required in the case of diversion of spirits to beverage use or other unauthorized dispositions. The provisions of subpart C of this part are applicable to distilled spirits for fuel use as follows: (a) Imposition of tax liability (§§19.21 through 19.25); (b) Assessment of tax (§§19.31 and 19.32); and (c) Claims for tax (§§19.41 and 19.44). (Sec. 201, Pub. L. 85–859, 72 Stat. 1314, as amended (26 U.S.C. 5001); sec. 232, Pub. L. 96–223, 94 Stat. 278 (26 U.S.C. 5181)) [T.D. ATF–207, 50 FR 23682, June 5, 1985] (a) General rule. A proprietor of an alcohol fuel plant established under this subpart shall be subject to a special (occupational) tax as prescribed in subpart Ca of this part, and shall hold a separate special tax stamp to cover the alcohol fuel operations except during the suspension period described in §19.49(a)(3) when special tax stamps are not issued. (b) Exemption for small plants (effective July 1, 1989). On and after July 1, 1989, paragraph (a) of this section shall not apply to small alcohol fuel plants as defined in §19.907. If the annual production (including receipts) of a small plant exceeds 10,000 proof gallons in any calendar year, special tax is due as provided in §19.49(a)(1) for the special tax year (July 1 through June 30) commencing during that calendar year, regardless of whether an application for change of plant type under §19.921(a) has been filed or approved. If a medium or large plant produces 10,000 or fewer proof gallons (including receipts) in any calendar year, the plant shall be exempt from special tax under this paragraph, as for a small plant, for the special tax year (July 1 through June 30) commencing during that calendar year, regardless of whether an application under §19.921(c) has been filed or approved. (26 U.S.C. 5081) [T.D. ATF–271, 53 FR 17543, May 17, 1988, as amended by T.D. ATF–285, 53 FR 12609, Mar. 28, 1989; T.D. ATF–312, 56 FR 31077, July 9, 1991; T.D. TTB–36, 70 FR 62243, Oct. 31, 2005] When used in this subpart, and in forms prescribed under this subpart, terms shall have the meaning given in this section. Words in the plural form include the singular and vice versa, and words indicating the masculine gender include the feminine. The terms “includes” and “including” do not exclude things not enumerated which are in the same general class. Alcohol fuel plant or plant. An establishment qualified under this subpart solely for producing, processing and storing, and using or distributing distilled spirits to be used exclusively for fuel use. Alcohol fuel producer's permit. The document issued pursuant to 26 U.S.C. 5181 authorizing the person named therein to engage in business as an alcohol fuel plant. Bonded premises. The premises of an alcohol fuel plant where distilled spirits are produced, processed and stored, and used or distributed. Premises of small alcohol fuel plants, which are exempt from bonding under §19.912(b), shall be treated as bonded premises for purposes of this subpart. CFR. The Code of Federal Regulations. Fuel alcohol. Distilled spirits which have been rendered unfit for beverage use at an alcohol fuel plant as provided in this subpart. Gallon or wine gallon. The liquid measure equivalent to the volume of 231 cubic inches. Person. An individual, trust, estate, partnership, association, company or corporation. Proof. The ethyl alcohol content of a liquid at 60 degrees Fahrenheit, stated as twice the percent of ethyl alcohol by volume. Proof gallon. A gallon of liquid at 60 degrees Fahrenheit which contains 50 percent by volume of ethyl alcohol having a specific gravity of 0.7939 at 60 degrees Fahrenheit referred to water at 60 degrees Fahrenheit as unity, or the alcoholic equivalent thereof. Proprietor. The person qualified under this subpart to operate the alcohol fuel plant. Render unfit for beverage use. The addition to distilled spirits of materials which will not impair the quality of the spirits for fuel use as prescribed and authorized by the provisions of this subpart. Secretary. The Secretary of the Treasury or his delegate. Spirits or distilled spirits. That substance known as ethyl alcohol, ethanol, or spirits of wine in any form (including all dilutions and mixtures thereof from whatever source or by whatever process produced), but not fuel alcohol unless specifically stated. For purposes of this subpart, the term does not include spirits produced from petroleum, natural gas, or coal. This chapter. Title 27, Code of Federal Regulations, Chapter I [27 CFR Chapter I]. Transfer in bond. The transfer of spirits between alcohol fuel plants or the transfer of spirits to or from a distilled spirits plant qualified under 26 U.S.C. 5171 and an alcohol fuel plant. Type of plant. The following three types of alcohol fuel plants are recognized in this subpart: (a) Small plant. An alcohol fuel plant which produces (including receipts) not more than 10,000 proof gallons of spirits per calendar year. (b) Medium plant. An alcohol fuel plant which produces (including receipts) more than 10,000 and not more than 500,000 proof gallons of spirits per calendar year. (c) Large plant. An alcohol fuel plant which produces (including receipts) more than 500,000 proof gallons of spirits per calendar year. U.S.C. The United States Code. [T.D. ATF–198, 50 FR 8464, Mar. 1, 1985, as amended by T.D. TTB–44, 71 FR 16933, Apr. 4, 2006]
Title 27: Alcohol, Tobacco and Firearms
PART 19—DISTILLED SPIRITS PLANTS
Subpart Y—Distilled Spirits For Fuel Use
§ 19.901 Scope of subpart.
§ 19.902 Waiver for alcohol fuel plants.
§ 19.903 Alternate methods or procedures.
§ 19.904 Emergency variations from requirements.
§ 19.905 Taxes.
§ 19.906 Special (occupational) tax.
Definitions
§ 19.907 Meaning of terms.
Permits
§ 19.910 Application for permit required.
Any person wishing to establish an alcohol fuel plant shall first make application for and obtain an alcohol fuel producer's permit. The application for a permit will be on Form 5110.74. The application, in duplicate, will be submitted to the appropriate TTB officer. The description of stills on the approved application constitutes registration of stills as required by 27 CFR 196.45. Alcohol fuel producers' permits are continuing unless automatically terminated under §19.920, suspended or revoked as provided in §19.950, or voluntarily surrendered.
(Sec. 201, Pub. L. 85–859, 72 Stat. 1355, as amended (26 U.S.C. 5179); sec. 232, Pub. L. 96–223, 94 Stat. 278 (26 U.S.C. 5181))
§ 19.911 Criteria for issuance of permit.
In general, an alcohol fuel producer's permit will be issued to any person who completes the required application for permit and who furnishes the required bond (if any). However, the appropriate TTB officer may institute proceedings for the denial of the application, if the appropriate TTB officer determines that:
(a) The applicant (including, in the case of a corporation, any officer, director, or principal stockholder, and in the case of a partnership, a partner) is, by reason of business experience, financial standing, or trade connections, not likely to maintain operations in compliance with 26 U.S.C. Chapter 51, or regulations issued thereunder; or
(b) The applicant has failed to disclose any material information required, or has made any false statement, as to any material fact, in connection with the application; or
(c) The premises on which the applicant proposes to conduct the operations are not adequate to protect the revenue. The procedures applicable to denial of applications are set forth in 27 CFR Part 71.
(Sec. 201, Pub. L. 85–859, 72 Stat. 1370, as amended (26 U.S.C. 5271); sec. 232, Pub. L. 96–223, 94 Stat. 278 (26 U.S.C. 5181))
§ 19.912 Small plants.
Persons wishing to establish a small plant shall apply for a permit as provided in this section. Except as provided in paragraph (c) of §19.913, operations may not be commenced until the permit has been issued.
(a) Application for permit. The application (Form 5110.74) shall be submitted to the appropriate TTB officer and shall set forth the following information:
(1) Name and mailing address of the applicant, and the location of the alcohol fuel plant if not apparent from the mailing address;
(2) A diagram of the plant premises and a statement as to the ownership of the premises (if the premises are not owned by the proprietor, the owner's consent to access by appropriate TTB officers must be furnished);
(3) A description of all stills and a statement of their maximum capacity;
(4) The materials from which spirits will be produced; and
(5) A description of the security measures to be used to protect premises, buildings and equipment where spirits are produced, processed, and stored.
(b) Bond. No bond is required for small plants.
(Sec. 232, Pub. L. 96–223, 94 Stat. 278 (26 U.S.C. 5181))
§ 19.913 Action on applications to establish small plants.
(a) Receipt by the appropriate TTB officer—(1) Notice of receipt. Within 15 days of receipt of the application, the appropriate TTB officer shall send a written notice of receipt to the applicant. The notice will include a statement as to whether the application meets the requirements of §19.912. If the application does not meet those requirements, the application will be returned and a new 15-day period will commence upon receipt by the appropriate TTB officer of the amended or corrected application.
(2) Failure to give notice. If the required notice of receipt is not sent, and the applicant has a receipt indicating that the appropriate TTB officer has received the application, the 45-day period provided for in paragraphs (b) and (c) of this section will commence on the fifteenth day after the date the appropriate TTB officer received the application.
(3) Limitation. The provisions of subparagraphs (1) and (2) of this section apply only to:
(i) The first application submitted with respect to any one small plant in any calendar quarter; and
(ii) An amended or corrected first application.
(b) Determination by the appropriate TTB officer. Within 45 days from the date the appropriate TTB officer sent the applicant a notice of receipt of a completed application, the appropriate TTB officer shall either (1) issue the permit, or (2) give notice in writting to the applicant, stating in detail the reason that a permit will not be issued. Denial of an application will not prejudice any further application for a permit made by the same applicant.
(c) Presumption of approval. If, within 45 days from the date of the notice to the applicant of receipt of a completed application, the appropriate TTB officer has not notified the applicant of issuance of the permit or denial of the application, the application shall be deemed to have been approved and the applicant may proceed if a permit had been issued.
(Sec. 232, Pub. L. 96–223, 94 Stat. 278 (26 U.S.C. 5181))
§ 19.914 Medium plants.
Any person wishing to establish a medium plant shall make application for and obtain in alcohol fuel producer's permit. Operations may not be commenced until the application has been approved and the permit issued.
(a) Application for permit. The application (Form 5110.74) shall be submitted to the appropriate TTB officer and shall set forth the following information:
(1) The information required by §19.912 (a);
(2) Statement of maximum total proof gallons of spirits that will be produced and received during a calendar year:
(3) Information identifying the principal persons involved in the business and a statement as to whether the applicant or any such person has ever been convicted of a felony or misdemeanor under Federal or State law; and,
(4) Statement of the amount of funds invested in the business and the source of those funds.
(b) Bond. A bond of sufficient penal sum, as prescribed in §19.957, is required. The bond must be submitted on Form 5110.56 and approved before a permit may be issued.
(Sec. 232, Pub. L. 96–223, 94 Stat. 278 (26 U.S.C. 5181))
§ 19.915 Large plants.
Any person wishing to establish a large plant shall make application for and obtain an alcohol fuel producer's permit. Operations may not be commenced until the application has been approved and the permit issued.
(a) Application for permit. The application (Form 5110.74) shall be submitted to the appropriate TTB officer and shall set forth the following information:
(1) The information required by §19.912(a);
(2) Statement of the maximum proof gallons of spirits that will be produced and received during a calendar year;
(3) Information identifying the principal persons involved in the business and a statement as to whether the applicant or any such person has ever been convicted of a felony or misdemeanor under Federal or State law;
(4) Statement of the amount of funds invested in the business and the source of those funds;
(5) Statement of the type of business organization and of the persons interested in the business, supported by the items of information listed in §19.916; and,
(6) List of the offices, the incumbents of which are authorized by the articles of incorporation or the board of directors to act on behalf of the proprietor or to sign the proprietor's name.
(b) Bond. A bond of sufficient penal sum, as prescribed in §19.957, is required. The bond must be submitted on Form 5110.56 and approved before a permit may be issued.
(Sec. 232, Pub. L. 96–223, 94 Stat. 278 (26 U.S.C. 5181))
§ 19.916 Organizational documents.
The supporting information required by paragraph (a)(5) of §19.915, includes, as applicable, copies of—
(a) Corporate documents. (1) Corporate charter or certificate of corporate existence or incorporation.
(2) List of officers and directors, showing their names and addresses. However, do not list officers and directors who have no responsibilities in connection with the operation of the alcohol fuel plant.
(3) Certified extracts or digests of minutes of meetings of board of directors, authorizing certain individuals to sign for the corporation.
(4) Statement showing the number of shares of each class of stock or other evidence of ownership, authorized and outstanding, and the voting rights of the respective owners or holders.
(b) Statement of interest. (1) Names and addresses of the 10 persons having the largest ownership or other interest in each of the classes of stock in the corporation, or other legal entity, and the nature and amount of the stockholding or other interest of each, whether the interest appears in the name of the interested party or in the name of another for him. If a corporation is wholly owned or controlled by another corporation, those persons of the parent corporation who meet the above standards are considered to be the persons interested in the business of the subsidiary, and the names thereof need be furnished only upon request of the appropriate TTB officer.
(2) In the case of an individual owner or partnership, the name and address of each person interested in the plant, whether the interest appears in the name of the interested party or in the name of another for that person.
(c) Availability of additional documents. The originals of documents required to be submitted under this section and additional items required under §19.918 such as the articles of incorporation, bylaws, State certificate authorizing operations, or articles of partnership or association (in the case of a partnership where required by State law) shall be made available to any appropriate TTB officer upon request.
(Sec. 201, Pub. L. 85–859, 72 Stat. 1370, as amended (26 U.S.C. 5271); sec. 232, Pub. L. 96–223, 94 Stat. 278 (26 U.S.C. 5181))
§ 19.917 Powers of attorney.
The proprietor of a large plant shall execute and file with the appropriate TTB officer a Form 1534 (5000.8), in accordance with instructions on the form, for each person authorized to sign or act on behalf of the proprietor (Not required for persons whose authority is furnished in the application).
(Sec. 201, Pub. L. 85–859, 72 Stat. 1370, as amended (26 U.S.C. 5271))
§ 19.918 Information already on file and supplemental information.
If any of the information required by §§19.912 through 19.916 is on file with the appropriate TTB officer, that information, if accurate and complete, may be incorporated by reference and made a part of the application. When required by the appropriate TTB officer, the applicant shall furnish as a part of the application for permit, additional information as may be necessary to determine whether the application should be approved.
(Sec. 232, Pub. L. 96–223, 94 Stat. 278, (26 U.S.C. 5181))
Changes Affecting Applications and Permits
§ 19.919 Changes affecting applications and permits.
When there is a change relating to any of the information contained in, or considered a part of, the application on Form 5110.74, the proprietor shall within 30 days file with the appropriate TTB officer, a written notice, in duplicate, of such change. Where the change affects the terms and conditions of the permit the proprietor shall within 30 days (except as otherwise provided in this subpart), file with the appropriate TTB officer, in duplicate, an amended application on Form 5110.74.
(Sec. 201, Pub. L. 85–859, 72 Stat. 1349, as amended, 1370, as amended (26 U.S.C. 5172, 5271); sec. 232, Pub. L. 96–223, 94 Stat. 278 (26 U.S.C. 5181))
§ 19.920 Automatic termination of permits.
(a) Permits not transferable. Permits issued under this subpart shall not be transferred. In the event of the lease, sale, or other transfer of such a permit, or of the authorized operations, the permit automatically terminates.
(b) Corporations. In the case of a corporation holding a permit under this subpart, if actual or legal control of the permittee corporation changes, directly or indirectly, whether by reason of change in stock ownership or control (in the permittee corporation or in any other corporation), by operation of law, or in any other manner, the permit may remain in effect until the expiration of 30 days after the change, whereupon the permit will automatically terminate. However, if operations are to be continued after the change in control, and an application for a new permit is filed within 30 days of the change, then the outstanding permit may remain in effect until final action is taken on the new application. When final action is taken on the application, the outstanding permit automatically terminates.
(Sec. 201, Pub. L. 85–859, 72 Stat. 1370, as amended (26 U.S.C. 5271))
§ 19.921 Change in type of alcohol fuel plant.
(a) Small plants. If the proprietor of a small plant wishes to increase production (including receipts) to a level in excess of 10,000 proof gallons of spirits per calendar year, the proprietor shall first furnish a bond and obtain an amended permit by filing application under §19.914 or §19.915, as applicable. Information filed with the original application for permit need not be resubmitted, but may be incorporated by reference in the new application.
(b) Medium plants. Where the proprietor of a medium plant intends to increase production (including receipts) above 500,000 proof gallons of spirits per calendar year, the proprietor shall first obtain an amended permit by filing an application under §19.915. A new or strengthening bond may be required (see §19.956). Information already on file may be incorporated by reference in the new application.
(c) Curtailment of activities. Proprietors of large or medium plants who have curtailed operations to a level where they are eligible to be requalified as medium or small plants may, on approval of a letter of application by the appropriate TTB officer, be relieved from the additional requirements incident to their original qualification. In the case of a change to small plant status, termination of the bond and relief of the surety from further liability shall be as provided in subpart H of this part.
(Sec. 201, Pub. L. 85–859, 72 Stat. 1370, as amended (26 U.S.C. 5271); sec. 232, Pub. L. 96–223, 94 Stat. 278 (26 U.S.C. 5181))
§ 19.922 Change in name of proprietor.
Where there is to be a change in the individual, firm, or corporate name, the proprietor shall, within 30 days of the change, file an application to amend the permit; a new bond or consent of surety is not required.
(Sec. 201, Pub. L. 85–859, 72 Stat. 1349, as amended, 1370, as amended (26 U.S.C. 5172, 5271); sec. 232, Pub. L. 96–223, 94 Stat. 278 (26 U.S.C. 5181))
§ 19.923 Changes in officers, directors, or principal persons.
Where there is any change in the list of officers, directors, or principal persons, furnished under the provisions of §19.914, §19.915 or §19.916, the proprietor shall submit, within 30 days of any such change, a notice in letter form stating the changes in officers, directors, or principal persons. A new list reflecting the changes will be submitted with the letter notice.
(Sec. 232, Pub. L. 96–233, 94 Stat. 278 (26 U.S.C. 5181))
§ 19.924 Change in proprietorship.
(a) General. If there is a change in the proprietorship of a plant qualified under this part, the outgoing proprietor shall comply with the requirements of §19.945 and the successor shall, before commencing operations, apply for and obtain a permit and file the required bond (if any) in the same manner as a person qualifying as the proprietor of a new plant.
(b) Fiduciary. A successor to the proprietorship of a plant who is an administrator, executor, receiver, trustee, assignee or other fiduciary, shall comply with the applicable provisions of §19.186(b).
(Sec. 201, Pub. L. 85–859, 72 Stat. 1349, as amended (26 U.S.C. 5172))
§ 19.925 Continuing partnerships.
If under the laws of the particular State, the partnership is not immediately terminated on death or insolvency of a partner, but continues until the winding up of the partnership affairs is completed, and the surviving partner has the exclusive right to the control and possession of the partnership assets for the purpose of liquidation and settlement, the surviving partner may continue to operate the plant under the prior qualification of the partnership. However, in the case of a large or a medium plant, a consent of surety must be filed, wherein the surety and the surviving partner agree to remain liable on the bond. If the surviving partner acquires the business on completion of the settlement of the partnership, he shall qualify in his own name from the date of acquisition, as provided in §19.924(a). The rule set forth in this section will also apply where there is more than one surviving partner.
(Sec. 201, Pub. L. 85–859, 72 Stat. 1349, as amended (26 U.S.C. 5172); sec. 232, Pub. L. 96–223, 94 Stat. 278 (26 U.S.C. 5181))
§ 19.926 Change in location.
Where there is a change in the location of the plant or of the area included within the plant premises, the proprietor shall file an application to amend the permit and, if a bond is required, either a new bond or a consent of surety on Form 1533 (5000.18). Operation of the plant may not be commenced at the new location prior to issuance of the amended permit.
(Sec. 201, Pub. L. 85–859, 72 Stat. 1349, as amended, 1370, as amended (26 U.S.C. 5172, 5271); sec. 805(c), Pub. L. 96–39, 93 Stat. 276 (26 U.S.C. 5173); sec. 232, Pub. L. 96–223, 94 Stat. 278 (26 U.S.C. 5181))
Alternate Operations
§ 19.930 Alternating proprietorship.
(a) General. (1) An alcohol fuel plant, or a part thereof, may be operated alternately by proprietors if—
(i) The alcohol fuel plant and the proprietors are otherwise qualified under the provisions of this subpart, and
(ii) The necessary operations bonds (if any) and applications covering such operations have been filed with and approved by the appropriate TTB officer.
(2) Where alternating proprietorship is to be limited to a part of a plant, that part must be suitable for qualification as a separate plant.
(b) Qualifying Documents. Each person desiring to operate an alcohol fuel plant as an alternating proprietor shall file with the appropriate TTB officer:
(1) An application on Form 5110.74 to cover the proposed alternation of premises.
(2) Diagram of premises, in duplicate, showing the arrangement under which the premises will be operated. Diagrams will be prepared in accordance with paragraph (c) of this section.
(3) Evidence of existing operations bond (if any), consent of surety, or a new operations bond to cover the proposed alternation of premises.
(4) When required by the appropriate TTB officer, additional information as may be necessary to determine whether the application should be approved.
(c) Diagram of premises. Each person filing an application for operation of a plant as an alternating proprietor shall submit a diagram of the premises. Where operations by alternating proprietors are limited to parts of a plant, a diagram which designates the parts of the plant that are to be alternated will be submitted. A diagram will be submitted for each arrangement under which the premises will be operated. The diagram will be in sufficient detail to establish the boundaries of the plant or any part thereof which is to be alternated.
(d) Alternation Journal. Once the applications have been approved and initial operations conducted thereunder, the plant, or parts thereof, may be alternated. The outgoing and incoming proprietor shall enter into an alternation journal the following information:
(1) Name or trade name;
(2) Alcohol fuel plant permit number;
(3) Date and time of alternation; and
(4) Quantity of spirits transferred in proof gallons.
The alternation journal will remain in the possession of the incoming proprietor until the premises are again alternated whereupon it will be transferred to the new incoming proprietor.
(e) Commencement of operations. Except for spirits transferred to the incoming proprietor, the outgoing proprietor shall remove all spirits from areas, rooms, or buildings to be alternated, prior to the effective date and time shown in the alternation journal. Fuel alcohol may be either transferred to the incoming proprietor or may be retained by the outgoing proprietor in areas, rooms, or buildings to be alternated when the areas, rooms, or buildings are secured with locks, the keys to which are in the custody of the outgoing proprietor. Whenever operation of the areas, rooms, or buildings is to be resumed by a proprietor following suspension of operations by an alternating proprietor, the outgoing proprietor (except proprietors of small plants) must furnish a consent of surety on Form 1533 (5000.18) to continue in effect the operations bond covering his operations. This is to be done prior to alternating the premises.
(f) Records. Each proprietor shall maintain separate records and submit separate reports. All transfers of spirits will be reflected in the records of each proprietor. The quantity of spirits and fuel alcohol transferred will be shown in the production and disposition records of the outgoing proprietor. The quantity of spirits transferred will be shown in the receipt record of the incoming proprietor. Each outgoing and incoming proprietor shall include spirits transferred in determinations of plant size and bond amounts. The provisions of §19.921 regarding change in type of plant are applicable to each proprietor. Entries into these records will be in the manner prescribed in §§19.982, 19.984, and 19.986.
(Sec. 201, Pub. L. 85–859, 72 Stat. 1349, as amended, 1370, as amended (26 U.S.C. 5172, 5271; sec. 805(a), Pub. 96–39, 93 Stat. 275 (26 U.S.C. 5171); sec. 232 Pub. L. 96–223, 94 Stat. 278 (26 U.S.C. 5181))
Permanent Discontinuance of Business
§ 19.945 Notice of permanent discontinuance.
A proprietor who permanently discontinues operations as an alcohol fuel plant shall, after completion of the operations, file a letterhead notice with the appropriate TTB officer. The notice shall be accompanied—
(a) By the alcohol fuel producer's permit, and by the proprietor's request that such permit be canceled;
(b) By a written statement disclosing, as applicable, whether (1) all spirits (including fuel alcohol) have been lawfully disposed of, and (2) any spirits are in transit to the premises; and
(c) By a report covering the discontinued operations (the report shall be marked “Final Report”).
(Sec. 201, Pub. L. 85–859, 72 Stat. 1349, as amended, 1370, as amended (26 U.S.C. 5172, 5271); sec. 232, Pub. L. 96–223, 94 Stat. 278 (26 U.S.C. 5181))
Suspension or Revocation of Permits
§ 19.950 Suspension or revocation.
Whenever the appropriate TTB officer has reason to believe that any person holding an alcohol fuel producer's permit—
(a) Has not in good faith complied with the applicable provisions of 26 U.S.C. Chapter 51, or regulations issued thereunder; or
(b) Has violated conditions of the permit; or
(c) Has made any false statements as to any material fact in the application therefor; or
(d) Has failed to disclose any material information required to be furnished; or
(e) Has violated or conspired to violate any law of the United States relating to intoxicating liquor or has been convicted of any offense under Title 26, U.S.C. punishable as a felony or of any conspiracy to commit such offense; or
(f) Has not engaged in any of the operations authorized by the permit for a period of more than 2 years; the appropriate TTB officer may institute proceedings for the revocation or suspension of the permit in accordance with the procedures set forth in 27 CFR part 71.
(Sec. 201, Pub. L. 85–859, 72 Stat. 1370, as amended (26 U.S.C. 5271))
Bonds
§ 19.955 Bonds.
An operations bond is required for medium and large plants. The bond will be executed, in duplicate, on Form 5110.56. Surety bonds may be given only with corporate sureties holding certificates of authority from, and subject to the limitations prescribed by, the Secretary as set forth in the current revision of Treasury Department Circular 570. However, in lieu of corporate surety the proprietor may pledge and deposit as surety for his bond, securities which are transferable and are guaranteed as to both interest and principal by the United States, in accordance with the provisions of 31 CFR part 225. The appropriate TTB officer will not release such securities until liability under the bond for which they were pledged has been terminated.
(Sec. 805(c), Pub. L. 96–39, 93 Stat. 276 (26 U.S.C. 5173); CH. 390, Pub. L. 80–280, 61 Stat. 648, 650 (31 U.S.C. 9301, 9303, 9304, 9306); sec. 232, Pub. L. 96–223, 94 Stat. 278 (26 U.S.C. 5181))
§ 19.956 Amount of bond.
The penal sum of the bond is based on the total quantity of distilled spirits to be produced (including receipts) during a calendar year. If the level of production and/or receipts at the plant is to be increased, and the bond is not in the maximum penal sum, a new or strengthening bond shall be obtained.
(a) Medium plants. A medium plant which will produce (including receipts) between 10,000 and 20,000 proof gallons of spirits per year requires a bond in the amount of $2,000. For each additional 10,000 proof gallons (or fraction thereof), the bond amount is increased $1,000. The maximum bond for a medium plant is $50,000.
(b) Large plants. The minimum bond for a large plant is $52,000 (more than 500,000, but not more than 510,000 proof gallons annual production (including receipts)). For each additional 10,000 (or fraction) proof gallons, the amount of the bond is increased $2,000. The maximum bond for a large plant is $200,000 (more than 1,240,000 proof gallons).
(Sec. 805(c), Pub. L. 96–39, 93 Stat. 276 (26 U.S.C. 5173); sec. 232, Pub. L. 96–233, 94 Stat. 278 (26 U.S.C. 5181))
§ 19.957 Instructions to compute bond penal sum.
(a) Medium plants. To find the required amount of your bond, estimate the total proof gallons of spirits to be produced and received in a calendar year. The amount of the bond is $1,000 for each 10,000 proof gallons (or fraction), subject to a minimum of $2,000 and a maximum of $50,000. The following table provides some examples:
Annual Production and Receipts in Proof Gallons------------------------------------------------------------------------ But not Amount More than over of bond------------------------------------------------------------------------10,000.............................................. 20,000 $2,00020,000.............................................. 30,000 3,00090,000.............................................. 100,000 10,000190,000............................................. 200,000 20,000490,000............................................. 500,000 50,000------------------------------------------------------------------------
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(b) Large plants. To find the required amount of your bond, estimate the total proof gallons of spirits to be produced and received in a calendar year. The amount of the bond is $50,000 plus $2,000 for each 10,000 proof gallons (or fraction) over 500,000. The following table provides some examples: |
Annual Production and Receipts in Proof Gallons------------------------------------------------------------------------ But not Amount More than over of bond------------------------------------------------------------------------500,000............................................ 510,000 $52,000510,000............................................ 520,000 54,000740,000............................................ 750,000 100,000990,000............................................ 1,000,000 150,0001,240,000.......................................... ......... 200,000------------------------------------------------------------------------
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(Sec. 805(c), Pub. L. 96–39, 93 Stat. 276 (26 U.S.C. 5173; sec. 232, Pub. L. 96–223, 94 Stat. 278 (26 U.S.C. 5181)) § 19.958 Conditions of bond.The bond shall be conditioned on payment of all taxes (including any penalties and interest) imposed by 26 U.S.C. Chapter 51, on compliance with all requirements of law and regulations, and on payment of all penalties incurred or fines imposed for violations of any such provisions. (Sec. 805(c), Pub. L. 96–39, 93 Stat. 276 (26 U.S.C. 5173); sec. 232, Pub. L. 96–223, 94 Stat. 278 (26 U.S.C. 5181)) § 19.959 Additional provisions with respect to bonds.Subpart H of this part contains further provisions applicable to bonds which, where not inconsistent with this subpart, are applicable to bonds of alcohol fuel plants. Construction, Equipment and Security§ 19.965 Construction and equipment.Buildings and enclosures where distilled spirits will be produced, processed, or stored shall be constructed and arranged to enable the proprietor to maintain security adequate to deter diversion of the spirits. Distilling equipment shall be constructed to prevent unauthorized removal of spirits, from the point where distilled spirits come into existence until production is complete and the quantity of spirits has been determined. Tanks and other vessels for containing spirits shall be equipped for locking and be constructed to allow for determining the quantities of spirits therein. (Sec. 201, Pub. L. 85–859, 72 Stat. 1353, as amended (26 U.S.C. 5178)) § 19.966 Security.Proprietors shall provide security adequate to deter the unauthorized removal of spirits. The proprietor shall store spirits either in a building, a storage tank, or within an enclosure, which the proprietor will keep locked when operations are not being conducted. (Sec. 201, Pub. L. 85–859, 72 Stat. 1353, as amended (26 U.S.C. 5178); sec. 806, Pub. L. 96–39, 93 Stat. 279 (26 U.S.C. 5202)) § 19.967 Additional security.If the appropriate TTB officer finds that security is inadequate to deter diversion of the spirits, as may be evidenced by the occurrence of break-ins or by diversion of spirits to unauthorized purposes, additional security measures may be required. Such additional measures may include, but are not limited to, the following: (a) The erection of a fence around the plant or the alcohol storage facility; (b) Flood lights; (c) Alarm systems; (d) Watchman services; or, (e) Locked or barred windows. The exact additional security requirements would depend on the extent of the security problems, the volume of alcohol produced, the risk to tax revenue, and safety requirements. (Sec. 201, Pub. L. 85–859, 72 Stat. 1353, as amended (26 U.S.C. 5178); sec. 806, Pub. L. 96–39, 93 Stat. 279 (26 U.S.C. 5202)) Supervision§ 19.970 Supervision of operations.The appropriate TTB officer may assign appropriate TTB officers to premises of plants qualified under this subpart. The authorities of appropriate TTB officers, provided in §§19.81 through 19.84, and the requirement that proprietors furnish facilities and assistance to appropriate TTB officers, provided in §19.86, apply to plants qualified under this subpart. The provisions of §19.75 of this part pertaining to the assignment of appropriate TTB officers and hours of operation, to the extent deemed necessary by the appropriate TTB officer, are applicable to plants qualified under this subpart. (Sec. 201, Pub. L. 85–859, 72 Stat. 1320, as amended, 1356, as amended, 1357, as amended, 1358, as amended, 1375, as amended, 1396, as amended (26 U.S.C. 5006, 5201, 5203, 5204, 5213, 5555); sec. 806, Pub. L. 96–39, 93 Stat. 279 (26 U.S.C. 5202); sec. 807, Pub. L. 96–39, 93 Stat. 284 (26 U.S.C. 5207)) Accounting for Spirits§ 19.980 Gauging.(a) Equipment and method. Proprietors shall gauge spirits by accurately determining the proof and quantity of spirits. The proof of the spirits shall be determined using a glass cylinder, hydrometer, and thermometer. Proprietors may account for fuel alcohol in wine gallons. Unless proprietors desire to do so, it is not necessary to determine the proof of fuel alcohol manufactured, on-hand, or removed. The Proprietor may determine quantity either by volume or weight. A tank or receptacle with a calibrated sight glass installed, a calibrated dipstick, conversion charts, meters (subject to approval by the appropriate TTB officer, or other devices or methods approved by the appropriate TTB officer, may be used to determine quantity by volume. The proprietor shall ensure that hydrometers, thermometers, and other equipment used to determine proof, volume, or weight are accurate. From time to time appropriate TTB officers shall verify the accuracy of such equipment. Detailed procedures for gauging spirits are provided in 27 CFR part 30. (b) When Required. Proprietors shall guage spirits and record the results in their records at the following times: (1) On completion of production of distilled spirits; (2) On receipt of spirits at the plant; (3) Prior to the addition of materials to render the spirits unfit for beverage use; (4) Before withdrawal from plant premises or other disposition of spirits (including fuel alcohol); and (5) When spirits are to be inventoried. (Sec. 201, Pub. L. 85–859, 72 Stat. 1356, as amended, 1358, as amended (26 U.S.C. 5201, 5204)) § 19.981 Inventories.Proprietors shall take actual physical inventory of all spirits (including fuel alcohol) on bonded premises at least once during each period for which a report is required by §19.988. The results of the inventory shall be posted in the applicable records required by §19.982. (Sec. 201, Pub. L. 85–859, 72 Stat. 1356, as amended (26 U.S.C. 5201)) § 19.982 Records.(a) All plants. All proprietors shall maintain records with respect to: (1) The quantity and proof of spirits produced; (2) The proof gallons of spirits on-hand and received; (3) The quantities and types of materials added to render the spirits unfit for beverage use; (4) The quantity of fuel alcohol manufactured; and, (5) All dispositions of spirits (including fuel alcohol). Fuel alcohol may be recorded in wine gallons. (b) Medium and large plants. Proprietors of medium and large plants shall also record the kind and quantity of materials used to produce spirits. (c) General requirements. (1) The records must contain sufficient information to allow appropriate TTB officers to determine the quantities of spirits produced, received, stored, or processed and to verify that all spirits have been lawfully disposed of or used. (2) Records which the proprietor prepares for other purposes (i.e. invoices or other commercial records) may be used to meet the record requirements of this subpart, so long as they show the required information. (3) Where the format or arrangement of the record is such that the information is not clearly or accurately reflected, the appropriate TTB officer may require a format or arrangement which will clearly and accurately reflect the information. (4) Entries required by this subpart to be made into records will be made on the day on which the operation or transaction occurs. However, these entries may be deferred until the third business day succeeding the day on which the operation or transaction occurs when the proprietor prepares commercial records concurrent with the individual operation or transaction. (Sec. 807, Pub. L. 96–39, 93 Stat. 284 (26 U.S.C. 5207)) § 19.983 Spirits rendered unfit for beverage use in the production process.Where spirits are rendered unfit for beverage use before removal from the production system, the proprietor shall enter into the production records, in addition to the quantity and proof of spirits produced, the kind and quantity of materials added to each lot of spirits. In such a case, a separate record under §19.985 is not required. The quantity of spirits produced will be determined by substracting the quantity of materials added to render the spirits unfit for beverage use from the quantity of fuel alcohol produced and multiplying the resulting figure by the proof of each lot of spirits. The proprietor shall determine the proof of each lot of spirits. The proprietor shall procure a representative sample of each lot, prior to the addition of any material for rendering the spirits unfit for beverage use, and proof the sample in accordance with the provisions of §19.980(a). This paragraph applies to in-line addition of materials and to systems in which, before any spirits come off the production equipment, the proprietor adds materials for rendering the spirits unfit for beverage use to the first receptacle where spirits are to be deposited. (Sec. 807, Pub. L. 96–39, 93 Stat. 284 (26 U.S.C. 5207); sec. 232, Pub. L. 96–222, 94 Stat. 278 (26 U.S.C. 5181)) § 19.984 Record of spirits received.The proprietor's copy of the consignor's invoice or other document received with the shipment, on which the proprietor has noted the date of receipt and quantity received, constitutes the required record. (Sec. 807, Pub. L. 96–39, 93 Stat. 284 (26 U.S.C. 5207)) § 19.985 Record of spirits rendered unfit for beverage use.The proprietor shall record the kind and quantity of materials added to render each lot of spirits unfit for beverage use and the quantity of fuel alcohol manufactured (which may be given in wine gallons). (Sec. 807, Pub. L. 96–39, 93 Stat. 284 (26 U.S.C. 5207)) § 19.986 Record of dispositions.(a) Fuel alcohol removed. For fuel alcohol removed from the plant premises, the commercial record or other document required by §19.997 constitutes the required record. (b) Spirits transferred. For spirits transferred in bond (including transfers from small plants) to a distilled spirits plant qualified under subpart G of this part or to another alcohol fuel plant, the commercial invoice or other document required by §§19.508 and 19.999 constitutes the required record. (c) Other dispositions. For spirits or fuel alcohol used or otherwise disposed of (e.g., lost, destroyed, redistilled) on the premises of the alcohol fuel plant, the proprietor shall maintain a record as follows: (1) The quantity of spirits (in proof gallons) or fuel alcohol (in gallons) and the date of disposition; and, (2) The purpose for which used or the nature of the other disposition. (d) Separate records. Records for dispositions of fuel alcohol and spirits will be maintained separately. (Sec. 807, Pub. L. 96–39, 93 Stat. 284 (26 U.S.C. 5207); sec. 232, Pub. L. 96–223, 94 Stat. 278 (26 U.S.C. 5181)) § 19.987 Maintenance and retention of records.The proprietor shall retain at the plant where an operation or transaction occurs the records required by this subpart for a period of not less than three years from the date thereof or from the date of the last entry made thereon, whichever is later. Whenever any record because of its condition becomes unsuitable for its intended or continued use the proprietor shall reproduce the record by a process approved by the appropriate TTB officer under the provisions of §19.725. The records shall be available for inspectin by any appropriate TTB officer during business hours. For records maintained on data processing equipment, the provisions of §19.723 apply. (Sec. 807, Pub. L. 96–39, 93 Stat. 284 (26 U.S.C. 5207)) § 19.988 Reports.Each proprietor shall submit an annual report of their operations, Form 5110.75, for the calendar year ending December 31. The proprietor shall submit this report to the appropriate TTB officer by January 30 following the end of the calendar year. (Sec. 807, Pub. L. No. 96–39, 93 Stat. 284 (26 U.S.C. 5207)) [T.D. ATF–327, 57 FR 32178, July 21, 1992] Redistillation§ 19.990 Redistillation of spirits or fuel alcohol received on the plant premises.(a) Receipts for redistillation. Proprietors of alcohol fuel plants may receive and redistill spirits. Fuel alcohol may be received on the premises of an alcohol fuel plant for the recovery by redistillation of the spirits contained therein. Spirits and fuel alcohol received for redistillation will be identified as such and will be kept separate from other spirits and fuel alcohol on the premises until redistilled. Spirits originally produced by the plant and subsequently recovered by redistillation will not be included in determinations of plant size and bond amounts. Spirits riginally produced at other plants and subsequently recovered by redistillation will be included in determinations of plant size and bond amounts. (b) Recordkeeping. (1) The proprietor shall record in a separate record the following information for spirits and fuel alcohol received for redistillation. (i) Date received; (ii) Whether fuel alcohol or spirits; (iii) Quantity received; (iv) From whom received; (v) Reason for redistillation; (vi) Date redistilled; and (vii) Quantity of spirits recovered by redistillation. (2) The proprietor's commercial record required for spirits by §19.999 or for fuel alcohol by §19.997 and any other commercial record received covering spirits or fuel alcohol to be redistilled will be filed separately from other records. These records may be used in lieu of the record required by paragraph (b)(1) of this section when any missing information required to be shown has been entered upon the commercial record by the proprietor. (c) Status. Spirits recovered by redistillation will be treated the same as spirits which have not been redistilled. All provisions of this subpart and 26 U.S.C. Chapter 51 (including liability for tax) applicable to spirits when originally produced are applicable to spirits recovered by redistillation. (Sec. 201, Pub. L. 85–859, 72 Stat. 1365, as amended, 1370, as amended (26 U.S.C. 5223, 5243); sec. 232, Pub. L. 96–223, 94 Stat. 278 (26 U.S.C. 5181)) Uses, Withdrawals and Transfers§ 19.995 Use on premises.Spirits may be used as a fuel on the premises of the alcohol fuel plant at which produced and need not be rendered unfit for beverage use. Proprietors using spirits on the plant premises shall keep the applicable records concerning such dispositions as provided in §19.986(c). (Sec. 232, Pub. L. 96–223, 94 Stat. 278, (26 U.S.C. 5181)) § 19.996 Withdrawal of spirits.Before spirits may be withdrawn from the premises of an alcohol fuel plant, they must be rendered unfit for beverage use as provided in this subpart. Spirits rendered unfit for beverage use (fuel alcohol) may be withdrawn free of tax from plant premises exclusively for fuel use. (Sec. 201, Pub. L. 85–859, 72 Stat. 1362, as amended (26 U.S.C. 5214); sec. 232, Pub. L. 96–223, 94 Stat. 278 (26 U.S.C. 5181)) § 19.997 Withdrawal of fuel alcohol.For each shipment or other removal of fuel alcohol from the plant premises the consignor shall prepare a commercial invoice, sales slip, or similar document. The consignor shall enter on the document the date, the quantity of fuel alcohol removed, a description of the shipment (for example, number and size of containers, tank truck, etc.), and the name and address of the consignee. The consignor shall retain a copy of the document as a record. (Sec. 232, Pub. L. 96–223, 94 Stat. 278 (26 U.S.C. 5181)) § 19.998 Transfer in bond of spirits.(a) Transfer between alcohol fuel plants. A proprietor may remove spirits from the bonded premises of an alcohol fuel plant (including the premises of a small plant) for transfer in bond to another alcohol fuel plant. Bulk conveyances in which spirits are transferred shall be secured with locks, seals or other devices as prescribed by §19.96. The spirits need not be rendered unfit for beverage use prior to transfer. Spirits so transferred may not be withdrawn, used, sold, or otherwise disposed of for other than fuel use. (b) Transfer to or from other distilled spirits plants. Spirits (not including spirits produced from petroleum, natural gas, or coal) may be transferred in bond from distilled spirits plants qualified under subpart G of this part to alcohol fuel plants. Alcohol fuel plants may transfer spirits in bond to distilled spirits plants qualified under subpart G of this part. Bulk conveyances in which spirits are transferred shall be secured with locks, seals, or other devices as prescribed by §19.96. The spirits need not be rendered unfit for beverage use prior to transfer. Spirits so transferred may not be withdrawn, used, sold, or otherwise disposed of for other than fuel use. (c) Transfer procedures. The procedures in §§19.999 through 19.1001 pertain only to the transfer of spirits between alcohol fuel plants. The procedures in §§19.506 through 19.509 and 19.770 pertain to the transfer of spirits from an alcohol fuel plant to a distilled spirits plant qualified under 26 U.S.C. 5171. The alcohol fuel plant transferring in bond spirits filled into portable containers to the bonded premises of a distilled spirits plant qualified under 26 U.S.C. 5171 shall mark each container as required by §19.1008(b). The procedures in §§19.508, 19.510 and 19.770 pertain to the transfer of spirits from a distilled spirits plant to an alcohol fuel plant. (Sec. 201, Pub. L. 85–859, 72 Stat. 1362, as amended (26 U.S.C. 5212); sec. 232, Pub. L. 96–223, 94 Stat. 278 (26 U.S.C. 5181)) § 19.999 Consignor premises.The consignor shall prepare, in duplicate, a commerical invoice or shipping document to cover each shipment of spirits. The consignor shall enter on the document the quantity of spirits transferred, the proof of the spirits transferred, a description of the shipment (for example, number and size of drums or barrels, tank truck, etc.), the name, address, and permit number of the consignor and of the consignee, and the serial numbers of seals, locks, or other devices used to secure the conveyance. The consignor shall forward the original of the document to the consignee with the shipment and retain the copy as a record. (Sec. 201, Pub. L. 85–859, 72 Stat. 1362, as amended (26 U.S.C. 5212)) § 19.1000 Reconsignment in transit.When, prior to or on arrival at the premises of a consignee, spirits transferred in bond are found to be unsuitable for the intended purpose, were shipped in error, or, for any other bona fide reason, are not accepted by such consignee, or are not accepted by a carrier, they may be reconsigned, by the consignor, to himself, or to another qualified consignee. In such case, the bond, if any, of the proprietor to whom the spirits are reconsigned shall cover such spirits while in transit after reconsignment. In addition, if the spirits are reconsigned to a distilled spirits plant qualified under subpart G of this part, an application to receive spirits by transfer in bond (on Form 5100.16) must have been previously approved for the consignee. Notice of cancellation of the shipment shall be made by the consignor to the consignee and the consignor shall note the reconsignemnt on his copy of the document covering the original shipment. Where the reconsignment is to another proprietor, a new document shall be prepared and prominently marked with the word “Reconsignment”. (Sec. 201, Pub. L. 85–859, 72 Stat. 1362, as amended, (26 U.S.C. 5212); sec. 232, Pub. L. 96–223, 94 Stat. 278 (26 U.S.C. 5181)) § 19.1001 Consignee premises.(a) General. When spirits are received by transfer in bond, the proprietor shall examine each conveyance to determine whether the locks, seals, or other devices are intact upon arrival at his premises. If the locks, seals or other devices are not intact, he shall immediately notify the appropriate TTB officer, before removal of any spirits from the conveyance. The consignee shall determine the quantity of spirits received and record the quantity and the date received on the document received with the shipment. The consignee shall retain the document as the record of receipt required by §19.984. (b) Portable containers. When spirits are received in barrels, drums, or similar portable containers, the proprietor shall examine each container and, unless the transfer was made in a secured conveyance and the seals or other devices are intact on arrival, verify the contents of each container. The proprietor shall record the quantity received for each container on a list, and shall attach a copy of the list to the invoice or other document received with the shipment. (c) Bulk conveyances and pipelines. When spirits are received in bulk conveyances or by pipeline, the consignee shall gauge the spirits received and shall record the quantity so determined on the invoice or other document received with shipment. However, the appropriate TTB officer may waive the requirement for gauging spirits on receipt by pipeline if, because of the location of the premises, there will be no jeopardy to the revenue. (Sec. 201, Pub. L. 85–859, 72 Stat. 1358, as amended, 1362, as amended (26 U.S.C. 5204, 5212); sec. 232, Pub. L. 96–223, 94 Stat. 278 (26 U.S.C. 5181)) § 19.1002 Prohibited uses, transfers, and withdrawals.No person shall withdraw, use, sell, or otherwise dispose of distilled spirits (including fuel alcohol) produced under this subpart for other than fuel use. The law imposes criminal penalties on any person who withdraws, uses, sells or otherwise disposes of distilled spirits (including fuel alcohol) produced under this subpart for other than fuel use. (Sec. 201, Pub. L. 85–859, 72 Stat. 1398, as amended (26 U.S.C. 5601); sec. 232, Pub. L. 96–223, 94 Stat. 278 (26 U.S.C. 5181)) Materials for Rendering Spirits Unfit for Beverage Use§ 19.1005 Authorized materials.(a) General. The appropriate TTB officer shall determine and authorize for use materials for rendering spirits unfit for beverage use which will not impair the quality of the spirits for fuel use. Spirits treated under this section will be considered rendered unfit for beverage use and eligible for withdrawal as fuel alcohol. (b) List. The appropriate TTB officer will compile and issue periodically a list of materials authorized for rendering spirits unfit for beverage use. The list will specify for each material (1) name and (2) quantity required to render spirits unfit for beverage use. The list may be obtained by accessing the TTB Web site (http://www.ttb.gov). (c) Authorized material. Until issuance of the initial list of materials authorized for rendering spirits unfit for beverage use, proprietors are authorized to add to each 100 gallons of spirits any of the following materials in the quantities specified. (1) 2 gallons or more of— (i) Gasoline or automotive gasoline (for use in engines which require unleaded gasoline Environmental Protection Agency and manufacturers specifications may require that unleaded gasoline be used to render the spirits unfit for beverage use). (ii) Kerosene, (iii) Deodorized kerosene, (iv) Rubber hydrocarbon solvent, (v) Methyl isobutyl ketone, (vi) Mixed isomers of nitropropane, (vii) Heptane, or, (viii) Any combination of (i) through (vii); or (2) (Sec. 232, Pub. L. 96–223, 94 Stat. 278 (26 U.S.C. 5181)) [T.D. ATF–198, 50 FR 8464, Mar. 1, 1985, as amended by T.D. ATF–249, 52 FR 5961, Feb. 27, 1987; T.D. ATF–442, 66 FR 12854, Mar. 1, 2001] § 19.1006 Other materials.If a proprietor desires to use a material not authorized under §19.1005 to render spirits unfit for beverage use, the proprietor shall submit an application to the appropriate TTB officer. The application must state the name of the material and the quantity of material that the proprietor proposes to add to each 100 gallons of spirits. The proprietor may be required to submit an 8 ounce sample of the material with the application. Material that impairs the quality of the spirits for fuel use will not be approved. The proprietor shall not use any proposed material prior to its approval. Materials approved for use under this section will appear in the next subsequent issuance of the list of materials authorized for rendering spirits unfit for beverage use provided for under §19.1005. The proprietor shall retain as part of the records available for inspection by appropriate TTB officers, any application approved by the appropriate TTB officer under the provisions of this section. (Sec. 232, Pub. L. 96–233, 94 Stat. 278 (26 U.S.C. 5181)) § 19.1007 Samples.A proprietor may take samples of spirits and fuel alcohol for testing and analysis. Samples of spirits may not be removed from the premises of the alcohol fuel plant. Samples of fuel alcohol may be removed from the premises of the alcohol fuel plant to a bona fide laboratory for testing and analysis. The proprietor shall indicate on sample containers that the spirits or fuel alcohol contained therein is a sample. The proprietor shall account for samples in the record provided for in §19.986. (Sec. 232, Pub. L. 96–223, 94 Stat. 278 (26 U.S.C. 5181)) Marks§ 19.1008 Marks.(a) Fuel alcohol. The proprietor shall conspicuously and permanently mark or securely label each container of fuel alcohol containing 55 gallons or less that will be withdrawn from the plant premises, as follows:
WARNING FUEL ALCOHOL MAY BE HARMFUL OR FATAL IF SWALLOWED The mark or label shall be placed on the head or side of the container, and shall be in plain legible letters. Proprietors may place other marks or labels on containers so long as they do not obscure the required mark. (b) Spirits. When barrels, drums or similiar portable containers of spirits are to be transferred by a proprietor to a distilled spirits plant qualified under subpart G of this part, each container will be marked or labeled in plain legible letters on the side or head to show the following information: (1) Quantity in wine gallons; (2) Proof; (3) Serial number of container; (4) Name, address (city or town and State) and permit number of the alcohol fuel plant; and (5) The words “Spirits-For Alcohol Fuel Use Only”. Proprietors may place other marks or labels on such containers so long as they do not obscure the required mark. Serial numbers will be assigned consecutively commencing with “1”. When the numbering of any series reaches “1,000,000”, the proprietor may recommence the series. The recommenced series will be given an alphabetical prefix or suffix. Where there is a change in proprietorship, or in the individual, firm, corporate name or trade name, the series in use at the time of the change may be continued. (Sec. 232, Pub. L. 96–233, 94 Stat. 278, (26 U.S.C. 5181); sec. 201, Pub. L. 85–859, 72 Stat. 1360, as amended (26 U.S.C. 5206)) Browse Previous | Browse Next
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