Implementation of Public Law 105-34, Section 1417, Related to the Use of Additional Ameliorating Material in Certain Wines

[Federal Register Volume 64, Number 179 (Thursday, September 16, 1999)]
[Rules and Regulations]
[Pages 50252-50253]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 99-24158]


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DEPARTMENT OF THE TREASURY

Bureau of Alcohol, Tobacco and Firearms

27 CFR Parts 4 and 24

[T.D. ATF-403]
RIN 1512-AB78


Implementation of Public Law 105-34, Section 1417, Related to the 
Use of Additional Ameliorating Material in Certain Wines

AGENCY: Bureau of Alcohol, Tobacco and Firearms (ATF), Department of 
the Treasury.

ACTION: Temporary rule (Treasury decision).

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SUMMARY: This temporary rule implements one of the provisions of the 
Taxpayer Relief Act of l997. In accordance with the new law, the wine 
regulations are amended to extend the amelioration and sweetening 
limitations so that wines made exclusively from any fruit (excluding 
grapes) or berry with a fixed acid content of 20 or more parts per 
thousand are entitled to a volume of up to 60 percent ameliorating 
material. In the Proposed Rules section of this Federal Register, ATF 
is also issuing a notice of proposed rulemaking inviting comments on 
this temporary rule for a 90-day period following the publication of 
this temporary rule.

DATES: The temporary regulations are retroactive to April 1, 1998.

ADDRESSES: Send written comments to: Chief, Regulations Division, 
Bureau of Alcohol, Tobacco and Firearms, P.O. Box 50221, Washington, DC 
20091-0221.

FOR FURTHER INFORMATION CONTACT: Thomas B. Busey, Regulations Division, 
650 Massachusetts Avenue, NW., Washington, DC 20226 (202) 927-8204.

SUPPLEMENTARY INFORMATION:

Background

    This temporary rule implements one of the provisions of the 
Taxpayer Relief Act of 1997, Public Law 105-34 (``the Act''). Section 
1417 of the Act amended Section 5384(b)(2)(D) of the Internal Revenue 
Code of 1986 by striking ``loganberries, currants, or gooseberries,'' 
and inserting ``any fruit or berry with a natural fixed acid of 20 
parts per thousand or more (before any correction to such fruit or 
berry).''

Current Regulation for Amelioration of Fruit and Berries

    Before enactment of the Act, the amelioration and sweetening 
limitations of 26 U.S.C. 5384(b)(2)(D) could only be used for wines 
produced exclusively from loganberries, currants, or gooseberries. For 
wine produced exclusively from loganberries, currants, or gooseberries, 
the volume of ameliorating material added to juice or wine may not have 
exceeded 60 percent of the total volume of ameliorated juice or wine 
(calculated exclusive of pulp). If the starting fixed acid level was or 
exceeded 12.5 grams per liter, a maximum of 1,500 gallons of 
ameliorating material may have been added to each 1,000 gallons of wine 
or juice.
    Section 1417 of Public Law 105-34 now extends the amelioration and 
sweetening limitations so that wines made from any fruit or berry with 
a natural fixed acid of 20 parts per thousand or more (before any 
correction of such fruit or berry) is entitled to a volume of up to 60 
percent ameliorating material. These provisions do not apply to grape 
wine, only to fruit or berry wine.

Regulatory Flexibility Act

    Because no notice of proposed rulemaking is required for this 
temporary rule, the provisions of the Regulatory Flexibility Act (5 USC 
601) do not apply. Pursuant to 26 U.S.C. 7805(f), this temporary 
regulation will be submitted to the Chief Counsel for Advocacy of the 
Small Business Administration for comment on its impact on small 
business.

Executive Order 12866

    It has been determined that this temporary rule is not a 
significant regulatory action as defined by Executive Order 12866.

Paperwork Reduction Act

    The provisions of the Paperwork Reduction Act of 1995 (44 U.S.C. 
3507) and its implementing regulations, 5 CFR part 1320, do not apply 
to this temporary rule because no new collection of information is 
contained in this regulation.

Administrative Procedure Act

    It has been determined that 5 USC 553 (b)(A) applies to this 
temporary rule. Moreover, because this document merely implements a 
section of the law which was effective April 1, 1998, and because 
immediate guidance is necessary to implement the provisions of the law, 
it is found to be impracticable to issue this Treasury decision with 
notice and public procedure under 5 U.S.C. 553(b), or subject to the 
effective date limitation in section 553(d).

Drafting Information

    The principal author of this document is Thomas B. Busey, 
Regulations Division, Bureau of Alcohol, Tobacco and Firearms.

List of Subjects

27 CFR Part 4

    Advertising, Consumer protection, Customs duties and inspection, 
Imports, Labeling, Packaging and containers, Wine.

27 CFR Part 24

    Administrative practice and procedure, Authority delegations, 
Claims, Electronic fund transfers, Excise taxes, Exports, Food 
additives, Fruit juices, Labeling, Liquors, Packaging and containers, 
Reporting and recordkeeping requirements, Research, Scientific 
equipment, Spices and flavoring, Surety bonds, Taxpaid wine bottling 
house, Transportation, Vinegar, Warehouses, Wine.

Authority and Issuance:

    Accordingly, Chapter I of title 27, Code of Federal Regulations is 
amended as follows:

PART 4--LABELING AND ADVERTISING OF WINE

    Par. 1. The authority citation for 27 CFR part 4 continues to read 
as follows:

    Authority: 27 U.S.C. 205, unless otherwise noted.

    Par. 2. Section 4.21 is amended by revising the proviso in 
paragraph (e)(1)(i) to read as follows:


Sec. 4.21  The standards of identity.

* * * * *
    (e) * * *
    (1)(i) * * * Provided, That a domestic product may be ameliorated 
or sweetened in accordance with the provisions of 26 U.S.C. 5384 and 
any product other than domestic may be ameliorated before, during, or 
after fermentation by adding, separately or in combination, dry sugar, 
or such an amount of dry sugar and water solution as will increase the 
volume of resulting product, in the case of wines produced from any 
fruit or berry other than grapes, having a normal acidity of 20 parts 
or more per thousand, not more than 60 percent, but in no event shall

[[Page 50253]]

any product so ameliorated have an alcoholic content, derived by 
fermentation, of more than 13 percent by volume, or a natural acid 
content, if water has been added, of less than 5 parts per thousand, or 
a total solids content of more than 22 grams per 100 cubic centimeters.
* * * * *
    Par. 3. Section 4.22 is amended by revising the proviso in 
paragraph (b)(5) to read as follows:


Sec. 4.22  Blends, cellar treatment, alteration of class or type.

* * * * *
    (b) * * *
    (5) * * * Provided, That the class or type thereof shall not be 
deemed to be altered:
    (i) Where such wine (other than grape wine) is derived from fruit, 
or other agricultural products, having a high normal acidity, if the 
total solids content is not more than 22 grams per 100 cubic 
centimeters, and the content of natural acid is not less than 7.5 parts 
per thousand and
    (ii) Where such wine is derived exclusively from fruit, or other 
agricultural products, the normal acidity of which is 20 parts or more 
per thousand, if the volume of the resulting product has been increased 
not more than 60 percent by the addition of sugar and water solution, 
for the sole purpose of correcting natural deficiencies due to such 
acidity, and (except in the case of such wine when produced from fruit 
or berries other than grapes) there is stated as part of the class and 
type designation the phrase ``Made with over 35 percent sugar 
solution''.
* * * * *

PART 24--WINE

    Par. 1. The authority citation for 27 CFR part 24 continues to read 
as follows:

    Authority: 5 U.S.C. 552(a); 26 U.S.C. 5001, 5008, 5041, 5042, 
5044, 5061, 5062, 5081, 5111-5113, 5121, 5122, 5142, 5143, 5173, 
5206, 5214, 5215, 5351, 5353, 5354, 5356, 5357, 5361, 5362, 5364-
5373, 5381-5388, 5391, 5392, 5511, 5551, 5552, 5661, 5662, 5684, 
6065, 6091, 6109, 6301, 6302, 6311, 6651, 6676, 7011, 7302, 7342, 
7502, 7503, 7606, 7805, 7851; 31 U.S.C. 9301, 9303, 9304, 9306.

    Par. 2. Section 24.178 is amended by revising paragraph (b) (3) and 
(b) (4) to read as follows:


Sec. 24.178  Amelioration.

* * * * *
    (b) * * *
    (3) For all wine, except for wine described in (b) (4), the volume 
of ameliorating material added to juice or wine may not exceed 35 
percent of the total volume of ameliorated juice or wine (calculated 
exclusive of pulp). Where the starting fixed acid level is or exceeds 
7.69 grams per liter, a maximum of 538.4 gallons of ameliorating 
material may be added to each 1,000 gallons of wine or juice.
    (4) For wine produced from any fruit (excluding grapes) or berry 
with a natural fixed acid of 20 parts per thousand or more (before any 
correction of such fruit or berry), the volume of ameliorating material 
added to juice or wine may not exceed 60 percent of the total volume of 
ameliorated juice (calculated exclusive of pulp). If the starting fixed 
acid level is or exceeds 12.5 grams per liter, a maximum of 1,500 
gallons of ameliorating material may be added to each 1,000 gallons of 
wine or juice. (26 U.S.C. 5383, 5384).
* * * * *
    Signed: July 22, 1999.
John W. Magaw,
Director.
    Approved: August 13, 1999.
John P. Simpson,
Deputy Assistant Secretary (Regulatory, Tariff and Trade Enforcement).
[FR Doc. 99-24158 Filed 9-15-99; 8:45 am]
BILLING CODE 4810-31-P