[Code of Federal Regulations]
[Title 27, Volume 1, Parts 1 to 199]
[Revised as of April 1, 1999]
From the U.S. Government Printing Office via GPO Access
[CITE: 27CFR25]
[Page 595-644]
PART 25--BEER
Subpart A--Scope of Regulations
Sec.
25.1 Production and removal of beer.
25.2 Territorial extent.
25.3 Forms prescribed.
25.4 Related regulations.
25.5 OMB control numbers assigned under the Paperwork Reduction Act.
Subpart B--Definitions
25.11 Meaning of terms.
Subpart C--Location and Use of Brewery
25.21 Restrictions on location.
25.22 Continuity of brewery.
25.23 Restrictions on use.
25.24 Storage of beer.
25.25 Operation of a tavern on brewery premises.
Subpart D--Construction and Equipment
Construction
25.31 Brewery buildings.
[[Page 596]]
Equipment
25.35 Tanks.
25.36 Empty container storage.
Subpart E--Measurement of Beer
25.41 Measuring system required.
25.42 Testing of measuring devices.
Subpart F--Miscellaneous Provisions
25.51 ATF officer's right of entry and examination.
25.52 Variations from requirements.
Subpart G--Qualification of a Brewery
Original Qualification
25.61 General requirements for notice.
25.62 Data for notice.
25.63 Notice of registration.
25.64 Maintenance of notice file.
25.65 Power of attorney.
25.66 Organizational documents.
25.67 Statement of process.
25.68 Description of brewery.
Changes After Original Qualification
25.71 Amended or superseding notices.
25.72 Change in proprietorship.
25.73 Change in partnership.
25.74 Change in stockholders.
25.75 Change in officers and directors.
25.76 Change in statement of process.
25.77 Change in location.
25.78 Change in premises.
Alternation of Operations
25.81 Alternation of brewery and bonded or taxpaid wine premises.
Discontinuance of Business
25.85 Notice of permanent discontinuance.
Subpart H--Bonds and Consents of Surety
25.91 Requirement for bond.
25.92 Consent of surety.
25.93 Penal sum of bond.
25.94 Strengthening bonds.
25.95 New bond.
25.96 Superseding bond.
25.97 Continuation certificate.
25.98 Surety or security.
25.99 Filing powers of attorney.
Disapproval or Termination of Bonds or Consents of Surety
25.101 Disapproval of bonds or consents of surety.
25.102 Termination of surety's liability.
25.103 Notice by surety for relief from liability under bond.
25.104 Termination of bonds.
25.105 Release of collateral security.
Subpart I--Special Taxes
Liability for Special Tax
25.111 Brewer's special tax.
25.111a Special tax rates.
25.111b Reduced rate of tax for small brewers.
25.112 Wholesaler's special tax.
25.113 Each place of business taxable.
25.114 Exemptions from dealer's special taxes.
Execution of Special Tax Returns
25.117 Special tax returns.
25.118 Preparation of AFT Form 5630.5.
25.119 Multiple locations and/or classes of tax.
25.120 Signing of ATF Forms 5630.5.
Employer Identification Numbers
25.121 Employer identification number.
25.122 Application for employer identification number.
25.123 Preparation and filing of IRS Form SS-4.
Special Tax Stamps
25.125 Issuance of special tax stamps.
25.126 Distribution of stamps for multiple locations.
25.127 Examination of special tax stamps.
Changes in Special Tax Stamps
25.131 Change in name.
25.132 Change in proprietorship.
25.133 Persons having right of succession.
25.134 Change in location.
Subpart J--Marks, Brands, and Labels
25.141 Barrels and kegs.
25.142 Bottles.
25.143 Cases.
25.144 Rebranding barrels and kegs.
25.145 Tanks, vehicles, and vessels.
Subpart K--Tax on Beer
Liability for Tax
25.151 Rate of tax.
25.152 Reduced rate of tax for certain brewers.
25.153 Persons liable for tax.
Determination of Tax
25.155 Types of containers.
25.156 Determination of tax on keg beer.
25.157 Determination of tax on bottled beer.
25.158 Tax computation for bottled beer.
25.159 Time of tax determination and payment; offsets.
25.160 Tax adjustment for brewers who produce more than 2,000,000
barrels of beer.
[[Page 597]]
Preparation and Remittance of Tax Returns
25.163 Method of tax payment.
25.164 Semimonthly return.
25.164a Special rule for taxes due for the month of September
(effective after December
31, 1994).
25.165 Payment of tax by electronic fund transfer.
25.166 Payment of reduced rate of tax.
25.167 Notice of brewer to pay reduced rate of tax.
25.168 Employer identification number.
Prepayment of Tax
25.173 Brewer in default.
25.174 Bond not sufficient.
25.175 Prepayment of tax.
Failure To Pay Tax
25.177 Evasion of or failure to pay tax; failure to file a tax return.
Subpart L--Removals Without Payment of Tax
Transfer to Another Brewery of Same Ownership
25.181 Eligibility.
25.182 Kinds of containers.
25.183 Determination of quantity transferred.
25.184 Losses in transit.
25.185 Mingling.
25.186 Record of beer transferred.
Removal of Beer Unfit for Beverage Use
25.191 General.
25.192 Removal of sour or damaged beer.
Removals for Analysis, Research, Development or Testing
25.195 Removals for analysis.
25.196 Removals for research, development or testing.
Removal of Beer to a Contiguous Distilled Spirits Plant
25.201 Removal by pipeline.
Exportation
25.203 Exportation without payment of tax.
Beer for Personal or Family Use
25.205 Production.
25.206 Removal of beer.
25.207 Removal from brewery for personal or family use.
Subpart M--Beer Returned to Brewery
25.211 Beer returned to brewery.
25.212 Beer returned to brewery from which removed.
25.213 Beer returned to brewery other than that from which removed.
Subpart N--Voluntary Destruction
25.221 Voluntary destruction of beer.
25.222 Notice of brewer.
25.223 Destruction of beer off brewery premises.
25.224 Refund or adjustment of tax.
25.225 Destruction of taxpaid beer which was never removed from brewery
premises.
Subpart O--Beer Purchased From Another Brewer
25.231 Finished beer.
25.232 Basic permit.
Subpart P--Cereal Beverage
25.241 Production.
25.242 Markings.
Subpart Q--Removal of Brewer's Yeast and Other Articles
25.251 Authorized removals.
25.252 Records.
Subpart R--Beer Concentrate
25.261 General.
25.262 Restrictions and conditions on processes of concentration and
reconstitution.
25.263 Production of concentrate and reconstitution of beer.
25.264 Transfer between breweries.
Subpart S--Pilot Brewing Plants
25.271 General.
25.272 Application.
25.273 Action on application.
25.274 Bond.
25.275 Special tax.
25.276 Operations and records.
25.277 Discontinuance of operations.
Subpart T--Refund or Adjustment of Tax or Relief From Liability
25.281 General.
25.282 Beer lost by fire, theft, casualty, or act of God.
25.283 Claims for refund of tax.
25.284 Adjustment of tax.
25.285 Refund of beer tax excessively paid.
25.286 Claims for remission of tax on beer lost in transit between
breweries.
Subpart U--Records and Reports
25.291 Records.
25.292 Daily records of operations.
25.293 Record of ballings and alcohol content.
[[Page 598]]
25.294 Inventories.
25.295 Record of unsalable beer.
25.296 Record of beer concentrate.
25.297 Brewer's Report of Operations, Form 5130.9.
25.298 Excise tax return, Form 5000.24.
25.299 Execution under penalties of perjury.
25.300 Retention and preservation of records.
25.301 Photographic copies of records.
Authority: 19 U.S.C. 81c; 26 U.S.C. 5002, 5051-5054, 5056,
5061,
5091, 5111, 5113, 5142, 5143, 5146, 5222, 5401-5403, 5411-5417, 5551,
5552, 5555, 5556, 5671, 5673, 5684, 6011, 6061, 6065, 6091, 6109, 6151,
6301, 6302, 6311, 6313, 6402, 6651, 6656, 6676, 6806, 7011, 7342, 7606,
7805; 31 U.S.C. 9301, 9303-9308.
Source: T.D. ATF-224, 51 FR 7673, Mar. 5, 1986, unless otherwise noted.
Sec. 25.1 Production and removal of beer.
The regulations in this part relate to beer and cereal beverages
and cover the location, construction, equipment, operations and qualifications
of breweries and pilot brewing plants.
Sec. 25.2 Territorial extent.
This part applies to the several States of the United States
and the District of Columbia.
Sec. 25.3 Forms prescribed.
(a) The Director is authorized to prescribe all forms required
by this part, including bonds, applications, notices, reports, returns,
and records. All of the information called for in each form shall be furnished
as indicated by the headings on the form and the instructions on or pertaining
to the form. In addition, information called for in each form shall be
furnished as required by this part.
(b) Requests for forms should be mailed to the ATF Distribution
Center, 7943 Angus Court, Springfield, Virginia 22153.
[T.D. ATF-224, 51 FR 7673, Mar. 5, 1986; 51 FR 10540, Mar. 27, 1986, as
amended by T.D. 372, 61 FR 20724, May 8, 1996]
Sec. 25.4 Related regulations.
Regulations relating to this part are listed below:
27 CFR Part 7--Labeling and Advertising of Malt Beverages.
27 CFR Part 170--Miscellaneous Regulations Relating to Liquor.
27 CFR Part 252--Exportation of Liquors.
31 CFR Part 225--Acceptance of Bonds, Notes, or Other Obligations Issued
or Guaranteed by the United States as Security in Lieu of Surety or Sureties
on Penal Bonds.
Sec. 25.5 OMB control numbers assigned under the Paperwork Reduction Act.
(a) Purpose. This section collects and displays the control
numbers assigned to information collection requirements by the Office of Management
and Budget contained in 27 CFR Part 25 under the Paperwork Reduction Act
of 1980, Pub. L. 96-511.
(b) Display, OMB control number 1512-0045. OMB control number
1512-0045 is assigned to the following sections in 27 CFR Part 25: Secs.
25.23, 25.25, 25.52, 25.61, 25.62, 25.64, 25.66, 25.67, 25.68, 25.71, 25.72,
25.73, 25.74, 25.75, 25.76, 25.77, 25.78, 25.81, 25.85, 25.103, 25.114,
25.141, 25.142, 25.144, 25.158, 25.167, 25.184, 25.213, 25.222, 25.225,
25.272, 25.273, 25.277, 25.282, 25.299.
(c) Display, OMB control number 1512-0052. OMB control number
1512-0052 is assigned to the following sections in 27 CFR Part 25: Secs.
25.296(b), 25.297.
(d) Display, OMB control number 1512-0079. OMB control number
1512-0079 is assigned to the following section in 27 CFR Part 25: Sec. 25.65.
(e) Display, OMB control number 1512-0141. OMB control number
1512-0141 is assigned to the following sections in 27 CFR Part 25: Secs.
25.281, 25.282, 25.286.
(f) Display, OMB control number 1512-0333. OMB control number
1512-0333 is assigned to the following sections in 27 CFR Part 25: Secs.
25.42, 25.142, 25.186, 25.192, 25.195, 25.196, 25.211, 25.252, 25.264,
25.276, 25.284, 25.291, 25.292, 25.293, 25.294, 25.295, 25.296(a), 25.300,
25.301.
(g) Display, OMB control number 1512-0457. OMB control number
1512-0457 is assigned to the following section in 27 CFR Part 25: Sec.
25.165.
(h) Display, OMB control number 1512-0467. OMB control number
1512-0467 is assigned to the following sections in 27 CFR Part 25: Secs.
25.122, 25.160, 25.163, 25.164, 25.165, 25.166, 25.167, 25.168, 25.175,
25.224, 25.284, 25.285, 25.298.
(i) Display, OMB control number 1512-0472. OMB control number
1512-0472 is assigned to the following sections in 27 CFR Part 25: Secs.
25.111, 25.112, 25.113,
[[Page 599]]
25.114, 25.117, 25.118, 25.119, 25.121, 25.126, 25.127, 25.131, 25.132, 25.133,
25.134.
(j) Display, OMB control number 1512-0478. OMB control number
1512-0478 is assigned to the following sections in 27 CFR Part 25: Secs.
25.24, 25.35, 25.141, 25.142, 25.143, 25.145, 25.192, 25.196, 25.231, 25.242,
25.251, 25.263.
[T.D. ATF-224, 51 FR 7673, Mar. 5, 1986; 51 FR 10540, Mar. 27, 1986; T.D.
ATF-268, 53 FR 8628, Mar 16, 1988]
Sec. 25.11 Meaning of terms.
When used in this part, where not otherwise distinctly expressed
or manifestly incompatible with the intent thereof, terms have the meanings given
in this section.
Area supervisor. The supervisory officer of a Bureau of Alcohol, Tobacco and Firearms area office.
ATF officer. An officer of the Bureau of Alcohol, Tobacco and Firearms (ATF) authorized to perform any function relating to the administration or enforcement of this part.
Balling. The percent by weight of dissolved solids at 60 deg.F. present in wort and beer, usually determined by a balling saccharometer.
Bank. Any commercial bank.
Banking day. Any day during which a bank is open to the public for carrying on substantially all its banking functions.
Barrel. When used as a unit of measure, the quantity equal to 31 U.S. gallons. When used as a container, a consumer package or keg containing a quantity of beer listed in Sec. 25.156, or other size authorized by the regional director (compliance).
Beer. Beer, ale, porter, stout, and other similar fermented beverages (including sake or similar products) of any name or description containing one-half of one percent or more of alcohol by volume, brewed or produced from malt, wholly or in part, or from any substitute for malt.
Bottle. A bottle, can or similar container.
Bottling. The filling of bottles, cans, and similar containers.
Brewer. Any person who brews beer (except a person who produces only beer exempt from tax under 26 U.S.C. 5053(e)) and any person who produces beer for sale.
Brewery. The land and buildings described in the Brewer's Notice, Form 5130.10, where beer is to be produced and packaged.
Brewing. The production of beer for sale.
Business day. The 24-hour cycle of operations in effect at the brewery and described on the Brewer's Notice, Form 5130.10.
Calendar quarter. A 3-month period during the year as follows: January 1 through March 31; April 1 through June 30; July 1 through September 30; and October 1 through December 31.
Cereal beverage. A beverage, produced either wholly or in part from malt (or a substitute for malt), and either fermented or unfermented, which contains, when ready for consumption, less than one-half of 1 percent of alcohol by volume.
Commercial bank. A bank, whether or not a member of the Federal Reserve System, which has access to the Federal Reserve Communications System (FRCS) or Fedwire. The ``FRCS'' or ``Fedwire'' is a communications network that allows Federal Reserve System member banks to effect a transfer of funds for their customers (or other commercial banks) to the Treasury Account at the Federal Reserve Bank of New York.
Concentrate. Concentrate produced from beer by the removal of water under the provisions of subpart R of this part. The processes of concentration of beer and reconstitution of beer are considered authorized processes in the production of beer.
Delegate. Any officer, employee, or agency of the Department of the Treasury authorized by the Secretary of the Treasury directly, or indirectly by one or more redelegations of authority, to perform the functions mentioned or described in the context.
Director. The Director, Bureau of Alcohol, Tobacco and Firearms, the Department of the Treasury, Washington, DC.
Director of the service center. A Director of an Internal Revenue Service Center.
District Director. A district director of internal revenue.
[[Page 600]]
Electronic fund transfer or EFT. Any transfer of funds made
by a brewer's commercial bank, either directly or through a correspondent banking
relationship, via the Federal Reserve Communications System (FRCS) or Fedwire
to the Treasury Account at the Federal Reserve Bank of New York.
Executed under penalties of perjury. Signed with the prescribed declaration under the penalties of perjury as provided on or with respect to the return, claim, form, or other document or, when no form of declaration is prescribed, with the declaration: ``I declare under the penalties of perjury that this------(insert type of document such as statement, report, certificate, application, claim, or other document), including the documents submitted in support thereof, has been examined by men and, to the best of my knowledge and belief, is true, correct and complete.''
Fiscal year. The period which begins October 1 and ends on the following September 30.
Gallon. The liquid measure containing 231 cubic inches.
Losses. Known quantities of beer lost due to breakage, casualty, or other unusual cause.
Package. A bottle, can, keg, barrel, or other original consumer container.
Packaging. The filling of any package.
Person. An individual, trust, estate, partnership, association, company, or corporation.
Racking. The filling of kegs or barrels.
Region. A Bureau of Alcohol, Tobacco and Firearms region.
Regional director (compliance). The principal ATF regional official responsible for administering regulations in this part.
Removed for consumption or sale. Except when used with respect to beer removed without payment of tax as authorized by law, (a) the sale and transfer of possession of beer for consumption at the brewery, or (b) any removal of beer from the brewery.
Secretary. The Secretary of the Treasury or his or her delegate.
Service center. An Internal Revenue Service Center in any of the Internal Revenue regions.
Shortage. An unaccounted for discrepancy (missing quantity) of beer disclosed by physical inventory.
This chapter. Title 27, Code of Federal Regulations, Chapter I (27 CFR Chapter I).
Treasury account. The Department of the Treasury's General Account at the Federal Reserve Bank of New York.
U.S.C. The United States Code.
Wort. The product of brewing before fermentation which results
in beer.
[T.D. ATF-224, 51 FR 7673, Mar. 5, 1986, as amended by T.D. ATF-345, 58 FR
40357, July 28, 1993]
Sec. 25.21 Restrictions on location.
A brewery may not be established or operated in any dwelling
house or on board any vessel or boat, or in any building or on any premises where
the revenue will be jeopardized or the effective administration of this
part will be hindered.
(Sec. 201, Pub. L. 85-859, 72 Stat. 1389, as amended (26 U.S.C. 5402))
Sec. 25.22 Continuity of brewery.
Brewery premises will be unbroken except that they may be
separated by public passageways, streets, highways, waterways, carrier
rights-of-way, or partitions. If the brewery premises are separated, the parts will
abut on the dividing medium and be adjacent to each other. If the brewer
has facilities for loading, or for case packing or storage which are located
within reasonable proximity to the brewery, the regional director (compliance)
may approve these facilities as part of the brewery if the revenue will
not be jeopardized.
(Sec. 201, Pub. L. 85-859, 72 Stat. 1389, as amended (26 U.S.C. 5402))
Sec. 25.23 Restrictions on use.
(a) Use of brewery in production of beer or cereal beverage.
A brewery may be used only for the following purposes involving the production
of beer or cereal beverages:
(1) For producing, packaging and storing beer, cereal beverages, vitamins,
ice, malt, malt syrup, and other
[[Page 601]]
by-products of the brewing process, or soft drinks and other nonalcoholic
beverages;
(2) For processing spent grain, carbon dioxide, and yeast;
and
(3) For storing packages and supplies necessary or connected
to brewery operations.
(b) Other authorized uses. A brewer may use a brewery for
other purposes, not involving the production of beer or cereal beverage,
upon approval from the Director, if the purposes:
(1) Require the use of by-products or waste from the production
of beer;
(2) Utilize buildings, rooms, areas, or equipment not fully
employed in the production or packaging of beer;
(3) Are reasonably necessary to realize the maximum benefit
from the premises and equipment and reduce the overhead of the brewery;
(4) Are in the public interest because of emergency conditions;
(5) Involve experiments or research projects related to equipment, materials,
processes, products, by-products, or waste of the brewery; or
(6) Involve operation of a tavern on brewery premises in
accordance with Sec. 25.25.
(c) Application. Except as provided in Sec. 25.25 for operation
of a tavern on brewery premises, a brewer desiring to use a brewery for
other purposes shall submit to the Director through the appropriate regional director
(compliance), an application listing the purposes. The Director will approve
the application if the use for other purposes will not jeopardize the revenue
or impede the effective administration of this part and is not contrary
to specific provisions of law.
(Sec. 201, Pub. L. 85-859, 72 Stat. 1389, as amended (26 U.S.C. 5411))
[T.D. ATF-224, 51 FR 7673, Mar. 5, 1986, as amended by T.D. ATF-268, 53 FR
8628, Mar 16, 1988]
Sec. 25.24 Storage of beer.
(a) Taxpaid beer. Beer of a brewer's own production on which
the tax has been paid or determined may not be stored in the brewery, except
as provided in Sec. 25.25 or Sec. 25.213. Beer produced by other brewers may
be stored at the brewery under the following conditions:
(1) Taxpaid beer will be segregated in such a manner as
to preclude mixing with nontaxpaid beer;
(2) If required by Part 1 of this chapter, the brewer shall
have a wholesalers or importers basic permit under the Federal Alcohol Administration
Act, and keep records of the taxpaid beer as a wholesaler or importer under
Part 194 of this chapter.
(3) Taxpaid beer may be stored in packages;
(4) Taxpaid beer may not be relabeled;
(5) Taxpaid beer may not be shown on required brewery records;
(6) The brewer shall purchase a special tax stamp as a wholesaler, if
required by Part 194 of this chapter; and
(7) The regional director (compliance) may require physical segregation
of taxpaid beer, or marking to show the status of taxpaid beer, if necessary
to protect the revenue.
(b) Untaxpaid beer. Packaged beer on which tax has not been
paid or determined may be stored in any suitable location in the brewery.
(Sec. 201, Pub. L. 85-859, 72 Stat. 1389, as amended (26 U.S.C. 5411))
[T.D. ATF-224, 51 FR 7673, Mar. 5, 1986, as amended by T.D. ATF-268, 53 FR
8628, Mar 16, 1988]
Sec. 25.25 Operation of a tavern on brewery premises.
(a) General. A brewer desiring to operate a tavern as an
alternate use of brewery premises, shall submit a Brewer's Notice, ATF
F 5130.10 containing the information required by paragraph (b) of this
section. If the regional director (compliance) finds that the operation
of the tavern on brewery premises will not jeopardize the revenue or impede
the effective administration of this part and is not contrary to specific provisions
of law, the approval of the Brewer's Notice, ATF F 5130.10 shall constitute
approval of the alternate use of brewery premises, in lieu of the application
required by Sec. 25.23. As used in this section, ``tavern'' means a portion
of brewery premises where beer is sold to consumers. Food, and/or taxpaid
wine, and/or taxpaid distilled spirits may also be sold at a tavern operated
on brewery premises. Taxpaid beer
[[Page 602]]
produced by other brewers may be received, stored and sold on brewery premises
in accordance with Sec. 25.24.
(b) Brewer's Notice. In preparing the Brewer's Notice, AFT
F 5130.10, the applicant shall show the following information, in addition to
the information required by the form:
(1) The applicant shall identify the portion of the brewery
which will be operated as a tavern by providing a diagram or narrative description
of the boundaries of the tavern. The diagram or description shall identify
areas of the brewery which are accessible to the public and areas which
are not. The applicant shall describe security measures to be used to segregate
public areas from non-public areas.
(2) The applicant shall describe in detail the method to
be used for measuring beer for the purposes of tax determination.
(3) The applicant shall identify the tanks which will periodically contain
tax-determined beer, and any other areas where tax-determined beer will
be stored.
(c) Procedures. The following procedures shall apply to operation
of a tavern on brewery premises:
(1) The brewery shall have a suitable method for measurement
of the beer, such as a meter or gauge glass. Tax determination shall consist
of the measurement of the beer and the preparation of the brewer's record of
tax determination, required by Sec. 25.292(a)(8). The taxes shall be determined
prior to the time that the beer is dispensed into a container for consumption.
(2) If the brewer uses one or more tanks for tax determination,
the following procedures shall apply:
(i) Each such tank shall be durably marked with the words
``tax-determination tank'';
(ii) The taxes shall be determined each time beer is added
to a tax-determination tank; and
(iii) The brewer may never simultaneously pump into and out
of a tax-determination tank.
(3) A brewer qualified under this section may store, on brewery premises,
tax-determined beer which is intended for sale at a tavern operated on
brewery premises, in accordance with this section. The prohibition of Sec.
25.24 shall not apply to such tax-determined beer.
(4) Beer consumed by employees and visitors in the brewery's
tavern shall be beer on which the tax has been paid or determined.
[T.D. ATF-268, 53 FR 8628, Mar 16, 1988]
Construction
Sec. 25.31 Brewery buildings.
Brewery buildings shall be arranged and constructed to afford adequate
protection to the revenue and to facilitate inspection by ATF officers.
(Sec. 201, Pub. L. 85-859, 72 Stat. 1389, as amended (26 U.S.C. 5402))
Equipment
Sec. 25.35 Tanks.
Each stationary tank, vat, cask or other container used,
or intended for use, as a receptacle for wort, beer or concentrate produced
from beer shall:
(a) Be durably marked with a serial number and capacity;
and
(b) Be equipped with a suitable measuring device. The brewer
may provide meters or other suitable portable devices for measuring contents of
tanks or containers in lieu of providing each tank or container with a
measuring device.
(Sec. 201, Pub. L. 85-859, 72 Stat. 1395, as amended (26 U.S.C. 5552))
Sec. 25.36 Empty container storage.
Empty barrels, kegs, bottles, other containers, or other
supplies stored in the brewery will be segregated from filled containers.
(Sec. 201, Pub. L. 85-859, 72 Stat. 1389, as amended (26 U.S.C. 5411))
Sec. 25.41 Measuring system required.
The brewer shall accurately and reliably measure the quantity
of beer transferred from the brewery cellars for bottling and for racking. The
brewer may use a measuring device, such as
[[Page 603]]
a meter or gauge glass, or any other suitable method.
(Sec. 201, Pub. L. 85-859, 72 Stat. 1395, as amended (26 U.S.C. 5552))
Sec. 25.42 Testing of measuring devices.
(a) General requirements. If a measuring device such as a
meter or gauge glass is used to measure beer, the brewer shall periodically
test the measuring device and adjust or repair it, if necessary. The brewer shall
keep records of tests available for inspection by ATF officers.
Records of tests will include:
(1) Date of test;
(2) Identity of meter or measuring device;
(3) Result of test; and
(4) Corrective action taken, if necessary.
(b) Requirements for beer meters. The allowable variation
for beer meters as established by testing may not exceed <plus-minus>0.5
percent.
If a meter test discloses an error in excess of the allowable variation, the brewer shall immediately adjust or repair the meter. Adjustments will reduce the error to as near zero as practicable.
(c) Authority to require tests. If the regional director (compliance)
has reason to believe that the accuracy or reliability of a measuring device
is not being properly maintained, he or she may require the brewer to test
the measuring device and, if necessary, adjust or repair the measuring
device.
(Sec. 201, Pub. L. 85-859, 72 Stat. 1395, as amended (26 U.S.C. 5552))
Sec. 25.51 ATF officer's right of entry and examination.
An ATF officer may enter, during normal business hours, a
brewery or other place where beer is stored and may, when the premises
are open at other times, enter those premises in the performance of official
duties. ATF officers shall make inspections as the regional director (compliance)
deems necessary to determine that operations are conducted in compliance
with the law and this part. The owner of any building or place where beer
is produced, made, or kept, or person having charge over such premises,
who refuses to admit an ATF officer acting under 26 U.S.C. 7606, or who
refuses to permit an ATF officer to examine beer shall, for each refusal,
forfeit $500.
(Act of August 16, 1954, 68A Stat. 872, 903, as amended (26 U.S.C. 7342, 7606))
Sec. 25.52 Variations from requirements.
(a) Exceptions to construction, equipment and methods of
operations
(1) General. The Director may approve details of construction,
equipment or methods of operations, in lieu of those specified in this
part. The brewer shall show that it is impracticable to conform to the
prescribed specification, and that the proposed variance: (i) will afford
the protection to the revenue intended by the specifications in this part; (ii)
will not hinder the effective administration of this part, and (iii) is
not contrary to any provision of law.
(2) Application. A brewer who proposes to employ methods
of operations or construction or equipment other than as provided in this part
shall submit an application to the regional director (compliance). The
application will describe the proposed variation and state the need for
it. The brewer shall submit drawings or photographs if necessary to describe
the proposed variation.
(3) Approval by Director. The Director may approve the use
of an alternate method or procedure if:
(i) The brewer shows good cause for its use;
(ii) It is consistent with the purpose and effect of the
procedure prescribed by this part and provides equal security to the revenue;
(iii) It is not contrary to law; and
(iv) It will not cause an increase in cost to the Government
and will not hinder the effective administration of this part.
(4) Exceptions. The Director may not authorize an alternate
method or procedure relating to the giving of any bond, or to the assessment, payment,
or collection of tax.
(5) Conditions of approval. A brewer may not employ an alternate method
or procedure until the Director has approved its use. The brewer shall,
during
[[Page 604]]
the terms of the authorization of an alternate method or procedure, comply
with the terms of the approved application.
(b) Emergency variations from requirements--
(1) Application. When an emergency exists, a brewer may apply to the regional director (compliance) for a variation from the requirements of this part relating to construction, equipment, and methods of operation. The brewer shall describe the proposed variation and set forth the reasons for using it.
(2) Approval. The regional director (compliance) may approve an emergency variation from requirements if:
(i) An emergency exists;
(ii) The variation
from the requirements is necessary;
(iii) It will afford
the same security and protection to the revenue as intended by the specific
regulations;
(iv) It will not hinder
the effective administration of this part; and
(v) It is not contrary
to law.
(3) Conditions of approval. A brewer may
not employ an emergency variation from the requirements until the regional
director (compliance) has approved its use. Approval of variations from
requirements are conditioned upon compliance with the conditions and limitations
set forth in the approval.
(c) Automatic termination
of approval. If the brewer fails to comply in good faith with the procedures,
conditions or limitations set forth in the approval, authority for the
variation from requirements is automatically terminated and the brewer
is required to comply with prescribed requirements of regulations.
(d) Withdrawal of approval.
The Director may withdraw approval of an alternate method or procedure,
approved under paragraph (a) of this section, if the Director finds that
the revenue is jeopardized or the effective administration of this part
is hindered by the approval. The regional director (compliance) may withdraw
approval of an emergency variation from requirements, approved under paragraph
(b) of this section, if the regional director (compliance) finds that the
revenue is jeopardized or the effective administration of this part is
hindered by the approval.
(Sec. 201, Pub. L. 85-859, 72 Stat. 1395, as amended, 1396, as amended (26
U.S.C. 5552, 5556))
Original Qualification
Sec. 25.61 General requirements for notice.
(a) Establishment. Operations as a brewer may be conducted
only by a person who has given notice as a brewer under this subpart. A
person may not commence the business of a brewer until the regional director (compliance)
approves the brewery and the brewer's notice, including all documents made
part of that notice.
(b) Brewer's Notice, Form 5130.10. Each person shall, before commencing
business as a brewer, give notice on Form 5130.10 to the regional director
(compliance) of the region in which the brewery is located. Each person
continuing business as a brewer as provided in Sec. 25.71 shall give notice
on Form 5130.10 to the regional director (compliance). Each notice will
be executed under penalties of perjury, and all written statements, affidavits,
and other documents submitted in support of the notice will be made part
of the notice.
(c) Additional information. The regional director (compliance)
may at any time require the brewer to furnish, as part of the notice, additional
information which is necessary to protect and insure collection of the
revenue.
(Sec. 201, Pub. L. 85-859, 72 Stat. 1388, as amended (26 U.S.C. 5401))
Sec. 25.62 Data for notice.
(a) Required information. The brewer shall prepare the notice
on Form 5130.10 and shall include the following information:
(1) Serial number.
(2) Purpose for which filed.
(3) Name and principal business address of the brewer and
the location of the brewery if different from the business address.
[[Page 605]]
(4) Statement of the type of business organization and of
the persons interested in the business, supported by the information listed in
Sec. 25.66.
(5) Description of brewery, as specified in Sec. 25.68.
(6) A list of trade names which the brewer intends to use
in doing business or in packaging beer.
(7) A statement of process for fermented beverages if required
by Sec. 25.67.
(8) The name and address of the owner of the land or buildings comprising
the brewery, and of any mortgagee or other encumbrancer of the land or
buildings comprising the brewery.
(9) The 24-hour cycle of operations at the brewery which
is to be the brewer's business day.
(10) The process by which the brewer intends to render beer
unfit for beverage use when beer is to be removed for use in manufacturing under
Secs. 25.191-25.192.
(11) Statement showing ownership or controlling interests
in other breweries which will establish eligibility for the transfer of
beer without payment of tax between breweries of the same ownership, as authorized
in Sec. 25.181.
(12) The date of the notice and the name and signature of
the brewer or person authorized to sign on behalf of the brewer.
(b) Incorporation by reference. If any of the information
required by paragraph (a)(4) of this section is on file with the regional director
(compliance) of any ATF region in connection with the qualification of
any other premises operated by the brewer, that information, if accurate
and complete, may be incorporated into the brewer's notice by reference.
(Sec. 201, Pub. L. 85-859, 72 Stat. 1388, as amended (26 U.S.C. 5401))
Sec. 25.63 Notice of registration.
The Brewer's Notice, Form 5130.10, when approved by the regional director
(compliance), will constitute the notice of registration of the brewery.
The regional director (compliance) will not approve the notice until the
notice and all incorporated documents are complete, accurate, and in compliance
with the requirements of this part. A person may not operate a brewery
until the notice required by this subpart has been approved by the regional
director (compliance).
(Sec. 201, Pub. L. 85-859, 72 Stat. 1388, as amended (26 U.S.C. 5401))
Sec. 25.64 Maintenance of notice file.
The brewer shall maintain the approved Brewer's Notice, Form 5130.10,
and all incorporated documents at the brewery premises, in complete and
current condition, readily available for inspection by an ATF officer.
(Sec. 201, Pub. L. 85-859, 72 Stat. 1388, as amended (26 U.S.C. 5401))
Sec. 25.65 Power of attorney.
The brewer shall execute and file with the regional director (compliance)
a Form 1534 (5000.8) for each person authorized to sign or act on behalf
on the brewer. The Form 1534 (5000.8) is not required for persons whose
authority is furnished in the Brewer's Notice, Form 5130.10.
(Sec. 201, Pub. L. 85-859, 72 Stat. 1388, as amended (26 U.S.C. 5401))
Sec. 25.66 Organizational documents.
The supporting information required by paragraph (a)(4) of Sec.
25.62 includes, as applicable, the following:
(a) Corporate documents.
(1) Corporate charter or a certificate
of corporate existence or incorporation;
(2) List of directors and officers, showing
their names and addresses;
(3) Extracts or digests of minutes of
meetings of board of directors, authorizing certain individuals to sign
for the corporation; and
(4) Statement showing the number of shares
of stock or other evidence of ownership, authorized and outstanding, and
the voting rights of the respective owners or holders.
(b) Articles of partnership.
Copy of the articles of partnership or association, if any, or certificate
of partnership or association if required to be filed by any State, county,
or municipality.
(c) Statement of interest.
(1) Names and addresses of all persons having 10 percent or more stock
in the corporation, or other legal entity, and the nature and amount of
the stockholding or
[[Page 606]]
other interest of each, whether the interest appears in the name of the interested
party or in the name of another person. 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 regional director (compliance); or
(2) In the case of an individual owner or partnership, the name and address
of each person holding an interest in the brewery, whether the interest
appears in the name of the interested party or in the name of another for
that person.
(d) Availability of additional corporate documents. The
originals of documents required to be submitted under this section, and
additional documents such as the articles of incorporation, bylaws, and
State certificates authorizing the brewer to operate in the State where located
(if other than the State in which the brewery is incorporated) shall be
made available to any ATF officer upon request. In the case of multiplant
brewers, these documents may be made available at the brewer's home brewery.
Each brewer's notice filed by multiplant brewers will state the location
where these corporate documents may be inspected.
(Sec. 201, Pub. L. 85-859, 72 Stat. 1388, as amended (26 U.S.C. 5401))
Sec. 25.67 Statement of process.
(a) The Brewer's Notice, Form 5130.10 will contain a statement
of
process for any fermented beverage which the brewer intends to produce
and market under a name other than ``beer,'' ``ale,'' ``porter,''
``stout,'' ``lager,'' or ``malt liquor.''
(b) The statement of process will give the name or designation
of
the product, the kinds and quantities of materials to be used, the
method of manufacture, and the approximate alcohol content of the
finished product.
(c) A statement of process for any fermented beverage (other
than
sake or cereal beverage) will not be approved unless the base product
has the characteristics of beer as defined in Sec. 25.11.
(Sec. 201, Pub. L. 85-859, 72 Stat. 1333, as amended, 1388, as amended
(26 U.S.C. 5052, 5401))
Sec. 25.68 Description of brewery.
(a) The Brewer's Notice, Form 5130.10, will include a description
of
(1) each tract of land comprising the brewery, and (2) a listing of each
brewery building by its designated letter or number, giving the
approximate ground dimensions and the purpose for which ordinarily used.
(b) The description of the land will be in sufficient detail
to
enable ATF officers to determine the boundaries of the brewery.
(Sec. 201, Pub. L. 85-859, 72 Stat. 1388, as amended (26 U.S.C. 5401))
Changes After Original Qualification
Sec. 25.71 Amended or superseding notices.
(a) Requirement for amended notice. (1) When there is a change
with
respect to the information shown in the Brewer's Notice, Form 5130.10,
the brewer shall within 30 days of the change (except as otherwise
provided in this subpart) submit to the regional director (compliance)
an amended notice setting forth the new information. Changed notices
will be submitted in skeleton form, with unchanged items marked ``No
change since Form 5130.10, Serial No. ______.''
(2) The regional director (compliance) may require immediate
filing
of an amended Form 5130.10 if the accuracy of existing documents has
been affected by any change.
(b) Requirement for superseding notice. (1) The regional
director
(compliance) may require a brewer to file a new and complete notice,
superseding those previously filed, in conjunction with the filing of a
new bond. This superseding notice will become effective on the date of
the brewer's bond or on the date of the brewer's bond continuation
certificate.
(2) If the information required by Sec. 25.62(a) (4), (5),
(6), (7),
(9), and (10) is on file as part of an approved Form 5130.10 and is
current, the brewer may
[[Page 607]]
incorporate by reference those documents as part of any superseding
notice.
(Sec. 201, Pub. L. 85-859, 72 Stat. 1388, as amended (26 U.S.C. 5401))
Sec. 25.72 Change in proprietorship.
(a) General. If there is a change in the proprietorship of
a
brewery, the outgoing brewer shall comply with the requirements of
Sec. 25.85. The successor brewer shall, before beginning operations,
qualify in the same manner as the proprietor of a new brewery. The
successor brewer shall file a new notice and bond in his or her own
name. Beer on hand may be transferred without payment of tax to the
successor brewer and will be accounted for by that brewer.
(b) Fiduciary. (1) If the successor to the brewer is an
administrator, executor, receiver, trustee, assignee or other fiduciary,
the fiduciary may in lieu of filing a new notice and bond, file an
amended notice and furnish a consent of surety extending the terms of
the predecessor's bond or continuation certificate.
(2) The fiduciary shall furnish the regional director (compliance)
a
certified copy of the court order or other document showing
qualification as fiduciary. The effective date of the qualifying
documents filed by a fiduciary will be the same as the date of the
order, or the date therein specified for the fiduciary to assume
control. If the fiduciary was not appointed by the court, the date of
the appointment will be the effective date of the qualifying documents
filed by the fiduciary.
(Sec. 201, Pub. L. 85-859, 72 Stat. 1388, as amended (26 U.S.C. 5401))
Sec. 25.73 Change in partnership.
(a) New notice required. The withdrawal of one or more members
of a
partnership or the taking in of a new partner, whether active or silent,
constitutes a change in proprietorship. Unless exempted by paragraph (b)
of this section, the death, bankruptcy or adjudicated insolvency of one
or more partners results in a dissolution of the partnership and a
change in proprietorship. The successor shall qualify the brewery in the
same manner as the proprietor of a new brewery.
(b) Continuing partnership. A surviving partner or partners
may
continue to operate the brewery for purposes of liquidation and
settlement under the following conditions:
(1) Under the laws of the State where the partnership was
formed,
the partnership is not terminated on death or insolvency of a
partner(s); and
(2) Under the laws of the State where the partnership was
formed,
the surviving partner(s) has the exclusive right to control and
possession of the partnership assets for the purpose of liquidation and
settlement; and
(3) A consent of surety is filed in which the surety and
the
surviving partner(s) agree to remain liable on the bond.
(c) Settlement of partnership. If the surviving partner(s)
acquires
the business on completion of the settlement of the partnership, that
partner(s) shall qualify in his or her own name from the date of
acquisition and give a new brewer's notice on Form 5130.10 and a new
bond on Form 5130.22.
(Sec. 201, Pub. L. 85-859, 72 Stat. 1388, as amended (26 U.S.C. 5401))
[T.D. ATF-224, 51 FR 7673, Mar. 5, 1986; 51 FR 10540, Mar. 27, 1986]
Sec. 25.74 Change in stockholders.
Changes in the list of stockholders furnished under the provisions
of Sec. 25.66(c)(1) shall be submitted annually by the brewer on July 1
or on any other date approved by the regional director (compliance).
When the sale or transfer of capital stock results in a change in the
control or management of the business, notification of the change will
be made within 30 days in accordance with Sec. 25.71.
(Sec. 201, Pub. L. 85-859, 72 Stat. 1388, as amended (26 U.S.C. 5401))
Sec. 25.75 Change in officers and directors.
When there is any change in the list of officers or directors
furnished under the provisions of Sec. 25.66(a)(4), the brewer shall
submit, within 30 days of the change, an amended notice on Form 5130.10.
If the brewer has shown to the satisfaction of the regional director
[[Page 608]]
(compliance) that certain corporate officers listed on the original
notice have no responsibilities in connection with the operations
covered by the notice, the regional director (compliance) may waive the
requirements for submitting applications for amended notice to cover
changes of those corporate officers. In the case of multiplant brewers,
new brewers notices need not be filed for those breweries in which the
lists of officers and directors are incorporated by reference in their
brewer's notices under Sec. 25.62(b).
(Sec. 201, Pub. L. 85-859, 72 Stat. 1388, as amended (26 U.S.C. 5401))
Sec. 25.76 Change in statement of process.
When there is a change in the information in a statement
of process
required by Sec. 25.62(a)(7) for any fermented beverage produced and
marketed under a name other than ``beer,'' ``ale,'' ``porter,''
``stout,'' ``lager,'' or ``malt liquor,'' the brewer shall submit an
amended notice and obtain approval of the notice prior to using the
changed statement of process.
(Sec. 201, Pub. L. 85-859, 72 Stat. 1388, as amended (26 U.S.C. 5401))
Sec. 25.77 Change in location.
When there is a change in the location of the brewery, the
brewer
shall file an amended Form 5130.10, and a new bond, Form 5130.22, or a
consent of surety, Form 1533 (5000.18), in accordance with Sec. 25.91,
extending the terms of the bond or continuation certificate to cover
operations at the new location. The brewer may not begin operations at
the new location until the regional director (compliance) approves the
required documents.
(Sec. 201, Pub. L. 85-859, 72 Stat. 1388, as amended (26 U.S.C. 5401))
Sec. 25.78 Change in premises.
Except as authorized in Sec. 25.81, when the brewery is to
be
extended or curtailed, the brewer shall file with the regional director
(compliance) an amended Form 5130.10. The additional facilities covered
by the extension may not be used for the proposed purposes, and the
portion to be curtailed may not be used for other than the previously
approved purposes, prior to approval of Form 5130.10
(Sec. 201, Pub. L. 85-859, 72 Stat. 1388, as amended (26 U.S.C. 5401))
Alternation of Operations
Sec. 25.81 Alternation of brewery and bonded or taxpaid wine premises.
(a) General. A brewer operating a contiguous bonded winery
or
taxpaid wine bottling house may, as provided in this section, alternate
the use of each premises by extension or curtailment.
(b) Qualifying documents. The brewer shall file with the
regional
director (compliance) and receive approval of the following qualifying
documents:
(1) ATF F 5120.25 and Form 5130.10 to cover the curtailment
and
extension of the premises to be alternated.
(2) Special diagrams, in duplicate, delineating the brewery
premises
and the bonded or taxpaid wine premises as they will exist both during
extension and curtailment. The diagrams will clearly depict all areas,
buildings, floors, rooms, equipment and pipelines which are to be
subject to alternation in their relative operating sequence.
(3) Evidence of existing bond, consent of surety, continuation
certificate, or a new bond to cover the proposed alternation of
premises.
(c) Brewer's responsibility. After approval of qualifying
documents,
the brewer may alternate the designated premises pursuant to a
letterhead notice submitted to the regional director (compliance)
through the ATF area supervisor. The notice will contain the information
required by paragraph (d) of this section. Prior to the effective date
and hour of the alternation, the brewer shall (1) remove all beer on
brewery premises to be alternated to bonded or taxpaid wine premises, or
(2) remove all wine from bonded to taxpaid wine premises to be
alternated to brewery premises.
(d) Information for notice. The notice required by paragraph
(c) of
this section will contain the following information:
(1) Plant name and address;
(2) Serial number;
(3) Effective date and hour of proposed change;
[[Page 609]]
(4) Whether premises are to be curtailed or extended;
(5) Purpose of curtailment or extension;
(6) Identification of the special diagram depicting the premises
as
they exist when curtailed or extended; and
(7) Date of execution and signature of brewer.
(e) Separation of premises. The regional director (compliance)
may
require that the portion of brewery or bonded or taxpaid wine premises
extended or curtailed under this section be separated, in a manner
satisfactory to the regional director (compliance), from the remaining
portion of the brewery or bonded or taxpaid premises.
(Sec. 201, Pub. L. 85-859, 72 Stat. 1388, as amended, 1389, as amended,
1390, as amended (26 U.S.C. 5401, 5411, 5415))
[T.D. ATF-224, 51 FR 7673, Mar. 5, 1986; 51 FR 9190, Mar. 18, 1986; as
amended by T.D. ATF-299, 55 FR 24989, June 19, 1990]
Discontinuance of Business
Sec. 25.85 Notice of permanent discontinuance.
When a brewer desires to discontinue business premanently,
he or she
shall file with the regional director (compliance) a notice on Form
5130.10. The brewer shall state the purpose of the notice as
``Discontinuance of business'' and give the date of the discontinuance.
When all beer has been lawfully disposed of, the regional director
(compliance) will approve the Form 5130.10 and return a copy to the
brewer. The brewer shall file a report on Form 5130.9 showing no beer or
cereal beverage on hand and marked ``Final Report.''
(Sec. 201, Pub. L. 85-859, 72 Stat. 1388, as amended (26 U.S.C. 5401))
Subpart H--Bonds and Consents of Surety
Sec. 25.91 Requirement for bond.
(a) General. Every person intending to commence the business
of a
brewer shall file a bond, Form 5130.22, as prescribed in this subpart,
covering operations at the brewery, at the time of filing the original
Brewer's Notice, Form 5130.10. Every brewer intending to continue the
business of a brewer shall, once every 4 years, or as provided in
Sec. 25.95, execute and file a new bond, or continuation certificate as
provided in Sec. 25.97, with the regional director (compliance).
(b) Conditions of the bond. The Brewer's Bond, Form 5130.22,
will be
conditioned upon the brewer faithfully complying with all provisions of
law and regulations relating to the activities covered by the bond, and
upon paying all taxes imposed by 26 U.S.C. Chapter 51 and all interest
and penalties incurred or fines imposed for violations of those
provisions.
(c) Additional information. The regional director (compliance)
shall
require, in connection with any brewer's bond, a statement executed
under the penalties of perjury, as to whether the principal or any
person owning, controlling, or actively participating in the management
of the business of the principal has been convicted of or has
compromised any offense set forth in Sec. 25.101(a)(1), or has been
convicted of any offense set forth in Sec. 25.101(a)(2). In the event
the above statement contains an affirmative answer, the applicant shall
submit a statement describing in detail the circumstances surrounding
the conviction or compromise.
(d) Bond required before beginning business. A person may
not begin
business or continue business as a brewer until first receiving notice
that the regional director (compliance) has approved the bond,
continuation certificate, or consent of surety, as required by this
part.
(Sec. 201, Pub. L. 85-859, 72 Stat. 1388, as amended (26 U.S.C. 5401);
sec. 4(a), Pub. L. 91-673, 84 Stat. 2057 (26 U.S.C. 5417))
Sec. 25.92 Consent of surety.
A brewer may change the terms of any bond filed under this
part by
filing a consent of surety. Consents of surety will be executed on Form
1533 (5000.18) by the brewer and the surety on the bond, with the same
formality and proof of authorization as required for the execution of a
bond.
(Sec. 201, Pub. L. 85-859, 72 Stat. 1388, as amended (26 U.S.C. 5401))
[[Page 610]]
Sec. 25.93 Penal sum of bond.
(a) Calculation. The penal sum of the brewer's bond will
be equal to
10 percent of the maximum amount of tax, calculated at the rates
prescribed by law, which the brewer will become liable to pay during a
calendar year during the period of the bond on beer:
(1) Removed for transfer to the brewery from other breweries
owned
by the same brewer;
(2) Removed without payment of tax for export or for use
as supplies
on vessels and aircraft;
(3) Removed without payment of tax for use in research, development,
or testing; and
(4) Removed for consumption or sale.
(b) Concentrate. A brewer who concentrates beer under subpart
R of
this part shall calculate the penal sum of the bond by computing 10
percent of the amount of tax at the rates prescribed by law, on the
maximum quantity of beer used in the production of concentrate during a
calendar year. The brewer shall add this amount to the penal sum
calculated under paragraph (a) of this section to determine the total
penal sum of the brewer's bond.
(c) Maximum and minimum penal sums. The maximum penal sum
of the
bond (or total penal sum if original and strengthening bonds are filed)
is not to exceed $150,000 when the tax on beer is to be prepaid, or
$500,000 when the tax is to be deferred as provided in Sec. 25.164. The
minimum penal sum of a bond is $1,000.
(Sec. 201, Pub. L. 85-859, 72 Stat. 1388, as amended (26 U.S.C. 5401))
Sec. 25.94 Strengthening bonds.
(a) Requirement. When the penal sum of the brewer's bond
(calculated
as provided in Sec. 25.93) in effect is not sufficient, the principal
may prepay the tax on beer as provided in subpart K of this part, or
give a strengthening bond in sufficient penal sum if the surety is the
same as on the bond in effect. If the surety is not the same, a new bond
covering the entire liability is required.
(b) Restrictions. A strengthening bond may not in any way
release a
former bond or limit a bond to less than the full penal sum.
(c) Date of execution. Strengthening bonds will show the
current
date of execution and their effective date.
(Sec. 201, Pub. L. 85-859, 72 Stat. 1388, as amended (26 U.S.C. 5401))
Sec. 25.95 New bond.
The regional director (compliance) may at any time, at his
or her
discretion, require a new bond. A new bond is required immediately in
the case of insolvency of a surety. Executors, administrators,
assignees, receivers, trustees, or other persons acting in a fiduciary
capacity shall execute a new bond or obtain a consent of surety on all
bonds in effect. When the interests of the Government so demand, or in
any case when the security of the bond becomes impaired for any reason,
the principal will be required to give a new bond. When a bond is found
to be not acceptable by the regional director (compliance), the
principal will be required immediately to obtain a new and satisfactory
bond or discontinue business.
(Sec. 201, Pub. L. 85-859, 72 Stat. 1388, as amended (26 U.S.C. 5401))
Sec. 25.96 Superseding bond.
When the principal submits a new bond to supersede a bond
or bonds
in effect, the regional director (compliance) after approving the
superseding bond, will issue a notice of termination for the superseded
bond under the provisions of this subpart. Superseding bonds will show
the current date of execution and their effective date.
Sec. 25.97 Continuation certificate.
If the contract of surety between the brewer and the surety
on an
expiring bond or continuation certificate is continued in force for a
succeeding period of not less than 4 years from the expiration date of
the bond or continuation certificate, the brewer may submit, in lieu of
a new bond, a Brewer's Bond Continuation Certificate on Form 5130.23,
executed under the penalties of perjury, by the brewer and the surety
attesting to continuation of the bond. Each continuation certificate
will constitute a bond and all provisions of law and regulations
applicable to bonds on
[[Page 611]]
Form 5130.22 given under this part, including the disapproval of bonds,
are applicable to continuation certificates.
(Sec. 201, Pub. L. 85-859, 72 Stat. 1388, as amended (26 U.S.C. 5401))
Sec. 25.98 Surety or security.
(a) Bond coverage. Bonds required by this part will be given
with
corporate surety or collateral security.
(b) Corporate surety. Surety bonds may be given only with
surety
companies holding certificates of authority from the Secretary as
acceptable sureties on Federal bonds, subject to the limitations set
forth in the current revision of Treasury Department Circular No. 570,
Companies Holding Certificates of Authority as Acceptable Reinsuring
Companies.
(c) Revisions of Circular No. 570. Treasury Department Circular
No.
570 is published in the Federal Register annually as of the first
workday in July. As they occur, interim revisions of the circular are
published in the Federal Register. Copies may be obtained from the
Surety Bond Branch, Financial Management Service, Department of the
Treasury, Washington, DC 20226.
(d) More than one corporate surety. A bond may be executed
by two or
more corporate sureties. Each corporate surety may limit its liability
in terms on the face of the bond in a specified amount. This amount may
not exceed the limitations set forth for corporate security by the
Secretary which are set forth in the current revision of Treasury
Department Circular No. 570. The sum of the liabilities for the sureties
will equal the required penal sum of the bond.
(e) Deposit of collateral securities in lieu of corporate
surety.
Bonds or notes of the United States, or other obligations which are
unconditionally guaranteed as to both interest and principal by the
United States, may be pledged and deposited by principals as collateral
security in lieu of corporate surety in accordance with 31 CFR Part 225.
(96 Stat. 1068, 1085 (31 U.S.C. 9304-9308); sec. 201, Pub. L. 85-859, 72
Stat. 1388, as amended (26 U.S.C. 5401))
Sec. 25.99 Filing powers of attorney.
Each bond, continuation certificate, and each consent of
surety will
be accompanied by a power of attorney authorizing the agent or officer
to execute the document. The power of attorney will be prepared on a
form provided by the surety company and executed under the corporate
seal of the company. If the power of attorney submitted is other than a
manually signed original, it will be accompanied by a certificate of its
validity.
(96 Stat. 1068, 1085 (31 U.S.C. 9304-9308))
Disapproval or Termination of Bonds
or Consents of Surety
Sec. 25.101 Disapproval of bonds or consents of surety.
(a) Reasons for disapproval. The regional director (compliance)
may
disapprove a bond or consent of surety if the individual, firm,
partnership, corporation, or association giving the bond or consent of
surety, or if any of the above entities owning, controlling or actively
participating in the management of a business giving a bond as a brewer,
has been previously convicted in a court of competent jurisdiction of:
(1) Any fraudulent noncompliance with any provision of law
of the
United States if it related to internal revenue or customs taxation of
distilled spirits, wines or beer, or if the offense shall have been
compromised with the individual, firm, partnership, corporation, or
association on payment of penalties or otherwise; or
(2) Any felony under a law of any State or the District of
Columbia,
or the United States, prohibiting the manufacture, sale, importation, or
transportation of distilled spirits, wines, beer, or other intoxicating
liquor.
(b) Appeal of disapproval. If the regional director (compliance)
disapproves a bond or consent of surety, the person giving the bond may
appeal the disapproval to the Director, who will grant a hearing in the
matter if requested by the applicant or brewer. The decision of the
Director shall be final.
(Sec. 201, Pub. L. 85-859, 72 Stat. 1394, as amended (26 U.S.C. 5551))
[[Page 612]]
Sec. 25.102 Termination of surety's liability.
The liability of a surety on a bond required by this part
will be
terminated only as to liability arising on or after: (a) the effective
date of a superseding bond; (b) the date of approval of the
discontinuance of business of the brewer; or (c) following the giving of
notice by the surety as provided in Sec. 25.103.
(Sec. 201, Pub. L. 85-859, 72 Stat. 1388, as amended (26 U.S.C. 5401))
Sec. 25.103 Notice by surety for relief from liability under bond.
A surety may, at any time, in writing, notify the principal
and the
regional director (compliance) that the surety desires after a specified
date (not less than 60 days after the date of service on the principal)
to be relieved of any liability under the bond which is incurred by the
principal after the date named in the notice. The surety shall include
proof of service of the notice on the principal with the notice filed
with the regional director (compliance). The notice will become
effective on the date named, unless the surety withdraws the notice, in
writing. The surety on the bond remains liable under the bond with
respect to any liability incurred by the principal while the bond is in
effect.
(Sec. 201, Pub. L. 85-859, 72 Stat. 1388, as amended (26 U.S.C. 5401))
Sec. 25.104 Termination of bonds.
Brewer's bonds may be terminated as to liability for future
removals
or receipts (a) pursuant to application of the surety as provided in
Sec. 25.103, (b) on approval of a superseding bond, or (c) on
notification by the principal that the business has been discontinued.
On termination of the surety's liability under a bond, the regional
director (compliance) will notify the principal and sureties.
(31 U.S.C. 9301, 9303)
Sec. 25.105 Release of collateral security.
Bonds, notes, and other obligations of the United States,
pledged
and deposited as security in connection with bonds required by this part
will be released in accordance with 31 CFR Part 225. When the regional
director (compliance) determines there is no outstanding liability
against the bond and that it is no longer necessary to hold the
security, he or she shall fix the date or dates on which a part or all
of the security will be released. At any time prior to the release of
the security, the regional director (compliance) may, for proper cause,
extend the date of release of the security for an additional length of
time as may be appropriate.
(31 U.S.C. 9301, 9303)
Subpart I--Special Taxes
Liability for Special Tax
Sec. 25.111 Brewer's special tax.
(a) General. Every brewer shall pay a special (occupational)
tax at
the rate specified by Sec. 25.111a or Sec. 25.111b, whichever is
applicable. The tax shall be paid on or before the date of commencing
business as a brewer, and thereafter every year on or before July 1. On
commencing business, the tax shall be computed from the first day of the
month in which liability is incurred, through the following June 30.
Thereafter, the tax shall be computed for the entire year (July 1
through June 30).
(b) Transition rule. A brewer who was engaged in business
on January
1, 1988, and paid a special (occupational) tax for a taxable period
which began before January 1, 1988, and included that date, shall pay an
increased special tax for the period January 1, 1988, through June 30,
1988. The increased special tax shall not exceed one-half the excess (if
any) of (1) the rate of special tax in effect on January 1, 1988, over
(2) the rate of such tax in effect on December 31, 1987. The increased
special tax shall be paid on or before April 1, 1988.
(26 U.S.C. 5091, 5142)
[T.D. ATF-271, 53 FR 17547, May 17, 1988]
Sec. 25.111a Special tax rates.
(a) Prior rates. The special (occupational) tax imposed on
brewers
prior to January 1, 1988, was $110 a year, except that the special tax
for any brewer of less than 500 barrels a year was $55 a year.
(b) Rate effective January 1, 1988. The special tax rate
imposed on
brewers
[[Page 613]]
(other than small brewers as defined in Sec. 25.111b) is $1000 a year.
(26 U.S.C. 5091)
[T.D. ATF-271, 53 FR 17547, May 17, 1988]
Sec. 25.111b Reduced rate of tax for small brewers.
(a) General. Effective January 1, 1988, 26 U.S.C. 5091(b)
provides
for a reduced rate of tax with respect to any brewer whose gross
receipts (for the most recent taxable year ending before the first day
of the taxable period to which the tax imposed by Sec. 25.111 relates)
are less than $500,000. The rate of tax for such a brewer is $500 a
year. The ``taxable year'' to be used for determining gross receipts is
the taxpayer's income tax year. All gross receipts of the taxpayer shall
be included, not just the gross receipts of the business subject to
special tax. Proprietors of new businesses that have not yet begun a
taxable year, as well as proprietors of existing businesses that have
not yet ended a taxable year, who commence a new activity subject to
special tax, qualify for the reduced special (occupational) tax rate,
unless the business is a member of a ``controlled group''; in that case,
the rules of paragraph (b) of this section shall apply.
(b) Controlled group. In determining gross receipts, all
persons
treated as one taxpayer under 26 U.S.C. 5061(e)(3) shall be treated as
one taxpayer for purposes of paragraph (a) of this section. ``Controlled
group'' means a controlled group of corporations, as defined in 26
U.S.C. 1563, and implementing regulations in 26 CFR 1.1563-1 through
1.1563-4, except that the words ``at least 80 percent'' shall be
replaced by the words ``more than 50 percent'' in each place they appear
in subsection (a) of 26 U.S.C. 1563, as well as in the implementing
regulations. Also, the rules for a ``controlled group of corporations''
apply in a similar fashion to groups which include partnerships and/or
sole proprietorships. If one entity maintains more than 50% control over
a group consisting of corporations and one, or more, partnerships and/or
sole proprietorships, all of the members of the controlled group are one
taxpayer for the purpose of this section.
(c) Short taxable year. Gross receipts for any taxable year
of less
than 12 months shall be annualized by multiplying the gross receipts for
the short period by 12 and dividing the result by the number of months
in the short period as required by 26 U.S.C. 448(c)(3).
(d) Returns and allowances. Gross receipts for any taxable
year
shall be reduced by returns and allowances made during that year under
26 U.S.C. 448(c)(3).
(26 U.S.C. 448, 5061, 5091)
[T.D. ATF-271, 53 FR 17547, May 17, 1988]
Sec. 25.112 Wholesaler's special tax.
A brewer shall be subject to or exempt from a wholesaler's
special
(occupational) tax as provided in Part 194 of this chapter.
(26 U.S.C. 5111, 5142)
[T.D. ATF-271, 53 FR 17548, May 17, 1988]
Sec. 25.113 Each place of business taxable.
(a) General. A brewer incurs special tax liability at each
place of
business in which an occupation subject to special tax is conducted. A
place of business means the entire office, plant or area of the business
in any one location under the same proprietorship. Passageways, streets,
highways, rail crossings, waterways, or partitions dividing the premises
are not sufficient separation to require additional special tax, if the
divisions of the premises are otherwise contiguous.
(b) Exception for contiguous areas. A brewer will not incur
additional special tax liability for sales of beer made at a location
other than on brewery premises described on the brewer's notice, Form
5130.10, if the location where such sales are made is contiguous to the
brewery premises in the manner described in paragraph (a) of this
section.
(Sec. 201, Pub. L. 85-859, 72 Stat. 1347, as amended (26 U.S.C. 5143))
Sec. 25.114 Exemptions from dealer's special taxes.
(a) Brewer. A brewer is not required to pay special tax as
a
wholesale or retail dealer in beer because of sales, at the principal
place of business or at the brewery, of beer which at the time of
[[Page 614]]
sale is stored at the brewery or which had been removed and stored in a
taxpaid storeroom operated in connection with the brewery. Each brewer
shall have only one exemption from dealer's special tax for each
brewery. The brewer may designate, in writing to the regional director
(compliance), that the principal place of business will be exempt from
dealer's special tax; otherwise, the exemption will apply to the
brewery.
(b) Wholesale dealer. A wholesale dealer in beer who has
paid the
appropriate special tax will not again be required to pay special tax as
a wholesale dealer in beer because of sales of beer to wholesale or
retail dealers in liquors or beer or to limited retail dealers, at the
purchaser's place of business.
(Sec. 201, Pub. L. 85-859, 72 Stat. 1340, as amended (26 U.S.C. 5113))
Execution of Special Tax Returns
Sec. 25.117 Special tax returns.
Special tax shall be paid by return. The prescribed return
is ATF
Form 5630.5, Special Tax Registration and Return. Special tax returns,
with payment of tax, shall be filed with ATF in accordance with
instructions on the form.
[T.D. ATF-271, 53 FR 17548, May 17, 1988]
Sec. 25.118 Preparation of ATF Form 5630.5.
All of the information called for on Form 5630.5 shall be
provided,
including:
(a) The true name of the taxpayer.
(b) The trade name(s) (if any) of the business(es) subject
to
special tax.
(c) The employer identification number (see Sec. 25.121).
(d) The exact location of the place of business, by name
and number
of building or street, or if these do not exist, by some description in
addition to the post office address. In the case of one return for two
or more locations, the address to be shown shall be the taxpayer's
principal place of business (or principal office, in the case of a
corporate taxpayer).
(e) The class(es) of special tax to which the taxpayer is
subject.
(f) Ownership and control information: that is, the name,
position,
and residence address of every owner of the business and of every person
having power to control its management and policies with respect to the
activity subject to special tax. ``Owner of the business'' shall include
every partner, if the taxpayer is a partnership, and every person owning
10% or more of its stock, if the taxpayer is a corporation. However, the
ownership and control information required by this paragraph need not be
stated if the same information has been previously provided to ATF in
connection with the Brewer's Notice, and if the information previously
provided is still current.
[T.D. ATF-271, 53 FR 17548, May 17, 1988]
Sec. 25.119 Multiple locations and/or classes of tax.
A taxpayer subject to special tax for the same period at
more than
one location or for more than one class of tax shall--
(a) File one special tax return, ATF Form 5630.5, with payment
of
tax, to cover all such locations and classes of tax; and
(b) Prepare, in duplicate, a list identified with the taxpayer's
name, address (as shown on ATF Form 5630.5), employer identification
number, and period covered by the return. The list shall show, by
States, the name, address, and tax class of each location for which
special tax is being paid. The original of the list shall be filed with
ATF in accordance with instructions on the return, and the copy shall be
retained at the taxpayer's principal place of business (or principal
office, in the case of a corporate taxpayer) for the period specified in
Sec. 25.300(c).
[T.D. ATF-271, 53 FR 17548, May 17, 1988]
Sec. 25.120 Signing of ATF Forms 5630.5.
(a) Ordinary returns. The return of an individual proprietor
shall
be signed by the individual. The return of a partnership shall be signed
by a general partner. The return of a corporation shall be signed by any
officer. In each case, the person signing the return shall designate his
or her capacity as ``individual owner,'' ``member of firm,'' or, in the
case of a corporation, the title of the officer.
[[Page 615]]
(b) Fiduciaries. Receivers, trustees, assignees, executors,
administrators, and other legal representatives who continue the
business of a bankrupt, insolvent, deceased person, etc., shall indicate
the fiduciary capacity in which they act.
(c) Agent or attorney in fact. If a return is signed by an
agent or
attorney in fact, the signature shall be preceded by the name of the
principal and followed by the title of the agent or attorney in fact. A
return signed by a person as agent will not be accepted unless there is
filed, with the ATF office with which the return is required to be
filed, a power of attorney authorizing the agent to perform the act.
(d) Perjury statement. ATF Forms 5630.5 shall contain or
be verified
by a written declaration that the return has been executed under the
penalties of perjury.
(26 U.S.C. 5142, 6061, 6065, 6151, 7011)
[T.D. ATF-271, 53 FR 17548, May 17, 1988]
Employer Identification Numbers
Sec. 25.121 Employer identification number.
The employer identification number (defined in 26 CFR 301.7701-12)
of the taxpayer who has been assigned such a number shall be shown on
each special tax return, including amended returns, filed under this
subpart. Failure of the taxpayer to include the employer identification
number may result in the imposition of the penalty specified in
Sec. 70.113 of this chapter.
(26 U.S.C. 6109, 6676)
[T.D. ATF-271, 53 FR 17548, May 17, 1988, as amended by T.D. ATF-301, 55
FR 47605, Nov. 14, 1990]
Sec. 25.122 Application for employer identification number.
Each taxpayer who files a special tax return, who has not
already
been assigned an employer identification number, shall file IRS Form SS-
4 to apply for one. The taxpayer shall apply for and be assigned only
one employer identification number, regardless of the number of places
of business for which the taxpayer is required to file a special tax
return. The employer identification number shall be applied for no later
than 7 days after the filing of the taxpayer's first special tax return.
IRS Form SS-4 may be obtained from the director of an IRS service center
or from any IRS district director.
(26 U.S.C. 6109)
[T.D. ATF-271, 53 FR 17548, May 17, 1988]
Sec. 25.123 Preparation and filing of IRS Form SS-4.
The taxpayer shall prepare and file IRS Form SS-4, together
with any
supplementary statement, in accordance with the instructions on the form
or issued in respect to it.
(26 U.S.C. 6109)
[T.D. ATF-271, 53 FR 17549, May 17, 1988]
Special Tax Stamps
Sec. 25.125 Issuance of special tax stamps.
Upon filing a properly executed return on ATF Form 5630.5,
together
with the full remittance, the taxpayer will be issued an appropriately
designated special tax stamp. If the return covers multiple locations,
the taxpayer will be issued one appropriately designated stamp for each
location listed on the attachment required by Sec. 25.119, but showing,
as to name and address, only the name of the taxpayer and the address of
the taxpayer's principal place of business (or principal office in the
case of a corporate taxpayer).
(26 U.S.C. 6806)
[T.D. ATF-271, 53 FR 17549, May 17, 1988]
Sec. 25.126 Distribution of stamps for multiple locations.
On receipt of the special tax stamps, the taxpayer shall
verify that
there is one stamp for each location listed on the attachment to Form
5630.5. The taxpayer shall designate one stamp for each location and
type on each stamp the address of the business conducted for which that
stamp is designated. The taxpayer shall then forward each stamp to the
place of business designated on the stamp.
[T.D. ATF-224, 51 FR 7673, Mar. 5, 1986, as amended by T.D. ATF-251, 52
FR 19313, May 22, 1987]
[[Page 616]]
Sec. 25.127 Examination of special tax stamps.
All stamps denoting payment of special tax will be kept available
for inspection by ATF officers, at the location for which designated,
during business hours.
(Act of August 16, 1954 68A Stat. 831, as amended (26 U.S.C. 6806); sec.
201, Pub. L. 85-859, 72 Stat. 1348, as amended (26 U.S.C. 5146))
Changes in Special Tax Stamps
Sec. 25.131 Change in name.
If there is a change in the corporate or firm name, or in
the trade
name, as shown on Form 5630.5, the brewer shall file an amended special
tax return as soon as practicable after the change covering the new
corporate or firm name, or trade names. No new special tax is required
to be paid. The brewer shall attach the special tax stamp for
endorsement of the change in name.
(26 U.S.C. 7011)
[T.D. ATF-271, 53 FR 17549, May 17, 1988]
Sec. 25.132 Change in proprietorship.
(a) General. If there is a change in the proprietorship of
a
brewery, the successor shall obtain the required special tax stamps.
(b) Exemption for certain successors. Persons having the
right of
succession provided for in Sec. 25.133 may carry on the business for the
remainder of the period for which the special tax was paid, if within 30
days after the date on which the successor begins to carry on the
business, the successor files a return on Form 5630.5, which shows the
basis of succession. A person who is a successor to a business for which
special tax has been paid and who fails to register the succession is
liable for special tax computed from the first day of the calendar month
in which he or she began to carry on the business.
(Act of August 16, 1954, 68A Stat. 845, as amended (26 U.S.C. 7011);
sec. 201, Pub. L. 85-859, 72 Stat. 1347, as amended (26 U.S.C. 5143))
[T.D. ATF-224, 51 FR 7673, Mar. 5, 1986, as amended by T.D. ATF-251, 52
FR 19313, May 22, 1987]
Sec. 25.133 Persons having right of succession.
Under the conditions indicated in Sec. 25.132, the right
of
succession will pass to certain persons in the following cases:
(a) Death. The widowed spouse or child, or executor, administrator,
or other legal representative of the taxpayer;
(b) Succession of spouse. A husband or wife succeeding to
the
business of his or her spouse (living);
(c) Insolvency. A receiver or trustee in bankruptcy, or an
assignee
for benefit of creditors;
(d) Withdrawal from firm. The partner or partners remaining
after
death or withdrawal of a member.
(Sec. 201, Pub. L. 85-859, 72 Stat. 1347, as amended (25 U.S.C. 5143))
Sec. 25.134 Change in location.
If there is a change in location of a taxable place of business,
the
brewer shall, within 30 days after the change, file with ATF an amended
special tax return covering the new location. The brewer shall attach
the special tax stamp or stamps, for endorsement of the change in
location. No new special tax is required to be paid. However, if the
brewer does not file the amended return within 30 days, the brewer is
required to pay a new special tax and obtain a new special tax stamp.
(26 U.S.C. 5143, 7011)
[T.D. ATF-271, 53 FR 17549, May 17, 1988]
Subpart J--Marks, Brands, and Labels
Sec. 25.141 Barrels and kegs.
(a) General requirements. The brewer's name or trade name
and the
place of production (city and, if necessary for identification, State)
shall be permanently marked on each barrel or keg. If the place of
production is clearly shown on the bung or on the tap cover, or on a
label securely affixed to each barrel or keg, the place of production
need not be permanently marked on each barrel or keg. No statement as to
payment of internal revenue taxes may be shown.
[[Page 617]]
(b) Breweries of same ownership. (1) If two or more breweries
are
owned or operated by the same person, firm, or corporation (as defined
in Sec. 25.181), the place of production:
(i) May be shown as the only location on the bung, or on
the tap
cover, or on a separate label attached to the keg;
(ii) May be included in a listing of the locations of breweries
qualified under this part if the place of production is not given less
emphasis than any of the other locations; or
(iii) Need not be shown if the brewer's principal place of
business
is shown in lieu of any other location. The brewer's principal place of
business will be the location of a brewery operated by the brewer and
qualified under this part.
(2) If the location of two or more breweries is shown on
the keg,
bung, tap cover, or on a separate label attached to the keg (paragraph
(b)(1)(ii)), or if the brewer's principal place of business is shown in
lieu of the actual place of production (paragraph (b)(1)(iii)), the
brewer shall indicate the actual place of production by printing, coding
or other markings on the keg, bung, tap cover, or on a separate label
attached to the keg. The coding system employed will permit an ATF
officer to determine the place of production (including street address
if two or more breweries are located in the same city) of the beer. The
brewer shall notify the regional director (compliance) prior to
employing a coding system.
(c) Label approval required. Labels or tap covers used by
brewers
shall be covered by certificates of label approval, Form 5100.31, when
required by Part 7 of this chapter.
(Approved by the Office of Management and Budget under control number
1512-0474)
(Sec. 201, Pub. L. 85-859, 72 Stat. 1389, as amended (26 U.S.C. 5412))
[T.D. ATF-224, 51 FR 7673, Mar. 5, 1986, as amended by T.D. ATF-225, 51
FR 8492, Mar. 12, 1986]
Sec. 25.142 Bottles.
(a) Label requirements. Each bottle of beer shall show by
label or
otherwise the name or trade name of the brewer, the net contents of the
bottle, the nature of the product such as beer, ale, porter, stout,
etc., and the place of production (city and, when necessary for
identification, State). No statement as to payment of internal revenue
taxes may be shown.
(b) Breweries of same ownership. (1) If two or more breweries
are
owned or operated by the same person, firm, or corporation (as defined
in Sec. 25.181), the place of production:
(i) May be shown as the only location on the label;
(ii) May be included in a listing of the locations of breweries
qualified under this part if the place of production is not given less
emphasis than any of the other locations; or
(iii) Need not be shown if the brewer's principal place of
business
is shown in lieu of any other location. The brewer's principal place of
business will be the location of a brewery operated by the brewer and
qualified under this part.
(2) If the location of two or more breweries is shown on
the label
(paragraph (b)(1)(ii)), or if the brewer's principal place of business
is shown on the label in lieu of the actual place of production
(paragraph (b)(1)(iii)), the brewer shall indicate the actual place of
production by printing, coding or other markings on the label, bottle,
crown or lid. The coding system employed will permit an ATF officer to
determine the place of production (including street address if two or
more breweries are located in the same city) of the beer. The brewer
shall notify the regional director (compliance) prior to employing a
coding system.
(c) Distinctive names. If the brewer's name, trade name or
brand
name includes the name of a city which is not the place where the beer
was produced, the Director may require the brewer to state the actual
place of production on the label.
(d) Tolerances. The statement of net contents shall indicate
exactly
the volume of beer within the bottle except for variations in measuring
as may occur in filling conducted in compliance with good commercial
practice. The barrel equivalent of bottles filled during a consecutive
three month period, calculated on the basis of the brewer's fill test
records, may not vary more than 0.5 percent from the barrel equivalent
of bottles filled during the
[[Page 618]]
same period, calculated on the basis of the stated net contents of the
bottles. The brewer is liable for the tax on the entire amount of beer
removed, without benefit of tolerance, when the fill of bottles and cans
exceeds the tolerance for the three month period, or when filling is not
conducted in compliance with good commercial practice.
(e) Label approval required. Labels used by brewers shall
be covered
by certificates of label approval, Form 5100.31, when required by Part 7
of this chapter.
(f) Short-fill bottles. A brewer may dispose of taxpaid short-fill
bottles of beer to employees for their use but not for resale. These
bottles need not be labeled, but if labeled they need not show an
accurate statement of net contents.
(Approved by the Office of Management and Budget under control number
1512-0474)
(Sec. 201, Pub. L. 85-859, 72 Stat. 1389, as amended (26 U.S.C. 5412))
[T.D. ATF-224, 51 FR 7673, Mar. 5, 1986, as amended by T.D. ATF-225, 51
FR 8492, Mar. 12, 1986]
Sec. 25.143 Cases.
(a) Brewer's name. The brewer's name or trade name will be
shown on
each case or other shipping container of bottled beer. A brewer may use
unmarked cases to hold:
(1) Cartons of beer, if the visible portion of the cartons
shows the
required name; or
(2) Bottles or cans with plastic carriers, if the visible
portion of
the bottles or cans shows the required name.
(b) Other information. The brewer may show on a case or shipping
container the place of production (city and, when necessary for
identification, State), and the addresses of other breweries owned by
the same person, firm, or corporation (as defined in Sec. 25.181). If
only one address is shown, it will be that of the producing brewery, or
of the brewer's principal place of business.
(Approved by the Office of Management and Budget under control number
1512-0474)
(Sec. 201, Pub. L. 85-859, 72 Stat. 1389, as amended (26 U.S.C. 5412))
[T.D. ATF-224, 51 FR 7673, Mar. 5, 1986, as amended by T.D. ATF-225, 51
FR 8492, Mar. 12, 1986]
Sec. 25.144 Rebranding barrels and kegs.
(a) A brewer may not use a barrel or keg which bears the
name of
more than one brewer, and except as provided in Sec. 25.231, may not use
a barrel or keg bearing the name of a brewer other than the producing
brewer.
(b) A brewer who purchases or otherwise obtains barrels or
kegs from
another brewer shall permanently remove or durably cover the original
marks and brands after notifying the regional director (compliance) of
the proposed action. A brewer may use the barrels or kegs obtained
without removing or covering the original marks and brands if the
brewer: (1) Adopts a trade name substantially identical to the name
appearing on the barrels or kegs; or (2) succeeds to a brewer who has
discontinued business, in which case the brewer may add marks or brands,
in accordance with Sec. 25.141, which indicate ownership.
(Sec. 201, Pub. L. 85-859, 72 Stat. 1389, as amended (26 U.S.C. 5412))
Sec. 25.145 Tanks, vehicles, and vessels.
(a) Each brewer who transfers beer to another brewery of
the same
ownership (as defined in Sec. 25.181), or who exports beer without
payment of tax, as provided in Sec. 25.203, shall plainly and durably
mark each tank, tank car, tank truck, tank ship, barge, or deep tank of
a vessel in accordance with paragraph (b) of this section. These marks
may be placed on a label securely affixed to the route board of the
container.
(b) The brewer shall mark each container with--
(1) The designation ``Beer'';
(2) The brewer's name;
(3) The address of the brewery from which removed;
(4) The address of the brewery to which transferred or the
marks
required for exportation in Part 252 of this chapter, as applicable;
(5) The date of shipment; and
(6) The quantity, expressed in barrels.
(Sec. 201, Pub. L. 85-859, 72 Stat. 1334, as amended, 1389, as amended
(26 U.S.C. 5053, 5414))
[[Page 619]]
Subpart K--Tax on Beer
Liability for Tax
Sec. 25.151 Rate of tax.
All beer, brewed or produced, and removed for consumption
or sale,
is subject to the tax prescribed by 26 U.S.C. 5051, for every barrel
containing not more than 31 gallons, and at a like rate for any other
quantity or for the fractional parts of a barrel as authorized in
Sec. 25.156.
(Sec. 201, Pub. L. 85-859, 72 Stat. 1333, as amended (26 U.S.C. 5051,
5052))
Sec. 25.152 Reduced rate of tax for certain brewers.
(a) General. Section 5051(a)(2) of Title 26 U.S.C. provides
for a
reduced rate of tax on the first 60,000 barrels of beer removed for
consumption or sale by a brewer during a calendar year. To be eligible
to pay the reduced rate of tax, a brewer:
(1) Shall brew or produce the beer at a qualified brewery
in the
United States;
(2) May not produce more than 2,000,000 barrels of beer per
calendar
year; and
(3) May not be a member of a ``controlled group'' of brewers
whose
members together produce more than 2,000,000 barrels of beer per
calendar year.
The regional director (compliance) shall deny use of the reduced rate of
tax provided by 26 U.S.C. 5051(a)(2) where it is determined that the
allowance of such a reduced rate would benefit a person who would
otherwise fail to qualify for use of such rate.
(b) Definitions. For the purpose of determining eligibility
for
payment of the reduced rate of tax on beer, terms have the following
meanings:
(1) Controlled group. A related group of brewers as defined
in 26
U.S.C. 5051(a)(2)(B). Controlled groups include, but are not limited to:
(i) Parent-subsidiary controlled groups as defined in 26
CFR 1.1563-
1(a)(2);
(ii) Brother-sister controlled groups as defined in 26 CFR
1.1563-
1(a)(3); and
(iii) Combined groups as defined in 26 CFR 1.1563-1(a)(4).
Stock
ownership in a corporation need not be direct and 51% constructive
ownership, defined in 26 CFR 1.1563-3, may be acquired through:
(A) An option to purchase stock;
(B) Attribution from partnerships;
(C) Attribution from estate or trusts;
(D) Attribution from corporations; or
(E) Ownership by spouses, children, grandchildren, parents,
and
grandparents.
(2) Production of beer. The production of beer as recorded
in the
brewer's daily records and reported in the Brewer's Report of
Operations, Form 5130.9. For the purpose of determining compliance with
the 2,000,000 barrel limitation, production of beer by a brewer or a
controlled group of brewers includes both beer produced at qualified
breweries within the United States and beer produced outside the United
States.
(c) Brewers operating more than one brewery. Brewers who
operate
more than one brewery shall include the combined production of beer at
all their breweries when determining eligibility under the 2,000,000
barrel limitation. The reduced rate of tax applies to the first 60,000
barrels of beer removed for consumption or sale in a calendar year by
the brewer; the brewer shall apportion the 60,000 barrels among the
breweries in the manner described in the notice as provided by
Sec. 25.167(b)(3).
(d) Controlled groups of brewers. Members of a controlled
group of
brewers shall include the combined production of beer by all member
brewers when determining eligibility under the 2,000,000 limitation. The
reduced rate of tax applies to the first 60,000 barrels of beer removed
for consumption or sale in a calendar year by the controlled group of
brewers; the controlled group of brewers shall apportion the 60,000
barrels among member brewers in the manner described in each brewer's
notice as provided by Sec. 25.167(b)(3).
(Sec. 201, Pub. L. 85-859, 72 Stat. 1333, as amended (26 U.S.C. 5052))
[T.D. ATD-224, 51 FR 7673, Mar. 5, 1986, as amended by T.D. ATF-307, 55
FR 52738, Dec. 21, 1990; T.D. ATF-345, 58 FR 40357, July 28, 1993]
Sec. 25.153 Persons liable for tax.
The tax imposed by law on beer (including beer purchased
or procured
by one brewer from another) shall be paid
[[Page 620]]
by the brewer of the beer at the brewery where produced. The tax on beer
transferred to a brewery from other breweries owned by the same brewer
in accordance with subpart L of this part shall be paid by the brewer at
the brewery from which the beer is removed for consumption or sale.
(Sec. 201, Pub. L. 85-859, 72 Stat. 1334, as amended, 1389, as amended
(26 U.S.C. 5054, 5413, 5414))
Determination of Tax
Sec. 25.155 Types of containers.
Beer may be removed from a brewery for consumption or sale
only in
barrels, kegs, bottles, and similar containers, as provided in this
part. A container which the Director determines to be similar to a
bottle or can will be treated as a bottle for purposes of this part. A
container which the Director determines to be similar to a barrel or keg
and which conforms to one of the sizes prescribed for barrels or kegs in
Sec. 25.156 will be treated as such for purposes of this part.
(Sec. 201, Pub. L. 85-859, 72 Stat. 1389, as amended, 1390, as amended
(26 U.S.C. 5412, 5416))
Sec. 25.156 Determination of tax on keg beer.
(a) In determining the tax on beer removed in kegs, a barrel
is
regarded as a quantity of not more than 31 gallons. The authorized
fractional parts of a barrel are whole barrels, halves, thirds,
quarters, sixths, and eighths, and beer may be removed in kegs rated at
those capacities. The following keg sizes are also authorized at the
stated barrel equivalents:
------------------------------------------------------------------------
Barrel
Size of keg
equivalent
------------------------------------------------------------------------
5 gallons..................................................
0.16129
30 liter...................................................
0.25565
50 liter...................................................
0.42608
------------------------------------------------------------------------
(b) If any barrel or authorized size keg contains a quantity
of beer
more than 2 percent in excess of its rated capacity, tax will be
determined and paid on the actual quantity of beer (without benefit of
any tolerance) contained in the keg.
(c) The quantities of keg beer removed subject to tax will
be
computed to 5 decimal places. The sum of the quantities computed for any
one day will be rounded to 2 decimal places and the tax will be
calculated and paid on the rounded sum.
(26 U.S.C. 5051)
[T.D. ATF-345, 58 FR 40357, July 28, 1993]
Sec. 25.157 Determination of tax on bottled beer.
The quantities of bottled beer removed subject to tax shall
be
computed to 5 decimal places in accordance with the table and
instructions in Sec. 25.158. The sum of the quantities computed for any
one day will be rounded to 2 decimal places and the tax will be
calculated and paid on the rounded sum.
(Sec. 201, Pub. L. 85-859, 72 Stat. 1333, as amended (26 U.S.C. 5051))
Sec. 25.158 Tax computation for bottled beer.
Barrel equivalents for various case sizes are as follows:
(a) For U.S. measure bottles.
------------------------------------------------------------------------
Number of
Bottle size (net contents in fluid ounces)
bottles Barrel
per case equivalent
------------------------------------------------------------------------
6................................................
12 0.01815
6................................................
24 0.03629
7................................................
12 0.02117
7................................................
24 0.04234
7................................................
32 0.05645
7................................................
35 0.06174
7................................................
36 0.06351
7................................................
40 0.07056
7................................................
48 0.08468
8.......