dhdunbar

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dhdunbar last won the day on February 20

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  1. My last word on this, I promise. Bottom line . American style is governed by US regulations. That said, "American style" is the same in Tasmania as Tulsa. If you want to know if someone is making American style whiskey anywhere "outside of the US," you have to know what American style is.
  2. Since you know what the standards are, then you know the questions to ask. So, rather than asking, "Is there anyone who makes American style whiskey?" ask, "Is there anyone, outside of the United States, who makes a whiskey with a mash bill of grain only, with 51% or more of a single grain, that is distilled to 160 proof or less, aged in new charred oak at not more than 125 degrees proof, and bottled at not less than 40% abv?" That is not ambiguous. "American type" is ambiguous because a lot of people are going to try to answer your question who don't know what you already do, what American type means. It is also ambiguous, because as the term is used in US regulations, "American type" also includes "a mixture of neutral spirits and not less than 5 percent on a proof gallon basis of whisky, or straight whisky, or straight whisky and whisky, if the straight whisky component is less than 20 percent on a proof gallon basis." The answer to your question would be "yes" if there is someone, somewhere making that sort of NSG diluted product. However, I think that is not what you want to know.
  3. This is a complicated question. Here is how I understand it. Because the FDA was drowning in requests for GRAS determinations, it took refuge in a policy that allows a food manufacturer to self-certify that an ingredient is GRAS. However, to do so, the food manufacturer must possess evidence that would have convinced the FDA to issue a GRAS certification if the FDA had examined the evidence itself. Under those circumstances, it seems to me that self-certification is not something that most of the people engaged in craft businesses can pull off. The FDA struggled with the rules for more than 10 years, then issued guidelines. TTB reported on this in its newsletter. Here is what TTB said: . TTB NEWSLETTER | Weekly News August 19, 2016 FDA ISSUES FINAL RULE ON FOOD INGREDIENTS THAT MAY BE "GENERALLY RECOGNIZED AS SAFE" Each producer and importer of alcohol beverages is responsible for ensuring that the ingredients in its products comply with the laws and regulations that FDA administers, including rules regarding criteria for concluding that a substance is “generally recognized as safe” (GRAS). Industry members are reminded that TTB's approval of a COLA or formula does not imply or otherwise constitute a determination that the product complies with the Federal Food, Drug, and Cosmetic Act. Source: FDA Constituent Update dated August 12, 2016 In a step to strengthen its oversight of food ingredients, the U.S. Food and Drug Administration today issued a final rule detailing the criteria for concluding that the use of a substance in human or animal food is “generally recognized as safe” (GRAS). Unlike food additives, GRAS substances are not subject to FDA pre-market approval; however, they must meet the same safety standards as approved food additives. The rule addresses the types of scientific evidence that can be used to demonstrate safety as well as the role of publications in evaluating whether the scientific evidence of safety is “generally available and accepted.” The GRAS criteria require that the safe use of ingredients in human and animal food be widely recognized by the appropriate qualified experts. The final rule also formalizes the voluntary GRAS notification procedure, which was originally established under an interim policy and pilot program for human food in 1997 and animal food in 2010. The FDA strongly encourages companies to inform the agency of GRAS conclusions through the notification procedure finalized with today’s rule. While the FDA can question the basis for an independent GRAS conclusion, whether notified or not, and take action as appropriate, the notification procedure yields important information that aids the agency’s food safety monitoring efforts. The GRAS final rule is the most recent step we are taking to strengthen the FDA’s oversight of substances added to human and animal food. Next steps include issuing additional guidances related to the GRAS regulations. As part of the Foods and Veterinary Medicine Program’s Strategic Plan, the FDA will develop and implement innovative regulatory and compliance strategies to improve premarket oversight and safety evaluation of human and animal food additives and GRAS substances. Now, TTB requires that you submit a formula when you add harmless coloring, flavoring, or blending materials to a spirits product that comes under TTB's labeling jurisdiction. However, in all instances, the FDA is the arbiter of what is and is not safe. TTB bows to the FDA's determinations. The question, then, is what TTB would do it you asserted, in a formula, that you cannot give a GRAS number because you have self-certified, to the FDA, the safety or "kukiboja" root (my invention) as a flavoring ingredient in your specialty item. I suspect it would not be well received. The burden is going to fall on you to show the sense of the community of experts applies in the case of spirits, and not just kukiboja jelly or chewing gum. Thomas Merton wrote in his journal, "Isn't life absurd enough already without our adding to it our own fantastic frustrations and stupidities?" I have a feeling attempts to use kukoboja extract might be piling frustrations onto the absurdities. I will add that the possibility that said extract could destroy kidney function is not an absurdity to be ignored. The requirement for proof that it is safe should not be decomposed along with the rest of the administrative state. I prefer to live free of concerns that food producers are poisoning me, even if it means that the food producer is not free to add any damned thing it wants. Tweedle-dee and Tweedle-dum; freedom to and freedom from. Sometimes it is necessary for government to put a thumb on the scale to balance to and from on a reasonable way
  4. Can someone tell me how many people out of one hundred could tell if you made the NSG from sugar, wine, or grain? I suspect it is very few, but I do not know that. Next, would any subtle difference in the sugar, wine, grain neutral spirits carry over into a gin after you get the required primarily juniper character? Finally, wouldn't it always be better, as a gin maker, if I started with the cleanest spirits available, that is, with the stuff that comes off industrial stills? I don't intend these as rhetorical questions. I am honestly curious.
  5. "American Whiskey" comes under the rubric (l) Class 12; products without geographical designations but distinctive of a particular place. That section provides, (1) The whiskies of the types specified in paragraphs (b) (1), (4), (5), and (6) of this section are distinctive products of the United States and if produced in a foreign country shall be designated by the applicable designation prescribed in such paragraphs, together with the words “American type” or the words “produced (distilled, blended) in __”, the blank to be filled in with the name of the foreign country: Provided, That the word “bourbon” shall not be used to describe any whisky or whisky-based distilled spirits not produced in the United States. If whisky of any of these types is composed in part of whisky or whiskies produced in a foreign country there shall be stated, on the brand label, the percentage of such whisky and the country of origin thereof. That is the law in the United States. It is not the law in Tuva because the US senate can't make laws that apply in Tuva. Search the TTB COLAs online public database for examples of class 12 products and you will find out if anyone has label approvals for American type whiskey produced in another country for export to the US. However, you will not find out if someone is making it in Laos. I think that for your purposes, the important whiskey type listed in Class 12 is whiskey of the type specified in (b)(1). The rest are, respectively, "blended whiskey," which is not what you might think it is; a blend of straight whiskeys; and spirit whiskey; all of which, I think, were meant to allow you to call just about anything that is derived only from grain a whiskey of some sort or the other. They are all, including (b)(1), in my opinion, special interest legislation marching under the banner of consumer protection. That few of you can tell me the standard for blended whiskey demonstrates the proof of that. But I suspect that when you use the term "American type," you are using in loosely, which is okay, as long as we understand that you probably mean only those products that comport to the (b)(1) standard, which is: (1)(i) “Bourbon whisky”, “rye whisky”, “wheat whisky”, “malt whisky”, or “rye malt whisky” is whisky produced at not exceeding 160° proof from a fermented mash of not less than 51 percent corn, rye, wheat, malted barley, or malted rye grain, respectively, and stored at not more than 125° proof in charred new oak containers; and also includes mixtures of such whiskies of the same type. I will omit the provisions related to corn and straight whiskey that follow. Add to that the requirement that it be bottled at not less than 80 proof, which is true of all types of the class whiskey, and you have described American type whiskey as we here in the US understand it. So your question is really whether anyone elsewhere is making whiskey in the manner in which products that would allow them to import them into the US if they are labeled, for example, as "American Type Rye." This is not easily answered, because, unless some in Mozambique wants to export their product to the US, the person has no reason to label the stuff as "American." Frankly who outside of the US gives a hoot? Who in Johannesburg cares that the whiskey down the street is made in an American style? I wouldn't and don't. And given the propensity to play with aging rule so that nanoseconds suffice, I think that a lot of US producers don't really care either.
  6. Everyone who says pay a trademark attorney is correct. Period. And, if the attorney says it is okay, make sure that the attorney files the paperwork to obtain the name for you ASAP. Here today, gone tomorrow rules. Then don't ignore first use issues. Then ... no, no more "thens" allowed - loop this back to my first comment. Get a trademark attorney.
  7. Okay - go to the part 19 table of contents. You know that fusel oil is a byproduct of the distillation processes. Distillation is done in the production account. Look for the production account in the table of contents. You find: Rules for Chemical Byproducts 19.308 Spirits content of chemicals produced. 19.309 Disposition of chemicals. 19.310 Wash water. Follow those leads - you find: Sec. 19.308 Spirits content of chemicals produced. All chemicals and chemical byproducts produced must be substantially free of spirits before being removed from bonded premises. The spirits content of chemicals to be removed from bonded premises must not exceed 10 percent by volume unless the appropriate TTB officer approves higher limits. A proprietor must test chemicals for spirits content and maintain a record of such tests as required by Sec. 19.584. Sec. 19.309 Disposition of chemicals. - Chemicals that meet the requirements in Sec. 19.308 may be removed from bonded premises by pipeline or in containers marked to show the contents. The proprietor must determine the quantities of chemicals removed from bonded premises and keep records of removals as required by Sec. 19.586. A TTB officer may take samples of chemicals. Remember the 10% limit. Follow the leads to 19.584 and 19.586. You'll find that 584 applies and 586 does not (it addresses the production of spirits as a byproduct of a manufacturing process for another product. Sec. 19.584(f) Materials for the production of distilled spirits. - A proprietor must maintain daily records of materials produced or received for, or used in, the production of distilled spirits. This includes records covering ... the quantity of fusel oils or other chemicals removed from the production system, including the disposition thereof, with the name of he consignee, if any, together with the results of alcohol content tests performed on those fusel oils or chemicals ... Sec. 19.586 Byproduct spirits production records. Each proprietor who manufactures substances other than spirits in a process that produces spirits as a byproduct must maintain daily production records of: (a) The kind and quantity of materials received and used in production; (b) The kind and quantity of spirits produced and disposed of; and (c) The kind and quantity of other substances produced. I cannot explain how 19.586 sneaks into the requirement, but if you keep the records required by 19.584, TTB will be delighted. I offer this in the hope that I can encourage people to find answers in the regulations. I did not know the specific answer before I began, but I knew there was something about it and that I probably could find it through the table of contents. I've gone into detail to show you how you can do what I did. It is not hard.
  8. The TTB advice above is somewhat dated, even if they did give it only a year ago. If you filed online originally, then you amend the permit on line as well. You do not use, and TTB will not accept, paper forms. You will also need a diagram, which is not listed in the TTB info. The bond situation is changing, of course, and if you have a bond, you will have to get consent of surety, but it you can get permission to terminate your bond prior to the move, then you would not need the consent of surety - the reason is simple, there would be no surety to give consent. As a rough guideline, if you pay taxes on 2,000 cases of 80 proof 12/750 bottles, you need a bond; if you pay on less you do not, unless you have some industrial alcohol or, strangely, you pay no taxes at all. Yup, if you don not pay taxes you need a bond to cover the taxes you do not pay (the withdrawal portion of the unit bond) , plus the potential liability on any bulk spirits you have (the operating portion of the unit bond). This is not TTB's doing; it is the way that congress wrote the law. The issue of moving the cased goods remains because you can't move bottled spirits from one DSP to another, bond or no bond. So the letter is actually a request for a variance from that requirement, which TTB will grant on a one time basis. How long? Who knows how long TTB will take with anything these days. Allow five months. That is a long time to pay two rents. But do not bank on someone else's experience. Last year's experience is not this year's experience and someone else's experience this year may not be yours. I just wrote a client who asked the how long question, giving the same answer and an apology that I cannot give a better one.
  9. You are correct. Quickly, because I'm drowning in paper today, if you change class or type, you do not do that in storage. Adding flavoring, which changes class and type, takes place, as you summize, in the processing account. So you would transfer the whiskey as whiskey out of the storage account and into the processing account, where you would add the flavorings, according to an approved formula, of course. If the flavorings have an alcohol content, then you need to record the number of proof gallons dumped into the product (line 4). Ditto if the flavoring is wine. You do not report any additions of flavoring that has no alcohol content (it does not change proof gallons, but you do need records of what you added to show that the product is properly labeled.). Note that you do not account for products on the front of processing report by class and type. That is done on the reverse, part IV, where, in your example, you would enter whiskey into the account (column b of the appropriate row) and bottle it as a flavored product, which I would include at line 66, since they do not give a space for that. No, I do not know why. Note that the bottling entry is in wine gallons. Again, why is because they say it is. That's all. That is the general answer. For more specific info on specific products, write me and I'll get back to you to discuss how I can help.
  10. Well, I'm over 60 and had to climb a damned fence to catch my dog, a Shih Tzu, who are notorious wanders and so, like TTB, required a fence. The issue with TTB is not keeping people from scaling. It is establishing a demarcation between an area where a resident has a reasonable expectation of privacy and an area where the resident does not. If an area is within the domain where the resident has a reasonable expectation of privacy, then warrantless entry could be restricted under the 4th Amendment's prohibition against unreasonable search. TTB does not want to have to get warrants to enter, and although the IRC gives them unfettered right of entry at any time of the day or night [see Section 19.11 and 26 USC 5203(b)], they do not want to cloud that authority with constitutional issues. Or, at least, that is my reading of the situation, absent any statement from TTB on the matter. I doubt the TTB specialist will, or maybe even can, articulate that position, and I can't justify it by reference to the legislative history of Section 5178, since the law dates back to the mid 1800's, but it makes complete sense within the regulatory scheme. That, of course, doesn't make my reading right!
  11. There is something in the regulations and there is also something in the law. Sec. 19.52 Restrictions on location of plants. A person who intends to establish a distilled spirits plant may not locate it in any of the following places: (a) In any residence, shed, yard, or enclosure connected to a residence ... 26 USC 5178 (b) - No distilled spirits plant for the production of distilled spirits shall be located in any dwelling house, in any shed, yard, or inclosure connected with any dwelling house, or on board any vessel or boat, or on premises where beer or wine is made or produced, or liquors of any description are retailed, or on premises where any other business is carried on (except when authorized under subsection (b)). There are some not so subtle differences between the regulation and law, but TTB gets to interpret the law - it's their job to do that - and its interpretation is the regulation. Once upon a time, TTB visited the premises before approval, but no longer, and could see with human eyes the residence sitting next to the DSP. They no longer do and there is no question in the application that requires you to disclose the fact that the DSP you propose is located in yard that contains a residence. That is a flaw in TTB's regulatory scheme. So I suspect that some DSP's get approved without consideration of the location because TTB does not know. Others get approved after full disclosure. Those rest on safe grounds. The "connected to" phrase is the key to approval. At one time TTB preached that locating on the same tract of land created the connection, per se, case closed. As recently as a year ago there was a specialist at the NRC who proclaimed that approval was not allowed. I had fought that battle already and gotten approvals, so he's wrong. I don't know if others did too, but TTB will now approve DSP premises on the same tract of land, provided you establish that it is not connected to the residence within the meaning of Section 5178. TTB does not have rules, at least any that they make public. They say they will determine this on a case by case basis and as much as I hate case by case, that seems proper here. They state distance is one consideration, but it is only one. If you build a DSP on the same tract of land, you roll the dice, unless you get TTB's approval first. I think the odds in the dice roll are becoming more and more in your favor as we push the envelope on what it means to be "connected to a residence," but there are limits. Attachment is at one end of the scale and location five miles away is at the other. Somewhere between them is an undefined line, which is a lot closer to attached than to five miles, but nevertheless will exist in the case by case world, but where that line falls will vary by the habitual use and other considerations. If you want to approach TTB about this, embrace the term "curtilage." It is the passage from no to yes. "Yard" is the wand we wave. "Yard" has legal meaning. A fence can, but need not, provide a division that sets the "yard" off from the rest of the property. Establishing a clear division between the portion of the property that is within the curtilage of the residence, which includes, but may not be limited to the "yard," and the portion that is not within the curtilage, then establishing that the proposed DSP is located on the right side of that line, is the hurdle you must clear. Beyond these general comments, everything becomes cases specific.
  12. A second bond article in the recent ADI newsletter is in need of comment. It was written by an attorney, and who am I to challenge that - well, I did serve as a hearing office who listened to attorneys squabble and had to decide which, if either, made sense, but here are my comments. You can read the article for yourself. It's entitled "Dropping your bond: thrifty or risky. I'll not quote it here. Here is how I responded to the article after I first read it in Artisans Spirits Magazine: All applications for bonds with which I am familiar carry indemnification clauses. At least two persons must individually indemnify the surety against loss, if there is more than one person who is a principal, as must the entity in whose name the bond is issued, before the surety will issue the bond. I can assure you that the sureties do not see themselves as the deep pockets that will ultimately get stuck with the bill if you can’t pay. Their attorneys will protect them against that. Default on tax payments and if you have any assets, you will likely find yourself in front of a judge in a civil asset discovery hearing. Further, before TTB will go against the surety, it is likely that it will provide the proprietor of the DSP with an opportunity to submit an offer in compromise to compromise all or portion of the tax liability in the proprietor is for some reason unable to pay what is owed. You can see examples of such offers on TTB’s website. I think TTB seldom pursues payment from a surety, but I have no data to substantiate that claim. The advice given in the article is given by an attorney. I am not an attorney and my advice is not legal advice, but neither is his in this context. If you are concerned about risk-reward calculations, consult your personal attorney. Reply ↓
  13. The most recent issue of the ADI newsletter has two - count them - articles on bonds that are at misleading. The first, "How the Government is Saving Craft Alcohol, argues that dropping the bond requirement ... well, here are my comments. First, the Tax and Trade Bureau (TTB), the federal office that governs the alcohol industry, eliminated bond requirements for small breweries, wineries, and distilleries. This is true, but anyone who sells more than 2,000 cases, of 80 proof 1/750ml bottles, a year will still have to have a bond. In essence, a bond is a pre-paid amount of tax that the government holds as collateral to make sure booze producers pay their other taxes and generally play by the government’s rules. It is nothing of the sort. It is a guarntee of payment. If you have $20,000 in deferred taxes, i.e., excise taxes due but not yet paid on spirits removed, the bond would be in the amount of $20,000, but the bond would probably cost about $150 a year, including processing fees. That is a whale of a difference from its being, in essence, a prepayment of the $20,000. But applying for bonds is time consuming, technical (they require submitting elaborate architectural plans of any production space), and requires a large capital outlay up front, a serious strain for businesses that have no cash flow. This is once again false. You do not apply to the government for a bond. You apply to the surety. It does not invlove architectural plans. It involves your indemnifying the surety against loss and swearing that you've never been bankrupt, etc. The plans - which can be hand drawn - are submitted with the application to register the plant. Aside from no longer requiring that you submit a bond when you apply to register, NOTHING, I hate screamoing capitals but sometimes they are necessary - NOTHING else changes. By eliminating the bond requirement, this amendment removed a major hurdle for new producers, making it significantly cheaper and easier for newbies to start out as a small brand. No, unless you figure that a bond costing $10 per $1,000 in principal is a significant cost vs, the cost of rent, the still, etc.. It is neither significantly cheaper or easier for anyone to start out as a small brand. Now, they can apply to receive a refund of their original bond payment and operate under the small-producer permit instead. And they can use their capital to make more drinks! Refund? Well, yes, but most sureties are only going to refund a prorated amount, and a prorated refund on $130 - which is the cost to most small wineries per year and since it is the minimum will not be refunded - to, I don't know, chose your poison, $500, for example, is not going to be a cornucopia from which flows capital to make more drinks. Next - while direct to consumer sales of wine are becoming more and more common and are certainly a boon to both wine and spirits, you are not about to be able to ship spirits around the country for mail order or internet sales. It won't happen and do not - I refrained from screaming capitals - try and factor that into your spirits business plan. I'll respond later to the attorney who counsels that you might want to keep your bond.
  14. I don't have time to go long here, James, but ... The quote: "Craft distilleries in this state are essentially business start-ups, so allowing them to operate a restaurant on the premises will help them get off the ground by exposing more potential customers to their products and also attracting new clientele who might not necessarily be drawn to distilled spirits,” said Assemblyman Reed Gusciora (D-Mercer/Middlesex) in a statement. “This business model has proved a boon to the brewpub industry, and would do much the same for the long-term health of craft distilleries." The TTB issue. It is illegal to have a distilled spirits plant anywhere where liquors of any sort (wine, beer, spirits) are sold at retail. That is a matter of law, not regulation, so TTB can't make exceptions, grant variances, etc. The DSP must have bonded premises and may have general premises as well. Since general premises are part of the DSP, you can't locate the retail sales area on the general premise either. I don't care that you know someone who ... What TTB approved in the past is irrelevant and in many cases wrong under their rules. But don't despair or abandon all hope. The solution is simple enough; you put a suitable partition between the DSP and retail area and describe the DSP, on your application, in a way that does not include the retail area. Bingo, the DSP is not located where liquors are sold at retail. You then register, with TTB, as a retail liquor dealer at the location. Note, nothing says that the boundaries of the state defined distillery premises must coincide with the federally defined distillery premises. Don't fall into the trap of thinking that consistency is required. It is not. There are lots of examples of inconsistencies between federal and state law. You must obey both. The trick is finding a way to do that. Here it is not hard. This answer breaks my rule about providing citations, but the answer is sound, nonetheless. Particular circumstances? PM me and we can discuss how I might be able to help. That's as close to an advertisement as you will find me including in my forum comments, but I can only give general answers here. Particulars would make for a very long decision tree sort of presentation of the issues, most of which would be irrelevant to most other situations. One final comment. TTB allows taverns on brewery premises. That is why it is not safe to compare breweries (apples) to distilleries (oranges). It isn' that TTB wants to be inconsistent across commodities. The law is inconsistent that way. Gotta run.
  15. Two disclaimers: State law matters, a lot. What people do is not my forte. Here are some answers from federal regulation: You may not withdraw consumer samples or samples for market analysis free of tax. That's in the info above, I think. Pay the tax due on the samples on the next return you submit. Bottle size. As long as you fill into an authorized size, you are okay. But you have to have a label that shows the size unless it is blown into the bottle. 5.38 (c) Net contents marked in bottles. The net contents need not be marked on any label if they are legibly blown, etched, sandblasted, marked by underglaze coloring, or otherwise permanently marked by any method approved by the appropriate TTB officer on the side, front, or back of the container in an unobscured location. containers of 200 ml or greater capacity shall bear letters and figures of not less than one-quarter inch height. You do not need a separate label approval for different bottle sizes, but the label has to be approved as formatted for at least one size. See https://www.ttb.gov/labeling/allowable_revisions.shtml, where ou will find: YOU MAY... REVISION APPLIES TO COMMENTS WINE DISTILED SPIRITS MALT BEVERAGE 10. Change the net contents statement. YES YES YES Revisions must comply with all applicable regulations governing net content statements and standards of fill. Please ensure that all applicable type size requirements are met for each container size. Others can advise you better about the marketing advantage you may receive from furnishing a 375 or 750 vs. a 100 ml.