TTB urges alcohol businesses to review guidance on four prohibited trade practices

The Alcohol and Tobacco Tax and Trade Bureau used its industry newsletter on Friday to steer alcohol businesses to compliance materials on trade practices, announce its participation in a state liquor regulators conference next week, and disclose two recently accepted offers in compromise involving tax and reporting issues.

In the newsletter, the bureau put its main focus on trade practice rules under the Federal Alcohol Administration Act, which governs parts of the alcohol marketplace and bars several kinds of conduct. TTB said the regulations are meant to support fair competition across the industry and are enforced through its compliance program. The agency pointed readers to four main areas in Title 27 of the Code of Federal Regulations: tied-house arrangements, exclusive outlets, commercial bribery, and consignment sales.

TTB said businesses looking for guidance can find educational materials on its trade practices webpage, including a video on the history of the Federal Alcohol Administration Act and separate videos on each of the four prohibited practices. It also highlighted a quick reference guide called “Federal Trade Practices: What Every Industry Member Should Know.” For questions or to report a suspected violation, the bureau directed readers to its Market Compliance Office by phone at 202-453-2251, option 2, or by email at [email protected].

The agency also said it will take part in the National Conference of State Liquor Administrators Central/Western Regional Conference in Santa Fe, New Mexico, from Oct. 19 through Oct. 21. According to the newsletter, TTB will join a panel discussion on Tuesday focused on trade practices and possible concerns involving retailer promotions, including coupons, third-party marketing, and tastings. The bureau said its representatives will be available throughout the conference to answer questions and speak with state regulators and other attendees.

In a separate item, TTB said it recently accepted offers in compromise from East End Distillers, LLC and American Marksman, LLC. The bureau said East End Distillers allegedly paid the reduced $2.70 tax rate on distilled spirits without qualifying for that rate. TTB said the reduced rate is limited under controlled-group rules, which require all members of a controlled group to share a capped volume. The agency alleged that East End Distillers, as a member of such a group, exceeded those limits.

TTB said American Marksman allegedly failed to apply the proper tax treatment to taxable sales, did not submit required export documentation within the six-month deadline, and failed to file excise tax returns and remit excise tax payments as required. The bureau told readers that its administrative actions can be reviewed on TTB.gov.

The newsletter also flagged two Food and Drug Administration notices that TTB said may matter to regulated businesses. One is a draft guidance document on additional traceability record requirements for certain foods. TTB, quoting the FDA notice, said the draft guidance states that the agency does not currently intend to enforce some regulatory requirements for certain entities or activities covered by the Food Traceability Rule, based on its current understanding of the risks. The deadline for electronic or written comments on that draft guidance is Nov. 23.

The second FDA item is a public meeting on “Challenges and Solutions in Lot-Level Food Traceability.” The meeting is scheduled for Nov. 6 from 12 p.m. to 3:30 p.m. Eastern Time. TTB said the purpose is to give the public a forum to discuss continued implementation of the final traceability rule, identify concerns tied to lot-level tracking, and explore possible flexibilities that could support compliance. Comments on the meeting may be submitted through Dec. 6.

TTB also pointed readers to information collection notices from the Bureau of Alcohol, Tobacco, Firearms, and Explosives that it said may be of interest. The newsletter said ATF is preparing to submit several information collection requests to the Office of Management and Budget under the Paperwork Reduction Act. The items listed in the newsletter include the Annual Firearms Manufacturing and Exportation Report, applications for alternate means of firearm identification and tax-exempt firearm transfers, a federal firearms licensee inventory and theft or loss report, National Firearms Act special occupational tax materials, and a request related to restricted machine guns under federal law. The comment deadline listed in the newsletter for those information collections is Dec. 14.

The bureau also used the newsletter to draw attention to several resources on alcohol beverage advertising that are currently featured on TTB.gov. Those materials cover the use of social media in alcohol advertising, tips for AI-generated imagery in alcohol beverage advertising, and rules on labeling and advertising statements related to calorie, carbohydrate, and sugar content. TTB also highlighted a presentation and video titled “Alcohol Beverage Advertising: What Every Industry Member Should Know.”