for transfer to him from the time of removal from the consig brewery and that the concentrate will not be removed from his bre ery except as specifically authorized in this subpart. The Direct Alcohol and Tobacco Tax Division, may withdraw approval of ar constitution process in any case where the brewer fails to comp with the provisions of this subpart.

§ 245.240 CONSENT OF SURETY ON BOND OF BREWER CONCENTRATIS BEER.-A brewer who intends to produce concentrate shall file w the assistant regional commissioner a Consent of Surety, Form 15 extending the terms of his bond, Form 1566, to cover the use of t concentration process and containing the following statement:

"WHEREAS, the principal intends to concentrate beer on t above-described premises under the provision of Subpart BB Part 245, Title 26, Code of Federal Regulations;

"Now, THEREFORE, the above-described bond is further speci ically conditioned that the principal named therein shall p or cause to be paid, on demand of the assistant regional commis sioner (alcohol and tobacco tax), an amount equal to the tas which would be due on removal for consumption or sale, includ ing penalties and interest, on all beer used to produce concentrate

(a) If such concentrate is produced, reconstituted, use or removed from the brewery in violation of laws or regula tions, now or hereafter in force, or in any manner contrary to the terms or conditions of his application for approval of the concentration process; and

(b) If such concentrate is removed without payment of tax for export and is not exported or otherwise accounted for. "The aforesaid terms and conditions shall have the same for and effect as the other terms and conditions stated in the bond." A brewer who intends to reconstitute beer from concentrate at the premises covered by an application for approval of the concentration process shall also give the consent of surety provided for in § 245.241.

245.241 CONSENT OF SURETY ON BOND OF BREWER RECONSTITUT ING BEER.-A brewer who intends to reconstitute beer from concertrate shall file with the assistant regional commissioner a Consent of Surety, Form 1533, extending the terms and conditions of his bond, Form 1566, to cover the transportation, receipt, and reconstitution of concentrate and containing the following statement:

"WHEREAS, the principal intends to reconstitute beer from concentrate or to receive concentrate and reconstitute beer therefrom on the above-described premises under the provisions of Subpart BB of Part 245, Title 26, Code of Federal Regulations: "Now, THEREFORE, the above-described bond is further specifically conditioned that the principal named therein shall pay, or cause to be paid, on demand of the assistant regional commissioner (alcohol and tobacco tax), an amount equal to the tax which would have been due on removal for consumption or sale, including penalties and interest, on all beer used to produce

concentrate:

(a) If such concentrate is transported, reconstituted, or removed from the brewery in violation of laws or regula tions, now or hereafter in force, or in any manner contrary

to the terms or conditions of his application for approval of the process for reconstitution;

(b) If such concentrate is removed for transfer to the said brewery from other breweries owned by the said principal, and is not transported, received and accounted for in accordance with laws or regulations now or hereafter in force, and

(c) If such concentrate is removed without payment of tax for export and is not exported or otherwise accounted for. "The aforesaid terms and conditions shall have the same force and effect as the other terms and conditions of the bond."

245.242 OPERATIONS.-The operations incident to the production f concentrate and the reconstitution of beer therefrom shall be conucted in the brewery but shall not be conducted in the brewery ottling house or racking room. Each tank, vat, cask, or other coniner used or intended for use as a receptacle for concentrate shall eet the requirements of § 245.25. Such receptacles shall be identied as containers of concentrate. Concentrate produced shall be idenified and accounted for by the serial number of Form 3019 under which it was produced and shall not be mingled with unconcentrated Deer. The brewer shall accurately measure the quantity and deternine the balling and alcohol content of all (a) beer entered into the concentration process, (b) concentrate produced, (c) concentrate ransferred to other breweries belonging to the same brewer, (d) concentrate removed for export, (e) concentrate received, (f) concenrate used in reconstituting beer, and (g) beer reconstituted. Containers of concentrate transferred to other breweries belonging to the same brewer, and containers of concentrate removed for export shall be marked, branded, and labeled in the same manner as is prescribed for containers of beer in Subpart O of this part and shall be clearly marked as containers of concentrate. Barrels, kegs, and bottles containing reconstituted beer shall show by label or otherwise the statement "PRODUCED FROM_ CONCENTRATE"

-the blank to be filled in with the appropriate class designation of the beer (beer, lager beer, ale, stout, etc.) from which the concentrate was made. Such statement shall be conspicuous and readily legible and, in the case of bottled beer, shall appear in direct conjunction with, and as a part of, the class designation of the reconstituted beer. All parts of the class designation shall appear in lettering of substantially the same size and kind.

$245.243 TRANSFERS BETWEEN BREWERIES.-Concentrate produced from beer may, under the provisions of this subpart, be removed without payment of tax from the brewery to another brewery belonging to the same brewer (within the limits of ownership and on submission of evidence of control as described in § 245.140). Concentrate may be transferred only to a brewery which is qualified under this subpart for the reconstitution of beer. The provisions of Subpart Q, except as otherwise provided in this section, shall be aplicable in respect of transfers of concentrate which is produced under the provisions of this subpart. Concentrate may not be removed in containers of the kind ordinarily used by brewers for the removal of beer for consumption

or sale. Reconstituted beer may be mingled with beer at the receir brewery but concentrate shall not be mingled with unconcentral beer. The brewer shall give notice on Form 3020 of the ship and receipt of concentrate (in the manner outlined in §§ 245.1 245.147 for Form 2035), reflect the details of such transactions in daily records, and report such transactions monthly on Form 10 accordance with the provisions of § 245.245.

§ 245.244 EXPORTATION.-Concentrate produced under the pr sions of this subpart may be removed from the brewery without r ment of tax (a) for exportation, or (b) for transfer to and dep in foreign-trade zones for exportation or for storage pending expor tion, in accordance with the provisions of Part 252 of this chapter $245.245 RECORDS AND REPORTS.-(a) Daily record.-A brev who produces concentrate or reconstitutes beer therefrom under provisions of this subpart shall, in addition to complying with requirements of Subpart AA, maintain daily records which will ac rately and clearly reflect the quantity and the balling and the alcol content of all (1) beer entered into the concentration process, concentrate produced, (3) concentrate transferred to other brewer belonging to the same brewer, (4) concentrate exported, (5) cont trate received, (6) concentrate used in reconstituting beer, and i beer reconstituted.

(b) Monthly summary reports.-When concentrate is produc and/or beer is reconstituted from concentrate, the brewer shall refle by specific entries on Form 103, the quantity of beer entered into th concentration process, the quantity of beer reconstituted from co centrate, and a summary accounting of all concentrate operations a the brewery for the month. Such summary accounting shall sho the quantities (expressed in barrels of 31 gallons and fractions there to three decimal places) of concentrate on hand at the beginning ar at the end of the month, concentrate produced, concentrate receive and the specific disposition thereof (as "used in reconstitution”, “* moved for export", "removed to foreign-trade zones", "transferre to other breweries"). The accounting shall be so made as to clear distinguish between the concentrate produced at the brewery cover by the report and the concentrate received from any other brewery (showing as to each such brewery the serial number of the Form 301 applicable to the concentrate).

This Treasury Decision shall become effective on the first day of th first month that begins not less than 90 days after the date of publica tion in the Federal Register.

(This Treasury Decision is issued under the authority contained i section 7805 of the Internal Revenue Code (68A Stat. 917; 26 U.S.C 1 7805).)

Approved August 27, 1963.

STANLEY S. SURREY,

MORTIMER M. CAPLIN, Commissioner of Internal Revenue.

Assistant Secretary of the Treasury.

(Filed by the Division of the Federal Register on Aug. 30, 1963, 8:51 a.m., ar published in the issue of the Federal Register for Aug. 31, 1963, 28 F.R. 9634)

PART II.-OPERATIONS

SECTION 5411.-USE OF BREWERY

CFR 245.242: Operations.

Production and labeling of beer concentrate. See T.D. 6673, page

.

CTION 5414.-REMOVALS FROM ONE BREWERY TO ANOTHER BELONGING TO THE SAME BREWER

CFR 245.243: Transfers between breweries.

Transfer of beer concentrate without payment of tax. See T.D. 73, page 675.

SECTION 5415.-RECORDS AND RETURNS

CFR 245.245: Records and reports.

Maintenance of production and shipment records for concentrated er. See T.D. 6673, page 675.

Federal Alcohol Administration Act

ECTION 5(e).-UNFAIR COMPETITION AND UNLAWFUL PRACTICES: LABELING

7 CFR 4.50: Certificates of label approval.

Procedure for obtaining a single certificate of label approval by mporters and bottlers of imported wines of various types (within he same taxable grade) where the only change on the label is the vine-type designation. See Rev. Proc. 63-25, page 761.

7 CFR 5.10: Meaning of terms.

Whether distilled spirits shipped from the United States to Puerto Rico are exportations or shipments in interstate commerce for purposes of the standards of fill for distilled spirits. See Rev. Rul. 63-142, 682.

27 CFR 5.34: Class and type.

For the current trade and consumer understanding of the composition of a "Bottled Martini Cocktail." See Rev. Rul. 63-194, page 670.

27 CFR 5.35: Name and address.

Whether an importer who holds a permit to do business under one or more trade names may show his real name or any one of his approved trade names on the label of distilled spirits where the red strip stamp is overprinted only with his real name. See Rev. Rul. 63-218, page 668.

$5(e).]

27 CFR 5.50: Certificates of label approval.

Procedure for changing the stated proof on labels for all classes t types of distilled spirits. See Rev. Proc. 63-25, page 761.

27 CFR 5.70: Application.

Whether distilled spirits shipped from the United States to Puer Rico are exportations or shipments in interstate commerce for p poses of the standards of fill for distilled spirits. See Rev. R: 63-142, below.

27 CFR 5.73: Standards of fill. (Also 5.10, 5.70.)

(Also Sections 5214, 5301, 7653; 26 CFR

252.11, 201.328, 201.457, 301.7653-1.)

Rev. Rul. 63-11

Section 7653(b) of the Internal Revenue Code of 1954 provide in part, that articles or merchandise shipped into Puerto Rico fro: the United States shall be exempt from the payment of any ta imposed by the internal revenue laws of the United States. More over, under the provisions of section 252.11 of the Exportation e Liquors Regulations, shipments of distilled spirits from the Unite States to Puerto Rico are treated as exportations.

However, in accordance with section 5.10 (k) of the Regulations relating to Labeling and Advertising of Distilled Spirits, the ter "United States" means the several States and Territories and the D trict of Columbia; the term "State" includes a Territory and the District of Columbia; and the term "Territory" means Puerto Riox Thus, even though shipments of distilled spirits to Puerto Rico are treated as exportations for tax purposes, such shipments are not con sidered to be exportations for purposes of the Regulations relating to Labeling and Advertising of Distilled Spirits. Rather, they ar shipments in interstate commerce within the scope of section 5.10(1) of the regulations.

Accordingly, it is held that distilled spirits shipped from the United States to Puerto Rico must be packaged in containers of the capacities prescribed in the standards of fill for distilled spirits, a provided by section 5.73 of the regulations.

27 CFR 7.24: Class and type.

T. D. 6672

TITLE 27-INTOXICATING LIQUORS.-CHAPTER I, PART 7.-LABELING ANI ADVERTISING OF MALT BEVERAGES

The publication of this Treasury Decision in 28 F.R. 9637, dated Aug. 31, 1963, con tains (1) instruction for modifying the notice of proposed rulemaking published in 2 F.R. 13786, dated Dec. 28, 1960, and (2) the full context of the regulations with suc modifications. As here published, the Treasury Decision reflects the full context of such regulations, with modifications. The individual instructions have been omitted.