No. 30510 (Amendment): R81-1-27. Label Approvals

DAR File No.: 30510
Filed: 10/01/2007, 12:27
Received by: NL

RULE ANALYSIS

Purpose of the rule or reason for the change:

It has come to the attention of the Alcoholic Beverage Control (ABC) Commission that malt beverages and some energy drinks are being sold in containers that do not clearly put the public on notice that the beverage contains alcohol. Though clear labeling has always been required by statute, there have never been any guidelines for specific requirements for that labeling. This rule is proposed to remedy this situation.

Summary of the rule or change:

This rule amendment is proposed to establish procedures for manufacturers of beer and other malt beverages to submit labels to the department for approval; and establishes guidelines for approving or denying labels on such products, and for revoking previously authorized labels.

State statutory or constitutional authorization for this rule:

Section 32A-1-107 and Subsection 32A-11-106(8)

Anticipated cost or savings to:

the state budget:

None--Department staff already approves labels for beer and malt beverage products. This rule merely establishes guidelines and procedures for these approvals and should require no additional manpower or resources, nor does it assess administrative fees to manufacturers.

local governments:

None--Beer and malt beverage label approval is a requirement of state government and is provided through the Department of Alcoholic Beverage Control. The process does not affect local governments.

small businesses and persons other than businesses:

Some manufacturers of beer and malt beverages are large-scale businesses and some operate on a much smaller scale. This proposed rule provides specific label guidelines involving verbiage, letter size and type style, and the requirement for contrasting, solid background colors to make the required verbiage more visible. Many manufacturers will be required to redesign their product labels to comply with this rule if they want to sell their products in the state of Utah. The cost of redesigning and printing the labels will vary from one manufacturer and one product to another. Persons other than these manufacturers should not be affected by this proposed rule amendment.

Compliance costs for affected persons:

There will almost certainly be compliance costs for beer and malt beverage manufacturers because many products will require a label redesign and reprint to meet the requirements of this proposed rule. The exact compliance cost is unknown since many labels will require complete redesign while others will require only minor alterations.

Comments by the department head on the fiscal impact the rule may have on businesses:

The department realizes the implementation of this proposed rule amendment will have a fiscal impact on manufacturers of beer and malt beverages. We do not take this lightly. However, if these label changes help prevent the purchase and consumption of alcoholic beverages by our young people, they are justified. Dennis R. Kellen, Director

The full text of this rule may be inspected, during regular business hours, at the Division of Administrative Rules, or at:

Alcoholic Beverage Control
Administration
1625 S 900 W
SALT LAKE CITY UT 84104-1630

Direct questions regarding this rule to:

Sharon Mackay at the above address, by phone at 801-977-6800, by FAX at 801-977-6889, or by Internet E-mail at [e-mail]

Interested persons may present their views on this rule by submitting written comments to the address above no later than 5:00 p.m. on:

11/14/2007

This rule may become effective on:

11/21/2007

Authorized by:

Dennis R. Kellen, Director

RULE TEXT

R81. Alcoholic Beverage Control, Administration.

R81-1. Scope, Definitions, and General Provisions.

R81-1-27. Label Approvals.

(1) Authority. This rule is pursuant to 32A-11-106(8) which prohibits a beer wholesaler from selling or distributing any alcoholic beverage in this state that is not clearly labeled in a manner reasonably calculated to put the public on notice that the beverage is an alcoholic beverage. The statute requires that the beverage bear the label "alcoholic beverage" or a manufacturer's label which in common usage apprises the general public that the beverage contains alcohol.

(2) Purpose. This rule:

(a) establishes procedures for manufacturers and importers of beer or other alcoholic malt beverage products to submit labels to the department for approval; and

(b) establishes guidelines for approving or denying labels on such products, and for revoking previously authorized labels.

(3) Application of Rule.

(a) Procedure.

(i) The following shall submit an application for label approval for any beer or alcoholic malt beverage product prior to distributing or selling the product in Utah:

(A) a manufacturer of such products that is located in Utah and is licensed by the department; and

(B) an out-of-state manufacturer or importer of such products that holds a certificate of approval issued by the department under 32A-8-101. Nothing herein precludes the manufacturer or importer from applying for label approval at the same time application is made for a certificate of approval.

(ii) The application shall be on a form approved by the department and shall include the following:

(A) a copy of the federal certificate of label approval (COLA) from the Department of Treasury, Tax and Trade Bureau (Form TTB F 5100.31) for each brand and label being approved;

(B) one (1) complete set of original labels for each size of container of each product. "Complete set" means all band, strip, front and back labels appearing on any individual container. Original containers will not be accepted. If original labels cannot be obtained, the following will be accepted:

(I) color reproductions that are exact size; or

(II) TTB F 5100.31 with the exact size label if printed in color;

(C) a description of the size of the container; and

(D) a description of the type of container (i.e. bottle or can).

(iii) There is no fee to apply for a label approval.

(iv) The department shall notify the applicant within 30 days whether the label has been approved or denied. The department may extend this period in unusual circumstances that require additional time to consider issues presented by an application.

(v) Any revision of a previously approved label must be submitted to the department for approval before the product may be distributed or sold in Utah.

(vi) The department may revoke labels previously approved upon a finding that the label is not in compliance with applicable laws or rules. Notice shall be given to the person or entity that applied for the label approval of any proposed revocation. The person or entity may present written arguments or evidence why the revocation should not occur.

(vii) Any denial or revocation of a label approval may be appealed to the commission.

(b) Guidelines.

(i) Each label submitted shall comply with all federal label requirements for such products under 27 Code of Federal Regulations Parts 7, 13 and 16.

(ii) In addition to federal label requirements, the label shall clearly put the public on notice that the beverage is an alcoholic beverage by including on the label any of the following words or phrases:

(A) "Beer"; or

(B) "Alcoholic Beverage".

(iii) The words or phrases in section (3)(b)(ii) must appear:

(A) in capital letters and bold type;

(B) on the front of the container;

(C) parallel to the base of the container;

(D) in a format that is readily legible;

(E) in a solid, contrasting background;

(F) separate and apart from any descriptive or explanatory information; and

(G) in the following type sizes:

(I) a minimum of 3 millimeters wide and 3 millimeters high for containers of 16 fluid ounces or less; and

(II) a minimum of 4 millimeters wide and 3 millimeters high for containers larger than16 fluid ounces.

(iv) The label shall include a statement of alcohol content stated as a percentage of alcohol by volume and/or by weight.

(v) The statement of alcohol content required in section (3)(b)(iv):

(A) may be abbreviated "alc/vol" or "alc/wt"; and

(B) shall be in the following type sizes:

(I) a minimum of 3 millimeters wide and 3 millimeters high for containers of 16 fluid ounces or less; and

(II) a minimum of 4 millimeters wide and 3 millimeters high for containers larger than16 fluid ounces.

(vi) The department has the authority to reject any label that appears designed to obscure the information required by 32A-11-106(8) and this rule.

 

KEY: alcoholic beverages

Date of Enactment or Last Substantive Amendment: August 27, 2007

Notice of Continuation: August 31, 2006

Authorizing, and Implemented or Interpreted Law: 32A-1-107; 32A-1-119(5)(c); 32A-3-103(1)(a); 32A-4-103(1)(a); 32A-4-106(22); 32A-4-203(1)(a); 32A-4-304(1)(a); 32A-4-307(22); 32A-4-401(1)(a); 32A-4-403(1)(a); 32A-5-103(1)(a); 32A-5-107(40); 32A-6-103(2)(a); 32A-7-103(2)(a); 32A-7-106(5); 32A-8-103(1)(a); 32A-8-503(1)(a); 32A-9-103(1)(a); 32A-10-203(1)(a); 32A-10-206(14); 32A-10-303(1)(a); 32A-10-306(5); 32A-11-103(1)(a); 32A-11-106(8)