REDUCED ALCOHOL BEER
Brewers & Importers of Malt Beverages
PURPOSE. This circular notifies industry members of
an ATF Ruling which will be published in the next issue of
the Alcohol, Tobacco and Firearms Bulletin. This ruling
will read substantially as follows:
BACKGROUND. The Bureau of Alcohol, Tobacco and
Firearms has been asked whether a brewer, pursuant to
sections 5(e) and 5(f) of the Federal Alcohol Adminis-
tration Act (FAA Act), 27 U.S.C. 201 et seq., may label
and advertise a malt beverage as a reduced or low alcohol
product.
During the past several months, the Bureau has received
several inquiries from brewers requesting permission to
label and advertise their new malt beverage product as a
reduced or low alcohol product. In each instance, the
malt beverage product contained no more than 2.5 percent
alcohol by volume.
Sections 5(e) and 5(f) of the FAA Act provide in
general terms that malt beverage labeling and advertising
shall not contain statements concerning the alcoholic
content of the product. More specifically, section 5(e)(2)
prohibits statements of, or statements likely to be
considered as statements of, alcoholic content of malt
beverages unless required by State law. Section 5(f)(2)
provides a similar prohibition without regard to what is
required by State law.
Regulations which implement these provisions are set
forth in 27 C.F.R. Part 7. In particular, sections 7.26;
and 7.29(f) prohibit any statement as to the actual
alcoholic content of the malt beverage from appearing on
the label unless required by State law. Furthermore,
section 7.29(f) prohibits references to "strong," "full
strength" and similar words or statements that are likely
to be considered as statements of alcoholic content except
where required by State law. Similar prohibitions exist
for advertising without references to State law
requirements. See 27 C.F.R. 7.54(c).
The legislative history of the FAA Act discusses the
meaning of the term "statements likely to be considered
as statements of alcoholic content." It indicates that
the term was intended to prohibit statements likely to be
considered as statements of alcoholic content where such
statements represent that the product has a high alcoholic
content. The following excerpt from the legislative
history is illustrative:
"Legitimate members of the industry have suffered
seriously from unfair competition resulting from
labeling and advertising that uses such terms as
'strong', 'extra strength', 'high-test', 'high
proof', 'prewar strength', '14 percent original
extract', and from brand names or other statements
or references which include conspicuous numerals
or symbols intending to suggest that the numerals
or symbols represent the alcoholic content.
Usually such representations of excess alcoholic
content are false, but irrespective of their
falsity, their abuse has grown to such an extent
since repeal that the prohibition of all such
statements is in the interest of the consumer and
the promotion of fair competition (H. Rept. No.
1542, on H.R. 8870, 74th Cong., Federal Alcohol
Control Bill, pp. 12 and 13)."
The above excerpt demonstrates that Congress was
concerned with prohibiting statements of alcoholic strength
in the labeling and advertising of malt beverages. See,
Rev. Rul. 54-513, 1954-2 C.B. 593, which held, in part,
that references likely to be considered as indicative of
alcoholic content, such as the phrase "Is it stronger?"
are prohibited by section 7.54(c) of the regulations. It
appears that Congress was not concerned with prohibiting
labeling and advertising of malt beverages on the basis of
reduced or low alcohol content, since such advertising was
not perceived as a problem in 1935.
In view of the statute's purpose, the Bureau believes
that the phrase "statements likely to be considered as
statements of alcoholic content" relates only to statements
that represent the malt beverage as high in alcohol con-
tent. The statute would not preclude statements indicating
that the alcohol content of the malt beverage is below the
range of alcohol content found in regular malt beverages.
HELD. Sections 5(e) and 5(f) of the FAA Act prohibit,
in the labeling and advertising of malt beverages, state-
ments of alcohol content of malt beverages and statements
likely to be considered as statements of alcohol content
of malt beverages.
The Bureau continues to subscribe to its longstanding
position that statements of actual alcohol content by
weight or volume fall within the proscriptions of sections
5(e) and 5(f) of the FAA Act as well as sections 7.26,
7.29, and 7.54(c) of the regulations. However, as to
statements likely to be considered as statements of alco-
holic content of malt beverages, the Bureau interprets
this term to be restricted to statements of high alcohol
content.
Furthermore, the Bureau has determined that statements
of low or reduced alcohol content when used with malt
beverage products containing less than 2.5 percent alcohol
by volume are not misleading. Since the alcohol content
of regular malt beverages falls within the range of 3.5
to 5.0 percent alcohol by volume, malt beverage products
containing less than 2.5 percent alcohol by volume have
a substantially lower alcohol content and may accurately
be described as low alcohol or reduced alcohol malt
beverages.
Therefore, the Bureau will permit malt beverage
products containing less than 2.5 percent alcohol by
volume to be labeled and advertised as a reduced alcohol
or low alcohol malt beverage. Labeling and advertising
for reduced alcohol or low alcohol malt beverages may use
statements comparing the alcohol content of the reduced or
low alcohol product to the alcohol content of the brewer's
regular malt beverage or to any other specific brand of
a regular malt beverage. Such comparative statements may
not refer to the actual alcohol content of either of the
products being compared. Examples of permissible
statements are as follows:
"This product is a reduced/low alcohol malt beverage."
"This Brand Name is a reduced/low alcohol pilsner
beer."
"This product contains less than half the alcohol
contained in Brand Name beer."
"Brand Name contains half the alcohol of our Brand
Name regular beer."
INQUIRIES. Inquiries concerning this circular should
refer to its number and be addressed to the Associate
Director (Compliance Operations), Bureau of Alcohol,
Tobacco and Firearms, 1200 Pennsylvania Avenue, N.W.,
Washington, DC 20226.
Director |