TTB Commences Long Process to Revise its Labeling Rules

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The Alcohol and Tobacco Tax and Trade Bureau (TTB) recently initiated a long-anticipated project to revise the labeling regulations that apply to all the products under its jurisdiction, including most beers (called “malt beverages” under TTB nomenclature). The TTB is considering mandatory disclosure rules for alcohol content, major allergens, nutritional information, and ingredients.

The process will kick off with two days of live “listening sessions” on February 28 and 29, 2024, followed by the acceptance of written comments through March 29, 2024 (a deadline that TTB might extend). Upon gathering feedback, TTB will likely publish proposed regulations, which would be subject to additional commentary from the public. We also expect that TTB will provide a reasonable (two- or three-year) phase-in period. Thus, while this process is very important, brewers should not expect to face new legally binding labeling mandates for four or more years.

The Brewers Association (BA) supports transparency in labeling while also seeking to ensure that new obligations do not stifle innovation or unfairly burden small businesses. Moreover, given the near-universality of smartphones, we support options to allow the disclosure of some consumer information off-label, accessible via an on-label QR code. The European Union recently took this approach with its new wine labeling regulations, providing TTB with an excellent example to follow.

We believe alcohol content and allergen information is especially important to consumers and that labels should show both. In the case of alcohol content, all distilled spirits and most wines already must display this information, and consumers recognize and understand the concept of alcohol by volume. For individuals with sensitivity to the “big nine” allergens (as recognized by laws enforced by the Food & Drug Administration), avoiding those ingredients is a health imperative. On-label disclosure will best protect our valued consumers from inadvertent allergic reactions.

In the case of nutritional information and ingredients, providing an off-label disclosure option will adequately satisfy the needs of those consumers interested in such information. With respect to nutritional information, the TTB’s existing policies establishing a “statement of average analysis” for light beer and similar products provide a solid foundation to work with. We accordingly support requiring disclosure —either on- or off-label—of a beer’s calories, carbohydrate, fat, and protein content. For ingredients, the fact that fermentation has substantially transformed most materials in a finished beer requires a carefully thought-out approach. Rules must avoid misleading consumers into believing, for example, that the barley used to make a beer ends up, after fermentation, being nutritionally similar to the barley used to make, for example, breakfast cereal. Materials consumed during production or added as processing aids should be excluded if not found in the finished beer.

To protect innovation and small businesses, the BA will advocate for an approach that avoids placing a substantial burden on small producers and small-batch products. Keep in mind that any final TTB rule will almost certainly arise from the agency’s Federal Alcohol Administration Act authority. As brewers already know, this authority (which, among other things, determines when a brewer must obtain a Certificate of Label Approval or “COLA” for a label) requires that the beer cross state lines in order to be considered within “interstate commerce.” We accordingly do not expect any new TTB labeling rule to apply to the thousands of taproom-only, brewpub-only, or in-state distribution-only beers produced and sold by our members.

In addition, the BA will seek to ensure that small businesses and brewing operations can readily meet any new rule’s measuring tolerances and testing requirements. If TTB eventually proposes rules with tolerances and requirements that would be difficult to meet by small businesses, we will advocate for standards for small batch products that provide greater tolerances and/or less expensive methods to meet those requirements. In the case of testing methods, for example, the BA favors methodologies that small brewers can perform without the need for expensive equipment or outside testing services (e.g., formulas). In the case of tolerances, we favor approaches that allow for the sort of batch-per-batch variations common in the beers of small brewers and in small-batch products, such as seasonals that may vary from year to year.

Finally, the BA will advocate for a reasonable implementation schedule to avoid placing financial burdens on brewers. Once regulations are formulated and finalized, small brewers should be given at least three years to bring their labels and websites into compliance with those new regulations. In addition, even if the TTB decides to move forward on different subjects (e.g., alcohol labeling versus ingredient labeling) on different timelines, it should establish a single effective date for making all the labeling changes mandated by new rules. Brewers do not want to face more than one mandated re-design of labels as a result of this process.

The BA will continue to engage in this rulemaking process to protect the interests of America’s small and independent brewers. We will participate in the listening sessions and have encouraged select members and guild leaders to participate as well. Due to the limited time allotted for the sessions, we did not encourage all of our members to make themselves heard, as the TTB would likely respond by excluding additional small brewer voices as redundant. We also will submit written comments as the comment deadline nears.

After the current listening sessions and the close of the written comment period, we expect that the TTB will take at least a year—and quite possibly much longer—to review comments and formulate proposed regulations on these complex subjects. Thereafter, the TTB may publish proposed regulations on all or part of the mandatory labeling subjects contemplated, giving the public (which includes the brewing industry) an additional opportunity to submit comments on the proposed rule. After the TTB reviews and considers those additional comments—also a process that may take a year or more—it can publish a final rule. That final rule will have the force of law, although, as noted, the BA will ask for a lengthy (at least three-year) transition period before brewers must change their labeling and marketing to comply with the new regulations.

We will continue to provide members with information about this important process as it unfolds.