1513-0015 Laws and Regs.

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1513-0015

26 U.S.C.

Sec. 5401. Qualifying documents

(a) Notice

Every brewer shall, before commencing or continuing business, file

with the officer designated for that purpose by the Secretary a notice

in writing, in such form and containing such information as the

Secretary shall by regulations prescribe as necessary to protect and

insure collection of the revenue.

(b) Bonds

Every brewer, on filing notice as provided by subsection (a) of his

intention to commence business, shall execute a bond to the United

States in such reasonable penal sum as the Secretary shall by regulation prescribe as necessary to protect and insure collection of the revenue. The bond shall be conditioned (1) that the brewer shall pay, or cause to be paid, as herein provided, the tax required by law on all beer, including all beer removed for transfer to the brewery from other breweries owned by him as provided in section 5414; (2) that he shall pay or cause to be paid the tax on all beer removed free of tax for export as provided in section 5053(a), which beer is not exported or returned to the brewery; and (3) that he shall in all respects faithfully comply, without fraud or evasion, with all requirements of law relating to the production and sale of any beer aforesaid. Once in every 4 years, or whenever required so to do by the Secretary, the brewer shall execute a new bond or a continuation certificate, in the penal sum prescribed in pursuance of this section, and conditioned as above provided, which bond or continuation certificate shall be in lieu of any former bond or bonds, or former continuation certificate or certificates, of such brewer in respect to all liabilities accruing after its approval. If the contract of surety between the brewer and the surety on an expiring bond or continuation certificate is continued in force between the parties for a succeeding period of not less than 4 years, the brewer may submit, in lieu of a new bond, a certificate executed, under penalties of perjury, by the brewer and the surety attesting to continuation of the bond, which certificate shall constitute a bond subject to all provisions of law applicable to bonds given pursuant to this section.

(Added Pub. L. 85-859, title II, Sec. 201, Sept. 2, 1958, 72 Stat. 1388; amended Pub. L. 91-673, Sec. 3(a), Jan. 12, 1971, 84 Stat. 2056; Pub. L. 94-455, title XIX, Sec. 1906(b)(13)(A), Oct. 4, 1976, 90 Stat. 1834.)

Sec. 5551. General provisions relating to bonds

(a) Approval as condition to commencing business

No individual, firm, partnership, corporation, or association,

intending to commence or to continue the business of a distiller,

warehouseman, processor, brewer, or winemaker, shall commence or

continue the business of a distiller, warehouseman, processor, brewer,

or winemaker until all bonds in respect of such a business, required by

any provision of law, have been approved by the Secretary of the

Treasury or the officer designated by him.

(b) Disapproval

The Secretary of the Treasury or any officer designated by him may

disapprove any such bond or bonds if the individual, firm, partnership,

or corporation, or association giving such bond or bonds, or owning,

controlling, or actively participating in the management of the business of the individual, firm, partnership, corporation, or association giving such bond or bonds, shall have been previously convicted, in a court of competent jurisdiction, of--

(1) any fraudulent noncompliance with any provision of any law

of the United States, if such provision related to internal revenue

or customs taxation of distilled spirits, wines, or beer, or if

such an offense shall have been compromised with the individual,

firm, partnership, corporation, or association on payment of

penalties or otherwise, or

(2) any felony under a law of any State, or the District of

Columbia, or the United States, prohibiting the manufacture, sale,

importation, or transportation of distilled spirits, wine, beer, or

other intoxicating liquor.

(c) Appeal from disapproval

In case the disapproval is by an officer designated by the Secretary of the Treasury to approve or disapprove such bonds, the individual, firm, partnership, corporation, or association giving the bond may appeal from such disapproval to the Secretary of the Treasury or an officer designated by him to hear such appeals, and the disapproval of the bond by the Secretary of the Treasury or officer designated to hear such appeals shall be final.

(Added Pub. L. 85-859, title II, Sec. 201, Sept. 2, 1958, 72 Stat. 1394; amended Pub. L. 94-455, title XIX, Secs. 1905(c)(5), 1906(b)(13)(B), Oct. 4, 1976, 90 Stat. 1823, 1834; Pub. L. 96-39, title VIII, Sec. 807(a)(51), July 26, 1979, 93 Stat. 288.)

Sec. 7101. Form of bonds

Whenever, pursuant to the provisions of this title (other than

section 7485), or rules or regulations prescribed under authority of

this title, a person is required to furnish a bond or security--

(1) General rule

Such bond or security shall be in such form and with such

surety or sureties as may be prescribed by regulations issued by

the Secretary.

(2) United States bonds and notes in lieu of surety bonds

The person required to furnish such bond or security may, in

lieu thereof, deposit bonds or notes of the United States as

provided in section 9303 of title 31, United States Code.

(Aug. 16, 1954, ch. 736, 68A Stat. 847; Pub. L. 92-310, title II,

Sec. 230(b), June 6, 1972, 86 Stat. 209; Pub. L. 94-455, title XIX,

Sec. 1906(b)(13)(A), Oct. 4, 1976, 90 Stat. 1834; Pub. L. 97-258,

Sec. 3(f)(11), Sept. 13, 1982, 96 Stat. 1065.)

27 CFR

Sec. 25.91 Requirement for bond.

(a) General. Every person intending to commence the business of a

brewer shall file a bond, Form 5130.22, as prescribed in this subpart,

covering operations at the brewery, at the time of filing the original

Brewer's Notice, Form 5130.10. Every brewer intending to continue the

business of a brewer shall, once every 4 years, or as provided in Sec.

25.95, execute and file a new bond, or continuation certificate as

provided in Sec. 25.97.

(b) Conditions of the bond. The Brewer's Bond, Form 5130.22, will be

conditioned upon the brewer faithfully complying with all provisions of

law and regulations relating to the activities covered by the bond, and

upon paying all taxes imposed by 26 U.S.C. Chapter 51 and all interest

and penalties incurred or fines imposed for violations of those

provisions.

(c) Additional information. The appropriate TTB officer shall

require, in connection with any brewer's bond, a statement executed

under the penalties of perjury, as to whether the principal or any

person owning, controlling, or actively participating in the management

of the business of the principal has been convicted of or has

compromised any offense set forth in Sec. 25.101(a)(1), or has been

convicted of any offense set forth in Sec. 25.101(a)(2). In the event

the above statement contains an affirmative answer, the applicant shall

submit a statement describing in detail the circumstances surrounding

the conviction or compromise.

(d) Bond required before beginning business. A person may not begin

business or continue business as a brewer until first receiving notice

that the appropriate TTB officer has approved the bond, continuation

certificate, or consent of surety, as required by this part.

(Sec. 201, Pub. L. 85-859, 72 Stat. 1388, as amended (26 U.S.C. 5401);

sec. 4(a), Pub. L. 91-673, 84 Stat. 2057 (26 U.S.C. 5417))

[T.D. ATF-224, 51 FR 7673, Mar. 5, 1986, as amended by T.D. ATF-437, 66

FR 5479, Jan. 19, 2001]

Sec. 25.93 Penal sum of bond.

(a)(1) Brewers filing semimonthly tax returns. For brewers filing

tax returns and remitting taxes semimonthly under Sec. 25.164(c)(2),

the penal sum of the brewers bond must be equal to 10 percent of the

maximum amount of tax calculated at the rates prescribed by law which

the brewer will become liable to pay during a calendar year during the

period of the bond on beer:

(i) Removed for transfer to the brewery from other breweries owned

by the same brewer;

(ii) Removed without payment of tax for export or for use as

supplies on vessels and aircraft;

(iii) Removed without payment of tax for use in research,

development, or testing; and

(iv) Removed for consumption or sale.

(2) Brewers filing quarterly tax returns. For brewers filing tax

returns and remitting taxes quarterly under Sec. 25.164(c)(3), the

penal sum of the brewers bond must be equal to 29 percent of the maximum amount of tax calculated at the rates prescribed by law which the brewer will become liable to pay during a calendar year during the period of the bond on beer:

(i) Removed for transfer to the brewery from other breweries owned

by the same brewer;

(ii) Removed without payment of tax for export or for use as

supplies on vessels and aircraft;

(iii) Removed without payment of tax for use in research,

development, or testing; and

(iv) Removed for consumption or sale.

(b) Concentrate. A brewer who concentrates beer under subpart R of

this part shall calculate the penal sum of the bond by computing 10

percent of the amount of tax at the rates prescribed by law, on the

maximum quantity of beer used in the production of concentrate during a

calendar year. The brewer shall add this amount to the penal sum

calculated under paragraph (a) of this section to determine the total

penal sum of the brewer's bond.

(c) Maximum and minimum penal sums. The maximum penal sum of the

bond (or total penal sum if original and strengthening bonds are filed)

is not to exceed $150,000 when the tax on beer is to be prepaid, or

$500,000 when the tax is to be deferred as provided in Sec. 25.164. The

minimum penal sum of a bond is $1,000.

(Sec. 201, Pub. L. 85-859, 72 Stat. 1388, as amended (26 U.S.C. 5401))

[T.D. ATF-224, 51 FR 7673, Mar. 5, 1986, as amended by T.D. TTB-41, 71

FR 5603, Feb. 2, 2006]

Sec. 25.97 Continuation certificate.

If the contract of surety between the brewer and the surety on an

expiring bond or continuation certificate is continued in force for a

succeeding period of not less than 4 years from the expiration date of

the bond or continuation certificate, the brewer may submit, in lieu of

a new bond, a Brewer's Bond Continuation Certificate on Form 5130.23,

executed under the penalties of perjury, by the brewer and the surety

attesting to continuation of the bond. Each continuation certificate

will constitute a bond and all provisions of law and regulations

applicable to bonds on Form 5130.22 given under this part, including the disapproval of bonds, are applicable to continuation certificates.

(Sec. 201, Pub. L. 85-859, 72 Stat. 1388, as amended (26 U.S.C. 5401))