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TTB Proposes Rule Changes to Ease DSP Application Process

Writer's picture: James NiekampJames Niekamp

Updated: Dec 12, 2021

Those in the alcohol manufacturing industry are generally aware that the Alcohol & Tobacco Tax & Trade Bureau ("TTB") does not regulate all commodities the same way.


For example, there has been tremendous regulatory accommodation from the agency towards the craft beer industry in recent years, in response to the explosive growth of the industry segment. Tobacco, on the other hand, is generally not provided the same leniency when it comes to enforcement of compliance issues.


Distilled Spirits Plants ("DSP's") fall somewhere in the middle. Generally, Distilled Spirits are taxed at the federal level at a significantly higher excise rate compared to wine and beer for the same beverage when adjusted to alcohol by volume. Historically, distilled spirits have been more heavily regulated by state ABC's as well.


Now, it appears that TTB seeks to extend this newfound flexibility to America's craft distilleries.


Last week, TTB announced plans to modernize the Basic Permit and Registration application requirements for DSP's. Here is a link to the announcement. In true government/legal fashion, the document is far from succinct.


There are a lot of proposed permit application changes, but some of the most significant include:

  • Eliminating narrative descriptions for production processes and storage operations.

  • Tailoring requirements to describe the DSP premises more narrowly to match statutory requirements.

  • Replacing required narrative descriptions of DSP security with certifications that the applicant will comply with regulatory requirements.

  • Eliminating serial numbers requirements for equipment, and allowing a DSP application to be submitted prior to receiving equipment.

  • Extending deadlines for reporting certain changes in the business from 30 days to 60 days.

  • Allowing regulated businesses to add or remove trade names by submitting a notification to TTB rather than applying for TTB approval.

  • Allowing DSP's to maintain required records at a location other than the permitted premises without first obtaining TTB approval.


Many DSP's are likely reading the above and thinking "wait, we were supposed to be doing that?!"


The proposed changes are now open to public comment. Stay tuned for updates.

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