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Modern Wine Industry Still Fears the 'Feds' but for Labeling Reasons : Regulations: The Bureau of Alcohol, Tobacco and Firearms decides the fate of guns, smokes and using old rules, wine labels.


WASHINGTON — A California winery wanted to use a phrase on the label of one of its wines that said, "This wine has lively acidity." It submitted the label for approval to the Bureau of Alcohol, Tobacco and Firearms.

The label was rejected because the word lively was deemed appropriate only on bottles of sparkling wine, not on table wine.

Rulings such as this confuse and irritate winery owners and generate a dichotomous appraisal of the BATF, the branch of the Treasury Department that regulates the wine industry.

As the agency that collects taxes and monitors winery records, BATF is feared. But not because these are the same "Feds" who, during Prohibition, ran through the Appalachian hills kicking over stills.

Instead, today the major weapons of the folks who regulate the alcoholic beverage industries are the calculator and the label approval form. And whereas beer and distilled spirits are formulated products that change little from year to year, wine changes annually.

Among other things, BATF audits wineries and insures that the wine inside a bottle of varietal wine is 75% of the variety named on the label.

But one of the facts of life for winery owners is that the agency that oversees label approval is also the one that regulates guns, drugs, explosives and tobacco.

"We regulate commodities that are driven by disaster," said Terry Cates, chief of the industry compliance division of BATF, speaking about some of the products BATF looks after.

A majority of BATF's 3,400 employees today are concerned with drugs, explosives and guns; alcoholic beverages take a smaller role, tobacco smaller still.

On Nov. 18 a congressionally mandated warning label began appearing on bottles, cans and packages of wine, beer and spirits. It warns against the dangers of birth defects for those who are pregnant, it says that consuming alcoholic beverages can impair your ability to drive a car, and it warns against its use with machinery.

The warning label was implemented by BATF, and it is BATF who will monitor the warning label for the first year of its existence, and then determine what the final ruling on it will be.

Recently, BATF asked wineries not to print more than a one-year supply of labels because the final ruling on the appearance of the warning label won't be published for at least a year.

Sources say the final warning label will probably differ from the one now in force.

Beyond warning labels, however, BATF regulates everything that appears on packages of alcoholic beverages. All such products must have certain mandatory information on their labels, and wine--which changes every vintage--has regulations for labeling that differ from spirits and beer.

California winery owners often say they are irritated by what they call the antiquated rules BATF uses to regulate labeling and advertising. Technically, it is Part 4 of Title 27, U.S. Code of Federal Regulations, written in 1935.

Though it has been amended throughout the years, Part 4 is not very specific and it is open to interpretation. Some rulings occasionally cause wineries to curse BATF's decisions.

Yet Tom Busey, recently appointed chief of the product compliance branch of BATF, said American vintners should be happy BATF's regulations are written as loosely as they are.

Busey spent the last seven years in BATF's international division, where he analyzed European wine regulations.

"The EEC 'regs' were written under a philosophy that says if it's not specifically permitted, you can't do it," said Busey. "Our 'regs' say that if something's not prohibited and it's not false, there's probably a way to say it (on a label)."

Busey's 16 label approval specialists receive some 4,500 label applications per month, many of them identical with last year's label. These can be rubber-stamped "Approved" without problems.

But new wine terms can confound these people, and Busey acknowledges that having flexible regulations leaves much open to interpretation. Thus some of BATF's label approval specialists fall back on historic interpretations.

In one recent case, BATF used historic precedent to rule that the word refreshing may appear on a wine label or in an advertisement only if the consumer is also told that the wine should be served chilled.

"In many cases, we have to fall back on past precedence," said Jim Hunt, coordinator in the wine and beer branch.

Busey added, "I have always felt the 'regs' should be more specific," and Hunt said his office was working on a revision of Part 4 to smooth out regulations covering wine labeling and advertising.

Some time early next year, Hunt said, BATF will publish an advance notice of proposed rule making, seeking recommendations on changes in the regulations. Hunt said, for example, that the industry needs guidelines on terms such as late harvest, early harvest and ice wine, among others.

A revision of Part 4 of the regulations will take about four to five years, he said, but it's overdue. The last revision in the code was 1978.

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