NABI Press Release (2023-2) July 7, 2023
The National Association of Beverage Importers (NABI), Washington, DC, submitted a detailed comments letter responding to the Advance Notice of Proposed Rulemaking by the Alcohol and Tobacco Tax and Trade Bureau (TTB), U.S. Treasury Department, on the extensive review and modernization of the unfair trade practice regulations. NABI applauds TTB and the Treasury Department in moving forward with this significant rulemaking.
The Federal Alcohol Administration Act (FAA Act) enacted in 1935 is the primary federal law regulating the beverage alcohol industry in particular. The FAA Act comprehensively covers basic permits, labels, advertisements, and unfair trade practices. More specifically, exclusive outlet, tied-house, commercial bribery, and consignment sales are the focus of the unfair trade practices. Provisions on bulk sales of distilled spirits and interlocking directors in the distilled spirits industry are also covered.
TTB is asking for comments on all aspects of the unfair trade practice provisions in this rulemaking proposal given the present regulations were issued in 1980, and updated in 1995. This comprehensive review is mandated by the President’s Executive Order of July 9, 2021, Promoting Competition.
“The evolution of the beverage alcohol industry, since 1935, from local to regional to national to global merits and even necessitates this overhaul review,” said NABI President Robert M. Tobiassen, noting that this rulemaking “must look at the unfair trade practices from both the macro and micro aspects in the U.S. marketplace taking into account the shifting market powers of all three tiers.” He added that “in 1935, Congress would never have anticipated the giant and global corporate players in the industry today.”
NABI said in its comment letter the unique challenges facing small and medium-sized industry members in today’s marketplace, unanswered questions about shelve schematics, unclear credit rules between suppliers and wholesalers, the need for new procedural rules in trade practice enforcement proceedings to ensure the due process rights of industry members, and the importance of looking to the future of marketing that will integrate ChatGPT, among other things. Read the NABI comment letter on public file with the Office of the Federal Register here.
“The outcome is still very uncertain,” said Tobiassen “because the length of time that TTB requires to review the ANPRM comments and draft a proposed regulation with text, if that is the decision, will likely take us to the 2024 presidential election period,” He added, “any major changes in the Administration or Congress as a result of that election likely means this rulemaking will be put on hold or suspended.”
NABI is the nationwide trade association representing importers of wine, distilled spirits, beer, malt beverages, cider, and mead since 1935. NABI is the “eyes, ears, and voice” for these importers in the Nation’s Capital and the consumers they proudly serve.
For further information, please contact NABI at (202) 393-6224 or nabipresident@bevimporters.org