manner that they accurately and reliably measure and record beer metered for packaging. The frequency of meter tests, and the equipment used and procedures employed in testing meters, shall be subject to approval by the assistant regional commissioner. The brewer shall submit a letterhead application, in triplicate, which shall describe, in detail, the method by which he proposes to maintain the accuracy and reliability of each metering system to be used for the measurement of beer to be packaged and list the make, model, and serial number of each meter to be used by him for such purpose. The assistant regional commissioner shall, after satisfying himself as to the adequacy of the proposed method, indicate his approval on all copies of the application and return the original to the brewer who shall keep it on file on the brewery premises available for examination by internal revenue officers.

(72 Stat. 1395; 26 U.S.C. 5552) [T.D. 7113, 36 F.R. 8799, May 13, 1971]

§ 245.34 Meter tests.

(a) General requirements. The allowable variation of beer meters, as established by approved tests, shall not exceed 0.5 percent (plus or minus). If a meter test discloses an error in excess of the allowable variation, it shall be corrected immediately by suitable adjustment. Adjustments shall reduce the error to as near zero as practicable. If the meter or counter does not function properly or record accurately after adjustment or repair, the use of such meter or counter shall be discontinued and a suitable replacement installed. The brewer shall record on Form 138 the counter reading at the time a counter or meter is placed in service for measuring beer or removed therefrom.

(b) Authority to require tests. When the assistant regional commissioner has reason to believe the accuracy and reliability of a meter is not being properly maintained, he may require the brewer to have the meter tested and, if necessary, adjusted. The assistant regional commissioner may require that such testing and adjustment be supervised by an internal revenue officer.

(72 Stat. 1395; 26 U.S.C. 5552) [T.D. 7091, 36 F.R. 4116, Mar. 4, 1971]

§ 245.35 Report of meter tests.

When a meter is tested, the brewer shall prepare Form 138, Brewer's Report of Meter Test. He shall submit the origi

nal and one copy of the form to the assistant regional commissioner and file the remaining copy on the brewery premises where it will be available for examination by internal revenue officers. [T.D. 7091, 36 F.R. 4116, Mar. 4, 1971] § 245.36 Emergency procedures.

who

Where a meter becomes inaccurate or inoperative, the brewer shall make such adjustment or repair as is necessary or replace it with another meter. If such corrective action is not possible, the brewer shall report the condition to the assistant regional commissioner may authorize the temporary measurement of beer by methods other than by metering. If the brewer is unable to contact the assistant regional commissioner when such an emergency arises, he may temporarily measure beer by methods other than metering. When a brewer operates under emergency procedures as provided in this section, he shall terminate the emergency procedures as soon as practical. If emergency procedures are used without prior approval, the assistant regional commissioner shall be notified of the action and the circumstances thereof as soon as possible. The assistant regional commissioner may, if the emergency procedures have not been terminated, either authorize the continuation of the emergency procedures or require that such procedures be terminated until the meter malfunction has been corrected or the meter replaced. The brewer shall determine and record the quantities of unmetered beer, and retain this information for examination by an internal revenue officer. (72 Stat. 1395; 26 U.S.C. 5552) 36 FR. 4116, Mar. 4, 1971]

Subpart G-Notices

§ 245.40 Notice on Form 27-C.

[T.D. 7091,

Every person shall, before commencing the business of a brewer, give notice of his intention on Form 27-C, in triplicate, to the assistant regional commissioner. Every brewer continuing business shall, as provided in § 245.44, give notice on Form 27-C, in triplicate, to the assistant regional commissioner. The notices shall be numbered serially, commencing with "1" for the original, and continuing in sequence for all amended, supplemental, or superseding notices thereafter filed. All data, written statements, affidavits, and other documents

(c) Name of brewer.

(d) Business address of brewer.

(e) Address of brewery affected by the notice (if other than the business address).

(f) Character of brewer, i.e., sole proprietorship, partnership, corporation, or other, supported by copies, in triplicate, of articles and amended articles of incorporation (and including the certificate of incorporation), partnership, or association, etc.

(g) Description of brewery, including (1) each tract of land comprising the brewery and (2) brewery buildings, referring to each building by its designated number or letter and giving the approximate ground dimensions and the purposes for which ordinarily used. Description of land shall be by courses and distances, in feet and hundredths thereof or inches, with the particularity required in conveyances of real estate.

(h) A list of (1) mash tubs, brewkettles, fermenting tanks, storage tanks, and similar tanks to be used in the production of beer and (2) tanks and bottling lines to be used in the bottling of beer. The list shall show as to tanks, the quantity (number) of each type, their capacities in barrels, and the designated number or letter of the building in which located; and as to bottling lines, the number of lines and the designated number or letter of the building in which located.

(1) A list of the trade names which the brewer is using or intends to use in doing business or in packaging, and the offices where such names are registered, supported by copies, in triplicate, of any certificates or other documents filed or issued in respect to such names.

(j) A statement of process for any fermented beverage which the brewer in

tends to produce and market under a name or description other than "beer," "ale," "porter," or "stout." The statement shall show the name or other designation of the product, the kinds and quantities of materials to be used, the method of manufacture, and the approximate alcohol content of the finished product.

(k) The name and address of the owner of the fee and of any mortgagee or other encumbrancer of the land, buildings, or equipment comprising the brewery (except when an encumbrance on equipment is held by, or the equipment is leased from, the manufacturer thereof or his representative or franchised distributor).

(1) A statement setting forth the authorized, the issued, the classifications, and the par value of the capital stock or other evidence of ownership of a corporate brewer, or, in the case of an individual owner or partnership, a statement giving the name of every person interested in the brewery, whether such interest appears in the name of the interested party or in the name of another for him.

(m) A list of the names and addresses of all stockholders and other persons having an interest of not less than 10 percent in the corporation or similar legal entity and the nature and amount of the stockholding or other interest of each, whether such interest appears in the name of the interested party or in the name of another for him; also, a list of officers and directors, showing their residence and business addresses.

(n) The date of the notice and name and signature of the brewer. The name of the brewer, if an individual, must be typed or written, preceded by the trade name, if any, and followed either by the signature of the brewer and the words "sole owner" or by the signature of a duly empowered attorney in fact and his title as such. In the case of a partnership, the trade name of the firm shall be typed or written, followed by the word "By" and the signatures of all partners, or of any partner duly authorized to sign in behalf of the firm, or of a duly empowered attorney in fact. If a corporation, the form will be executed in the corporate name immediately followed by the signature and title of the person duly authorized to act in its behalf. If the brewer is any other entity, the notice shall be

The brewer shall execute and file with the assistant regional commissioner & Form 1534, in accordance with the instructions on the form, for every person who is authorized to sign or act on behalf of the brewer, except that a certified true copy, in duplicate, of a resolution of the board of directors authorizing a person to sign or act on behalf of the brewer will be accepted as evidence of the authority of such person to so sign or act.

[T.D. 6963, 39 P. 10811, July 24, 1968] $245.43 Additional information.

The assistant regional commissioner may at any time require the brewer to furnish as a part of the notice such additional information as is necessary to protect and insure collection of the revenue. (68A Stat. 674; 20 U. B. C. 5401)

§ 245.44 Supplemental and surperseding notices.

The brewer shall fille an amended or supplemental Form 27-C, as provided in Subpart L of this part, where there is any change with respect to items of information recorded on the active Forms 27-C on file. Such amended or supplemental notices may be in skeleton form. The brewer shall file a new and complete notice, superseding those previously filled, once every 4 years, which new notice will become effective on the date of renewal of the brewer's bond or the effective date of the brewer's continuation certificate as provided in § 245.45: Provided, That where the information and documents required by § 245.41 (f), (g), (h), (i), (1), (1), and (m) are on file as an attachment to a previously filed and approved Form 27-C and reflect current data, such information and documents may be incorporated by reference in, and be made a part of, the new and complete notice. Where a brewer files a new bond before expiration of the usual 4-year period, as provided in § 245.49, the assistant regional commissioner may require the filing of a new and complete notice, which supersedes those previously filed and which may incorporate information and documents contained in a previously filed and approved Form 27-C and re

flecting current data, as provided in this section. The new notice will become effective on the effective date of the new bond, or the assistant regional commissioner may postpone the filing of such new notice until such time as the new bond is renewed or superseded.

[T.D. 7119, 80 FR. 8800, May 13, 1971]

Subpart H-Bonds, Continuation Certificates, and Consents of Surety 1 § 245.45 General.

Every person intending to commence the business of a brewer shall, in connection with filing his notice, Form 27-C, file a bond, Form 1566, in accordance with the provisions of this subpart. Every brewer intending to continue the business of a brewer shall, once every 4 years (or as provided in § 245.49) execute and file with the assitant regional commissioner a new bond in accordance with the provisions of this subpart, or a continuation certificate as provided in

245.45a. Such bond or continuation certificate shall be in lieu of any former bond or bonds, or former continuation certificate or certificates, of the brewer in respect to all liabilities accruing after approval of the new bond or continuation certificate. Consents of surety to a change in the terms of any bond filed under this part shall be manifested on Form 1533 by the principal and by the surety on the bond with the same formality and proof of authorization as required for the execution of the bond. No person shall continue or commence the business of a brewer until he receives notice from the assistant regional commissioner of the approval of the bond, continuation certificate, or consent of surety required by this part.

(72 Stat. 1388, as amended; 26 U.S.C. 5401) (T.D. 7113, 36 FB. 8800, May 18, 1971] § 245.45a Continuation

Form 1566–A.

Certificate,

If the contract of surety between the brewer and the surety on an expiring bond or continuation certificate is continued in force between the brewer and surety for a succeeding period of not less than 4 years from the expiration date of such bond or continuation certificate, the brewer may submit, in lieu of a new bond, a continuation certificate on Form 1566-A, executed under the penal

1T.D. 7118, 36 F.R. 8800, May 13, 1971.

ties of perjury, by the brewer and the surety attesting to continuation of the bond. Each continuation certificate shall constitute a bond and all provisions of law and regulations applicable to bonds on Form 1566 given pursuant to this part, including the disapproval of bonds, shall be applicable to continuation certificates prescribed by this section.

(72 Stat. 1388, as amended; 28 U.S.C. 5401) [T.D. 7118, 36 PR. 8800, May 13, 1971] § 245.46 Penal sum of bond.

The penal sum of the brewer's bond shall be equal to the maximum amount of tax which, in the opinion of the assistant regional commissioner, the brewer may become liable to pay during any one calendar month on beer (a) removed for transfer to the brewery from other breweries owned by him, (b) removed without payment of tax for export or use as supplies on vessels and aircraft, and (c) removed for consumption or sale, calculated at the rate of tax prescribed by law: Provided, That the penal sum of any such bond (or the total penal sums where original and strengthening bonds are filed) shall not exceed $150,000 where the tax on beer is to be prepaid, or $500,000 where payment of such tax is to be deferred as provided in § 245.117a, and that the penal sum of any such bond shall be not less than $1,000.

(72 Stat. 1388; 26 U.S.C. 5401) [21 F.R. 8627, Nov. 9, 1956, as amended by T.D. 6384, 24 FR. 4821, June 12, 1959; T.D. 6478, 25 F.R. 5963, June 29, 1960]

The brewer's bond shall be conditioned that the principal shall pay, or cause to be paid, to the United States according to the laws of the United States and this part, the taxes, including penalties and interest, for which (a) the brewer shall become liable, on all beer, including all beer removed for transfer to the brewery from other breweries owned by the brewer, all beer removed without payment of tax for export or removed for use as supplies on vessels or aircraft, which is not exported or otherwise accounted for, and all beer removed without payment of tax for use in research, development, or testing, and (b) the proprietor of a pilot brewing plant shall become liable, on all beer brewed, produced, or received on the pilot brewing plant; and shall in all respects comply without fraud or evasion with all require

ments of law and this part relating to the production and sale of beer.

(72 Stat. 1388, as amended, 84 Stat. 2057; 26 U.S.C. 5401, 5417) [TD. 7113, 36 FR 8801, May 13, 1971]

§ 245.48 Strengthening bonds.

In all cases where the penal sum of the bond on file and in effect is not sufficient, computed as prescribed by this part, the principal may give a strengthening bond in a sufficient penal sum, provided the surety thereon is the same as on the bond already on file and in effect; otherwise a new bond covering the entire liability will be required. Such strengthening bonds, being filed to increase the bond liability of the principal and the surety, are in no sense substitute bonds, and the assistant regional commissioner will refuse to approve any strengthening bond where any notation is made thereon intended, or which may be construed, as a release of any former bond, or as limiting the amount of either bond to less than its full penal sum. Strengthening bonds must show the current date of execution and the effective date in the blank spaces provided therefor. Such bonds must have marked thereon, by the obligors at the time of execution, "Strengthening Bond".

§ 245.49 New bond.

A new bond may be required at any time in the discretion of the assistant regional commissioner. A new bond shall be required immediately in the case of the insolvency of a surety. Executors, administrators, assignees, receivers, trustees, or other persons acting in a fiduciary capacity, continuing, or liquidating the business of the principal, must execute and file a new bond or obtain the consent of the surety or sureties on the existing bond or bonds. When the interests of the Government so demand, or in any case where the security of the bond becomes impaired in whole or in part for any reason whatever, the principal will be required to give a new bond. Where a bond is found to be not acceptable, the principal shall be required to file immediately a new and satisfactory bond, or discontinue business forthwith. (68A Stat. 674; 26 U. 8. C. 5401)

§ 245.50 Superseding bond.

Where a new bond is submitted by the principal to supersede a bond or bonds then in effect, and such superseding bond has been approved, notice of termination