§ 45.4815(a) Statutory provisions; requirements applicable to dealers; selling requirements.

SEC. 4815. Requirements applicable to dealers-(a) Selling requirements. Dealers in adulterated butter must sell only original or from original stamped packages, and when such original stamped packages are broken the adulterated butter sold from same shall be placed in suitable wooden, tin-plate, or paper packages, which shall be marked and branded as the Secretary or his delegates shall prescribe.

[Sec. 4815(a) as originally enacted and in effect July 1, 1960]

§ 45.4815(a)-1 Selling and buying requirements applicable to adulterated butter.

(a) Factory-branded packages. Except as may otherwise be required by State law or local regulation, adulterated butter packed by the manufacturer in cartons or wrappers, branded as prescribed in § 45.4814-1(b), may be sold by a retail dealer from the original stamped container without further branding.

(b) Branding upon sale. (1) If the manufacturer's package is not subdivided into prints or rolls the retail dealer shall wrap the adulterated butter at the time of sale in a new covering, which shall be branded with his name and address, the words "Adulterated Butter", and the net weight of the contents. Example:

RICHARD ROE

100 Doe Street, Boston
1 pound adulterated butter

(2) The letters shall be not less than one-quarter of an inch square and printed in an ink which forms a strong contrast with the color of the covering. Other marks which would obscure the brand shall not be made. The covering shall be so placed around the adulterated butter that the brand will be plainly visible.

(c) Misbranded packages. A retail dealer shall see that cartons and wrappers are branded as prescribed in § 45.4814-1(b), as penalty provided in section 7235 (a) is incurred if he sells an improperly branded package of adulterated butter. It will be no defense for a retail dealer to show, in an action for failure to properly brand, that the product was sold in cartons or wrappers as packed by the manufacturer. Penalty for buying improperly branded packages is provided by section 7265 (b).

(d) Removal from package. A retail dealer may not lawfully remove adul

terated butter from the original stamped packages either for repacking, cutting into prints or rolls, or other purposes, nor remove the sides or ends of such packages, before disposal of the contents.

(e) Displaying packages. The top of a manufacturer's package may be removed or folded back to display the contents, provided the package is so placed that the words "Adulterated Butter" will be plainly visible and not obscured or rendered inconspicuous. (See § 45.4814-1(b).)

(f) Ordering. (1) When ordering or purchasing adulterated butter a dealer shall state his name and address as they appear on his special-tax stamp. If a trade name, as well as the proprietor's real name, appears on the special-tax stamp, both shall be stated on the order. Adulterated butter shall not be ordered in a trade name that is not registered with the district director and stated on the dealer's special-tax stamp.

(2) If the premises have two addresses, because fronting on two streets or for other reasons, the address registered with the district director shall always be used. If adulterated butter is ordered for shipment to a point other than the dealer's registered address, the registered address, as well as the shipping point, shall be named in the order. § 45.4815(b) Statutory provisions; requirements applicable to dealers; books of wholesale dealers.

SEC. 4815. Requirements applicable to dealers. *

(b) Books of wholesale dealers. Books required by section 6001 to be kept by wholesale dealers in process, renovated, or adulterated butter shall be open at all times to the inspection of any officer or employee designated by the Secretary or his delegate. [Sec. 4815(b) as originally enacted and in effect July 1, 1960]

§ 45.4816 Statutory provisions; expor

tation of adulterated butter.

SEC. 4816. Exportation of adulterated butter. Adulterated butter may be removed from the place of manufacture for export to a foreign country without payment of tax or affixing stamps thereto, under such regulations and the filing of such bonds and other security as the Secretary or his delegate may prescribe. Every person who shall export adulterated butter shall brand upon every tub, firkin, or other package containing such article the words "Adulterated Butter", in plain Roman letters not less than one-half inch square.

[Sec. 4816 as originally enacted and in effect July 1, 1960]

§ 45.4816-1

Exemption in case of exportation of adulterated butter.

(a) In general. The tax imposed by section 4811(a) shall not apply in the case of the removal from the place of manufacture of adulterated butter for the purpose of exportation to a foreign country.

(b) Requirements—(1) Packing and marking Every firkin, tub, or other package containing adulterated butter to be exported without payment of tax, must, before removal from the factory, be branded with the words "Adulterated Butter" in plain Roman letters not less than one-half inch square.

(2) Exception. When manufactured expressly for export in accordance with specifications of foreign customers, a product coming within the classification of adulterated butter, as defined in section 4826(b), may be branded "Preserved Butter" in lieu of "Adulterated Butter", provided such labeling does not violate the laws of the country to which the product is exported, or the Federal Food, Drug, and Cosmetic Act (52 Stat. 1040; 21 U.S.C. chapter 9), or any other act, or regulations issued under authority thereof.

(c) Consumption aboard vessel. Adulterated butter for consumption aboard a vessel while in a port of the United States or en route to a foreign country shall be tax-paid.

(d) Cross reference. For all other requirements with respect to the exportation of adulterated butter without the payment of tax see §§ 45.4453-1 and 45.4453-2 with respect to the exportation of playing cards which so far as applicable, are hereby extended and made to apply to the exportation of adulterated butter.

(e) No exemption in case of process or renovated butter. Part I of subchapter C, chapter 39, makes no provision for the exportation of process or renovated butter free of tax.

§ 45.4817 Statutory provisions; inspection of process or renovated butter. SEC. 4817. Inspection of process or renovated butter. For the purpose of protecting interstate and foreign commerce from process or renovated butter which is unclean, unwholesome, unhealthful, or otherwise unfit for human food

process or renovated butter. All ingredients which are found to be putrid or decomposed or which contain organic or inorganic substances which are foreign to such ingredients when properly made, manufactured, produced, collected, stored, transported, or handled, and which organic or inorganic substances cannot be removed by processing, shall be deemed unfit for use in the manufacture of process or renovated butter, shall be marked "U.S. Inspected and Condemned", and shall be denatured or destroyed under the supervision of the inspector. All other ingredients shall be marked "U.S. Inspected and Passed", and shall be deemed fit for use in the manufacture of process or renovated butter.

(2) Finished product. The Secretary of Agriculture shall cause inspections to be made of all process or renovated butter. If such butter is found to be clean, wholesome, healthful, and otherwise fit for human food, it shall be marked "U.S. Inspected and Passed". Process or renovated butter that is found to be unclean, unwholesome, unhealthful, or otherwise unfit for human food shall be denatured or destroyed under the supervision of the inspector.

(3) Factories. The Secretary of Agriculture shall cause inspections to be made of all factories wherein process or renovated butter is manufactured to determine the sanitary conditions thereof, and if it is found that the conditions existing in any such factory do not meet the standards prescribed by the Secretary in his regulations, he shall cause inspection to be withdrawn therefrom.

(4) Compliance by manufacturer. The Secretary of Agriculture is authorized to withdraw inspection from any factory wherein process or renovated butter is made, if the manufacturer shall fail to comply with any of the provisions of this section or with any of the rules and regulations prescribed hereunder.

(5) Rules and regulations. The Secretary of Agriculture is authorized to make such rules and regulations as he deems necessary for the efficient administration of the provisions of this section, and all inspections hereunder shall be made in such manner as may be prescribed in such regulations. The Secretary of Agriculture may, from time to time, by regulations define the foreign substances and the extent thereof that render the ingredients unfit for use in manufacturing process or renovated butter.

(6) Statistics. The Secretary of Agriculture shall cause to be ascertained, and he shall report, from time to time, the quantity and quality of all process or renovated butter manufactured and the character and condition of the materials from which it is made.

(7) Forgery, etc., of stamps, etc. No person, firm, or corporation shall forge, counterfeit, simulate, falsely represent, detach, or, knowingly alter, deface, or destroy, or use

without proper authority any of the marks, stamps, labels, or tabs provided for in this section or in any regulations prescribed hereunder by the Secretary of Agriculture for use on process or renovated butter or on wrappers, packages, containers, or cases in which the product is contained, or any certificate in relation thereto.

(8) Labels on containers. All process or renovated butter and the packages or containers thereof shall be marked with the words "Process Butter" and by such other marks, labels, or brands, and in such manner, as may be prescribed by the Secretary of Agriculture.

(9) False or misleading labels. No statement that is false or misleading in any particular shall be placed on or affixed to any wrapper, label, carton, or container of process or renovated butter.

(10) Unapproved product in interstate or foreign commerce. No person, firm or corporation shall transport, or offer for transportation, or sell or offer for sale, in interstate or foreign commerce, or in commerce affecting commerce among the States, any process or renovated butter that has not been inspected and passed and marked, labeled, and branded in accordance with this section and the regulations issued hereunder.

(11) Administration. The administration and enforcement of the provisions of this section, other than its provisions relating to revenue, but including the seizure and denaturing or destruction of ingredients intended to be used in the manufacture of process or renovated butter and the denaturing or destruction of process or renovated butter, are committed exclusively to the Secretary of Agriculture: Provided, That any powers and duties of the Food and Drug Administration of the Department of Health, Education, and Welfare under the Federal Food, Drug, and Cosmetic Act, as amended (52 Stat. 1040; 21 U.S.C., chapter 9), as regards such ingredients before they come into the possession of the manufacturers of process or renovated butter, or as regards such powers and duties in connection with process or renovated butter after it leaves such manufacturers and comes into the hands of wholesale or retail dealers, or others, shall not be affected by this section. [Sec. 4817 as originally enacted and in effect July 1, 1960]

(a) For definitions relating to adulterated butter and process or renovated butter, see section 4826 and the regulations thereunder.

(b) For penalties for offenses relating to stamps, see § 45.7209.

(c) For penalty for unauthorized use or sale of stamps, see § 45.7208.

(d) For penalties for other offenses relating to stamps, see § 45.7271.

(e) For penalty for failure to register, see $45.7272.

(f) For other administrative provisions relating to the tax imposed on adulterated butter, see subpart L. OCCUPATIONAL TAX

(2) Adulterated butter. Manufacturers of adulterated butter shall pay a special tax of $600 a year.

(b) Wholesale dealers in adulterated butter. Wholesale dealers in adulterated butter shall pay a special tax of $480 a year.

(c) Retail dealers in adulterated butter. Retail dealers in adulterated butter shall pay a special tax of $48 a year.

[Sec. 4821 as originally enacted and in effect July 1, 1960]

§ 45.4821-1 Imposition and rate of tax.

(a) Manufacturers—(1) Process or renovated butter. Section 4821 (a) (1) imposes a special tax in the case of manufacturers of process or renovated butter of $50 per year.

(2) Adulterated butter. Section 4821 (a) (2) imposes a special tax in the case of manufacturers of adulterated butter of $600 per year.

(b) Wholesale dealers. Section 4821 (b) imposes a special tax in the case of wholesale dealers in adulterated butter of $480 per year.

(c) Retail dealers. Section 4821(c) imposes a special tax in the case of retail dealers in adulterated butter of $48 per year.

(d) Computation of the tax. For regulations relating to computation of the tax, see paragraph (b) of § 45.4901-1.

§ 45.4821-2 Requirements with respect to manufacturers of adulterated butter or process or renovated butter. (a) Payment of special tax. A manufacturer of adulterated butter or process or renovated butter must make a return on Form 11 to the district director, pay the special tax, and comply with the provisions contained in subpart K, relating to special taxes.

(b) Liability as a wholesale dealer. If a manufacturer of adulterated butter sells statutory packages of his own production elsewhere than at the place of manufacture, liability as a wholesale dealer is incurred. (See paragraph (c) (1) of § 45.4821-3.) As to exemption from liability as a wholesale dealer, see §§ 45.4821-4 and 45.4903-1.

ages incurs liability to the $1,000 penalty imposed by section 7265 (c). If the quantity sold is less than 10 pounds, liability as a retail dealer is also incurred.

(d) Cross reference. For the general requirements with respect to manufacturers of adulterated butter or process or renovated butter, see §§ 45.4814-1 to 45.4814-5, inclusive.

§ 45.4821-3 Requirements with respect to wholesale dealers in adulterated butter.

(a) Payment of special tax. A wholesale dealer in adultered butter shall make a return on Form 11 to the district director, pay the special tax, and comply with the provisions contained in Subpart K, relating to special taxes.

(b) Liability for breaking package. A wholesale dealer in adulterated butter shall sell original stamped packages only. A wholesale dealer who removes and sells adulterated butter from original stamped packages incurs liability to the $1,000 penalty imposed by section 7265 (c). If the quantity sold is less than 10 pounds, liability as a retail dealer is also incurred.

(c) Liability in particular situations— (1) Place of sale. Liability to special tax as either a wholesale dealer or a retail dealer is incurred at each place other than the registered premises where adulterated butter is sold or offered for sale. The place of actual or constructive delivery transferring the ownership of the adulterated butter from the vendor to the vendee is regarded as the place of sale for which special tax is required to be paid. (See paragraph (b) of § 45.4821-6 as to itinerant vendors.)

(2) Delivery orders. Sales to persons ordering adulterated butter, including c.o.d. orders, shall be absolutely completed at the registered place of business of the vendor or liability is incurred at each place where deliveries are made. Orders must be received at the vendor's registered premises, where the adulterated butter must be addressed and billed to, and the sales recorded in the names of the persons ordering. The identical package sold at the vendor's registered place of business to the person ordering is the only package the vendor or his agent may deliver at another place without incurring liability for the special tax at the place of delivery.

(3) Sight draft orders. Where a bona fide order is received at the registered place of business of the vendor and the adulterated butter is there addressed and billed to the persons ordering, it may be shipped with a draft for the purchase money attached to the bill of lading. The bill of lading shall be endorsed specifically, and not in blank, to the person ordering, and the draft drawn on such person, otherwise the sale is completed and special-tax liability is incurred at the place of delivery.

(4) Standing orders. Deliveries of adulterated butter may be made as specified in a standing order accepted at the registered place of business of a manufacturer or dealer without incurring special tax liability at the place of delivery. However, delivery of any other quantity than that specified in the standing order, whether more or less, constitutes a separate transaction not covered by the standing order, and is subject to subparagraph (2) of this paragraph.

(5) Agents or brokers. A broker or agent may solicit orders for adulterated butter, receive a commission for his services, and make collections for the principal without becoming liable to special tax as a dealer, provided title to the adulterated butter does not vest in the agent or broker at any time. If the manufacturer or dealer bills the adulterated butter to the broker or agent, who in turn bills it to others, with or without profit, a second sale takes place and the broker or agent incurs special-tax liability as a dealer at each place where he makes deliveries.

(6) Resales. Before resale of original stamped packages of adulterated butter they shall be actually or constructively returned to the vendor's registered place of business and the second sale there consummated before delivery. If the goods are picked up at the address of one customer and delivered to that of another before the resale is completed at the vendor's registered place of business, the resale occurs at the place of delivery and additional special tax liability is incurred.

(7) Delivery from warehouse. Taxpaid packages of adulterated butter may be stored in warehouses and delivered therefrom without incurring special-tax liability at the warehouse: Provided, The sales are completed at the vendor's registered place of business. The mere transmittal to, and the filling of the order

Liability for the special tax as a wholesale dealer is not incurred in the following situations:

(a) Sales at factory. Where a manufacturer sells adulterated butter of his own production in statutory packages at the place of manufacture. As to manufacturer's liability as a retail dealer, see paragraph (c) of § 45.4821-2.

(b) Sales of left-over stock. Where a manufacturer who, having discontinued the business, directs a wholesale dealer holding adulterated butter of his production to consign it to another wholesale dealer for sale on commission for the manufacturer's account.

(c) Sales to secure charges. Where a warehouse sells adulterated butter to cover storage charges, or a transportation company to secure freight charges or salvage damaged merchandise. The quanity so sold and the name and address of the buyer shall be reported to the district director.

(d) Sales to assignee. Where a retail dealer sells his stock of merchandise, including adulterated butter, to his

successor.

§ 45.4821-5 Requirements with respect to retail dealers in adulterated butter. (a) Payment of special tax. A retail dealer shall make return on Form 11 to the district director, pay special tax, and comply with the provisions contained in subpart K, relating to special taxes.