§ 1.23 State agencies.

This subpart shall not apply to any agency of a State or political subdivision thereof or to any officer or employee of any such agency, and no such agency or officer or employee thereof shall be required to obtain a basic permit under this subpart.

PERSONS ENTITLED TO BASIC PERMITS

§ 1.24 Qualifications of applicants.

The application of any person shall be granted and the permit issued by the Regional director (compliance) if the applicant proves to the satisfaction of the Regional director (compliance) that:

(a) Such person (or in case of a corporation, any of its officers, directors, or principal stockholders) has not, within 5 years prior to the date of application, been convicted of a felony under Federal or State law, and has not, within 3 years prior to date of application, been convicted of a misdemeanor under any Federal law relating to liquor, including the taxation thereof; and

(b) Such person, by reason of his business experience, financial standing or trade connections, is likely to commence operations as a distiller, warehouseman and bottler, rectifier, wine producer, wine blender, importer, or wholesaler, as the case may be, within a reasonable period and to maintain such operations in conformity with Federal law; and

(c) The operations proposed to be conducted by such person are not in violation of the law of the State in which they are to be conducted.

APPLICATIONS FOR PERMITS

§ 1.25 General.

Applications for basic permits to engage in any of the operations set forth in §§ 1.20 to 1.22 shall be made on the appropriate form prescribed by the Director, Alcohol and Tobacco Tax Division, verified as required by § 1.56, and shall be accompanied by such affidavits, documents, and other supporting data, as the Director, Alcohol and Tobacco Tax Division or the Regional director (compliance) shall require. All data written statements,

affidavits, documents, or other evidence submitted in support of the application, or upon hearing thereon, shall be deemed to be a part of the application. All applications shall be filed by mailing or delivering the same to the office of the Regional director (compliance).

§ 1.26 Incomplete or incorrectly executed applications.

Incomplete or incorrectly executed applications will not be acted upon, but the applicant shall be entitled to file a new application without prejudice, or to complete the application already filed.

§ 1.27 Change in ownership, management, or control of the applicant.

In the event of any change in the ownership, management, or control of the applicant (in case of a corporation, any change in the officers, directors, or persons holding more than 10 percent of the corporate stock), after the date of filing of any application for a basic permit and prior to final action on such application, the applicant shall notify the Regional director (compliance) immediately of such change.

§ 1.29 Individual plant or premises.

An application for basic permit must be filed, and permit issued, to cover each individual plant or premises where any of the businesses specified in section 3 of the act is engaged in such application to be filed with and permit issued by the Regional director (compliance) for the region wherein such plant or premises is located.

§ 1.30 Power of attorney; Form 1534.

If the application and other documents in support of such application are signed by an attorney in fact of an individual, partnership, association, or corporation, or by one of the members of a copartnership or association, or, in the case of a corporation by an officer or other person not authorized by the corporation's bylaws or by its board of directors to sign such applications and supporting documents, the applications must be supported by a duly authenticated copy of the power

§ 1.35 Authority to issue, amend, deny, suspend, revoke, or annul basic permits.

The authority and power of issuing, amending, or denying basic permits, or amendments thereof, is conferred upon the Director and (except as to agency initiated curtailment) upon the regional director (compliance). The authority and power of suspending, revoking, or annulling basic permits is conferred upon the Director, and upon the administrative law judges referred to in Part 200 of this chapter. The Director, upon consideration of appeals on petitions for review, may order the regional director (compliance) to issue, deny, suspend, revoke, or annul basic permits.

(T.D. ATF-48, 44 FR 55837, Sept. 28, 1979]

Subpart E-Amendment and Duration of Basic Permits

§ 1.40 Change of name.

In the event of any change in the name (trade or corporate name) of a permittee, or, in the event a permittee desires to engage in operations under an additional trade name, such permittee must file application (Form 1643), with the Regional director (compliance), for an amended basic permit, which application must be approved, and amended permit issued, before op

erations may be commenced under new name.

§ 1.41 Change of address.

In the event of a change in add the permittee must file applica (Form 1643), with the Regional di tor (compliance), for an amended b permit.

§ 1.42 Change in ownership, managen or control of business.

In the event of any change in ownership, management, or contro any business operated pursuant basic permit (if the permittee is a poration, if any change occurs in officers, directors, or persons ow or controlling more than 10 percen the voting stock of said corporat the permittee shall immediately no the Regional director (compliance such change, giving the names and dresses of all new persons partici ing in the ownership, managemen control of such business, or in the of a corporation, the names and dresses of such new officers, direc or persons owning or controlling n than 10 percent of the voting st Notice to the Regional director ( pliance) of any such change shal accompanied or supplemented by data in reference to the persona business history of such persons as Regional director (compliance) require.

§ 1.43 Duration of permits.

A basic permit shall continu effect until suspended, revoked, nulled, voluntarily surrendered, automatically terminated, as prov in the act and in this part.

§ 1.44 Automatic termination of perm No basic permit shall be leased, or otherwise voluntarily transfer and, in the event of such lease, sal other voluntary transfer, the basic permit shall automatically te nate thereupon. If any basic perm transferred by operation of law actual or legal control of the per tee is acquired, directly or indire whether by stock ownership or in other manner, by any person, such permit shall be automatically

minated at the expiration of 30 days thereafter: Provided, That if within such 30-day period application for a new basic permit is made by the transferee or permittee, respectively, then the outstanding basic permit shall continue in effect until such time as the application is finally acted upon.

Subpart F-Revocation, Suspension, or Annulment of Basic Permits

§ 1.50 Revocation or suspension.

Whenever the Regional director (compliance) has reason to believe that any permittee has willfully violated any of the conditions of his basic permit or has not engaged in the operations authorized by the permit for a period of more than two years, he shall institute proceedings for the revocation or suspension of such permit, in accordance with the procedure set forth in Part 200 of this chapter, which part is made applicable to such proceedings.

[T.D. 6521, 25 FR 13831, Dec. 29, 1960, as amended by T.D. ATF-48, 44 FR 55837, Sept. 28, 1979]

Whenever the Regional director (compliance) has reason to believe that any basic permit was procured through fraud, or misrepresentation or concealment of material fact, he shall institute proceedings for the annulment of such permit in accordance with the procedure set forth in Part 200 of this chapter, which part is made applicable to such proceedings.

[T.D. 6521, 25 FR 13831, Dec. 29, 1960, as amended by T.D. ATF-48, 44 FR 55837, Sept. 28, 1979]

§ 1.52 Disposition of stocks of alcoholic beverages upon revocation, annulment, or automatic termination of basic permit.

In the event of the revocation or annulment of a basic permit, pursuant to Part 200 of this chapter, or in the event such permit is automatically terminated by operation of law (27 U.S.C. 204(g)) and section 144, the Regional director (compliance) may authorize the orderly disposition of stocks of distilled spirits, wines, or malt beverages

then held by the permittee or former permittee upon such conditions as may be considered proper.

[T.D. 6521, 25 FR 13831, Dec. 29, 1960, as amended by T.D. ATF-48, 44 FR 55837, Sept. 28, 1979]

Subpart G-Miscellaneous

§ 1.55 Recalling permits for correction. Whenever it shall be discovered that any basic permit has been issued authorizing acts, or combinations of acts, which may not properly, under the law and regulations, as of now or hereafter in force, be authorized, or that any material mistake has occurred in the issuance thereof, the holder of such permit shall forthwith surrender the same for correction or amendment upon demand of the Regional director (compliance).

§1.56 Oaths and affirmations.

Any document required by regulations or instructions of the Director to be verified, shall be so verified upon oath or affirmation taken before a person authorized by the laws of the United States or by State or local law to administer oaths or affirmations in the State, Territory, or District wherein such document is to be executed.

§ 1.57 Procedure.

The procedures prescribed by the rules of practice in Permit Proceedings (Part 200 of this chapter) are applicable to administrative proceedings for the issuance, amendment, denial, revocation, suspension, or annulment of basic permits, the issuance of subpoenas and the taking of depositions under the Federal Alcohol Administration Act.

[T.D. 6521, 25 FR 13831, Dec. 29, 1960, as amended by T.D. ATF-48, 44 FR 55837, Sept. 28, 1979]

§ 1.58 Filing of permits.

Every person receiving a basic permit under the provisions of this part must file the same, at the place of business covered by the basic permit, so that it may be examined by Government officers.

§ 1.59 Public information as to applications acted upon.

The Regional director (compliance) shall cause to be maintained currently in his office for public inspection, until the expiration of one year following final action on the application, the following information with respect to each application for basic permit filed:

(a) The name, including trade name or names, if any, and the address of the applicant; the kind of permit applied for and the location of the business; whether the applicant is an individual, a partnership or a corporation; if a partnership, the name and address of each partner; if a corporation, the name and address of each of the principal officers and of each stockholder owning 10 percent or more of the corporate stock.

(b) The time and place set for any hearing on the application.

(c) The final action taken on the application. In the event a hearing is held upon an application for a basic permit, the Regional director (compliance) shall make available for inspection at his office, upon request therefor: The transcript of the hearing, a copy of the administrative law judge's recommended decision, a copy of the Regional director (compliance) decision and, in the event of an appeal to the Director, Alcohol and Tobacco Tax Division, the decision on appeal with the reasons given in support thereof.

(T.D. 6521, 25 FR 13831, Dec. 29, 1960, as amended by T.D. ATF-48, 44 FR 55838, Sept. 28, 1979]

§ 2.5 Meaning of terms.

Distilled spirits. Section 17(a) of Federal Alcohol Administration defines "distilled spirits" as ethyl hol, hydrated oxide of ethyl, spirit wine, whiskey, rum, brandy, gin, other distilled spirits, including al lutions and mixtures thereof for industrial use.

Wine. Section 17(a) of the Fed Alcohol Administration Act def "wine" as (a) wine as defined in tion 610 and section 617 of the R nue Act of 1918 (26 U.S.C. 5381-53 as now in force or hereafter amen and (b) other alcoholic beverages so defined, but made in the manne wine, including sparkling and car ated wine, wine made from conder grape must, wine made from other ricultural products than the juic sound, ripe grapes, imitation w compounds sold as wine, vermo cider, perry, and sake; in each stance, only if containing not less t 7 percent and not more than 24 cent of alcohol by volume, and if nonindustrial use.

[T.D. ATF-48, 44 FR 55838, Sept. 28, 1

Subpart C-Uses Regarded as Industrial

§ 2.10 Use of distilled spirits.

The following uses of distilled spirits are regarded as "industrial" and will be excluded from any application of the term "nonindustrial use." The use of distilled spirits:

(a) Free of tax by, and for the use of, the United States or any governmental agency thereof, any State or Territory, any political subdivision of a State or Territory, or the District of Columbia, for nonbeverage purposes;

or

(b) Free of tax for nonbeverage purposes and not for resale or use in the manufacture of any product for sale:

(1) For the use of any educational organization described in 26 U.S.C. 503(b)(2) which is exempt from income tax under 26 U.S.C. 501(a), or for the use of any scientific university or college of learning;

(2) For any laboratory for use exclusively in scientific research;

(3) For use at any hospital, blood bank, or sanitarium (including use in making analysis or test at such hospital, blood bank, or sanitarium), or at any pathological laboratory exclusively engaged in making analyses or tests, for hospitals or sanitariums; or

(4) For the use of any clinic operated for charity and not for profit (including use in compounding of bona fide medicines for treatment outside of such clinics of patients thereof); or

(c) Free of tax, after denaturation of such spirits in the manner prescribed by law for:

(1) Use in the manufacture of ether, chloroform, or other definite chemical substance where such distilled spirits are changed into some other chemical substance and do not appear in the finished product; or

(2) Any other use in the arts and industries (except for uses prohibited by 26 U.S.C. 5273 (b) or (d) and for fuel, light, and power.

§ 2.11 Use of wine.

The following uses of wine are regarded as "industrial" and will be excluded from any application of the term "nonindustrial". The use of wine:

(a) Without payment of tax for us in the production of vinegar; or

(b) Free of tax for experimental o research purposes by any scientifi university, college of learning, or insti tution of scientific research; or

(c) Free of tax for use by the Unite States or any agency thereof, and for use for analysis, testing, research, o experimentation by the government of the several States and Territorie and the District of Columbia or of any political subdivision thereof or by an agency of such governments; or

(d) Which has been rendered unfi for beverage use.

§ 2.12 Use of distilled spirits or wine fo experimental purposes and in manufac ture of nonbeverage products.

The use of distilled spirits or wine for experimental purposes and in the manufacture of (a) medicinal, pharma ceutical, or antiseptic products, includ ing prescriptions compounded by retail druggists; (b) toilet preparations (c) flavoring extracts, syrups, or food products; or (d) scientific, chemical mechanical, or industrial products provided such products are unfit for beverage use, is regarded as "industri al," and will be excluded from any ap plication of the term "nonindustria use."

All uses of distilled spirits and wines. except as provided in Subpart C of this part, are regarded as "nonindus trial." Such "nonindustrial" use shall include, but not be limited to, distilled spirits or wine used for beverage purposes, or in the manufacture, rectification, or blending of alcoholic beverages; or in the preparation of food or drink by a hotel, restaurant, tavern, or similar establishment; or for sacramental purposes; or as a medicine.

§ 2.16 Distilled spirits in containers of a capacity of one gallon or less.

Distilled spirits in containers of a capacity of one wine gallon or less, except anhydrous alcohol and alcohol which may be withdrawn free of tax