ROTATION OF WINES AT RETAIL PREMISES
Proprietors of Distilled Spirits Plants, Bonded Wine Cellars,
Taxpaid Wine Bottling Houses, Importers, Wholesale Liquor
Dealers, and Others Concerned:
Purpose. This circular is to inform industry members that
ATF Ruling 77-4, which permits wine suppliers to rotate wines
at retail dealer premises under certain conditions, will be pub-
lished in the February issue of the Alcohol, Tobacco and Firearms
Bulletin. The ruling will read substantially as follows:
The Bureau of Alcohol, Tobacco and Firearms
has been asked to clarify permissible rotation of
wine products as provided for in ATF Ruling 73-7,
1973 ATF C.B. 88, concerning the rearrangement by
wine suppliers, of wine at retail liquor dealer
The Bureau has previously ruled, in ATF Ruling
73-7, that a wine supplier may rotate his brands of
wine at retail premises under certain conditions
without violating the provisions of 27 U.S.C. 205(b).
In that ruling, the Bureau recognized that the in-
crease in the production and sale of wines, especially
low alcoholic content wines having a comparatively
short shelf life, as well as a substantial increase
in the number of retail outlets handling wines, has
necessitated determining whether, for quality control
purposes, the foregoing activity could be permitted
within the scope of controlling law.
The legal requirements regarding unfair competi-
tion and unlawful practices in sales of wines by
producers or wholesalers are set out in 27 U.S.C. 205(b).
Under these requirements it is considered, in effect,
unlawful to induce retail dealers to purchase wines
to the exclusion in whole or in part of wines sold
by others (engaged in interstate or foreign commerce)
by reason of furnishing, selling, or giving service
or other things of value. There is provision, how-
ever, for exceptions including regard for public
health, the value of articles involved, and estab-
lished trade practices not contrary to the public
In order to further clarify the Bureau's
position, it is held:
1. Permission to rotate such wines must be obtained
from the retailer.
2. Only brands of wine sold by the supplier may
3. No brands of wine may be returned to the wine
supplier by the retailer other than under the
exception found in the proviso to 27 U.S.C.
205(d), as further discussed in Revenue Ruling
54-509, 1954-2 C.B. 561 (Internal Revenue).
Within these constraints, it is further held
that a wine supplier may, for the purpose of maintain-
ing the freshness of his products:
1. Rearrange his own wine already stocked on shelves,
in coolers, in cold boxes, and on floor displays
by placing the oldest wine in front.
2. Rearrange and add to his own wine in the storage
area assigned to him by the retailer.
However, the wine supplier may not:
1. Add wine to shelves, coolers, cold boxes and the
2. Transfer wine from one shelf, cooler, cold box,
floor display, or storage area to another shelf,
cooler, cold box, floor display, or storage area.
3. Alter or disturb in anyway the wine sold by
4. Mark or affix retail prices.
Suppliers who rotate wine under conditions other
than those identified above as permissible are cau-
tioned that such "rotation" will be viewed as the
providing of a service to the retailer. If such
service (inducement) results in exclusion in whole
or in part of a competitor's products sold or offered
for sale in interstate or foreign commerce, a vio-
lation of the Federal Alcohol Administration Act
With regard to product shelf life and freshness
considerations, suppliers are also reminded that the
return of unsalable "old" wine in exchange for fresh
wine is permissible, provided the exchange is for an
equal quantity of the same type and brand of wine,
varying only as to the container size.
This ruling shall not operate to exempt any
person from the requirements of State law or regu-
ATF Ruling 73-7, 1973 ATF C.B. 88, is superseded.
Inquiries. Inquiries concerning this circular should refer
to its number and be addressed to the Assistant Director (Regu-
latory Enforcement), Bureau of Alcohol, Tobacco and Firearms,
1200 Pennsylvania Avenue, NW, Washington, DC 20226.
Rex D. Davis