Records of Things of Value to Retailers, and Occasional Letter Reports from Industry Members Regarding Information on Sponsorships, Advertisements, Promotions, etc., under the FAA Act

The Federal Alcohol Administration Act (FAA Act) at 27 U.S.C. 205 generally prohibits alcohol beverage producers, importers, or wholesalers from offering inducements to alcohol retailers—giving things of value or conducting certain types of advertisements, promotions, or sponsorships—unless such an action is specifically exempted by regulation. Under that FAA Act authority, the Alcohol and Tobacco Tax and Trade Bureau (TTB) regulations in 27 CFR Part 6, “Tied-House,” describe exceptions to the general FAA Act prohibition on offering inducements to retailers and also describe things that are considered to be “things of value” for purposes of determining whether an inducement has been offered. Among other provisions, those regulations require alcohol beverage industry members to keep records concerning things of value furnished to retailers, identifying the item and the retailer receiving it, along with the industry member's cost and any charges to the retailer for the item. Industry members may use usual and customary business records to satisfy that recordkeeping requirement, and such records must be retained for 3 years, available for TTB inspection. In addition, the part 6 regulations provide that TTB may require, as part of a trade practice investigation, a letterhead report from an alcohol industry member regarding any advertisements, promotions, sponsorships, or other activities conducted by, on behalf of, or benefiting the industry member. This information collection is necessary to detect and prevent unfair trade practices as defined by the FAA Act, and ensure compliance with the Act’s trade practice exceptions and limitations.

The latest form for Records of Things of Value to Retailers, and Occasional Letter Reports from Industry Members Regarding Information on Sponsorships, Advertisements, Promotions, etc., under the FAA Act expires 2022-10-31 and can be found here.

Records of Things of Value to Alcohol Beverage Retailers under the FAA Act (TTB REC 5190/1)

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