The Fall 2013 issue of Whisky Advocate contains a great article about the story behind the start up of High West Distillery in Park City, Utah. The objective of the article is to provide insight into the process from conception to production of a craft distiller. Written by the founder, David Perkins, this article touches on some of the regulatory hurdles that a potential distiller would have to deal with starting up. Mr. Perkins explains the federal permitting application as “onerous, thick, and at times puzzling.”
In particular Mr. Perkins references his favorite provision relating to security issues for storage of distilled spirits and their lengthy regulatory guidelines on this topic. This blog will touch on some of those requirements, in particular what Mr. Perkins refers to as the “special lock.”
Treasury Regulations lay out exactly what will qualify as an “approved lock.” Approved locks, absent exception described below, must be used to secure everything from outdoor tanks used for spirit storage or an enclosure around an outdoor tank. These requirements are necessary for indoor tanks that store spirits, or the door in which a person can gain outside access to the indoor storage tanks. Finally, these apply to any door to the distillery from which access may be gained from the outside to rooms or buildings containing spirits stored in portable bulk containers.
Basically, a safe harbor is created in this Treasury Regulation so that if these requirements are met, the proprietor has met the regulatory requirements for an approved lock. The lock must have all of the following:
(1) A corresponding serial number on the lock and on the key, except for master key locking systems;
(2) A case hardened shackle at least one-fourth inch in diameter, with heel and toe locking;
(3) A body width of at least 2 inches;
(4) A captured key feature (the key may not be removed while the shackle is unlocked);
(5) A tumbler with at least 5 pins; and
(6) A lock and key containing no bitting data.
You are not out of luck if your proposed lock doesn’t match up with the above. However, you have to take additional steps to get your DSP. The regulations require the applicant to submit an example or prototype of the lock to the appropriate TTB officer, with a request that the lock be approved for use. The appropriate TTB officer will evaluate the lock and determine whether the lock should be approved for use. All applicants should make note of as many special requirements of this type as possible as they apply for their DSP so that they either plan to meet the safe harbor requirements of the regulations, or allow for additional time for special approval.
If you find any part of the application process for your DSP to be “onerous, thick, and at times puzzling,” give us a call, we’d be happy to help you get through the regulatory issues surrounding your application.