(c) MATERIALS FOR MANUFACTURE.

(1) EXPORTABLE FREE OF TAX.-Any manufacturer of the articles specified in subsection (a), or of any of them, having such bonded warehouse, shall be at liberty, under such regulations as the Secretary or his delegate may prescribe, to convey therein any materials to be used in such manufacture which are allowed by the provisions of law to be exported free from tax or duty, as well as the necessary materials, implements, packages, vessels, brands, and labels for the preparation, putting up, and export of such manufactured articles; and every article so used shall be exempt from the payment of stamp and excise duty by such manufacturer. Articles and materials so to be used may be transferred from any bonded warehouse under such regulations as the Secretary or his delegate may prescribe, into any bonded warehouse in which such manufacture may be conducted, and may be used in such manufacture, and when so used shall be exempt from stamp and excise duty; and the receipt of the officer in charge shall be received as a voucher for the manufacture of such articles.

(2) IMPORTED MATERIALS.-Any materials imported into the United States may, under such regulations as the Secretary or his delegate may prescribe, and under the direction of the proper officer, be removed in original packages from on shipboard, or from the bonded warehouse in which the same may be, into the bonded warehouse in which such manufacture may be carried on, for the purpose of being used in such manufacture, without payment of duties thereon, and may there be used in such manufacture. No article so removed, nor any article manufactured in said bonded warehouse, shall be taken therefrom except for exportation, under the direction of the proper officer having charge thereof, whose certificate, describing the articles by their mark or otherwise, the quantity, the date of importation, and name of vessel, with such additional particulars as may from time to time be required, shall be received by the collector of customs in cancellation of the bond, or return of the amount of foreign import duties.

(d) REMOVALS.

(1) GENERAL.-Such goods, when manufactured in such warehouses, may be removed for exportation under the direction of the proper officer having charge thereof, who shall be designated by the Secretary or his delegate, without being charged with duty and without having a stamp affixed thereto.

(2) TRANSPORTATION FOR EXPORT.-Any article manufactured in a bonded warehouse established under subsection (a) may be removed therefrom for transportation to a customs bonded warehouse at any port, for the purpose only of being exported therefrom, under such regulations and on the execution of such bonds or other security as the Secretary or his delegate may prescribe.

SEC. 5522. WITHDRAWAL OF DISTILLED SPIRITS TO MANUFACTURING BONDED WAREHOUSES.

(a) AUTHORIZATION.-Under such regulations and requirement as to stamps, bonds, and other security as shall be prescribed by the Secretary or his delegate, any manufacturer of medicines, preparations, compositions, perfumery, cosmetics, cordials, and other liquors, for

export, manufacturing the same in a duly constituted manufacturing bonded warehouse, shall be authorized to withdraw, from the bonded premises of any distilled spirits plant, so much distilled spirits as he may require for such purpose, without the payment of the internal revenue tax thereon.

(b) ALLOWANCE FOR LOSS OR LEAKAGE.

For provisions relating to allowance for loss of distilled spirits withdrawn under subsection (a), see section 5008 (f).

SEC. 5523. SPECIAL PROVISIONS RELATING TO DISTILLED SPIRITS AND WINES RECTIFIED IN MANUFACTURING BONDED WAREHOUSES.

Distilled spirits and wines which are rectified in manufacturing bonded warehouses, class six, and distilled spirits which are reduced in proof and bottled or packaged in such warehouses, shall be deemed to have been manufactured within the meaning of section 311 of the Tariff Act of 1930 (19 U. S. C. 1311), and may be withdrawn as provided in such section, and likewise for shipment in bond to Puerto Rico, subject to the provisions of such section, and under such regulations as the Secretary or his delegate may prescribe, there to be withdrawn for consumption or be rewarehoused and subsequently withdrawn for consumption. No internal revenue tax shall be imposed on distilled spirits and wines rectified in class six warehouses if such distilled spirits and wines are exported or shipped in accordance with such section 311. No person rectifying distilled spirits or wines in such warehouses shall be subject by reason of such rectification to the payment of special tax as a rectifier.

Subchapter I-Miscellaneous General Provisions

Sec. 5551. General provisions relating to bonds.

Sec. 5552. Installation of meters, tanks, and other apparatus.
Sec. 5553. Supervision of premises and operations.

Sec. 5554. Pilot operations.

Sec. 5555. Records, statements, and returns.

Sec. 5556.

Regulations.

Sec. 5557. Officers and agents authorized to investigate, issue search warrants, and prosecute for violations.

Sec. 5558. Authority of enforcement officers.

Sec. 5559. Determinations.

Sec. 5560. Other provisions applicable.

Sec. 5561. Exemptions to meet the requirements of the national

defense.

Sec. 5562. Exemptions from certain requirements in cases of

disaster.

SEC. 5551. GENERAL PROVISIONS RELATING TO BONDS.

(a) APPROVAL AS CONDITION TO COMMENCING BUSINESS.-No individual, firm, partnership, corporation, or association, intending to commence or to continue the business of a distiller, bonded warehouseman, rectifier, brewer, or winemaker, shall commence or continue the business of a distiller, bonded warehouseman, rectifier, brewer, or winemaker until all bonds in respect of such a business, required by any provision of law, have been approved by the Secretary or the officer designated by him.

(b) DISAPPROVAL.-The Secretary or any officer designated by him may disapprove any such bond or bonds if the individual, firm, partnership, or corporation, or association giving such bond or bonds, or owning, controlling, or actively participating in the management of the business of the individual, firm, partnership, corporation, or association giving such bond or bonds, shall have been previously convicted, in a court of competent jurisdiction, of—

(1) any fraudulent noncompliance with any provision of any law of the United States, if such provision related to internal revenue or customs taxation of distilled spirits, wines, or beer, or if such an offense shall have been compromised with the individual, firm, partnership, corporation, or association on payment of penalties or otherwise, or

(2) any felony under a law of any State, Territory, or the District of Columbia, or the United States, prohibiting the manufacture, sale, importation, or transportation of distilled spirits, wine, beer, or other intoxicating liquor.

(c) APPEAL FROM DISAPPROVAL.-In case the disapproval is by an officer designated by the Secretary to approve or disapprove such bonds, the individual, firm, partnership, corporation, or association giving the bond may appeal from such disapproval to the Secretary or an officer designated by him to hear such appeals, and the disapproval of the bond by the Secretary or officer designated to hear such appeals shall be final.

SEC. 5552. INSTALLATION OF METERS, TANKS, AND OTHER APPARATUS.

The Secretary or his delegate is authorized to require at distilled spirits plants, breweries, and at any other premises established pursuant to this chapter as in his judgment may be deemed advisable, the installation of meters, tanks, pipes, or any other apparatus for the purpose of protecting the revenue, and such meters, tanks, and pipes and all necessary labor incident thereto shall be at the expense of the person on whose premises the installation is required. Any such person refusing or neglecting to install such apparatus when so required by the Secretary or his delegate shall not be permitted to conduct business on such premises.

SEC. 5553. SUPERVISION OF PREMISES AND OPERATIONS.

(a) ASSIGNMENT OF INTERNAL REVENUE OFFICERS.-The Secretary or his delegate is authorized to assign to any premises established under the provisions of this chapter such number of internal revenue officers as may be deemed necessary.

(b) FUNCTIONS OF INTERNAL REVENUE OFFICER.-When used in this chapter, the term "internal revenue officer assigned to the premises" means the internal revenue officer assigned by the Secretary or his delegate to duties at premises established and operated under the provisions of this chapter.

SEC. 5554. PILOT OPERATIONS.

For the purpose of facilitating the development and testing of improved methods of governmental supervision (necessary for the protection of the revenue) over distilled spirits plants established under this chapter, the Secretary or his delegate is authorized to waive any regulatory provisions of this chapter for temporary pilot or experimental operations. Nothing in this section shall be construed as authority to waive the filing of any bond or the payment of any tax provided for in this chapter.

SEC. 5555. RECORDS, STATEMENTS, AND RETURNS.

(a) GENERAL.-Every person liable to any tax imposed by this chapter, or for the collection thereof, or for the affixing of any stamp required to be affixed by this chapter, shall keep such records, render such statements, make such returns, and comply with such rules and regulations as the Secretary or his delegate may prescribe.

(b) AUTHORITY TO WAIVE.-Whenever in this chapter any record is required to be made or kept, or statement or return is required to be made by any person, the Secretary or his delegate may by regulation waive, in whole or in part, such requirement when he deems such requirement to no longer serve a necessary purpose. This subsection shall not be construed as authorizing the waiver of the payment of any tax.

(c) PHOTOGRAPHIC COPIES.-Whenever in this chapter any record is required to be made and preserved by any person, the Secretary or his delegate may by regulations authorize such person to record, copy, or reproduce by any photographic, photostatic, microfilm, microcard, miniature photographic, or other process, which accurately reproduces or forms a durable medium for so reproducing the original of such record and to retain such reproduction in lieu of the original. Every person who is authorized to retain such reproduction in lieu of the

original shall, under such regulations as the Secretary or his delegate may prescribe, preserve such reproduction in conveniently accessible files and make provision for examining, viewing, and using such reproduction the same as if it were the original. Such reproduction shall be treated and considered for all purposes as though it were the original record and all provisions of law applicable to the original shall be applicable to such reproduction. Such reproduction, or enlargement or facsimile thereof, shall be admissible in evidence in the same manner and under the same conditions as provided for the admission of reproductions, enlargements, or facsimiles of records made in the regular course of business under section 1732 (b) of title 28 of the United States Code.

SEC. 5556. REGULATIONS.

The regulations prescribed by the Secretary or his delegate for enforcement of this chapter may make such distinctions in requirements relating to construction, equipment, or methods of operation as he deems necessary or desirable due to differences in materials or variations in methods used in production, processing, or storage of distilled spirits.

SEC. 5557. OFFICERS AND AGENTS AUTHORIZED TO INVESTIGATE, ISSUE SEARCH WARRANTS, AND PROSECUTE FOR VIOLATIONS.

(a) GENERAL.-The Secretary or his delegate shall investigate violations of this subtitle and in any case in which prosecution appears warranted the Secretary or his delegate shall report the violation to the United States Attorney for the district in which such violation was committed, who is hereby charged with the duty of prosecuting the offenders, subject to the direction of the Attorney General, as in the case of other offenses against the laws of the United States; and the Secretary or his delegate may swear out warrants before United States commissioners or other officers or courts authorized to issue warrants for the apprehension of such offenders, and may, subject to the control of such United States Attorney, conduct the prosecution at the committing trial for the purpose of having the offenders held for the action of a grand jury. Section 3041 of title 18 of the United States Code is hereby made applicable in the enforcement of this subtitle.

(b) CROSS REFERENCE.

For provisions relating to the issuance of search warrants, see the Federal Rules of Criminal Procedure.

SEC. 5558. AUTHORITY OF ENFORCEMENT OFFICERS.

For provisions relating to the authority of internal revenue enforcement officers, see section 7608.

SEC. 5559. DETERMINATIONS.

Whenever the Secretary or his delegate is required or authorized, in this chapter, to make or verify any quantitative determination, such determination or verification may be made by actual count, weight, or measurement, or by the application of statistical methods, or by other means, under such regulations as the Secretary or his delegate may prescribe.