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Federal Register / Vol. 83, No. 159 / Thursday, August 16, 2018 / Rules and Regulations 40665

FEDERAL TRADE COMMISSION 5 as applied to jewelry marketing, to Surface Application of Precious Metals help marketers avoid deceptive The final Guides include several 16 CFR Part 23 practices. To comply with Section 5, revisions addressing marketers must consider how Guides for the Jewelry, Precious surface applications. First, based on the reasonable consumers will view their Metals, and Industries comments, the Guides now caution claims as a whole, assessing the net marketers against using or AGENCY: Federal Trade Commission. impression conveyed by all elements terms to describe all or part of ACTION: Final rule; adoption of revised (including the text, product names, and a coated product unless they adequately guides. depictions).4 qualify the term to indicate the product When the Commission issues or has only a surface layer of the SUMMARY: The Federal Trade advertised precious metal.5 revises an guide, it is providing The Guides Commission (‘‘FTC’’ or ‘‘Commission’’) retain similar guidance advising an administrative interpretation of laws adopts revised Guides for the Jewelry, marketers not to use terms to Precious Metals, and Pewter Industries it administers, including Section 5’s describe coated products or parts unless (‘‘Jewelry Guides’’ or ‘‘Guides’’). This prohibition on unfair and deceptive acts the term is qualified to convey that the document summarizes the or practices in or affecting commerce. gold is only on the surface.6 Commission’s revisions to the previous The Commission provides its Second, for sellers choosing to Guides and includes the final Guides as administrative interpretation based on advertise their products’ precious metal revised. Readers can find the information submitted and any other coatings, the final Guides advise how to Commission’s complete analysis in the information available, including do so non-deceptively. Specifically, Statement of Basis and Purpose (‘‘SBP’’) consumer perception evidence they advise marketers advertising their on the FTC’s website at https:// whenever possible, analyzing the product’s gold, silver, or platinum www.ftc.gov/public-statements/2018/07/ information through the reasonable coating to assure its reasonable statement-basis-purpose-final-revisions- person standard first set forth in the durability. In this context, ‘‘reasonable jewelry-guides. Deception Policy Statement in 1983, durability’’ means ‘‘all areas of the DATES: Effective on August 16, 2018. and the unfairness standard, first set are sufficiently thick to assure coverage that reasonable consumers FOR FURTHER INFORMATION CONTACT: forth in the Unfairness Policy Statement would expect from the surface Reenah L. Kim, Attorney, (202) 326– announced in 1984 and codified in application.’’ 7 2272, Division of Enforcement, Bureau Section 5(n) of the FTC Act. Applying Third, based on new durability of Consumer Protection, Federal Trade the reasonable consumer standard testing, the final Guides include revised Commission, 600 Pennsylvania Avenue supported by consumer perception examples of non-deceptive markings NW, Washington, DC 20580. evidence as the Commission revises the and descriptions for gold surface SUPPLEMENTARY INFORMATION: As part of Jewelry Guides (which originally applications that are reasonably its comprehensive review of the Jewelry predated the two policy statements) durable.8 For electrolytic applications, Guides, the Commission reviewed enhances the protection of consumers the Guides retain the same thickness public comments and the transcript of a from the harm of false or misleading and karat amounts as the public roundtable. The Commission claims in jewelry marketing and fosters previous Guides, but no longer advise developed its final guidance in truthful, non-misleading claims in marketers they may non-deceptively use accordance with Section 5 of the jewelry marketing that are beneficial to ‘‘gold flashed’’ and ‘‘gold washed’’ for Federal Trade Commission Act (‘‘FTC consumers and competition. Based on products with an electroplating that Act’’), which prohibits deceptive or this framework, the Commission now does not have a minimum thickness unfair acts or practices.1 The Guides makes several modifications and throughout equivalent to 0.175 microns focus on advising marketers how to additions to the previous Guides and (approximately 7/1,000,000ths of an make non-deceptive claims about adopts the resulting revised Guides as inch) of fine gold. For mechanical jewelry products, rather than preventing final. Specifically, the Commission applications, the Guides now advise a 1/ 2 unfair practices. Under Section 5, an revises the following areas: (I) Surface 40th minimum weight ratio for non- act or practice is deceptive if it involves application of precious metals; (II) deceptive use of the terms ‘‘gold a material statement or omission that alloys with precious metals in amounts plate(d),’’ 9 ‘‘gold overlay,’’ ‘‘rolled gold would mislead a consumer acting below minimum thresholds; (III) plate.’’ 10 In addition, the Guides retain 3 reasonably under the circumstances. products containing more than one existing guidance advising a 1/20th As administrative interpretations of precious metal; (IV) composite gemstone weight ratio for ‘‘gold filled’’ products, Section 5, the Commission’s Jewelry products; (V) varietals; (VI) ‘‘cultured’’ and the guidance advising marketers to Guides are not intended to be stricter ; (VII) qualifying claims about than Section 5. Rather, they provide the 5 man-made gemstones; (VIII) Sections 23.5(b)(4) (silver) and 23.6(b)(1) Commission’s interpretation of Section (platinum). treatment disclosures; (IX) use of the 6 Section 23.3(b)(3). 1 15 U.S.C. 45. term ‘‘gem’’; (X) misleading 7 Sections 23.3(b)(4), (5), (6), and (8), (c)(2) and (3) 2 Although the Guides focus on deception, the illustrations; (XI) definition; (gold); 23.5(b)(5) (silver); and 23.6(b)(2) (platinum). FTC can also address unfair practices should the and (XII) exemptions recognized in the 8 These examples are also referred to as ‘‘safe need arise. assay for gold, silver, and platinum. harbor’’ guidance. 3 9 FTC Policy Statement on Deception, appended Finally, the Commission does not As proposed, the final Guides eliminate the safe to Cliffdale Assoc., Inc., 103 FTC 110 (1984); see harbor provision for ‘‘gold plate(d)’’ coatings also FTC v. Verity Int’l, 443 F.3d 48, 63 (2d Cir. expand the existing Guides to address applied by any method and transfer this term to 2006); FTC v. Pantron I Corp., 33 F.3d 1088, 1095 certain products and claims as guidance that separately addresses electrolytic and (9th Cir. 1994). Under Section 5, an act or practice requested by commenters. mechanical applications. is unfair if it causes or is likely to cause substantial 10 Section 23.3(c)(2). As explained in the SBP, the injury that consumers could not reasonably avoid, Guides advise a minimum weight ratio, rather than and the injury is not outweighed by countervailing 4 See generally Deception Policy Statement, the previously proposed coating thickness, based on benefits to consumers or competition. 15 U.S.C. appended to Cliffdale Assoc., Inc., 103 FTC at 179 new evidence indicating that 1/40th provides the 45(n). (1984). durability consumers expect.

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disclose weight ratio when using ‘‘gold conspicuous, accurate PPT designation these products, and advises against overlay’’ or ‘‘rolled gold plate’’ for immediately precedes the silver term.15 calling them ‘‘treated [gemstone name].’’ products below 1/20th.11 These changes will give marketers It also cautions against using the Fourth, the final Guides advise greater flexibility in providing accurate unqualified terms ‘‘composite [gemstone marketers to disclose the purity of information about their products’ name],’’ ‘‘hybrid [gemstone name],’’ or coatings made with a gold, silver, or content. ‘‘manufactured [gemstone name]’’ platinum . The Guides already However, the final Guides retain the unless the term is qualified to disclose caution marketers against unqualified guidance advising a 925 PPT threshold clearly and conspicuously that the use of ‘‘gold,’’ ‘‘silver,’’ or ‘‘platinum’’ to for ‘‘solid silver,’’ ‘‘,’’ product: (a) Does not have the same describe alloys containing less than 24K ‘‘Sterling,’’ and the ‘‘Ster.’’ characteristics as the named stone; and gold, 925 PPT silver, or 950 PPT Abbreviation,16 and reserving ‘‘coin’’ (b) requires special care. The final platinum. To clarify that this guidance and ‘‘coin silver’’ for products that are Guides further recommend that the applies equally to products coated with 900 PPT,17 based on their longstanding seller disclose the special care a gold, silver, or platinum alloy, the use and therefore probable consumer requirements to the purchaser.18 Commission amends the guidance to understanding. Rather than merely Varietals advise that marketers qualify their use signaling the presence of silver, these of gold, silver, or platinum terms to terms likely denote specific purity Based on consumer perception describe ‘‘all or part’’ of a product, levels (e.g., that ‘‘coin silver’’ contains evidence, Section 23.26 contains new ‘‘including the surface layer of a coated less silver than ‘‘sterling silver’’). In guidance stating it is unfair or deceptive product,’’ with equally conspicuous, addition, the Guides retain the existing to mark or describe a product with an accurate purity disclosures.12 platinum alloy guidance without change incorrect varietal name. Varietal names Finally, the final Guides advise because the record indicates that, unlike describe a division of gem species or marketers to disclose coatings gold and silver, which have genus based on color, type of optical over products advertised as precious traditionally been mixed with base phenomenon, or other distinguishing metal, such as rhodium-plated items metals to create jewelry, consumers characteristic of appearance (e.g., marketed as ‘‘white gold’’ or silver.13 expect platinum products to be structure). To help sellers avoid making deceptive claims, this section also Below-Threshold Precious Metal Alloys substantially composed of pure platinum. provides two examples of markings or The previous Guides cautioned descriptions that may be misleading: (a) marketers against using the words Products Containing More Than One Use of the term ‘‘yellow ’’ to ‘‘gold,’’ ‘‘silver,’’ ‘‘platinum,’’ or their Precious Metal describe a golden or heliodor, and abbreviations to describe or mark a Based on consumer perception (b) use of the term ‘‘green ’’ to product unless it contained the precious evidence, the final Guides contain a describe . metal in an amount that met or new section (Section 23.8), which states ‘‘Cultured’’ Diamonds exceeded specified thresholds. The final it is unfair or deceptive to misrepresent Guides remove the thresholds for gold the relative quantity of each precious The final Guides include new and silver alloys because new evidence metal in a product that contains more guidance addressing use of the word indicates they are no longer necessary to than one precious metal, and provides ‘‘cultured’’ to describe laboratory- prevent deception. Specifically, the examples of markings and descriptions created diamonds. Based on consumer final Guides now advise marketers they of terms that may be misleading (e.g., perception evidence showing marketers may use gold terms to describe a use of the term ‘‘Platinum + Silver’’ to can effectively qualify the term, Section product or part thereof composed describe a product that contains more 23.12(c)(3) advises them to qualify their throughout of gold alloy—whether silver than platinum by weight). This use of ‘‘cultured’’ by disclosing clearly above or below 10 karats—if they guidance generally advises marketers to and conspicuously that the product is qualify the term with an equally list precious metals in the order of their not a mined stone. Additionally, the conspicuous, accurate karat fineness relative weight in the product from record indicates that marketers can disclosure.14 The final Guides also greatest to least. Marketers, however, effectively qualify the term ‘‘cultured advise marketers they may use ‘‘silver’’ may list metals in a different order if the diamond’’ in some circumstances even to describe a product or part thereof context makes clear that the metal listed when the Guides’ suggested disclosures composed throughout of an alloy first is not predominant (e.g., ‘‘14k gold- (‘‘laboratory-created,’’ ‘‘laboratory- containing less than 925 parts per accented silver’’), and the Guides grown,’’ ‘‘[manufacturer-name]- thousand (PPT), as long as an equally provide illustrative examples of such created’’) do not appear in immediate contexts. conjunction to the term. For example, 11 Section 23.3(c)(2). As proposed, the final some lab-created diamond sellers may Guides eliminate a note concerning outdated terms Composite Gemstone Products choose to emphasize their products’ (e.g., ‘‘Duragold,’’ ‘‘Diragold’’) which commenters Based on the record, the final Guides man-made nature in advertisements agreed are no longer used. However, they do not set targeting consumers seeking diamonds standards for new coating terms (e.g., ‘‘clad,’’ contain new guidance in Section 23.25 ‘‘bonded’’) or other precious metal coatings such as to address increased prevalence of that are not traditionally mined. silver or platinum. deceptive claims resulting from the Therefore, to provide greater flexibility, 12 Sections 23.3(b)(1) and (2) (gold); 23.5(b)(1) marketing of composite gemstone the final Guides advise that marketers (silver); and 23.6(b)(3) (platinum). In addition, may qualify their ‘‘cultured diamond’’ based on the comments, the Guides now include products made with gemstone material karat fineness disclosures in the description and and any amount of filler or binder, such claim with words or phrases similar to marking examples for gold electrolytic applications, as . Specifically, this guidance those detailed in the Guides. Moreover, consistent with the examples for mechanical cautions marketers not to use an these marketers do not need to make applications. Section 23.3(b)(5), (6), and (8); unqualified gemstone name to describe these qualifying disclosures 23.3(c)(2) and (3). immediately adjacent to the word 13 Rhodium is a platinum group metal often used to enhance the white color of silver and white gold 15 Section 23.5(b)(1). ‘‘cultured,’’ provided they disclose jewelry. Section 23.7. 16 Section 23.5(b)(2). 14 Section 23.3(b)(2). 17 Section 23.5(b)(3). 18 Section 23.25(d).

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clearly and conspicuously that the diamond in Section 23.12(a) because ‘‘mass’’ or ‘‘industrially’’ produced product is not a mined stone. lab-created products that have jewelry as ‘‘handmade.’’ 23 Qualifying Claims About Man-Made essentially the same optical, physical, Conclusion Gemstones and chemical properties as mined diamonds are also diamonds.20 For further analysis of comments and To provide marketers greater the final guidance, please see the SBP flexibility, the final Guides also include Exemptions in the Assay for Gold, on the FTC’s website, available at revisions to the guidance regarding the Silver, and Platinum https://www.ftc.gov/public-statements/ use of gemstone names generally 2018/07/statement-basis-purpose-final- (Section 23.25(b)). This amended Based on the comments, the final revisions-jewelry-guides. Guides add and snap guidance now advises marketers of man- List of Subjects in 16 CFR Part 23 made gemstones sharing the same tongues to the exempted items listed in optical, physical, and chemical the Appendix for gold alloy products Advertising, Jewelry, Labeling, properties as the named stone that they and for products made of silver in Pewter, Precious metals, and Trade may use words or phrases other than the combination with gold. These items are practices. ones listed in the previous Guides already included in the exemptions for ■ For the reasons set forth in the (‘‘laboratory-grown,’’ ‘‘laboratory- mechanically-coated gold products, preamble, the Federal Trade created,’’ ‘‘[manufacturer name]- silver products, and platinum products. Commission revises 16 CFR part 23 to created,’’ ‘‘synthetic’’) if they clearly Thus, with this revision, bracelet and read as follows: and conspicuously convey that the necklace snap tongues appear in each product is not a mined stone. section addressing assay exemptions.21 PART 23—GUIDES FOR THE JEWELRY, PRECIOUS METALS, AND Treatments to Pearl Products Products and Claims Not Addressed PEWTER INDUSTRIES Based on the comments, the final The final Guides do not make some Sec. Guides include a new section (Section revisions that commenters sought. 23.0 Scope and application. 23.23) advising that marketers disclose Specifically, the final Guides do not 23.1 Deception (general). clearly and conspicuously treatments to 23.2 Misuse of the terms ‘‘handmade,’’ and cultured pearls that: (a) Are expand the existing guidance to address ‘‘hand-polished,’’ etc. not permanent, (b) create special care products made with , use of 23.3 Misrepresentation as to gold content. requirements, or (c) significantly affect the term ‘‘natural’’ to describe treated 23.4 Misuse of the word ‘‘vermeil.’’ value.19 gemstones, or the use of geographic and 23.5 Misrepresentation as to silver content. regional identifiers because the 23.6 Misuse of the words ‘‘platinum,’’ Use of the Term ‘‘Gem’’ ‘‘iridium,’’ ‘‘palladium,’’ ‘‘ruthenium,’’ evidence does not demonstrate that ‘‘rhodium,’’ and ‘‘osmium.’’ The final Guides eliminate two amendments are necessary to prevent 23.7 Disclosure of surface-layer application provisions that discussed use of the deception. For the same reason, the of rhodium. word ‘‘gem’’ because they are not Commission declines to make revisions 23.8 Misrepresentation as to products necessary to prevent deception. addressing diamond-related issues such containing more than one precious Specifically, the final Guides do not as use of the terms ‘‘blue white,’’ metal. include the former Section 23.25 23.9 Misrepresentation as to content of ‘‘ethical’’ and ‘‘conflict free,’’ as well as pewter. (Misuse of the word ‘‘gem’’) and Section grading and appraisals. Furthermore, 23.10 Additional guidance for the use of 23.20(j) (misuse of the word ‘‘gem’’ as to the final Guides do not expand the quality marks. pearls). Instead, they include the term guidance regarding ‘‘handmade’’ and 23.11 Misuse of ‘‘corrosion proof,’’ ‘‘non- ‘‘gem’’ in Section 23.25 (Misuse of the similar terms specifically to include or corrosive,’’ ‘‘corrosion resistant,’’ ‘‘rust words ‘‘,’’ ‘‘,’’ ‘‘emerald,’’ proof,’’ ‘‘rust resistant,’’ etc. exclude hand-cast items because the 23.12 Definition and misuse of the word ‘‘, ‘‘stone,’’ ‘‘,’’ Commission lacks sufficient evidence ‘‘gemstone,’’ etc.). ‘‘diamond.’’ on which to base new guidance.22 For 23.13 Misuse of the words ‘‘flawless,’’ Misleading Illustrations the same reason, the Guides do not ‘‘perfect,’’ etc. 23.14 Disclosure of treatments to diamonds. To streamline the guidance, the final address whether marketers may non- deceptively describe ‘‘large-scale’’ and 23.15 Misuse of the term ‘‘blue white.’’ Guides also eliminate a section that 23.16 Misuse of the term ‘‘properly cut,’’ discussed misleading illustrations etc. (former Section 23.2) because it 20 The distinctions between these lab-created 23.17 Misuse of the words ‘‘brilliant’’ and diamonds and mined stones are addressed ‘‘full cut.’’ provided guidance already addressed in elsewhere in the Guides. See Sections 23.12(c)(3) other areas: Section 23.1 (Deception 23.18 Misrepresentation of weight and and 23.25. ‘‘total weight.’’ (general)) and Section 23.0 (Scope and 21 Furthermore, the Commission removes an 23.19 Definitions of various pearls. application). To preserve its specific outdated provision in paragraph (e) of the 23.20 Misuse of the word ‘‘pearl.’’ guidance regarding diamond Appendix regarding platinum. The provision listed 23.21 Misuse of terms such as ‘‘cultured illustrations and gemstone size, additional exemptions for items marked in pearl,’’ ‘‘seed pearl,’’ ‘‘Oriental pearl,’’ however, the former Note to Section accordance with guidance that once addressed ‘‘natura,’’ ‘‘kultured,’’ ‘‘real,’’ ‘‘gem,’’ products containing less than 500 PPT platinum. ‘‘synthetic,’’ and regional designations. 23.2 has been transferred to Section Because the Commission eliminated this guidance 23.22 Misrepresentation as to cultured 23.1. in a prior proceeding, the corresponding list of assay exemptions is no longer necessary. See 62 FR pearls. Diamond Definition 16669, 16674 (Apr. 8, 1997). The final Appendix 23.23 Disclosure of treatments to pearls and cultured pearls. Based on changes in the market, the therefore retains the exemptions for platinum products, but does not include additional 23.24 Disclosure of treatments to final Guides eliminate the word exemptions for products with less than 500 PPT. gemstones. ‘‘natural’’ from the definition of 22 The Commission does, however, add precious metal clays, ingots, and grain to the ‘‘raw 23 Additionally, the Commission declines to make 19 This new section tracks the existing guidance materials’’ listed in the Note to this section (Section changes regarding the use of parts per thousand, regarding gemstone treatments. 23.2). instead of karats, for gold content disclosures.

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23.25 Misuse of the words ‘‘ruby,’’ member makes a claim inconsistent decoration were accomplished by hand ‘‘sapphire,’’ ‘‘emerald,’’ ‘‘topaz,’’ with the guides. In any such labor and manually-controlled methods ‘‘stone,’’ ‘‘birthstone,’’ ‘‘gemstone,’’ etc. enforcement action, the Commission which permit the maker to control and 23.26 Misrepresentation as to varietal name. must prove that the challenged act or 23.27 Misuse of the words ‘‘real,’’ vary the construction, shape, design, ‘‘genuine,’’ ‘‘natural,’’ ‘‘precious,’’ etc. practice is unfair or deceptive in and finish of each part of each 23.28 Misuse of the words ‘‘flawless,’’ violation of Section 5 of the FTC Act. individual product. ‘‘perfect,’’ etc. (e) The guides consist of general Note to Paragraph (a): As used herein, Appendix to Part 23—Exemptions principles, specific guidance on the use ‘‘raw materials’’ include bulk sheet, strip, Recognized in the Assay for Quality of of particular claims for industry wire, precious metal clays, ingots, casting Gold Alloy, Gold Filled, Gold Overlay, products, and examples. Claims may grain, and similar items that have not been Rolled Gold Plate, Silver, and Platinum raise issues that are addressed by more cut, shaped, or formed into jewelry parts, Industry Products than one example and in more than one semi-finished parts, or blanks. Authority: 15 U.S.C. 45, 46. section of the guides. The examples (b) It is unfair or deceptive to § 23.0 Scope and application. provide the Commission’s views on how represent, directly or by implication, reasonable consumers likely interpret (a) The guides in this part apply to that any industry product is hand- certain claims. Industry members may jewelry industry products, which forged, hand-engraved, hand-finished, use an alternative approach if the include, but are not limited to, the or hand-polished, or has been otherwise approach satisfies the requirements of following: Gemstones and their hand-processed, unless the operation Section 5 of the FTC Act. Whether a laboratory-created and imitation described was accomplished by hand particular claim is deceptive will substitutes; natural and cultured pearls labor and manually-controlled methods depend on the net impression of the and their imitations; and metallic which permit the maker to control and advertisement, label, or other bands not permanently attached to vary the type, amount, and effect of promotional material at issue. In . These guides also apply to such operation on each part of each addition, although many examples articles, including optical frames, pens individual product. present specific claims and options for and pencils, flatware, and hollowware, qualifying claims, the examples do not § 23.3 Misrepresentation as to gold fabricated from precious metals (gold, illustrate all permissible claims or content. silver, and platinum group metals), qualifications under Section 5 of the precious metal alloys, and their (a) It is unfair or deceptive to FTC Act. imitations. These guides also apply to misrepresent the presence of gold or all articles made from pewter. For the § 23.1 Deception (general). gold alloy in an industry product, or the quantity or karat fineness of gold or gold purposes of these guides, all articles It is unfair or deceptive to covered by these guides are defined as alloy contained in the product, or the misrepresent the type, kind, grade, karat fineness, thickness, weight ratio, ‘‘industry products.’’ quality, quantity, metallic content, size, (b) These guides apply to persons, or manner of application of any gold or weight, cut, color, character, treatment, gold alloy plating, covering, or coating partnerships, or corporations, at every substance, durability, serviceability, level of the trade (including but not on any surface of an industry product or origin, price, value, preparation, part thereof. limited to manufacturers, suppliers, and production, manufacture, distribution, (b) The following are examples of retailers) engaged in the business of or any other material aspect of an markings or descriptions that may be offering for sale, selling, or distributing industry product. industry products. misleading: 24 Note 1 to § 23.1: If, in the sale or offering Note to Paragraph (b): To prevent (1) Use of the word ‘‘Gold’’ or any for sale of an industry product, any abbreviation, without qualification, to consumer deception, persons, partnerships, representation is made as to the grade or corporations in the business of appraising, assigned the product, the identity of the describe all or part of an industry identifying, or grading industry products grading system used should be disclosed. product, including the surface layer of should utilize the terminology and standards a coated product, which is not set forth in the guides. Note 2 to § 23.1: To prevent deception, any composed throughout of fine (24 karat) (c) These guides apply to claims and qualifications or disclosures, such as those gold. representations about industry products described in the guides, should be (2) Use of the word ‘‘Gold’’ or any sufficiently clear and prominent. Clarity of included in labeling, advertising, language, relative type size and proximity to abbreviation to describe all or part of an promotional materials, and all other the claim being qualified, and an absence of industry product (including the surface forms of marketing, whether asserted contrary claims that could undercut layer of a coated product) composed directly or by implication, through effectiveness, will maximize the likelihood throughout of an alloy of gold (i.e., gold words, symbols, emblems, logos, that the qualifications and disclosures are that is less than 24 karats), unless a illustrations, depictions, product brand appropriately clear and prominent. correct designation of the karat fineness of the alloy immediately precedes the names, or through any other means. Note 3 to § 23.1: An illustration or (d) These guides set forth the Federal depiction of a diamond or other gemstone word ‘‘Gold’’ or its abbreviation, and Trade Commission’s current thinking that portrays it in greater than its actual size such fineness designation is of at least about claims for jewelry and articles may mislead consumers, unless a disclosure equal conspicuousness. made from precious metals and pewter. is made about the item’s true size. (3) Use of the word ‘‘Gold’’ or any The guides help marketers and other abbreviation to describe all or part of an industry members avoid making claims § 23.2 Misuse of the terms ‘‘handmade,’’ industry product that is not composed that are unfair or deceptive under ‘‘hand-polished,’’ etc. throughout of gold or a gold alloy, but Section 5 of the FTC Act, 15 U.S.C. 45. (a) It is unfair or deceptive to is surface-plated or coated with gold They do not confer any rights on any represent, directly or by implication, alloy, unless the word ‘‘Gold’’ or its person and do not operate to bind the that any industry product is handmade abbreviation is adequately qualified to FTC or the public. The Commission, or hand-wrought unless the entire however, may take action under the FTC shaping and forming of such product 24 See paragraph (c) of this section for examples Act if a marketer or other industry from raw materials and its finishing and of acceptable markings and descriptions.

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indicate that the product or part is only immediately preceded by a correct ‘‘14K. R.G.P.’’). When such plating surface-plated. designation of the karat fineness of the constitutes at least 1/20th of the weight (4) Marking, describing, or otherwise alloy that is of at least equal of the metal in the entire article, the representing all or part of an industry conspicuousness as the term used. term ‘‘Gold Filled’’ may be used. The product as being plated or coated with (9) Use of any name, terminology, or terms ‘‘Gold Overlay,’’ ‘‘Rolled Gold gold or gold alloy unless all significant other term to misrepresent that an Plate,’’ and ‘‘Rolled Gold Plated’’ may surfaces of the product or part contain industry product is equal or superior to, be used when the karat fineness a plating or coating of gold or gold alloy or different than, a known and designation is immediately preceded by that is of reasonable durability.25 established type of industry product a fraction accurately disclosing the (5) Use of the term ‘‘Gold Plate,’’ with reference to its gold content or portion of the weight of the metal in the ‘‘Gold Plated,’’ or any abbreviation to method of manufacture. entire article accounted for by the describe all or part of an industry (c) The following are examples of plating, and when such fraction is of product unless such product or part markings and descriptions that are equal conspicuousness as the term used contains a surface-plating of gold alloy, consistent with the principles described (for example, ‘‘1/40th 12 Kt. Rolled Gold applied by any process, which is of such above: Plate’’ or ‘‘1/40 12 Kt. R.G.P.’’). thickness and extent of surface coverage (1) An industry product or part (3) An industry product or part that reasonable durability 26 is assured, thereof, composed throughout of an thereof on which there has been affixed and unless the term is immediately alloy of gold may be marked and on all significant surfaces by an preceded by a correct designation of the described as ‘‘Gold’’ when such word electrolytic process an electroplating of karat fineness of the alloy that is of at ‘‘Gold,’’ wherever appearing, is gold, or of a gold alloy of not less than least equal conspicuousness as the term immediately preceded by a correct 10 karat fineness, which is of reasonable used. designation of the karat fineness of the durability 30 and has a minimum (6) Use of the terms ‘‘Gold Filled,’’ alloy, and such karat designation is of thickness throughout equivalent to ‘‘Rolled Gold Plate,’’ ‘‘Rolled Gold equal conspicuousness as the word 0.175 microns (approximately 7/ Plated,’’ ‘‘Gold Overlay,’’ or any ‘‘Gold’’ (for example, ‘‘14 Karat Gold,’’ 1,000,000ths of an inch) of fine gold,31 abbreviation to describe all or part of an ‘‘14 K. Gold,’’ ‘‘14 Kt. Gold,’’ ‘‘9 Karat may be marked or described as ‘‘Gold industry product unless such product or Gold,’’ or ‘‘9 Kt. Gold’’). Such product Plate,’’ ‘‘Gold Plated,’’ ‘‘Gold part contains a surface-plating of gold may also be marked and described by a Electroplate’’ or ‘‘Gold Electroplated,’’ alloy applied by a mechanical process designation of the karat fineness of the or so abbreviated, if the term is and of such thickness and extent of gold alloy unaccompanied by the word immediately preceded by a designation surface coverage that reasonable ‘‘Gold’’ (for example, ‘‘14 Karat,’’ 27 of the karat fineness of the plating durability is assured, and unless the ‘‘14Kt.,’’ ‘‘14 K.,’’ or ‘‘9 K.’’). which is of equal conspicuousness as term is immediately preceded by a Note to Paragraph (c)(1): Use of the term the term used (e.g., ‘‘12 Karat Gold correct designation of the karat fineness ‘‘Gold’’ or any abbreviation to describe all or Electroplate’’ or ‘‘12K G.E.P.’’). When of the alloy that is of at least equal part of a product that is composed the electroplating is of the minimum conspicuousness as the term used. throughout of gold alloy, but contains a fineness specified above and of a (7) Use of the terms ‘‘Gold Plate,’’ hollow center or interior, may mislead minimum thickness throughout ‘‘Gold Plated,’’ ‘‘Gold Filled,’’ ‘‘Rolled consumers, unless the fact that the product equivalent to two and one half (21⁄2) Gold Plate,’’ ‘‘Rolled Gold Plated,’’ contains a hollow center is disclosed in microns (or approximately 100/ ‘‘Gold Overlay,’’ or any abbreviation to immediate proximity to the term ‘‘Gold’’ or 1,000,000ths of an inch) of fine gold, the describe a product in which the layer of its abbreviation (for example, ‘‘14 Karat Gold- Hollow Center,’’ or ‘‘14 K. Gold Tubing,’’ marking or description may be ‘‘Heavy gold plating has been covered with a when of a gold alloy tubing of such karat Gold Electroplate’’ or ‘‘Heavy Gold (such as nickel), which is fineness). Such products should not be Electroplated.’’ When electroplatings covered with a thin wash of gold, unless marked or described as ‘‘solid’’ or as being qualify for the term ‘‘Gold Electroplate’’ there is a disclosure that the primary solidly of gold or of a gold alloy. For (or ‘‘Gold Electroplated’’), or the term gold coating is covered with a base example, when the composition of such a ‘‘Heavy Gold Electroplate’’ (or ‘‘Heavy metal, which is gold washed. product is 14 karat gold alloy, it should not (8) Use of the term ‘‘Gold be described or marked as either ‘‘14 Kt. Gold Electroplated’’), and have been Electroplate,’’ ‘‘Gold Electroplated,’’ or Solid Gold’’ or as ‘‘Solid 14 Kt. Gold.’’ applied by use of a particular kind of any abbreviation to describe all or part (2) An industry product or part electrolytic process, the marking may be of an industry product unless such thereof on which there has been affixed accompanied by identification of the product or part is electroplated with on all significant surfaces by , process used, as for example, ‘‘Gold gold or a gold alloy and such brazing, welding, or other mechanical Electroplated (X Process)’’ or ‘‘Heavy electroplating is of such karat fineness, means a plating of gold alloy of not less Gold Electroplated (Y Process).’’ (d) The provisions of this section thickness, and extent of surface than 10 karat fineness and of reasonable relating to markings and descriptions of coverage that reasonable durability 28 is durability 29 may be marked or industry products and parts thereof are assured, and unless the term is described as ‘‘Gold Plate,’’ ‘‘Gold Plated,’’ ‘‘Gold Overlay,’’ ‘‘Rolled Gold subject to the applicable tolerances of the National Stamping Act or any 25 For the purpose of this section, ‘‘reasonable Plate,’’ ‘‘Rolled Gold Plated,’’ or an 32 durability’’ means that all areas of the plating are adequate abbreviation, when such amendment thereof. sufficiently thick to assure coverage that reasonable plating constitutes at least 1/40th of the consumers would expect from the surface 30 weight of the metal in the entire article See footnote 2. application. Since industry products include items 31 A product containing 1 micron (otherwise having surfaces and parts of surfaces that are and when the term is immediately known as 1m) of 12 karat gold is equivalent to one- subject to different degrees of wear, the thickness preceded by a designation of the karat half micron of 24-karat gold. of the surface application for all items or for fineness of the plating which is of equal 32 Under the National Stamping Act, articles or different areas of the surface of individual items conspicuousness as the term used (for parts made of gold or of gold alloy that contain no does not necessarily have to be uniform. solder have a permissible tolerance of three parts 26 See footnote 2. example, ‘‘14 Kt. Gold Overlay,’’ or per thousand. If the part tested contains solder, the 27 See footnote 2. permissible tolerance is seven parts per thousand. 28 See footnote 2. 29 See footnote 2. For full text, see 15 U.S.C. 295, et seq.

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Note to Paragraph (d): Exemptions product unless it is at least 900/1,000ths (2) Marking, describing, or otherwise recognized in the assay of karat gold industry pure silver. representing all or part of an industry products and in the assay of gold filled, gold (4) Use of the word ‘‘silver’’ to mark, product as being plated or coated with overlay, and rolled gold plate industry describe, or otherwise represent all or platinum unless all significant surfaces products, and not to be considered in any of the product or part contain a plating assay for quality, are listed in the appendix. part of an industry product that is not composed throughout of silver, but has or coating of platinum that is of reasonable durability.37 § 23.4 Misuse of the word ‘‘vermeil.’’ a surface layer or coating of silver, unless the term is adequately qualified (3) Use of the word ‘‘Platinum’’ or any (a) It is unfair or deceptive to to indicate that the product or part is abbreviation, without qualification, to represent, directly or by implication, only coated. describe all or part of an industry that an industry product is ‘‘vermeil’’ if (5) Marking, describing, or otherwise product (including the surface layer of such mark or description misrepresents representing all or part of an industry a coated product) that is not composed the product’s true composition. product as being plated or coated with throughout of 950 parts per thousand (b) An industry product may be silver unless all significant surfaces of pure Platinum. described or marked as ‘‘vermeil’’ if it the product or part contain a plating or (4) Use of the word ‘‘Platinum’’ or any consists of a base of sterling silver coating of silver that is of reasonable abbreviation accompanied by a number coated or plated on all significant durability.34 indicating the parts per thousand of surfaces with gold, or gold alloy of not (c) The provisions of this section pure Platinum contained in the product less than 10 karat fineness, that is of without mention of the number of parts 33 relating to markings and descriptions of reasonable durability and a minimum industry products and parts thereof are per thousand of other PGM contained in thickness throughout equivalent to two subject to the applicable tolerances of the product, to describe all or part of an 1 2 industry product that is not composed and one half (2 ⁄ ) microns (or the National Stamping Act or any throughout of at least 850 parts per approximately 100/1,000,000ths of an amendment thereof.35 inch) of fine gold. thousand pure platinum, for example, Note 1 to § 23.5: The National Stamping Note 1 to § 23.4: It is unfair or deceptive ‘‘600Plat.’’ Act provides that silver plated articles shall (5) Use of the word ‘‘Platinum’’ or any to use the term ‘‘vermeil’’ to describe a not ‘‘be stamped, branded, engraved or product in which the sterling silver has been abbreviation thereof, to mark or describe imprinted with the word ‘sterling’ or the any product that is not composed covered with a base metal (such as nickel) word ‘coin,’ either alone or in conjunction plated with gold unless there is a disclosure with other words or marks.’’ 15 U.S.C. 297(a). throughout of at least 500 parts per that the sterling silver is covered with a base thousand pure Platinum. metal that is plated with gold. Note 2 to § 23.5: Exemptions recognized in (6) Use of the word ‘‘Platinum,’’ or the assay of silver industry products are any abbreviation accompanied by a Note 2 to § 23.4: Exemptions recognized in listed in the appendix. number or percentage indicating the the assay of gold filled, gold overlay, and parts per thousand of pure Platinum rolled gold plate industry products are listed § 23.6 Misuse of the words ‘‘platinum,’’ in the appendix. contained in the product, to describe all ‘‘iridium,’’ ‘‘palladium,’’ ‘‘ruthenium,’’ or part of an industry product that ‘‘rhodium,’’ and ‘‘osmium.’’ § 23.5 Misrepresentation as to silver contains at least 500 parts per thousand, content. (a) It is unfair or deceptive to use the but less than 850 parts per thousand, words ‘‘platinum,’’ ‘‘iridium,’’ pure Platinum, and does not contain at (a) It is unfair or deceptive to ‘‘palladium,’’ ‘‘ruthenium,’’ ‘‘rhodium,’’ least 950 parts per thousand PGM (for misrepresent that an industry product and ‘‘osmium,’’ or any abbreviation to example, ‘‘585 Plat.’’) without a clear contains silver, or to misrepresent an mark or describe all or part of an and conspicuous disclosure, industry product as having a silver industry product if such marking or immediately following the name or content, plating, electroplating, or description misrepresents the product’s description of such product: coating. true composition. The Platinum Group (i) Of the full composition of the (b) The following are examples of Metals (PGM) are Platinum, Iridium, product (by name and not abbreviation) markings or descriptions that may be Palladium, Ruthenium, Rhodium, and and percentage of each metal; and misleading: Osmium. (ii) That the product may not have the (1) Use of the unqualified word (b) The following are examples of same attributes or properties as ‘‘silver’’ to mark, describe, or otherwise markings or descriptions that may be traditional platinum products. Provided, represent all or part of an industry misleading: 36 however, that the marketer need not product, including the surface layer of (1) Use of the word ‘‘Platinum’’ or any make disclosure under this paragraph a coated product, unless an equally abbreviation to describe all or part of a (b)(6)(ii), if the marketer has competent conspicuous, accurate quality fineness product that is not composed and reliable scientific evidence that designation indicating the pure silver throughout of platinum, but has a such product does not differ materially content in parts per thousand surface layer or coating of platinum, from any one product containing at least immediately precedes the term (e.g., unless the word ‘‘Platinum’’ or its 850 parts per thousand pure Platinum ‘‘750 silver’’). abbreviation is adequately qualified to with respect to the following attributes (2) Use of the words ‘‘solid silver,’’ indicate that the product or part is only or properties: Durability, luster, , ‘‘Sterling Silver,’’ ‘‘Sterling,’’ or the coated. scratch resistance, tarnish resistance, abbreviation ‘‘Ster.’’ to mark, describe, hypoallergenicity, ability to be resized or otherwise represent all or part of an 34 or repaired, retention of precious metal industry product unless it is at least See footnote 2. 35 Under the National Stamping Act, sterling over time, and any other attribute or 925/1,000ths pure silver. silver articles or parts that contain no solder have property material to consumers. (3) Use of the words ‘‘coin’’ or ‘‘coin a permissible tolerance of four parts per thousand. Note to Paragraph (b)(6): When using silver’’ to mark, describe, or otherwise If the part tested contains solder, the permissible tolerance is ten parts per thousand. For full text, see percentages to qualify platinum represent all or part of an industry 15 U.S.C. 294, et seq. representations, marketers should convert the 36 See paragraph (c) of this section for examples 33 See footnote 2. of acceptable markings and descriptions. 37 See footnote 2.

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amount in parts per thousand to a percentage each precious metal in a product that ‘‘iridium,’’ ‘‘palladium,’’ ‘‘ruthenium,’’ that is accurate to the first decimal place contains more than than one precious ‘‘rhodium,’’ or ‘‘osmium,’’ or any (e.g., ‘‘58.5% Platinum, 41.5% Cobalt’’). metal. Marketers should list precious abbreviations thereof, whether used (c) The following are examples of metals in the order of their relative alone or in conjunction with the words markings and descriptions that are not weight in the product from greatest to ‘‘filled,’’ ‘‘plated,’’ ‘‘overlay,’’ or considered unfair or deceptive: least (i.e., leading with the predominant ‘‘electroplated,’’ or any abbreviations (1) The following abbreviations for metal). Listing precious metals in order thereof. Quality markings include those each of the PGM may be used for quality of relative weight is not necessary where in which the words or terms ‘‘gold,’’ marks on articles: ‘‘Plat.’’ or ‘‘Pt.’’ for it is clear to reasonable consumers from ‘‘karat,’’ ‘‘silver,’’ ‘‘vermeil,’’ ‘‘platinum’’ Platinum; ‘‘Irid.’’ or ‘‘Ir.’’ for Iridium; context that the metal listed first is not (or platinum group metals), or their ‘‘Pall.’’ or ‘‘Pd.’’ for Palladium; ‘‘Ruth.’’ predominant. abbreviations are included, either or ‘‘Ru.’’ for Ruthenium; ‘‘Rhod.’’ or (b) The following are examples of separately or as suffixes, prefixes, or ‘‘Rh.’’ for Rhodium; and ‘‘Osmi.’’ or markings or descriptions that may be syllables. ‘‘Os.’’ for Osmium. misleading: (a) Deception as to applicability of (2) An industry product consisting of (1) Use of the terms ‘‘Platinum + marks. (1) If a quality mark on an at least 950 parts per thousand pure Silver’’ to describe a product that industry product is applicable to only Platinum may be marked or described as contains more silver than platinum by part of the product, the part of the ‘‘Platinum.’’ weight. product to which it is applicable (or (3) An industry product consisting of (2) Use of the terms ‘‘14K/Sterling’’ to inapplicable) should be disclosed when, 850 parts per thousand pure Platinum, describe a product that contains more absent such disclosure, the location of 900 parts per thousand pure Platinum, silver than gold by weight. the mark misrepresents the product or or 950 parts per thousand pure Platinum (c) The following are examples of part’s true composition. may be marked ‘‘Platinum,’’ provided markings and descriptions that are not (2) If a quality mark is applicable to that the Platinum marking is preceded considered unfair or deceptive: only part of an industry product, but not by a number indicating the amount in (1) For a product comprised primarily another part which is of similar surface parts per thousand of pure Platinum (for of silver with a surface-layer application appearance, each quality mark should industry products consisting of 950 of platinum, ‘‘900 platinum over silver.’’ be closely accompanied by an parts per thousand pure Platinum, the (2) For a product comprised primarily identification of the part or parts to marking described in § 23.7(b)(2) above of silver with visually distinguishable which the mark is applicable. is also appropriate). Thus, the following parts of gold, ‘‘14k gold-accented (b) Deception by reason of difference markings may be used: ‘‘950Pt.,’’ silver.’’ in the size of letters or words in a ‘‘950Plat.,’’ ‘‘900Pt.,’’ ‘‘900Plat.,’’ (3) For a product comprised primarily marking or markings. It is unfair or ‘‘850Pt.,’’ or ‘‘850Plat.’’ of gold with visually distinguishable deceptive to place a quality mark on a (4) An industry product consisting of parts of platinum, ‘‘850 Platinum inset, product in which the words or letters at least 950 parts per thousand PGM, 14K gold .’’ appear in greater size than other words and of at least 500 parts per thousand or letters of the mark, or when different pure Platinum, may be marked § 23.9 Misrepresentation as to content of markings placed on the product have pewter. ‘‘Platinum,’’ provided that the mark of different applications and are in each PGM constituent is preceded by a (a) It is unfair or deceptive to mark, different sizes, when the net impression number indicating the amount in parts describe, or otherwise represent all or of any such marking would be per thousand of each PGM (e.g., part of an industry product as ‘‘Pewter’’ misleading as to the metallic ‘‘600Pt.350Ir.,’’ ‘‘600Plat.350Irid.,’’ or any abbreviation if such mark or composition of all or part of the ‘‘550Pt.350Pd.50Ir.,’’ or description misrepresents the product’s product. (An example of improper ‘‘550Plat.350Pall.50Irid’’). true composition. marking would be the marking of a gold (5) An industry product consisting of (b) An industry product or part electroplated product with the word at least 500 parts per thousand, but less thereof may be described or marked as ‘‘electroplate’’ in small type and the than 850 parts per thousand, pure ‘‘Pewter’’ or any abbreviation if it word ‘‘gold’’ in larger type, with the Platinum, and not consisting of at least consists of at least 900 parts per 1,000 result that purchasers and prospective 950 parts per thousand PGM, may be Grade A Tin, with the remainder purchasers of the product might only marked or stamped accurately, with a composed of metals appropriate for use observe the word ‘‘gold.’’) quality marking on the article, using in pewter. parts per thousand and standard Note 1 to § 23.10: Legibility of markings. If chemical abbreviations (e.g., ‘‘585 Pt., § 23.10 Additional guidance for the use of a quality mark is engraved or stamped on an quality marks. industry product, or is printed on a tag or 415 Co.’’). As used in these guides, the term label attached to the product, the quality Note to § 23.6: Exemptions recognized in quality mark means any letter, figure, mark should be of sufficient size type as to the assay of platinum industry products are be legible to persons of normal vision, should listed in the appendix. numeral, symbol, sign, word, or term, or be so placed as likely to be observed by any combination thereof, that has been purchasers, and should be so attached as to § 23.7 Disclosure of surface-layer stamped, embossed, inscribed, or remain thereon until consumer purchase. application of rhodium. otherwise placed on any industry Note 2 to § 23.10: Disclosure of identity of It is unfair or deceptive to fail to product and which indicates or suggests that any such product is composed manufacturers, processors, or distributors. disclose a surface-layer application of The National Stamping Act provides that any rhodium on products marked or throughout of any precious metal or any precious metal alloy or has a surface or person, firm, corporation, or association, described as precious metal. being a manufacturer or dealer subject to surfaces on which there has been plated section 294 of the Act, who applies or causes § 23.8 Misrepresentation as to products or deposited any precious metal or to be applied a quality mark, or imports any containing more than one precious metal. precious metal alloy. Included are the article bearing a quality mark ‘‘which (a) It is unfair or deceptive to words ‘‘gold,’’ ‘‘karat,’’ ‘‘,’’ ‘‘silver,’’ indicates or purports to indicate that such misrepresent the relative quantity of ‘‘sterling,’’ ‘‘vermeil,’’ ‘‘platinum,’’ article is made in whole or in part of gold

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or silver or of an alloy of either metal’’ shall number of and shape of the § 23.16 Misuse of the term ‘‘properly cut,’’ apply to the article the trademark or name of diamond or the name of a type of etc. such person. 15 U.S.C. 297. diamond that denotes shape and that It is unfair or deceptive to use the usually has less than seventeen (17) terms ‘‘properly cut,’’ ‘‘proper cut,’’ § 23.11 Misuse of ‘‘corrosion proof,’’ facets (e.g., ‘‘rose diamond’’). ‘‘modern cut,’’ or any representation of ‘‘noncorrosive,’’ ‘‘corrosion resistant,’’ ‘‘rust similar meaning to describe any proof,’’ ‘‘rust resistant,’’ etc. (3) The use of the word ‘‘cultured’’ to describe laboratory-created diamonds diamond that is lopsided, or is so thick (a) It is unfair or deceptive to: or so thin in depth as to detract (1) Use the terms ‘‘corrosion proof,’’ that have essentially the same optical, physical, and chemical properties as materially from the brilliance of the ‘‘noncorrosive,’’ ‘‘rust proof,’’ or any stone. other term of similar meaning to mined diamonds if the term is qualified describe an industry product unless all by a clear and conspicuous disclosure Note to § 23.16: Stones that are commonly called ‘‘fisheye’’ or ‘‘old mine’’ should not be parts of the product will be immune (for example, the words ‘‘laboratory- created,’’ ‘‘laboratory-grown,’’ described as ‘‘properly cut,’’ ‘‘modern cut,’’ from rust and other forms of corrosion etc. during the life expectancy of the ‘‘[manufacturer name]-created,’’ or some other word or phrase of like meaning) product; or § 23.17 Misuse of the words ‘‘brilliant’’ and (2) Use the terms ‘‘corrosion conveying that the product is not a ‘‘full cut.’’ mined stone. resistant,’’ ‘‘rust resistant,’’ or any other It is unfair or deceptive to use the term of similar meaning to describe an Note to Paragraph (c): Additional guidance unqualified expressions ‘‘brilliant,’’ industry product unless all parts of the about imitation and laboratory-created ‘‘brilliant cut,’’ or ‘‘full cut’’ to describe, product are of such composition as to diamond representations and misuse of the identify, or refer to any diamond except words ‘‘real,’’ ‘‘genuine,’’ ‘‘natural,’’ not be subject to material damage by a round diamond that has at least thirty- corrosion or rust during the major ‘‘precious,’’ ‘‘semi-precious,’’ and similar terms is set forth in §§ 23.25 and 23.27. two (32) facets plus the table above the portion of the life expectancy of the girdle and at least twenty-four (24) product under normal conditions of use. facets below. (b) Among the metals that may be § 23.13 Misuse of the words ‘‘flawless,’’ ‘‘perfect,’’ etc. considered as corrosion (and rust) Note to § 23.17: Such terms should not be applied to single or rose-cut diamonds. They resistant are: Pure nickel; gold alloys of (a) It is unfair or deceptive to use the may be applied to emerald-(rectangular) cut, not less than 10 Kt. fineness; and word ‘‘flawless’’ to describe any pear-shaped, heart-shaped, oval-shaped, and austenitic stainless steels. diamond that discloses flaws, cracks, marquise-(pointed oval) cut diamonds inclusions, spots, clouds, meeting the above-stated requirements § 23.12 Definition and misuse of the word when, in immediate conjunction with the ‘‘diamond.’’ internal lasering, or other blemishes or imperfections of any sort when term used, the form of the diamond is (a) A diamond is a consisting examined under a corrected magnifier at disclosed. essentially of pure carbon crystallized in 10-power, with adequate illumination, the isometric system. It is found in by a person skilled in diamond grading. § 23.18 Misrepresentation of weight and many colors. Its hardness is 10; its ‘‘total weight.’’ specific gravity is approximately 3.52; (b) It is unfair or deceptive to use the (a) It is unfair or deceptive to and it has a of 2.42. word ‘‘perfect,’’ or any representation of misrepresent the weight of a diamond. (b) It is unfair or deceptive to use the similar meaning, to describe any (b) It is unfair or deceptive to use the unqualified word ‘‘diamond’’ to diamond unless the diamond meets the word ‘‘point’’ or any abbreviation in any describe or identify any object or definition of ‘‘flawless’’ and is not of representation, advertising, marking, or product not meeting the requirements inferior color or make. labeling to describe the weight of a specified in the definition of diamond (c) It is unfair or deceptive to use the diamond, unless the weight is also provided above, or which, though words ‘‘flawless’’ or ‘‘perfect’’ to stated as decimal parts of a carat (e.g., meeting such requirements, has not describe a ring or other article of jewelry 25 points or .25 carat). been symmetrically fashioned with at having a ‘‘flawless’’ or ‘‘perfect’’ Note to Paragraph (b): A carat is a standard least seventeen (17) polished facets. principal diamond or diamonds, and unit of weight for a diamond and is 1 Note to Paragraph (b): It is unfair or supplementary stones that are not of equivalent to 200 milligrams ( ⁄5 gram). A deceptive to represent, directly or by such quality, unless there is a disclosure point is one one-hundredth (1/100) of a carat. implication, that industrial grade diamonds that the description applies only to the (c) If diamond weight is stated as or other non-jewelry quality diamonds are of principal diamond or diamonds. decimal parts of a carat (e.g., .47 carat), jewelry quality. § 23.14 Disclosure of treatments to the stated figure should be accurate to (c) The following are examples of diamonds. the last decimal place. If diamond descriptions that are not considered weight is stated to only one decimal unfair or deceptive: A diamond is a gemstone product. place (e.g., .5 carat), the stated figure (1) The use of the words ‘‘rough Treatments to diamonds should be should be accurate to the second diamond’’ to describe or designate disclosed in the manner prescribed in decimal place (e.g., ‘‘.5 carat’’ could uncut or unfaceted objects or products § 23.24 of these guides (Disclosure of represent a diamond weight between satisfying the definition of diamond treatments to gemstones). .495–.504). (d) If diamond weight is stated as provided above; or § 23.15 Misuse of the term ‘‘blue white.’’ (2) The use of the word ‘‘diamond’’ to fractional parts of a carat, a conspicuous describe or designate objects or products It is unfair or deceptive to use the disclosure of the fact that the diamond satisfying the definition of diamond but term ‘‘blue white’’ or any representation weight is not exact should be made in which have not been symmetrically of similar meaning to describe any close proximity to the fractional fashioned with at least seventeen (17) diamond that under normal, north representation and a disclosure of a polished facets when, in immediate daylight or its equivalent shows any reasonable range of weight for each conjunction with the word ‘‘diamond,’’ color or any trace of any color other fraction (or the weight tolerance being there is either a disclosure of the than blue or bluish. used) should also be made.

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Note to Paragraph (d): When fractional (d) It is unfair or deceptive to use the identifies, or refers to a cultured pearl representations of diamond weight are made, terms ‘‘faux pearl,’’ ‘‘ pearl,’’ formed in a salt water mollusk of the as described in paragraph (d) of this section, ‘‘Mother of Pearl,’’ or any other such Pacific Ocean South Sea Islands, in catalogs or other printed materials, the term to describe or qualify an imitation Australia, or Southeast Asia. disclosure of the fact that the actual diamond (h) It is unfair or deceptive to use the weight is within a specified range should be pearl product unless it is immediately made conspicuously on every page where a preceded, with equal conspicuousness, term ‘‘Biwa cultured pearl’’ unless it fractional representation is made. Such by the word ‘‘artificial,’’ ‘‘imitation,’’ or describes, identifies, or refers to disclosure may refer to a chart or other ‘‘simulated,’’ or by some other word or cultured pearls grown in fresh water detailed explanation of the actual ranges phrase of like meaning, so as to indicate mollusks in the lakes and rivers of used. For example, ‘‘Diamond weights are definitely and clearly that the product is Japan. not exact; see chart on p. X for ranges.’’ not a pearl. (i) It is unfair or deceptive to use the word ‘‘real,’’ ‘‘genuine,’’ ‘‘precious,’’ or § 23.19 Definitions of various pearls. § 23.21 Misuse of terms such as ‘‘cultured any word, term, or phrase of like pearl,’’ ‘‘seed pearl,’’ ‘‘Oriental pearl,’’ As used in these guides, the terms set meaning to describe, identify, or refer to ‘‘natura,’’ ‘‘kultured,’’ ‘‘real,’’ ‘‘synthetic,’’ and any imitation pearl. forth below have the following regional designations. meanings: (j) It is unfair or deceptive to use the (a) It is unfair or deceptive to use the word ‘‘synthetic’’ or similar terms to (a) Pearl: A calcareous concretion term ‘‘cultured pearl,’’ ‘‘cultivated describe cultured or imitation pearls. consisting essentially of alternating pearl,’’ or any other word, term, or (k) It is unfair or deceptive to use the concentric layers of carbonate of lime phrase of like meaning to describe, terms ‘‘Japanese Pearls,’’ ‘‘Chinese and organic material formed within the identify, or refer to any imitation pearl. Pearls,’’ ‘‘Mallorca Pearls,’’ or any body of certain mollusks, the result of (b) It is unfair or deceptive to use the regional designation to describe, an abnormal secretory process caused term ‘‘seed pearl’’ or any word, term, or identify, or refer to any cultured or by an irritation of the mantle of the phrase of like meaning to describe, imitation pearl, unless the term is mollusk following the intrusion of some identify, or refer to a cultured or an immediately preceded, with equal foreign body inside the shell of the imitation pearl, without using the conspicuousness, by the word mollusk, or due to some abnormal appropriate qualifying term ‘‘cultured’’ ‘‘cultured,’’ ‘‘artificial,’’ ‘‘imitation,’’ or physiological condition in the mollusk, (e.g., ‘‘cultured seed pearl’’) or ‘‘simulated,’’ or by some other word or neither of which has in any way been ‘‘simulated,’’ ‘‘artificial,’’ or ‘‘imitation’’ phrase of like meaning, so as to indicate caused or induced by humans. (e.g., ‘‘imitation seed pearl’’). definitely and clearly that the product is (b) Cultured pearl: The composite (c) It is unfair or deceptive to use the a cultured or imitation pearl. product created when a nucleus term ‘‘Oriental pearl’’ or any word, term, (usually a sphere of calcareous mollusk or phrase of like meaning to describe, § 23.22 Misrepresentation as to cultured pearls. shell) planted by humans inside the identify, or refer to any industry product shell or in the mantle of a mollusk is other than a pearl taken from a salt It is unfair or deceptive to coated with by the mollusk. water mollusk and of the distinctive misrepresent the manner in which (c) Imitation pearl: A manufactured appearance and type of pearls obtained cultured pearls are produced, the size of product composed of any material or from mollusks inhabiting the Persian the nucleus artificially inserted in the materials that simulate in appearance a Gulf and recognized in the jewelry trade mollusk and included in cultured pearl or cultured pearl. as Oriental pearls. pearls, the length of time that such (d) Seed pearl: A small pearl, as (d) It is unfair or deceptive to use the products remained in the mollusk, the defined in paragraph (a), that measures word ‘‘Oriental’’ to describe, identify, or thickness of the nacre coating, the value approximately two millimeters or less. refer to any cultured or imitation pearl. and quality of cultured pearls as (e) It is unfair or deceptive to use the compared with the value and quality of § 23.20 Misuse of the word ‘‘pearl.’’ word ‘‘natura,’’ ‘‘natural,’’ ‘‘nature’s,’’ or pearls and imitation pearls, or any other (a) It is unfair or deceptive to use the any word, term, or phrase of like material matter relating to the unqualified word ‘‘pearl’’ or any other meaning to describe, identify, or refer to formation, structure, properties, word or phrase of like meaning to a cultured or imitation pearl. It is unfair characteristics, and qualities of cultured describe, identify, or refer to any object or deceptive to use the term ‘‘organic’’ pearls. or product that is not in fact a pearl, as to describe, identify, or refer to an § 23.23 Disclosure of treatments to pearls defined in § 23.19(a). imitation pearl, unless the term is and cultured pearls. (b) It is unfair or deceptive to use the qualified in such a way as to make clear It is unfair or deceptive to fail to word ‘‘pearl’’ to describe, identify, or that the product is not a natural or disclose that a pearl or cultured pearl refer to a cultured pearl unless it is cultured pearl. has been treated if: immediately preceded, with equal (f) It is unfair or deceptive to use the (a) The treatment is not permanent. conspicuousness, by the word term ‘‘kultured,’’ ‘‘semi-cultured pearl,’’ The seller should disclose that the pearl ‘‘cultured’’ or ‘‘cultivated,’’ or by some ‘‘cultured-like,’’ ‘‘part-cultured,’’ or cultured pearl has been treated and other word or phrase of like meaning, so ‘‘premature cultured pearl,’’ or any that the treatment is or may not be as to indicate definitely and clearly that word, term, or phrase of like meaning to permanent; the product is not a pearl. describe, identify, or refer to an (b) The treatment creates special care (c) It is unfair or deceptive to use the imitation pearl. requirements for the pearl or cultured word ‘‘pearl’’ to describe, identify, or (g) It is unfair or deceptive to use the pearl. The seller should disclose that the refer to an imitation pearl unless it is term ‘‘South Sea pearl’’ unless it pearl or cultured pearl has been treated immediately preceded, with equal describes, identifies, or refers to a pearl and has special care requirements. It is conspicuousness, by the word that is taken from a salt water mollusk also recommended that the seller ‘‘artificial,’’ ‘‘imitation,’’ or ‘‘simulated,’’ of the Pacific Ocean South Sea Islands, disclose the special care requirements to or by some other word or phrase of like Australia, or Southeast Asia. It is unfair the purchaser; or meaning, so as to indicate definitely and or deceptive to use the term ‘‘South Sea (c) The treatment has a significant clearly that the product is not a pearl. cultured pearl’’ unless it describes, effect on the product’s value. The seller

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should disclose that the pearl or ‘‘imitation’’ or ‘‘simulated,’’ so as to (1) Use of the term ‘‘yellow emerald’’ cultured pearl has been treated. disclose clearly the nature of the to describe golden beryl or heliodor. Note to § 23.23: The disclosures outlined in product and the fact it is not a mined (2) Use of the term ‘‘green amethyst’’ this section are applicable to sellers at every gemstone. to describe prasiolite. level of trade, as defined in § 23.0(b) of these Note 1 to Paragraph (b): The use of the Note to § 23.26: A varietal name is given guides, and they may be made at the point word ‘‘faux’’ to describe a laboratory-created for a division of gem species or genus based of sale prior to sale, except that where a or imitation stone is not an adequate on a color, type of optical phenomenon, or product can be purchased without personally disclosure that the stone is not a mined other distinguishing characteristic of viewing the product (e.g., direct mail stone. appearance. catalogs, online services, televised shopping programs), disclosure should be made in the Note 2 to Paragraph (b): Marketers may use § 23.27 Misuse of the words ‘‘real,’’ solicitation for, or description of, the the word ‘‘cultured’’ to describe laboratory- ‘‘genuine,’’ ‘‘natural,’’ ‘‘precious,’’ etc. product. created gemstone products that have essentially the same optical, physical, and It is unfair or deceptive to use the word ‘‘real,’’ ‘‘genuine,’’ ‘‘natural,’’ § 23.24 Disclosure of treatments to chemical properties as the named stone if the gemstones. term (e.g., ‘‘cultured ruby’’) is qualified by a ‘‘precious,’’ ‘‘semi-precious,’’ or similar clear and conspicuous disclosure (for terms to describe any industry product It is unfair or deceptive to fail to example, the words ‘‘laboratory-created,’’ that is manufactured or produced disclose that a gemstone has been ‘‘laboratory-grown,’’ ‘‘[manufacturer name]- artificially. treated if: created,’’ or some other word or phrase of (a) The treatment is not permanent. like meaning) conveying that the product is § 23.28 Misuse of the words ‘‘flawless,’’ The seller should disclose that the not a mined stone. Additional guidance ‘‘perfect,’’ etc. gemstone has been treated and that the regarding the use of ‘‘cultured’’ to describe a (a) It is unfair or deceptive to use the treatment is or may not be permanent; laboratory-created diamond is set forth in word ‘‘flawless’’ as a quality description § 23.12(c)(3). (b) The treatment creates special care of any gemstone that discloses requirements for the gemstone. The (c) It is unfair or deceptive to use the blemishes, inclusions, or clarity faults of seller should disclose that the gemstone word ‘‘laboratory-grown,’’ ‘‘laboratory- any sort when examined under a has been treated and has special care created,’’ ‘‘[manufacturer name]- corrected magnifier at 10-power, with requirements. It is also recommended created,’’ ‘‘synthetic,’’ or other word or adequate illumination, by a person that the seller disclose the special care phrase of like meaning with the name of skilled in gemstone grading. requirements to the purchaser; or any natural stone to describe any (b) It is unfair or deceptive to use the (c) The treatment has a significant industry product unless such product word ‘‘perfect’’ or any representation of effect on the stone’s value. The seller has essentially the same optical, similar meaning to describe any should disclose that the gemstone has physical, and chemical properties as the gemstone unless the gemstone meets the been treated. stone named. definition of ‘‘flawless’’ and is not of Note to § 23.24: The disclosures outlined in (d) It is unfair or deceptive to describe inferior color or make. this section are applicable to sellers at every products made with gemstone material (c) It is unfair or deceptive to use the level of trade, as defined in § 23.0(b) of these and any amount of filler or binder, such word ‘‘flawless,’’ ‘‘perfect,’’ or any guides, and they may be made at the point as lead glass, in the following way: representation of similar meaning to of sale prior to sale, except that where a (1) With the unqualified word ‘‘ruby,’’ describe any imitation gemstone. product can be purchased without personally ‘‘sapphire,’’ ‘‘emerald,’’ ‘‘topaz,’’ or viewing the product (e.g., direct mail name of any other precious or semi- Appendix to Part 23—Exemptions catalogs, online services, televised shopping precious stone; Recognized in the Assay for Quality of programs), disclosure should be made in the (2) As a ‘‘treated ruby,’’ ‘‘treated Gold Alloy, Gold Filled, Gold Overlay, solicitation for, or description of, the sapphire,’’ ‘‘treated emerald,’’ ‘‘treated Rolled Gold Plate, Silver, and Platinum product. topaz,’’ or ‘‘treated [gemstone name]’’; Industry Products (3) As a ‘‘laboratory-grown [gemstone (a) Exemptions recognized in the industry § 23.25 Misuse of the words ‘‘ruby,’’ name],’’ ‘‘laboratory-created [gemstone ‘‘sapphire,’’ ‘‘emerald,’’ ‘‘topaz,’’ ‘‘stone,’’ and not to be considered in any assay for ‘‘birthstone,’’ ‘‘gem,’’ ‘‘gemstone,’’ etc. name],’’ ‘‘[manufacturer name]-created quality of a karat gold industry product [gemstone name],’’ ‘‘or ‘‘synthetic include springs, posts, and separable backs of (a) It is unfair or deceptive to use the [gemstone name];’’ or lapel buttons, posts and nuts for attaching unqualified words ‘‘ruby,’’ ‘‘sapphire,’’ (4) As a ‘‘composite [gemstone interchangeable ornaments, bracelet and ‘‘emerald,’’ ‘‘topaz,’’ or the name of any name],’’ ‘‘hybrid [gemstone name],’’ or necklace snap tongues, metallic parts other precious or semi-precious stone to ‘‘manufactured [gemstone name],’’ completely and permanently encased in a describe any product that is not in fact nonmetallic covering, field pieces and bezels unless the term is qualified to disclose for lockets,38 and wire pegs or rivets used for a mined stone of the type described. clearly and conspicuously that the (b) It is unfair or deceptive to use the applying mountings and other ornaments, product: (A) Does not have the same word ‘‘ruby,’’ ‘‘sapphire,’’ ‘‘emerald,’’ which mountings or ornaments shall be of characteristics as the named stone; and ‘‘topaz,’’ or the name of any other the quality marked. (B) requires special care. It is further precious or semi-precious stone, or the Note to Paragraph (a): Exemptions recommended that the seller disclose recognized in the industry and not to be word ‘‘stone,’’ ‘‘birthstone,’’ ‘‘gem,’’ the special care requirements to the considered in any assay for quality of a karat ‘‘gemstone,’’ or similar term to describe purchaser. gold optical product include: the hinge a laboratory-grown, laboratory-created, assembly (barrel or other special types such [manufacturer name]-created, synthetic, § 23.26 Misrepresentation as to varietal as are customarily used in plastic frames); imitation, or simulated stone, unless name. washers, bushings, and nuts of screw such word or name is immediately (a) It is unfair or deceptive to mark or assemblies; dowels; springs for spring shoe preceded with equal conspicuousness describe an industry product with the by the word ‘‘laboratory-grown,’’ incorrect varietal name. 38 Field pieces of lockets are those inner portions used as frames between the inside edges of the ‘‘laboratory-created,’’ ‘‘[manufacturer (b) The following are examples of locket and the spaces for holding pictures. Bezels name]-created,’’ or some other word or markings or descriptions that may be are the separable inner metal rings to hold the phrase of like meaning, or by the word misleading: pictures in place.

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straps; metal parts permanently encased in a DEPARTMENT OF HOMELAND comments received, go to http:// non-metallic covering; and for oxfords,39 coil SECURITY www.regulations.gov. Submitted and joint springs. comments may also be inspected during (b) Exemptions recognized in the industry U.S. Customs and Border Protection business days between the hours of 9:00 and not to be considered in any assay for a.m. and 4:30 p.m. at the Trade and quality of a gold filled, gold overlay and DEPARTMENT OF THE TREASURY Commercial Regulations Branch, rolled gold plate industry product, other than Regulations and Rulings, Office of watchcases, include joints, catches, screws, 19 CFR Part 24 pin stems, pins of scarf pins, hat pins, etc., Trade, U.S. Customs and Border field pieces and bezels for lockets, posts and [CBP Dec. 18–09; Docket No. USCBP–2018– Protection, 90 K Street NE, 10th Floor, separate backs of lapel buttons, bracelet and 0033] Washington, DC. Arrangements to necklace snap tongues, springs, and metallic inspect submitted comments should be RIN 1515–AE39 parts completely and permanently encased in made in advance by calling Mr. Joseph a nonmetallic covering. Refund of Alcohol Excise Tax Clark at (202) 325–0118. Note to Paragraph (b): Exemptions FOR FURTHER INFORMATION CONTACT: recognized in the industry and not to be AGENCY: U.S. Customs and Border Sharolyn J. McCann, Supervisory considered in any assay for quality of a gold Protection, Department of Homeland Program Manager, Office of Trade, U.S. filled, gold overlay and rolled gold plate Security; Department of the Treasury. Customs and Border Protection, (571) optical product include: Screws; the hinge ACTION: 468–5478, sharolyn.j.mccann@ assembly (barrel or other special types such Interim regulations; solicitation as are customarily used in plastic frames); of comments. cbp.dhs.gov. washers, bushings, tubes and nuts of screw SUPPLEMENTARY INFORMATION: SUMMARY: This document updates assemblies; dowels; pad inserts; springs for spring shoe straps, cores and/or inner language in the U.S. Customs and Public Participation Border Protection (CBP) regulations to windings of comfort cable temples; metal Interested persons are invited to reflect the current organization of CBP parts permanently encased in a nonmetallic participate in this rulemaking by and the Department of the Treasury. The covering; and for oxfords, the handle and submitting written data, views, or catch. document also eliminates a restriction arguments on all aspects of the interim pertaining to CBP’s authority to refund (c) Exemptions recognized in the industry rule. See ADDRESSES above for and not to be considered in any assay for excessive duties, taxes, fees, or interest information on how to submit quality of a silver industry product include imposed on distilled spirits, wine, and comments. U.S. Customs and Border screws, rivets, springs, spring pins for wrist beer to facilitate implementation of Protection (CBP) also invites comments watch straps; posts and separable backs of Subpart A (Craft Beverage that relate to the effects that might result lapel buttons; wire pegs, posts, and nuts used Modernization and Tax Reform) of Part from this interim rule. Comments that for applying mountings or other ornaments, IX of the Tax Cuts and Jobs Act, signed which mountings or ornaments shall be of will provide the most assistance to CBP December 22, 2017, commonly referred the quality marked; pin stems (e.g., of badges, will reference a specific portion of the to as the Craft Beverage Modernization , emblem pins, hat pins, and scarf interim rule, explain the reason for any Act. pins, etc.); levers for belt buckles; blades and recommended change, and include data, skeletons of pocket knives; field pieces and DATES: This interim final rule is information, or authority that support bezels for lockets; bracelet and necklace snap effective August 16, 2018; comments such recommended change. tongues; any other joints, catches, or screws; must be received by October 15, 2018. and metallic parts completely and Background permanently encased in a nonmetallic ADDRESSES: You may submit comments, covering. identified by docket number USCBP– CBP is amending § 24.36 of title 19 of (d) Exemptions recognized in the industry 2018–0033, by one of the following the Code of Federal Regulations (19 CFR and not to be considered in any assay for methods: 24.36) regarding the authority of CBP to quality of an industry product of silver in • Federal eRulemaking Portal: http:// issue refunds of excessive duties, taxes, combination with gold include joints, www.regulations.gov. Follow the fees, or interest to: catches, screws, pin stems, pins of scarf pins, instructions for submitting comments. (1) Reflect changes in departmental hat pins, etc., posts and separable backs of • Mail: Trade and Commercial organization, a statutory citation to lapel buttons, springs, bracelet and necklace Regulations Branch, Regulations and account for the Internal Revenue Code snap tongues, and metallic parts completely Rulings, Office of Trade, U.S. Customs of 1986, and current form names and and permanently encased in a nonmetallic numbers. The current text refers to the covering. and Border Protection, 90 K Street NE, (e) Exemptions recognized in the industry 10th Floor, Washington, DC 20229– Department of the Treasury’s (Treasury) and not to be considered in any assay for 1177. organization that preceded the 1972 quality of a platinum industry product Instructions: All submissions received transfer of certain functions from the include springs, winding bars, sleeves, must include the agency name and Internal Revenue Service to the Bureau cores, mechanical joint pins, screws, rivets, docket title for this rulemaking, and of Alcohol, Tobacco and Firearms. See dust bands, detachable movement rims, hat must reference docket number USCBP– Treasury Order 221 (June 6, 1972). The pin stems, and bracelet and necklace snap 2018–0033. All comments received will Homeland Security Act of 2002 (Pub. L. tongues. be posted without change to http:// 107–296, December 25, 2002) later By direction of the Commission. www.regulations.gov, including any transferred these functions described in Donald S. Clark, personal information provided. For 19 CFR 24.36(e) to the Alcohol and Secretary. detailed instructions on submitting Tobacco Tax and Trade Bureau (TTB). [FR Doc. 2018–17454 Filed 8–15–18; 8:45 am] comments and additional information The reference to Internal Revenue on the rulemaking process, see the Form 843 in § 24.36(e)(1) predates the BILLING CODE 6750–01–P ‘‘Public Participation’’ heading of the 1963 republication of chapter I of title SUPPLEMENTARY INFORMATION section of 19 (see 28 FR 14546, 14815 (Dec. 31, 39 Oxfords are a form of eyeglasses where a flat spring joins the two eye rims and the tension it the document. 1963)) and is obsolete. The current IRS exerts on the nose serves to hold the unit in place. Docket: For access to the docket to Form 843 is not related to excise tax. Oxfords are also referred to as pince nez. read background documents or Current TTB Form 5620.8, ‘‘Claim—

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