Section 80.375(c) requires that each batch of California gasoline be designated as such by the refiner or importer, and that California gasoline be segregated from gasoline that is not California gasoline at all points in the distribution system. The designation and segregation requirements for California gasoline are necessary to assure the enforceability of the federal gasoline sulfur rule and RFG rule.

Because the federal sulfur rule refinery standard is an annual average standard, there would be no way to ensure that a refinery producing both California gasoline and federal gasoline is in compliance with the average standard unless gasoline designated for California use is actually used in California and gasoline designated for 49 state use is actually used in the 49 states.