By: JR Valdes Firearms Licensing And Consulting Group, LLC
Gun Assembly and Disassembly requires a Type 07 Manufacturers Federal Firearms License (FFL). Building firearms and firearms manufacturing are considered one in the same under most circumstances.
Federal gun manufacturing laws apply to persons engaged in the assembly of guns for profit and livelihood (ATF Rul.2010-10;Revenue Ruling 55-342) . Some FFLs mistakenly believe that gun assembly and disassembly, or simply building guns from distinctive parts is not considered “manufacturing” and therefore doesn’t require a Type 07 Federal Firearms License. FFLs may consider this type of activity to be gunsmithing. ATF licensees should be careful and secure the proper federal firearms license for the type of activity they engage in.
If you have decided to apply for a FFL, it’s critical you apply for the Type required for the business conducted. Don’t think that a “Dealer’s” license is sufficient if you are in the “firearms building” business only and don’t “manufacture” in the traditional sense. Also be mindful of what ATF defines as manufacturing a gun or “modifying” a gun. Building guns or assembling guns from separate parts is considered “manufacturing” by definition and you should be properly licensed if you engage in a business that meets the definition of “manufacturing” firearms. If you are unsure of the matter, it’s better to either ask ATF for an opinion or get licensed.
ATF license to manufacture firearms.
Getting approved for a BATF manufacturing license (Type 07 Manufacturer of Firearms other than Destructive Devices) is quite similar to getting approved for a “Dealers'” license in most respects. However, it will commonly not be the federal requirements per se that put a damper on your dream. Your state and local authorities play a big role in whether you are successful. Furthermore, there are other federal agencies besides ATF whose requirements you should consider prior to making the decision to engage in manufacturing firearms. Make sure you research 22 CFR 121, and contact the Treasury Department’s Tax and Trade Bureau. You will likely have to register with U.S. Department of State Directorate of Defense and Trade Controls as well.
The details associated with getting a license to manufacture firearms are too extensive to get into here. Without question, the ATF website is actually the best source for information on most firearms related topics. There are some general issues that can be addressed in this format, but other important issues related to manufacturing firearms that are quite complicated and require extensive research must also be addressed by the applicant.
However, in general terms, if you desire to engage in the business of manufacturing firearms, you will be using the ATF Form 7 to apply, just like you would if you were desiring to do business as a “dealer”. You must be 21 years of age or over, pay the required fee, and not otherwise be a prohibited person. You must also pay a “Special Occupational Tax” yearly to stay in business. The applicant must also have “premises from which he conducts business…”. As I’ve pointed out in another article, under the federal law, the requirements are in fact very basic. However, federal regulations require that the business to be conducted under the license is not prohibited by state or other law. This particular requirement has become a barrier for many potential FFLs.
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FFL Zoning Restrictions
As I’ve indicated in the article FFL Zoning Restrictions, Overcoming Misinformation , as part of the application process ATF investigators will ensure that the proposed firearms business will not violate state and local law, including zoning ordinances prior to issuing a Federal Firearms License. If it is determined that the proposed business will be in violation, ATF will have cause to possibly deny the application.
Getting FFL Approval
Depending on local and state law, there may be a number of obstacles you have to overcome. The issues are usually related to environmental protection, however there could be a number of other state and local matters to address prior to applying for a license to manufacture firearms. I emphasize prior to applying, because you don’t want to waste your time and money attempting to secure a FFL if you will ultimately fail because of any issue you should have addressed prior to applying. I’ve seen this happen many times, and it’s usually a result of FFL applicants not fully understanding the process, or partially ignoring the requirement until it’s too late and ATF takes action on the application.
What also happens frequently is that potential FFLs don’t communicate effectively with local authorities about their plans. Always be honest with local and state authorities regarding your plans. One, because ATF will verify that in fact all concerned parties are informed and have approved or will likely approve the activity authorized under the license. WTwo, you will likely receive a compliance inspection prior to renewal of the license and again, ATF will ensure that there are no activities being conducted that are prohibited by state law or local ordinances. If there is evidence that you have violated such, ATF will likely refer the information for enforcement to the proper authority. This can be a nightmare for a new business, or an established business for that matter. Be honest with all parties concerned.
Consult an attorney prior to engaging in any business venture.
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