Mixed Messages from Shows

This NFATCA Report is being written while the temperatures in Brownsville, Texas are significantly colder than the temperatures in Anchorage, Alaska—a bit unsettling for the first week of January 2018. That said, the unusual weather patterns appear to be mimicking the unusual legislative and regulatory activity going on in Washington, D.C. You never know quite what you’re going to get, and you will be hard-pressed to come up with a solid reason This NFATCA Report is being written while the temperatures in Brownsville, Texas are significantly colder than the temperatures in Anchorage, Alaska—a bit unsettling for the first week of January 2018. That said, the unusual weather patterns appear to be mimicking the unusual legislative and regulatory activity going on in Washington, D.C. You never know quite what you’re going to get, and you will be hard-pressed to come up with a solid reason for why it is happening. Or maybe it’s just that the reasons are difficult to fathom.

There was a Notice issued by the Department of Justice (DOJ) on December 21, 2017, just before Christmas. A list of 25 guidance documents was withdrawn after a November 17 memorandum from Attorney General Sessions prohibiting the DOJ from using guidance documents to circumvent the rulemaking process. A handful of the 25 rulings and circulars involved the Bureau of Alcohol Tobacco Firearms and Explosives (BATFE) and were dumped as being obsolete, redundant or unnecessary:

• ATF Procedure 75-4, guidance incorporated into current document
• Industry Circular 75-10, guidance incorporated into current document
• ATF Ruling 85-3, obsolete
• Industry Circular 85-3, obsolete
• ATF Ruling 2001-1, obsolete
• ATF Ruling 2004-1, obsolete

There was a considerable buzz from the community and even the media trying to divine what ATF might be up to. To quote Dr. Freud, “sometimes a cigar is just a cigar.” The referenced items were obsolete and redundant and needed to go. Unfortunately, getting rid of these items may also be paying heed to the President’s requirement that two regulations must be tossed for each new one brought to bear.

And then there is the three-ringed circus surrounding bump stocks and other firearms accessories. The previous administration previously determined that such accessories were not firearms and did not fall under the purview of firearms enforcement regulations of any kind. BATFE appeared to be toeing this line after the Las Vegas mass-shooting incident. However, calls to do something could not be resisted. Conflicting messages were bandied about from many pro-2A and gun-control advocates. Recently, the BATFE and the DOJ announced their intentions to change the settled landscape view on Advanced Notice of Proposed Rulemaking (ANPRM): https://goo.gl/5q5jji. It is uncertain as to whether BATFE will come to the same conclusions, whether BATFE will determine that legislation is required to make any changes in enforcement or if there is something else, entirely different, at work.

The NFATCA strongly opposes any attempt by BATFE and the DOJ to “re-interpret” the legislative definition of National Firearms Act items, specifically machine guns, to include so-called “bump/slide fire” stocks and other similar, non-firearm accessories. Previous BATFE/DOJ research has found that these devices do not meet the definition of firearms or machine guns, and nothing has changed since those recent evaluations were made on numerous occasions.

The NFATCA encourages everyone to participate in the open comment period and clearly express their views when BATFE makes the ANPRM public.

It is not unusual to receive mixed messages from regulators and legislators. Indeed, it can be quite difficult to determine which way the wind is blowing (apologies for another weather connection). Even seasoned legislative professionals can come up short when trying to figure out exactly what is going on. That is why it is important to stay on top of the issues and to learn as much as you can from as many sources so that you can present a reasoned and cogent perspective. The NFATCA is certain that 2018 will present many opportunities to the NFA community. Hopefully, those challenges will include the elimination of even more unnecessary regulation and the rejection of new regulation that serves no public interest.

Mixed Messages from Shows

As this report is being written, it is December and the show season has pretty much wound down. The NFATCA just returned from the SAR West Show in Phoenix, and there is a mixed bag of news to report. In general, dealer sales at a variety of venues are scattered from dismal to mind-blowing. Commodity items, such as AR models, seem to be in the doldrums, while truly desirable collector pieces are enjoying robust sales. At a recent show, reports separated by mere minutes clearly demonstrated the broadness of the spectrum: one dealer lamented that sales were off by more than 50% at the show while another guardedly reported that they had already done six figures before the public had even showed up. There seems to be a “new normal,” yet nobody is able to define it.

The same holds true for the vagaries of the industry and community, as a whole. The NFATCA dutifully presents news to the community at many events. And although we do seem to cover much of the same territory, it is surprising that there are so many who have not learned what some consider to be “the basics.” For example, at each meeting that we hold, we go over the fact that marijuana is, indeed, legal in many states yet is still illegal at the federal level. We highlight the language on Form 4473 that clearly states, “The use or possession of marijuana remains unlawful under Federal law regardless of whether it has been legalized or decriminalized for medicinal or recreational purposes in the state where you reside.” We remind dealers that merely seeing a medical marijuana card in the wallet of a potential customer is sufficient grounds to terminate a potential transfer. We remind dealers that merely knowing that a particular customer enjoys an occasional smoke of the banned item is enough to make it unlawful for the dealer to make a transfer. This still comes as a shock to many. Along the same train of thought, it is still surprising to learn that many licensed manufacturers are unaware of or are avoiding registering with the State Department under the International Traffic in Arms Regulations (ITAR). Every manufacturer, by State Department definition, not ATF’s, must register and pay at least $2,250 every year, regardless of whether or not items are manufactured for export. It is not optional, and the only research and development exemptions granted by State are for accredited institutions of higher learning. Period. Yet we hear the lament that somebody, somewhere, read on the Internet that … So, it must be true. We all know how that works out!

Many are surprised to learn that the NFA Division is churning through the form processing cycle with increasing efficiency. Form processing times across the board continue to drop. Some are reporting Form 3 approvals in days and even just hours! All of this is occurring as volume has rebounded from last year’s July crash. July saw the peak of a surge, then an inevitable crash. Now we are seeing forms submissions normalize and even begin to rise. Even though we are through the worst of it, NFA Division Chief, Alphonso Hughes, has reported that he is determined to work towards further efficiency and time-to-process reductions. It is still all hands on deck, and the NFA community is enjoying the benefits.

With lower processing times and the improved ability to find exactly what you are looking for, the NFATCA suggests that NOW is the best time to make that move you have been putting off. Most agree that there is no pending NFA legislation that will be heading to the President’s desk in the near future. Prices continue to rise. And more people are getting into the NFA game. Pull that trigger! At the same time, more people are pulling the trigger on joining the NFATCA, or increasing the level of their existing support. To them we say thanks! And we invite you to join them and us as we diligently continue to make more NFA items available to more people, more often.