Thread muzzle pay ITAR

[guncrank]

Seen this on FFL forum, applies to some

Looks like the trade just got smaller or more expensive.
https://blog.princelaw.com/2016/07/2...-registration/

[HiBC]

I know this post is rather "drive by" but it is worthy of discussion.
(OP,if you will edit your post and say something besides just posting the link it will help keep the thread from being closed.Just posting a link is known as a "drive by" and they are usually closed)
It seems to require a $2250 registration with ITAR if you use machine tools in the practice of gunsmithing,(such as a barrel chambering job)with significant penalty for failure to comply.

Commentary from the legal scholars would be appreciated.

[Charles S]

It seems to require a $2250 registration with ITAR if you use machine tools in the practice of gunsmithing,(such as a barrel chambering job)with significant penalty for failure to comply.

If I read the post correctly that is a yearly fee, not just a registration fee. If applicable to all, it could really hurt some smaller gunsmiths. Does this apply to all, or just exporters and manufacturers?

It really seems like the system, as currently operated, makes it very difficult to be a small operation.

[Scorch]

ITAR regulations only apply to those manufacturers who export outside of the US.

[Spats McGee]

Originally Posted by HiBC

I know this post is rather "drive by" but it is worthy of discussion.
(OP,if you will edit your post and say something besides just posting the link it will help keep the thread from being closed.Just posting a link is known as a "drive by" and they are usually closed)
It seems to require a $2250 registration with ITAR if you use machine tools in the practice of gunsmithing,(such as a barrel chambering job)with significant penalty for failure to comply.

Commentary from the legal scholars would be appreciated.

Yes, drive-by posts are usually closed. This probably needs some discussion, so I'll leave it open.

I don't know that I qualify as a legal "scholar," but give me a couple of days to read up on ITAR regs and I'll come back around to see if I can shed any light on this.

[barnbwt]

You could not be more mistaken, Scorch, it applies to anyone dealing in 'defense articles' defined by ITAR and State. You might want to do some research on whether you should currently be paying if doing custom machine work. Even accurizing a rifle stock is considered applicable. Anything to do with ARs is generally applicable after these reg changes.

Meanwhile, I can supposedly post detailed instructions on how to build a new firearm action for all the world to see as a person not in the business, even though ITAR is about regulating information, not commerce (which is why I don't buy the claim this only applies to businesses, e.g. what happened to Cody Wilson)

TCB

[tobnpr]

Even accurizing a rifle stock is considered applicable.

Depends. Does the FFL own the stock, or does it belong to a customer?

It is critical to understand that the definition of "manufacturing" by the BATF, and that by DDTC, are NOT the same. I researched this extensively before getting my 07 instead of the typical 01 license for most gunsmithing.

Certain services, even on customers' firearms- is considered manufacturing under the BATF (hence my 07) but is not manufacturing under the DDTC.

There is a misconception that having an 07, is some sort of automatic requirement to register with DDTC and that is patently false- as outlined in the linked article.

Depends on the work- and commonly, who owns the receiver? Me, or the customer?

[Scorch]

You could not be more mistaken, Scorch, it applies to anyone dealing in 'defense articles' defined by ITAR and State.

Yeah, OK, whatever. I went through this with US Customs about 4 years ago. If you are not a manufacturer (07 FFL), it is not an issue as long as you do not try to export firearms or firearms parts.

22 C.F.R. § 122.1 discusses the registration requirements for ITAR.

(a) Any person who engages in the United States in the business of manufacturing or exporting or temporarily importing defense articles, or furnishing defense services, is required to register with the Directorate of Defense Trade Controls under § 122.2. For the purpose of this subchapter, engaging in such a business requires only one occasion of manufacturing or exporting or temporarily importing a defense article or furnishing a defense service. A manufacturer who does not engage in exporting must nevertheless register.

[Jimro]

Scorch,

You are definitely correct about what the ATF considers a firearms manufacturer, and I truly believe you got the correct answer 4 years ago when you inquired with US Customs about the need for ITAR compliance.

What the DDTC is doing is not using the ATF definition of "manufacturer" in a specific letter to manufacturers AND gunsmiths. The original letter can be found here: http://pmddtc.state.gov/compliance/A...0(Publish).pdf

Registration Required – Manufacturing: In response to questions from persons engaged in the business of gunsmithing, DDTC has found in specific cases that ITAR registration is required because the following activities meet the ordinary, contemporary, common meaning of “manufacturing” and, therefore, constitute “manufacturing” for ITAR purposes:
a) Use of any special tooling or equipment upgrading in order to improve the capability of assembled or repaired firearms;
b) Modifications to a firearm that change round capacity;
c) The production of firearm parts (including, but not limited to, barrels, stocks, cylinders, breech mechanisms, triggers, silencers, or suppressors);
d) The systemized production of ammunition, including the automated loading or reloading of ammunition;
e) The machining or cutting of firearms, e.g., threading of muzzles or muzzle brake installation requiring machining, that results in an enhanced capability;
f) Rechambering firearms through machining, cutting, or drilling;
g) Chambering, cutting, or threading barrel blanks; and
h) Blueprinting firearms by machining the barrel.

And I think that is an INSANE definition of "manufacture" since it is patently clear that someone doing a custom rear end swap on a car is going to have to do some machining, but the mechanic is clearly not "manufacturing" a car, just doing a modification. Also you have to wonder why in the world "stocks" would be listed?

But, the actual US Munitions List starts out with 50 cal and under small arms.

(g) Barrels, cylinders, receivers (frames)
or complete breech mechanisms for the articles
in paragraphs (a) through (d) of this category.
(h) Components, parts, accessories and attachments
for the articles in paragraphs (a)
through (g) of this category.

Since a "stock" is a component of a firearm, then sure as shooting there is a legal case to be made for anyone in the business of making and selling stocks would be subject to ITAR registration.

I think this guidance letter is insane, as domestic gunsmithing activities are as separated from the international arms trade the same way your local doctor is separated from the international drug trade.

Jimro

[HiBC]

Jimro,agreed,insane!!Or diabolical.

I'm trying to keep my jets cool and not get too excited till this is verified.

[rkbanet]

Interesting, I have always been under the impression that ALL firearms manufactures (except those that make sporting shotguns) had to pay the ITAR fee. To me the only new issue is that manufacturing would include threading a barrel.

[tobnpr]

What the DDTC is doing is not using the ATF definition of "manufacturer" in a specific letter to manufacturers AND gunsmiths. The original letter can be found here: http://pmddtc.state.gov/compliance/A...0(Publish).pdf

Quite an interesting read...

Edited...

Wow. All I can say....

Every gunsmith out there now needs an 07- and needs to register with DDTC.

I called DDTC- he confirmed that ownership of the firearm makes no difference, and all these operations that have been "gunsmithing" for as long as there have been gunsmiths- are now considered "manufacturing".

[carguychris]

Originally Posted by Jimro

I think this guidance letter is insane, as domestic gunsmithing activities are as separated from the international arms trade the same way your local doctor is separated from the international drug trade.

Ditto, and although this thread started with a discussion of threaded muzzles, I'm a good deal more concerned with this little gimme (my emphasis in boldface):

ITAR registration is required because the following activities meet the ordinary, contemporary, common meaning of “manufacturing” and, therefore, constitute “manufacturing” for ITAR purposes:
a) [omitted]
b) Modifications to a firearm that change round capacity;

Is it just me, or does this potentially include the simple insertion of an extended magazine into a firearm that will accept one?!!

(I'm thinking of spinning this off as a separate thread.)

[tobnpr]

^^^
I doubt it- but you never know. Even "clarifications" are not binding, read here:

This just out by the NRA-ILA yesterday. I emailed them, and was told Congress is working on legislation. We'll see. I have already called the Representative for my Congressional District.

https://www.nraila.org/articles/2016...ve-gun-control

[Sharkbite]

Hmmm...

So if i do a Form 1 to make an SBR....am i now a "manufacturer" under this ruling?

ATF has held that i am not, but what about under ITAR???

[mehavey]

Reading the original Princeton Law article itself, I'm left with little
doubt that death-by-1,000-cuts is clearly & deliberately in motion.

[Dixie Gunsmithing]

ITAT came about in the 1970s. Traditionally, it was meant to be only about importation and exportation of "defense articles". However, the firearm supposed fall into international traffic. From the State Dept:

Exporting Requirements - Generally, any person or company who intends to export or to temporarily import a defense article, defense service, or technical data must obtain prior approval from DDTC. The appropriate license form must be submitted for the purpose of seeking approval. Furthermore, in most cases, in order for a license to be considered, you first must be registered with DDTC.

http://pmddtc.state.gov/licensing/index.html

Thus, any gunsmith working on a firearm (considered a defense article) that will be exported, would fall under this act. This also includes the sharing of gunsmithing information (how to), and any firearms designs to a foreign entity. "Disclosing (including oral or visual disclosure) or transferring technical data to a foreign person".

Category I-Firearms (US munitions list)

*(a) Nonautomatic, semi-automatic and fully automatic firearms to caliber .50 inclusive, and all components and parts for such firearms. (See § 121.9 and §§ 123.16-123.19 of this subchapter.)

(b) Riflescopes manufactured to military specifications, and specifically designed or modified components therefor; firearm silencers and suppressors, including flash suppressors.

*(c) Insurgency-counterinsurgency type firearms or other weapons having a special military application (e.g. close assault weapons systems) regardless of caliber and all components and parts therefor.

(d) Technical data (as defined in § 120.21 of this subchapter) and defense services (as defined in § 120.8 of this subchapter) directly related to the defense articles enumerated in paragraphs (a) through (c) of this category. (See § 125.4 of this subchapter for exemptions.) Technical data directly related to the manufacture or production of any defense articles enumerated elsewhere in this category that are designated as Significant Military Equipment (SME) shall itself be designated SME.

also,

§ 120.4 -- Commodity jurisdiction.

(b) Registration with the Office of Defense Trade Controls as defined in part 122 of this subchapter is not required prior to submission of a commodity jurisdiction request. If it is determined that the commodity is a defense article or service covered by the U.S. Munitions List, registration is required for exporters, manufacturers, and furnishers of defense articles and defense services (see part 122 of this subchapter).

As Scorch mentions, I was told the same thing years ago. It does seem as if they are twisting the definition of manufacturing until it breaks. I can not find their definition of a manufacturer anywhere, within this law, under purpose and definitions. However, below is who must register.

§ 122.1 -- Registration requirements.

(a) Any person who engages in the United States in the business of either manufacturing or exporting defense articles or furnishing defense services is required to register with the Office of Defense Trade Controls. Manufacturers who do not engage in exporting must nevertheless register.

(b) Exemptions. Registration is not required for:

(1) Officers and employees of the United States Government acting in an official capacity.

(2) Persons whose pertinent business activity is confined to the production of unclassified technical data only.

(3) Persons all of whose manufacturing and export activities are licensed under the Atomic Energy Act of 1954, as amended.

(4) Persons who engage only in the fabrication of articles for experimental or scientific purpose, including research and development.

(c) Purpose. Registration is primarily a means to provide the U.S. Government with necessary information on who is involved in certain manufacturing and exporting activities. Registration does not confer any export rights or privileges. It is generally a precondition to the issuance of any license or other approval under this subchapter.

One will also notice when the letter went out, July 22, 2016. This is a recent use of this law, and what their recent definition of manufacturing is. The BATFE's manufacturer definition reads similar, though working on a gun belonging to another was not manufacturing by the BATFE.

BATFE on the definition of a manufacturer:

Although installing parts in or on firearms, and applying special coatings and treatments to firearms are manufacturing activities, the definition of “manufacturer” in 18 U.S.C. 921(a)(10) and 27 CFR 478.11 also requires that a person be “engaged in the business” before the manufacturer’s license requirement of section 923(a) applies. Thus, a person who manufactures a firearm will require a manufacturer’s license if he/she devotes time, attention, and labor to such manufacture as a regular course of trade or business with the principal objective of livelihood and profit through the sale or distribution of the firearms manufactured. If the person is performing such services only for a customer on firearms provided by that customer, and is not selling or distributing the firearms manufactured, the person would be a “dealer” as defined by 18 U.S.C. 921(a)(11)(B) and 27 CFR 478.11, requiring a dealer’s license, assuming the person is “engaged in the business” as defined in 18 U.S.C. 921(a)(21)(D) and 27 CFR 478.11 (i.e., “gunsmithing”).

18 U.S.C. 921(a)

(10) The term “manufacturer” means any person engaged in the business of manufacturing firearms or ammunition for purposes of sale or distribution; and the term “licensed manufacturer” means any such person licensed under the provisions of this chapter.

27 CFR 478.11

Manufacturer. Any person engaged in the business of manufacturing firearms or ammunition. The term shall include any person who engages in such business on a part-time basis.

Traditionally, the manufacture of a firearm meant building one from scratch, not re-barreling one. If you ask me, this has came from a group of anti-gun attorneys from the DOJ, and thus, the letter. This may end up in court about what the word, manufacturer is.

DDTC has found that many –but not all -traditional gunsmithing activities do not constitute manufacturing for ITAR purposes and, therefore, do not require registration with DDTC.

==========

Guncrank, you need to add your thoughts on this under your comment, as it is considered a drive by.

[Dixie Gunsmithing]

tobnpr, I hadn't seen the NRA article, but that explains it, an executive order from the famous gun-grabber himself. We'll see if the NRA takes the definition of "manufacturer" to court, as re-barreling, milling, or drilling on any firearm, belonging to another, was never considered manufacturing.

[Dixie Gunsmithing]

All,

I also noticed that the NRA has an article on how the DDTC is looking at interfering in what we speak of on this section of the forum, and on reloading. Obama used an executive order, and thus the letter from the DDTC, about not only reclassifying what a manufacturer is, but about what is acceptable speech to them on the internet.

Stop Obama's Planned Gag Order on Firearm-Related Speech:

https://www.nraila.org/articles/2015...related-speech

According to them, if we write something about how to build or manufacture a firearm, and someone from another country reads it, we could be fined and imprisoned.

[tobnpr]

I believe I spoke incorrectly above, when saying that all gunsmiths would now need an 07.

I don't think that's the case, but I'm not sure.

What is clear, is that DDTC registration, and ITAR compliance is required for all of us in the business- and I don't see why one couldn't still keep an 01, and register with DDTC as a "manufacturer". IOW, do all gunsmiths now need an 07? I'm saying that in general terms....somewhere, there may be a gunsmith that only swaps factory parts- but I doubt it.

Just stoning a sear or slide "improves the capability" of the firearm.

They state:

DDTC applies the ordinary, contemporary, common meaning for “gunsmithing,” which traditionally has broadly included designing, making, or repairing guns.

Really? Pee on my leg and tell me it's raining?

Since when has machining work NOT been part of "traditional" gunsmithing??

If you have an FFL- and even if you do not- call your Congressional Representatives! If you're a Dealer/Retailer- know that they will be coming for you, next.

[carguychris]

Originally Posted by tobnpr

I believe I spoke incorrectly above, when saying that all gunsmiths would now need an 07... What is clear, is that DDTC registration, and ITAR compliance is required for all of us in the business- and I don't see why one couldn't still keep an 01, and register with DDTC as a "manufacturer". IOW, do all gunsmiths now need an 07?

According to the article, it's actually more complicated and insidious than that. From page 2 of the letter, boldface in original, my emphasis underlined:

ITAR registration is required of persons who engage in the business of manufacturing defense articles. Persons who do not actually manufacture ITAR-controlled firearms (including by engaging in the activities described below, which DDTC has found in specific cases to constitute manufacturing) need not register with DDTC – even if they have an FFL from ATF. As indicated above, the requirements for obtaining FFLs under the GCA are separate and distinct from the requirement under the AECA and ITAR to register with DDTC.

As I read this, the class of FFL one holds—or whether one has a FFL at all—is irrelevant. The definitions of "manufacturing" under the AECA and the GCA are "separate and distinct".

DDTC registration is required if one engages in "manufacturing" as defined by the Department of State. Period. Even if you're NOT a FFL.

IOW stop thinking about ATF regulations. In fact, try to forget everything you know about them. This is unrelated.

[Dixie Gunsmithing]

carguychris,

Yes, it is insidious, in how they are interpreting the word, manufacture, when they don't even have it defined within the law itself. Thus, they can stretch the word to mean what they want. That is what this administration has had the DDTC look into, to find any loopholes that they can use.

Even worse, is what looks to be their assault on free speech, when one reads the Federal Register, about how they are redefining the wording, especially on what they consider technological data which we write about here. We wont know what that entails until others look at that on here. I was told that it will be several days for that to be investigated for its meaning.

[LogicMan]

So does this apply to doing gunsmithing in one's home?

[guncrank]

No it does not apply to any personal gunsmithing , only regulated firearms trade

[HiBC]

I appreciate your optimism.
But I'm not sure I can count on it.