New Background Check Rule

[stagpanther]

They do tell you what is a violation.

If you buy guns (or a gun) with the intent to resell for profit, then you are a dealer.

They don't give you a number because you could buy 1000 guns and then sell them later, possibly even as a profit and if you bought them for your personal collection and then later decided you didn't want them any more, then you are not a dealer.

If my father was a collector and leaves me 700 guns (as happened to a friend of mine) then you will certainly make money selling them, but you still aren't a dealer.

With due respect--that's not my take. Whether or not you make a gross profit as a result of selling one--or a thousand--firearms is not the determinant of what makes you a business (aka firearms dealer in this particular case). Whether or not you have a business is not being ruled on one way or another. My take is whether or not the nature of your sales makes you a dealer that falls under the requirements of needing to be licensed with an FFL license certificate. I could be wrong--but that's what I think this is about.

[JohnKSa]

Whether or not you make a gross profit as a result of selling one--or a thousand--firearms is not the determinant of what makes you a business...

Correct. That's not what the rule says.

It's about intent, not about the actual outcome. If your intent when you buy a gun (or guns) is to resell for a profit, then that's the violation. If you fail to make a profit for some reason, you won't get credit for being bad at running a business--what makes the violation is your intent.

[dogtown tom]

JohnKSa

Correct. That's not what the rule says.

This.

[FITASC]

I think its been as little as $12 a year annually prior to 1986.

In the early 80s, I paid $30/year; it might have been less when first enacted in '68 however.

[Bill DeShivs]

And, what if you sell your guns through a dealer-rather than being a dealer?

[dogtown tom]

It's pretty obvious that not many have actually read the new rule. I know its easier to stare glassy eyed at YouTube click bait than read for yourself.....but taking the time to read the rule will undoubtedly save you grief in the future.

Nearly everything one needs to know about this rule is posted at ATF.gov

Whether you consider it an infringement (as are all gun laws) isn't at issue. Until SCOTUS agrees, you either abide or you don't. The penalty if you are caught means never lawfully possessing a firearm again. You may never actually go to trial, but the process will cost you $$$$ in attorney fees.
vs
Getting your FFL- $200 for the first three years, $90 for each three year renewal. That is definitely less expensive than hiring The Texas Hammer, the Tough Smart Lawyer, Texas Lion, or Law Shark.


I posted this on THR a few days ago:

Defining what “Engaged in the Business”as a Dealer in Firearms is the purpose of this rule.https://www.atf.gov/firearms/final-r...ealer-firearms

Don't have time to read the entire rule? ATF has included this: Questions and Answers: Final Rule 2022R-17F

Before posting a "opinion" on the rule, and especially before renting a table at a gun show, it would be wise to read through these Q&A's.

Here are a few from that Q&A: (please note highlighted text in red):



Q – What does it mean to be “engaged in the business" as a wholesale or retail dealer?
A – A person is “engaged in the business” when the person devotes time, attention, and labor to dealing in firearms as a regular course of trade or business to predominantly earn a profit through the repetitive purchase and resale of firearms, but such term shall not include a person who makes occasional sales, exchanges, or purchases of firearms for the enhancement of a personal collection or for a hobby, or who sells all or part of the person’s personal collection of firearms. The term shall not include an auctioneer who provides only auction services on commission to assist in liquidating firearms at an estate-type auction, provided that the auctioneer does not purchase the firearms, or take possession of the firearms for sale on consignment.

The definition focuses on whether the intent underlying the sale or disposition of firearms is predominantly one of obtaining pecuniary gain. There is no statutory requirement that firearms actually be sold; indeed, a dealer may routinely (i.e., “regularly”) devote time and resources working toward that goal as a course of trade or business, but never find a buyer or consummate any sales due to insufficient demand or poor sales practices. Thus, the way that Congress drafted and amended the statute, and the way that courts have repeatedly interpreted it, no actual sales are required if the intent element is met, and the person’s conduct demonstrates their devotion of time, attention, and labor to dealing in firearms as a regular course of trade or business.

Under the BSCA, a person’s intended use for the income they receive from the sale or disposition of firearms is not relevant to the question of whether they intended to predominantly earn pecuniary gain. If a person must sell their previously acquired firearms to generate income for subsistence, such as to pay medical or tuition bills, they are still subject to the same considerations as persons who intend to sell their firearms to go on a vacation, increase their savings, or buy a sports car. If persons repetitively resell firearms and actually earn pecuniary (or monetary) gain, whether or not it was for support or subsistence, that gain is evidence demonstrating the intent element of being engaged in the business. However, a single or an isolated sale of firearms that generates pecuniary gain would not alone be sufficient to qualify as being engaged in the business without additional conduct indicative of firearms dealing. The issue is whether the person who exchanged the firearms for money, goods, or services was devoting time, attention, and labor to dealing in firearms as a regular course of trade or business and had the predominant intent to earn a profit through repetitive firearms purchases and resales.

For example, a person who bought a firearm 40 years ago and now sells it for a substantial profit to augment income during retirement is not engaged in the business based on this single firearms transfer because their intent was not to earn that pecuniary gain through repetitive purchases and resales of firearms and they are likely not dealing in firearms as a regular course of trade or business. Put another way, a bona fide collector, whose motive is not predominantly to profit, may make incidental profit in the course of enhancing a personal collection, which would not be engaged in the business.

Q. Is the term “occasional” defined in the BCSA or the final rule when addressing sales, exchanges, or purchases of firearms?
A. No. The term “occasional” is not defined in the regulatory text; however, the plain and ordinary meaning of that term is “infrequent or irregular occurrence.” However, regular or routine sales, exchanges, or purchases of firearms (even part-time) for the enhancement of a personal collection or for a hobby would not fall within the meaning of that term.

Q – Does the final rule require every private sale of a firearm be processed through a licensed dealer?
A – No. Individuals may continue to make intrastate private sales without a license provided they do not rise to the level of being “engaged in the business,” and the transactions are otherwise compliant with law.

Q. If a person sells their personal firearm and actually makes a profit, does that equate to being engaged in the business as a dealer requiring a license?
A. No. A person actually “selling at a profit does not equate to engaging in the business” because a showing of actual profit, whether or not expenses or inflation are considered, is not required to be engaged in the business. Rather, it is the predominant intent of obtaining pecuniary gain from sale or disposition of firearms that matters. See 18 U.S.C. § 921(a)(22). Moreover, because the person’s predominant intent to profit is the relevant fact, it does not matter how or whether actual
profit is calculated.

Q – Does the definition of the new term “predominantly earn a profit” apply to all persons who “engage in the business”?
A – No. The definition applies only to wholesale and retail dealers in firearms. The definition of “principal objective of livelihood and profit” remains in the regulations because it is still applicable to persons “engaged in the business” as a manufacturer, importer, or gunsmith. Those terms were not changed by the BSCA or this rule.



Background Checks

Q – Does this final rule create universal background checks?
A – No. Congress has not passed a law to require universal background checks, and this rule does not require unlicensed individuals who are not engaged in the business of manufacturing, importing, or dealing in firearms to run background checks for private firearm sales between individuals. The concept of “universal background checks” is not defined in Federal law, but is commonly understood to require persons to run background checks whenever a private, unlicensed person transfers a firearm to another, and some States have imposed this requirement.
Congress decided that only persons engaged in the business of manufacturing, importing, ordealing in firearms must obtain a license and run National Instant Criminal Background Check System (NICS) background checks on firearm transferees. Nonetheless, increasing licensure of persons who are currently engaged in the business of dealing in firearms will necessarily ensure that they will run NICS background checks when they transfer firearms at gun shows, over the Internet, and by other means, as Congress intended.



Location questions

Q – Does the location or venue of where I sell impact whether I am considered a “dealer”?
A – No. The term includes such activities wherever, or through whatever medium, they are conducted, such as at a gun show or event, flea market, auction house, or gun range or club; at one’s home; by mail order; over the Internet (e.g., online broker or auction); through the use of other electronic means (e.g., text messaging service, social media raffle, or website); or at any other domestic or international public or private marketplace or premises.



Q – Does the final rule set a minimum threshold number of firearms purchased or sold to be considered “engaged in the business”? If “no,” why not?
A – No. While selling large numbers of firearms or engaging or offering to engage in frequent transactions may be highly indicative of business activity, the final rule does not set a minimum number of firearms purchased or resold that triggers the licensing requirement. Similarly, there is no minimum number of transactions that determines whether a person is “engaged in the business” of dealing in firearms. Courts have held that even one transaction or attempted transaction can constitute “engaging in the business” if other factors or intent are present.
Establishing a minimum threshold would enable people to try to get around laws established for public safety, like background checks and records through which firearms involved in crime can be traced. To determine whether an individual is “engaged in the business” the rule looks at the
totality of circumstances. Even a single isolated transaction, or offer to engage in a transaction, when combined with other evidence, may be sufficient to require a license, such as by holding oneself out a source to purchase and resell more firearms.

Q – Since the final rule does not set a minimum threshold number of firearms, what criteria does it put forward to determine if a person is “engaged in the business” as a dealer?
A – The final rule established rebuttable presumptions to help unlicensed persons, industry operations personnel, and others determine when a person is presumed to be “engaged in the business” requiring a dealer’s license. There are two sets of rebuttable presumptions in this rule: one set of conduct that demonstrates when a person is “engaged in the business” as a dealer requiring a license, and another set that independently indicates when a person has the intent to “predominantly earn a profit” from sales or other dispositions of firearms.



Q – I plan to buy undervalued firearms for profit but will not sell them directly to nonlicensees; I will consign them to a Federal firearms licensee who will then sell them. Do I need a license?
A – A person who consigns firearms for sale (consignor) may have a predominant intent to earn a profit from the sale of the firearms; however, that does not finish the fact-specific inquiry because that person is often not devoting time, attention, and labor to dealing in firearms. The person engaged in the business is the seller who accepts the firearms on consignment (consignee), is paid to take the firearms into a business inventory for resale, and determines the manner in which to market and resell them on the consignor’s behalf. Like consignment-type auctioneers, firearms consignment businesses must be licensed because they are devoting time, attention, and labor to dealing in firearms as a regular course of trade or business to predominantly earn a profit through the repetitive purchase and resale of firearms.

Q – Is a nonlicensee who rents space to display firearms they offer for sale presumed to have intent to predominantly earn a profit from the firearms they sell?
A – A person is presumed to have the intent to predominantly earn a profit through the repetitive purchase and resale of firearms, absent reliable evidence to the contrary, when the person “repetitively or continuously purchases or rents, or otherwise exchanges (directly or indirectly) something of value to secure permanent or temporary physical space to display firearms they offer for resale, including part or all of a business premises, a table or space at a gun show, or a display case.” Of course, like the other presumptions, this one may be refuted with reliable evidence to the contrary.


Conduct not presumed to be engaged in the business
Q – Does the final rule provide examples of when a person would not be presumed to be engaged in the business requiring a license as a dealer?
A – Yes. Under this final rule, a person would not be presumed to be “engaged in the business” requiring a license as a dealer when reliable evidence shows the person transfers firearms only:
o As bona fide gifts;
o Occasionally to obtain more valuable, desirable, or useful firearms for their personal collection;
o Occasionally to a licensee or a to a family member for lawful purposes;
o To liquidate (without restocking) all or part of their personal collection; or
o To liquidate firearms
o That are inherited; or
o Pursuant to a court order; or
o To assist in liquidating firearms as an auctioneer when providing auction services on commission at an estate-type auction.
The final rule provides objectively reasonable standards for when a person is presumed to be “engaged in the business” to strike an appropriate balance that captures persons who should be licensed, without limiting or regulating activity truly for the purposes of a hobby or enhancing a personal collection.

Q – Does the final rule place additional restrictions on law-abiding citizens who wish to transfer firearms to family or friends, or to sell all or part of a personal collection of firearms?
A – This rule does not place additional restrictions on law-abiding citizens who occasionally acquire or sell personal firearms to enhance a personal collection or for a hobby. This rule does not prevent law abiding persons from purchasing or possessing firearms, from selling inherited firearms, or from using their personal firearms for lawful purposes such as self-defense, reenactments, or hunting. The rule includes a non-exhaustive list of conduct that does not constitute being engaged in the business and that may also be used to rebut the presumptions, as well as other examples of conduct that does not demonstrate a predominant intent to profit.

[Nathan]

To me, this dealer or not dealer thing is super simple.

To be in business, you have to make some minimal amount of gross profit to cover your required expenses.
Basic expenses: FFL, Storefront, Transportation

Why try to put FFL’s in the hands of millions of people who never intended to be a dealer?

Let me make this super clear. This is my meaningless opinion. A government will make their determinations on a variety of reasons, often different than mine.

[s3779m]

Why try to put FFL’s in the hands of millions of people who never intended to be a dealer?

Don't really think that was the intent of this new rule at all. Nor was it to catch those who should have an FFL but don't, there are already laws on the books for that. It damn sure has nothing to do with lowering the crime rate in our inner city hell holes where the majority of the crime and criminals are.

So what is the intent? Hard to say, I do know that there are some pretty smart people who post on this forum, people who know guns and who know gun matters, and they can not come to a consensus as to what the ATF intent is here. I would even venture as far as to say the ATF really could not give you an answer either. I can tell you this is example # 1,895,367 as to how our government agencies are way too bloated, have too much influence over we the people, and got their marching orders from a room full of monkeys. But do realize, this new rule was written this vague for a reason.

[Nathan]

To me, it is like much of the BSCA. More words without much ingress or regress of gun safety or freedom. The problem with new words is they can bring new interpretations and new enforcement.

[s3779m]

Originally Posted by Nathan

To me, it is like much of the BSCA. More words without much ingress or regress of gun safety or freedom. The problem with new words is they can bring new interpretations and new enforcement.

I think you nailed it.

[stagpanther]

To be in business, you have to make some minimal amount of gross profit to cover your required expenses.

The rule says only that the intent is to make money--doesn't matter whether you actually do or not. A certain amount of "reading between the lines" (yes, I know dogtown will refute this I'm sure) might help. Notice the use of the phrase "consider refutable evidence to the contrary" used quite frequently. The ATF in my state does give a potential violator the benefit of the doubt if there is some question as to ambiguity--and there obviously is.

Here is a possible hypothetical scenario that I made up:

So let's say Joe CoolMoose starts selling guns to people in his small rural town--friends, friends of friends, friends of friends of friends (which is everyone in the entire town). He quickly gets a local rep for cutting good deals compared to the gun shops or dealers who are licensed FFL dealers. Customer walks into licensed store and says "give me a better deal on this xxx cause Joe CoolMoose sells the same thing way under." Call goes into ATF--and now Joe is going to get a call/visit to see what's what. That's when Joe is probably going to be given the opportunity to provide refutable evidence. The ATF probably is not going to haul you into court even if you are in violation if there is reasonable doubt pure ignorance of the meaning and substance of the law was not well understood and, once duly informed, the violator indicates they will make amends to come into compliance. I don't speak for the ATF nor have any idea what they are actually doing as regular procedure--just that's what I've had communicated to me in the past.

[natman]

Originally Posted by stagpanther

Here is a possible hypothetical scenario that I made up:

So let's say Joe CoolMoose starts selling guns to people in his small rural town--friends, friends of friends, friends of friends of friends (which is everyone in the entire town). He quickly gets a local rep for cutting good deals compared to the gun shops or dealers who are licensed FFL dealers. Customer walks into licensed store and says "give me a better deal on this xxx cause Joe CoolMoose sells the same thing way under." Call goes into ATF--and now Joe is going to get a call/visit to see what's what. That's when Joe is probably going to be given the opportunity to provide refutable evidence. The ATF probably is not going to haul you into court even if you are in violation if there is reasonable doubt pure ignorance of the meaning and substance of the law was not well understood and, once duly informed, the violator indicates they will make amends to come into compliance. I don't speak for the ATF nor have any idea what they are actually doing as regular procedure--just that's what I've had communicated to me in the past.

This scenario is exactly what the new law and new rule are designed to prevent. And what amount of leeway the ATF might have offered in the past, they're currently running under the Biden administration's "zero-tolerance" policy.

[dogtown tom]

Nathan To me, this dealer or not dealer thing is super simple.

To be in business, you have to make some minimal amount of gross profit to cover your required expenses.
Basic expenses: FFL, Storefront, Transportation

Didn't read a thing I posted, did ya?

No ATF regulation has ever required a storefront. What you mean by "transportation" is puzzling.

Why try to put FFL’s in the hands of millions of people who never intended to be a dealer?

Again, read those FAQ's and you have the answer. Anyone who doesn't intend to be a dealer, likely isn't and isn't affected by this rule.
Again, this rule is for those who are unlicensed and actually engaging in the business of dealing in firearms.

[44 AMP]

ok, my newest pipe dream fantasy....
winning the mega monster lottery so I have bazillons to spend (including legal fees) and buying a bunch of guns legally, then just giving them to qualifying needy people.

Since I wasn't selling them, and didn't buy them with the intent of selling them or making a profit, I couldn't be a "dealer", could I ???

[Bill DeShivs]

I have known ATF agents who were very nice, helpful people.

I also know that today, all of them are under orders from the president down, to hold dealers accountable and make sure every "t" is crossed. Zero tolerance.
This also applies to ALMOST anyone the agency decides is selling guns- except those on the street with stolen firearms and "Glock switches." Those charges seem to be dropped or nolle pros ed with much regularity.

I have seen, under the Clinton Presidency, what ATF does to FFls. They eliminated them at every chance. I was one of them. No renewal send for the license, yet letter demanding my books seemed to get to me just fine. I was within the renewal grace period, yet was told that I had to apply for a new license. When I griped to ATF, I was threatened with an IRS audit. I dropped the FFL-just like they wanted me to. The reason I had a license in the first place was to engrave and otherwise customize guns.

As far as storefronts, ATF doesn't require them- but if local ordinances don't allow one to run a business from a home, ATF will not issue a license.

[Stuohn101]

I'd like to know what "predominately" for profit means and occasionally? How would this even be enforced for the average person who frequently sale or trade without ever turning a profit. I mean for people who don't complete bill of sales, how would this work.

[JohnKSa]

The final rule (linked earlier in the thread) goes into great detail about what the BATF thinks it means. This is in the section where they were responding to comments made.

People who have legitimate questions would probably benefit from reading through the rule--or at least looking through the sections that concern them. The responses to comments are not officially part of the rule, but they do provide insight into the BATF's reasoning behind the actual rule.

[44 AMP]

I'd like to know what "predominately" for profit means and occasionally? How would this even be enforced for the average person who frequently sale or trade without ever turning a profit. I mean for people who don't complete bill of sales, how would this work.

Pardon my cynicism, but it can work the same way its worked before. Once you come to their attention, they show up, accuse you, and arrest you. Then you're in the legal pipeline.

When you finally get to court, you may win, or you may find a jury who thinks the ATF knows gun law better than you do, and if they say you're guilty, then you're guilty!

The whole "prove you are innocent" thing helps with getting convictions too, I would suppose...

[The Verminator]

Originally Posted by 44 AMP

Pardon my cynicism, but it can work the same way its worked before. Once you come to their attention, they show up, accuse you, and arrest you. Then you're in the legal pipeline.

When you finally get to court, you may win, or you may find a jury who thinks the ATF knows gun law better than you do, and if they say you're guilty, then you're guilty!

The whole "prove you are innocent" thing helps with getting convictions too, I would suppose...

How many have they arrested lately?

How many are being tried by these juries?

When did "prove you're innocent" become part of our legal system?

Are we talking about actual cases or just fantasy?

[dogtown tom]

The Verminator

How many have they arrested lately?

Do they have Google in your country?

How many are being tried by these juries?

Most never make it to trial.
Pead out well before that happens.

When did "prove you're innocent" become part of our legal system?

At the same time as guilty until proven innocent.
Seriously, proving ones innocence's happens all the time.

Are we talking about actual cases or just fantasy?

Actual cases.
I know of several just here in DFW.

[PolarFBear]

Was at a local "event" today; largest in E. TN. Lots of speculation. Five ATF agents were on "patrol" on the premises. Three of five of my cohorts flatly stated they would NOT be renting table space in the future. Not confirmed but reported by a known FFL at the "event" stated ATF was visiting tables and "suggesting" that the vendor NOT display goods at future sales. The promoter said there would be a FFL at future shows to process background checks. Regrettably he did not offer specifics.

[The Verminator]

Originally Posted by PolarFBear

Was at a local "event" today; largest in E. TN. Lots of speculation. Five ATF agents were on "patrol" on the premises. Three of five of my cohorts flatly stated they would NOT be renting table space in the future. Not confirmed but reported by a known FFL at the "event" stated ATF was visiting tables and "suggesting" that the vendor NOT display goods at future sales. The promoter said there would be a FFL at future shows to process background checks. Regrettably he did not offer specifics.

If you had said, "Forty-three people were arrested," this would be a story.

As it stands, it sounds like things are working out as they should.

What percentage of law abiding gun owners rent tables at gun shows?

Maybe one percent?

[The Verminator]

Originally Posted by dogtown tom

Actual cases.
I know of several just here in DFW.

When I said "actual cases" I was talking about the comment about trial and juries.

As I have said before, the experience I had involved no such thing.

They had the guys dead to rights, having both sold and purchased from them over a period of a few months and having both ads they had placed and some very incriminating statements.........so all in all........a guilty plea with probation and loss of guns and gun rights was a sure outcome.

[The Verminator]

Originally Posted by dogtown tom

Seriously, proving ones innocence's happens all the time.

As in all criminal cases.........

They present evidence that you have broken the law.

You attempt to refute that evidence.

I guess you can call that "proving you're innocent" if you want.

But it's the same as every other criminal case..........you are innocent until proven guilty.

But as I said, going to trial is so rare as to be irrelevant.

Most are caught so red handed as to preclude any chance of a trial.

[mehavey]

They present evidence that you have broken the law.

If the Law (actually the new regulatory interpretation) is so squishy as to be bent to whatever shape fits the
moment, you have chaos in the minds of ordinary men.

We have here on this forum probably one of the most well-versed collections of men in this whole firearms arena.
And they still can't agree on what bright lines ordinary men should watch for.

You attempt to refute that evidence.

Against which those ordinary men face the bottomless treasury and limitless legal resources of the federal gov't's intent to convict you -- armed only with your own income, life savings, your home, your children's education, and your eventual freedom. The result? You plead out just to save your family. The actual "Law" then is rarely actually tested to closure on those "bright lines."

The consequence is a state of fear on the part of those ordinary men.
Rats in a maze afraid of shocking pain no matter which way they turn.
They simply stop in place.
Quit moving...

The result is the same as if "the Law" had gone full tilt against transfer of any kind .. absent retaining your own lawyers ...and even then rolling the dice.

As has been said quite eruditely on another Forum: They have laid a trap for ordinary men.
One having an inescapable 'Event Horizon' which once crossed, one cannot break free.
And one with very ill-defined, very plastic, and very slippery... edges.