By Tom Odom, Esq.
The text that the Bureau of Alcohol, Tobacco, Firearms, and Explosives (“ATF”) submitted to the Office of Information and Regulatory Affairs (“OIRA”) is now available for review. It can be found here: https://www.atf.gov/sites/default/files/assets/inside-atf/2013/082913-wash-machine-guns-destructive-devices-and-certain-other-firearms.pdf Yesterday I posted a summary of the process through which an initiative like this one may eventually become a final, enforceable rule, together with some general observations for individuals with gun trusts or who are contemplating establishing a gun trust. And, for those who sought guidance on how to prepare public comments for a rulemaking proceeding, I offered some resources.
Today, with the actual text of a proposal in hand, in a separate post I identified potential procedural defects that warrant immediate attention. It is not too late for input to require ATF to follow procedures that ensures a more thorough review of the substance of the proposal. While the matter is pending OIRA review is an ideal time to raise those issues.
What most of you want to know at this point is just what does ATF propose to do. Here is a brief summary of the substantive provisions of the ATF proposal.
First, despite prior indications to the contrary, ATF is NOT proposing to eliminate the requirement for certification by a chief law enforcement officer (“CLEO”). The text of the certification will change but the essential function remains the same. This information supercedes my posting yesterday.
Second, the requirements that have been applicable to individuals who sought to make or acquire National Firearms Act (“NFA”) firearms will not change in any substantial manner. Although ATF will be revising certain forms, the same information will be collected.
Third, the familiar requirements applicable to individuals will be extended to “responsible persons” of legal entities that own NFA firearms. That means that not only will responsible persons have to submit photographs and fingerprints, they will also need to get the CLEO signature.
Fourth, an estate would not constitute a legal entity with respect to which a “responsible person” would be subject to the foregoing requirements. The NFA firearms will pass from the decedent to the heir by operation of law, without transfer tax.
Who is a “responsible person” who would be subject to the new requirements, if finally adopted? With respect to a trust, the draft proposal defines as a responsible person “any individual, including any grantor, trustee, or beneficiary, who possesses, directly or indirectly, the power or authority, under any trust instrument or other document, or under state law, to receive, possess, ship, transport, deliver, transfer, or otherwise dispose of a firearm for, or on behalf of, the trust.” Although the specific titles vary in the context of partnerships, corporations, and associations, the breadth of the concept is the same.
Do not assume that just because someone has a title like “grantor” or “beneficiary” that they would necessarily constitute a responsible person. Depending upon the specific trust provisions (or pertinent document governing a different legal entity) and the law of the state, individuals with such titles may not have the “power or authority” that the definition considers key.
The proposal contains several internal inconsistencies and other problems that are worthy of consideration when preparing comments on the substance of the proposal. Look for that next post later this weekend.