Tag Archives: ammunition

Firearm and Ammunition Preemption Needs YOUR Immediate Support!

Today, in an 8-3 vote, the Senate Local Government Committee passed an extremely important firearm and ammunition preemption bill – Senate Bill 5 – which in addition to reaffirming/strengthening preemption would also provide for attorney fees and costs, where a local government violates the preemption statute.  Senate Bill 5 will now go to the Senate floor for consideration.

We can pass preemption with a veto proof majority, but we need YOUR help! Please contact your state Senator and urge them to support Senate Bill 5!  Please take the time to email, fax or call your Senator and do not use form letters/requests, as they are generally ignored. Our Representatives know when an issue is so important to you that you take the time to personally and respectfully contact them.

Together, we can ensure that our rights under Article 1, Section 21 are not questioned!

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ATF Just Banned Ammunition – Well Not Really…

The internet is a blaze with articles declaring that ATF just banned ammunition sales as a result of a June 2016 Explosives Newsletter; however, it isn’t exactly true (at least, not anymore). The ATF publishes newsletters which provide insight into complex subjects, shifting policies, and guidance on ATF’s plans to enforce regulations. In the June 2016 Explosives Newsletter ATF ‘clarified’ that Nitrocellulose is a high explosive subject to the requirements of the Safe Explosives Act and other laws governing the sale, storage, and transport of high explosives. You may be thinking – “Well great…but what is Nitrocellulose and what does that have to do with ammo?”

The answer to that is simple – most ammunition used in the United States is powered by smokeless gunpowders. Unlike black powder which is a fairly straight forward mix of chemicals, smokeless powders are proprietary blends of different chemicals each unique to the manufacturer. Unique that is except for the base chemical – Nitrocellulose.

The FBI Laboratory Services explains, “All smokeless powders can be placed into one of three different classes according to the…composition of their primary energetic ingredients. A single-base powder contains NITROCELLULOSE, whereas a double-base powder contains NITROCELLULOSE and nitroglyverine. …[T]riple-base powders are NITROCELLULOSE, nitroglycerine, and nitroguanidine….” Or put another way – If your ammunition uses any type of smokeless powder the odds are that it contains Nitrocellulose.

Okay, okay but what does all this mean? – High explosives are subject to extremely stringent regulations. These regulations mean that not just anyone can manufacture, store, or purchase high explosives. High explosives have to be secured in specialized magazines which are more like a bunker than what you insert into your pistol or rifle. High explosives have to be reported and anyone who manufacturers or sells these items have to be thoroughly subjected to background checks and all of their employees (referred to as “responsible persons”) have to be checked out and licensed. Even within the licensing structure there are different requirements.

If smokeless powders are now considered high explosives then ammunition can no longer be sold on store shelves. Manufacturers need to completely redesign their operations, rebuilding their facilities and ensuring their personnel meet the stringent requirements. Simply put, if ATF intends to enforce this new designation ammunition is going to be almost impossible to acquire.

Fortunately, it seems ATF did exactly what it does best – jump the gun. On August 31, 2016 ATF posted an addendum to their June 2016 newsletter. The addendum is merely one paragraph long and suffices to say:

[C]ontact from industry members…has brought to our attention issues that were not fully addressed…and require further consultation and consideration with the industry. Accordingly, ATF has and will conduct further industry outreach….”

In other words, someone at ATF received a question about Nitrocellulose and never stopped to think about the implications of clarifying it as a high explosive. Thankfully, at this time, ATF has concluded, “[i]n the interim, previously authorized industry practices concerning wetted Nitrocellulose will not be affected.

We here at Prince Law Offices and the Firearms Industry Consulting Group will be sure to update you as ATF releases more information.

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If You Thought ITAR Was Bad…Firearm and Ammunition Manufacturing, Importing (and Gunsmithing) Taxes

Recently, attorney Adam Kraut with Firearms Industry Consulting Group, a division of Prince Law Offices, P.C., blogged about the guidance recently issued by the Directorate of Defense Trade Control (DDTC) relating to its interpretation of what constitutes manufacturing under the Arms Export Control Act (AECA) and its implementing regulations, the International Trafficking in Arms Regulations (ITAR). Although I have blogged about ITAR’s applicability to the Firearms Industry for a long time, including my 2012 article that DDTC was stepping up enforcement of ITAR against the Firearms Industry and thereafter, ATF’s notice to firearm and ammunition manufacturers that they are likely required to register, the Firearms Industry has generally responded in absolute shock to DDTC’s recent guidance that AECA/ITAR regulates the Firearms Industry, even though it has since its implementation in 1976. While some of DDTC’s guidance does go beyond AECA/ITAR, such as requiring gunsmiths to register if they’re merely threading barrels, that is a battle that will need to be fought in court, if the Firearm Industry wants to challenge DDTC.

Nevertheless, there is another, potentially more encompassing law, the Firearm and Ammunition Excise Tax (FAET), which was first imposed by the Revenue Act of 1918. You can find it at 26 U.S.C. §§ 4181-4219 and the regulations at 27 C.F.R. Part 53. It is currently enforced by a separate agency, the Alcohol and Tax Trade Bureau, although referred to as TTB.

So, if you thought it was difficult enough remembering the definition of a “firearm” or what constitutes “manufacturing” under the Gun Control Act (GCA) and now AECA/ITAR, get ready, because FAET’s definition of a firearm and manufacturing is separate and distinct. While a book could be written on the intricacies of FAET, the exemptions, and the exceptions (yes, exemptions are different from the exceptions), this article is merely intended to give the Firearms Industry a heads up that they need to ensure their compliance not just with the GCA or AECA/ITAR, but also the FAET.

The FAET provides that a tax of 10% is due on the sale price for pistols/revolvers and 11% on all other firearms and shells and cartridges. Anyone manufacturing or importing any taxable product must file quarterly with the TTB on its 5300.26 Form (except, you do NOT need to submit a return for periods where no tax is due). BUT, what is a firearm? What are shells and cartridges? And what constitutes manufacturing or importing? And there are exceptions/exemptions, right?

Firearms

As I mentioned about FAET’s definition is NOT identical to the definition found in the GCA. FAET defines a firearms as:

Any portable weapons, such as rifles, carbines, machine guns, shotguns, or fowling pieces, from which a shot, bullet, or other projectile may be discharged by an explosive.

So, if the firearm is not “portable,” it is not taxable; however, pursuant to ATF Ruling 97-2, portable means the weapon can be lifted and carrier by an average person. In that ruling, ATF found that a Model 1919 was portable.

Further, for a firearm to be taxable, it must be complete. Thus, frames and receivers are not taxable; however, selling a firearm in breakdown condition (e.g. all parts present but not assembled) does not exclude it from being a taxable firearm. (Also, don’t think that you can just sell, for example, an AR-15 without a bolt and then, three weeks later, send the customer the bolt, to avoid the tax – REMEMBER, there is a difference between tax avoidance (which is lawful) and tax evasion (which is unlawful)).

Unlike under the GCA, antique firearms ARE firearms and ARE taxable under the FAET and include matchlock, flintlock and perscussion cap firearms. Moreover, unlike the GCA, silencers/suppressors are NOT included under the FAET.

Oh and for the real kicker? Pursuant to ATF Ruling 94-6, a manufacturers own use of a firearm it manufactured for purposes of a demonstration results in a taxable occurrence. Moreover, if a manufacturer lends a firearm to a evaluator for review, such constitutes a taxable occurrence.

Shells/Cartridges

Shells and cartridges is defined in the regulations as:

Any article consisting of a projectile, explosive, and contained that is designed, assembled, and ready for use in firearms, pistols or revolvers.

Like with firearms, all components of the ammunition must be present. Hence, blank ammunition with no projectile is exempt. HOWEVER, the sale of un-assembled ammunition kits (e.g. all components present), less than lethal ammunition, marker ammunition with plastic projectiles…etc are all taxable.

Like with firearms, if a manufacturer uses its own ammunition for a demonstration or its own business purposes, it must pay the applicable tax.

Who’s a Manufacturer?

Of course, we also have to define what constitutes a manufacturer, since I already told you that it was not consistent with the GCA or AECA/ITAR. Under the FAET, a manufacturer is defined as:

Any person who produces a taxable article from scrap, salvage, or junk material, or from new or raw materials by processing, manipulating, or changing the form of an article or by combining or assembling 2 or more articles.

Hence, it is not just the manufacture of a new firearm from raw materials that results in the manufacture of a firearm; but rather, it also includes the change in the form of the firearm (or ammunition). Under Revenue Ruling 69-325, it was held that the converting of military rifles into “sport-type” rifles by removing the wooden stock, cutting off the end of the barrel and installing a new front site constituted a change in form of the firearm and resulted in the manufacture of a firearm, for purposes of the FAET.

In this vein, TTB on its publication Gunsmith Information declares that merely “[c]utting off part of the barrel of a firearm is, of itself, an act of manufacture.” (see page 2 of the publication).

However, there can be a distinction between a fabricator and a manufacturer (resulting in a drastic tax liability difference), depending on who owns the materials at the time the firearm or ammunition is to be manufactured. In some occasions, the customer, if he/she provides all the materials, can actually constitute the manufacturer of the firearm/ammunition under the FAET.

Who’s an Importer?

Of course, this article wouldn’t be complete without defining an importer, since they too come under the FAET. An importer is defined as:

Any person who brings a taxable article into the U.S. from a source outside the U.S.

Generally, the FAET focuses on who arranges for the article to be imported as a principal, not the agent.

Exemptions and Exceptions?

All the exemptions and exceptions under FAET are too numerous for this article but some of the more important and applicable ones are:

  1. Purchase by specifically enumerated military departments using appropriated funds (be cautious, not all military departments are enumerated);
  2. Sales to state or local governments (including Indian Tribal Governments and the United Nations);
  3. Sales to non-profit educational organizations (see 26 U.S.C. § 170(b)(1)(A)(ii) for a definition)
  4. Firearms subject to the National Firearms Act, where the tax is paid (be cautious SOTs, as your SOT fee is not the payment of the tax for a particular firearm. Accordingly, in some occasions, it may make more sense to pay the manufacturing tax ($200.00) on the manufacture of an NFA firearm rather than pay the 11% tax);
  5. Manufacturers of less than an aggregate of 50 pistols. revolvers, or firearms during a calendar year (this does NOT apply to manufacture of shells or cartridges); and
  6. Personal use is exempted, per 27 C.F.R. 53.112(b).

The Good Aspect to FAET?

The only good thing about FAET is that all tax revenue goes into a trust fund, which can only be used for wildlife restoration and hunter safety training.

Confused?

If you’re still confused about the FAET’s application to your situation or need to submit a request for determination to the TTB, we are here to help. Give us a call at 888-313-0416 or send us an email at Info@PrinceLaw.com.

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Justice Thomas’ Overlooked Second Amendment Statement

Many in the legal profession focus their Supreme Court decision review based on the areas of law in which they practice or otherwise have an interest in, but sometimes, the best support for a particular legal issue comes not from a case on point but in an opinion or concurrence which most would overlook. Last week, on March 30th, the Court issued a decision in Luis v. U.S., No. 14-419, relating to whether the Government can seize assets of a criminal defendant, prior to trial. While the topic may sound bland and unenticing to most, it is Justice Thomas’ concurrence that makes a profound statement about the Second Amendment – a statement that has been overlooked by almost all in the media and legal profession.

So what exactly did Justice Thomas say?

Constitutional rights thus implicitly protect those closely related acts necessary to their exercise. “There comes a point . . . at which the regulation of action intimately and unavoidably connected with [a right] is a regulation of [the right] itself.” Hill v. Colorado, 530 U. S. 703, 745 (2000) (Scalia, J., dissenting). The right to keep and bear arms, for example, “implies a corresponding right to obtain the bullets necessary to use them,” Jackson v. City and County of San Francisco, 746 F. 3d 953, 967 (CA9 2014) (internal quotation marks omitted), and “to acquire and maintain proficiency in their use,” Ezell v. Chicago, 651 F. 3d 684, 704 (CA7 2011). See District of Columbia v. Heller, 554 U. S. 570, 617–618 (2008) (citing T. Cooley, General Principles of Constitutional Law 271 (2d ed. 1891) (discussing the implicit right to train with weapons)); United States v. Miller, 307 U. S. 174, 180 (1939) (citing 1 H.Osgood, The American Colonies in the 17th Century 499(1904) (discussing the implicit right to possess ammunition)); Andrews v. State, 50 Tenn. 165, 178 (1871) (discussing both rights). Without protection for these closely related rights, the Second Amendment would be toothless. (Emphasis added).

This statement is so profound and logical; yet, many judges overlook it…or, possibly, their political views overshadow their oath to uphold the Constitution. Regardless, Justice Thomas, along with Justice Alito, appear to be the new voice for the Second Amendment on the Court. A voice that may be extinguished, if Justice Scalia’s replacement is not one who upholds and defends the oath that he/she has already taken and will again be required to take before taking the bench. With the elections quickly approaching, I cannot emphasize enough the importance of having a Constitutional jurist appointed to the Supreme Court.

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ATF Determination – FFLs Can Rent Handguns AND Ammunition to Individuals 18 and Older

As our readers are aware, Trop Gun Shop, LTD has been at the forefront of defending the rights of those in the Firearms Industry, including individuals, FFLs and Gun Clubs/Ranges. Recently, Trop obtained a determination from the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF) that benefits the entire Firearms Industry.

In March of 2013, the ATF issued its FFL Newsletter that, inter alia, addressed whether an FFL could rent a handgun to an individual under the age of 21 for on-premises use. ATF declared, “A licensee may rent a handgun to a person less than 21 years of age, or a long gun to a person less than 18 years of age for use at an on-premises shooting range.” However, ATF did not address, or even mention, whether the FFL could provide ammunition for the handgun to an individual between the ages of 18 and 21 given the prohibition on the sale or delivery of handgun ammunition to those under 21, pursuant to 18 U.S.C. 922(b)(1).

As a result and due to Trop’s dedication to protecting the Firearms Industry, Trop requested that I submit a determination request on its behalf to ATF arguing that an FFL is lawfully able to provide ammunition that can be used in either a rifle or handgun to someone who is between 18 and 21 years of age, when the person is renting a handgun from an FFL for on-premises use, in which the ammunition can be utilized. That request was submitted on August 16, 2014.

On May 6, 2015, the Firearms Industry Program Branch (FIPB) responded:

The longstanding position of ATF has been that the temporary use of a handgun and the “using up” of ammunition onsite does not constitute a delivery and the prohibition to the sale or delivery of handguns or ammunition to a person under 21 years of age according to 18 U.S.C. 922(b)(1) would not apply. This is provided that the ammunition is to be expended and used-up on the licensed premises in conjunction with the onsite rental of a firearm and is included as part of the overall fee for the usage of the facility. In addition, the spent cartridges and any unused ammunition must be returned to the facility.

A copy of the determination can be found here.

Accordingly, as I originally contended in my determination request, an FFL may lawfully provide (NOT SELL) ammunition that can be used in either a rifle or handgun to someone who is between 18 and 21 years of age, when the person is renting a handgun from that FFL for on-premises use, in which the ammunition can be utilized. However, it is imperative that the FFL ensure that either all ammunition is expended or any unused ammunition is returned.

If you are in the Firearms Industry and require a determination from ATF, contact us today to discuss how we can assist you in obtaining the determination that you desire and which further protects our Industry.

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PRESS RELEASE: Chief Counsel Joshua Prince to be on NBC10’s @ Issue on Sunday!

We are proud to announce that Chief Counsel Joshua Prince of the Firearms Industry Consulting Group, a division of Prince Law Offices, P.C., will be on NBC 10’s @ Issue on Sunday at 11:30 AM discussing Pennsylvania’s recent amendment to our firearm and ammunition preemption statute, known as Act 192. Shira Goodman from CeaseFirePA will also be in attendance.

Tune in to watch Attorney Prince debate Mrs. Goodman regarding Act 192, its validity, and the criminal penalties, since 1974, associated with violating 18 Pa.C.S. § 6120. This is guaranteed to be a show you don’t want to miss!

If you live in a municipality that is violating your rights by regulating firearms or ammunition, contact us today – 888-313-0416 or Info@PrinceLaw.com – to discuss your legal rights! Together, we can ensure that our Article 1, Section 21 and Second Amendment Rights are here for our children.

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Winchester recalls certain lots of M-22 22LR ammo!

FICG is always concerned with the well being and  safety of our clients, readers, and the general shooting public. We therefore wanted you to know that you should check out any Winchester 22LR ammo you may have bought or others you know may have bought, as it is being recalled.

Winchester thinks it may have double charged certain lots of 22LR with extra gunpowder when manufacturing the ammunition! For anyone who reloads or knows a little about how ammunition is made or works, they know that a double charged load is an EXTREMELY dangerous and potentially deadly situation for a shooter and those around them. So check those boxes, share the story to your friends and stay safe!

Symbol Number: S22LRT 

Lot Numbers: GD42L and GD52L

Winchester has determined the above lots of 22 Long Rifle rimfire ammunition may contain double powder charges. Ammunition with double powder charges may subject the shooter or bystanders to a risk of serious personal injury and/or death, or cause firearm damage, rendering the firearm inoperable.

DO NOT USE WINCHESTER® M*22™ 22 Long Rifle RIMFIRE AMMUNITION WITH LOT NUMBERS GD42L or GD52L. The ammunition Lot Number is imprinted (stamped without ink) on the left tuck flap of the 500-round carton as indicated here. The 1000-round intermediate carton does not have a Lot Number.

To determine if your ammunition is subject to this notice, review the Symbol Number and Lot Number. If it is Symbol Number S22LRT with a Lot Number containing GD42L or GD52L immediately discontinue use and contact Winchester toll-free at 866-423-5224 or visit http://www.winchester.com/Product-Service/Pages/Contact-Us.aspx for free UPS pick-up of the recalled ammunition.

This notice applies only to Symbol Number S22LRT with Lot Numbers GD42L and GD52L. Other Symbol Numbers or Lot Numbers are not subject to this recall.

If you have any questions concerning this 22 Long Rifle rimfire ammunition recall please call toll-free 866-423-5224, write to Winchester (600 Powder Mill Road, East Alton, IL 62024 Attn: S22LRT Recall), or contact Winchester Customer Support online.

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