Rather than establishing a minimum threshold number of firearms purchased or
sold, this rule proposes to clarify that, absent reliable evidence to the contrary, a person
will be presumed to be engaged in the business of dealing in firearms when the person:
(1) sells or offers for sale firearms, and also represents to potential buyers or
otherwise demonstrates a willingness and ability to purchase and sell additional
firearms;
(2) spends more money or its equivalent on purchases of firearms for the purpose
of resale than the person’s reported taxable gross income during the applicable period of
time;
(3) repetitively purchases for the purpose of resale, or sells or offers for sale
firearms-
(A) through straw or sham businesses, or individual straw purchasers or
sellers; or
(B) that cannot lawfully be purchased or possessed, including:
(i) stolen firearms (18 U.S.C. 922(j));
(ii) firearms with the licensee’s serial number removed, obliterated, or
altered (18 U.S.C. 922(k); 26 U.S.C. 5861(i));
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(iii) firearms imported in violation of law (18 U.S.C. 922(l), 22 U.S.C.
2778, or 26 U.S.C. 5844, 5861(k)); or
(iv) machineguns or other weapons defined as firearms under 26
U.S.C. 5845(a) that were not properly registered in the National Firearms
Registration and Transfer Record (18 U.S.C. 922(o); 26 U.S.C.
5861(d));
(4) repetitively sells or offers for sale firearms—
(A) within 30 days after they were purchased;
(B) that are new, or like new in their original packaging; or
(C) that are of the same or similar kind (i.e., make/manufacturer, model,
caliber/gauge, and action) and type (i.e., the classification of a firearm as a rifle,shotgun, revolver, pistol, frame, receiver, machinegun, silencer, destructive
device, or other firearm);
(5) who, as a former licensee (or responsible person acting on behalf of the former
licensee) sells or offers for sale firearms that were in the business inventory of such
licensee at the time the license was terminated (i.e., license revocation, denial of license
renewal, license expiration, or surrender of license), and were not transferred to a
personal collection in accordance with 18 U.S.C. 923(c) and 27 CFR 478.125a; or
(6) who, as a former licensee (or responsible person acting on behalf of a former
licensee) sells or offers for sale firearms that were transferred to a personal collection of
such former licensee or responsible person prior to the time the license was terminated,
unless: (A) the firearms were received and transferred without any intent to willfully
evade the restrictions placed on licensees by chapter 44, title 18, of the United States
Code; and (B) one year has passed from the date of transfer to the personal collection.
Any one or a combination of the circumstances above gives rise to a presumption
in civil and administrative proceedings that the person is engaged in the business of
dealing in firearms and must be licensed under the GCA. The activities set forth in these
rebuttable presumptions are not exhaustive of the conduct that may show that, or be
considered in determining whether, a person is engaged in the business of dealing in
firearms. Further, as noted above, while the criteria may be useful to courts in criminal cases when instructing juries regarding permissible inferences, the presumptions outlined
above shall not apply to criminal cases.
At the same time, the Department recognizes that certain transactions are not
likely to be sufficient to support a presumption that a person is engaging in the business
of dealing in firearms. For this reason, the proposed rule also includes examples of when
a person is not presumed to be engaged in the business of dealing in firearms.
Specifically, under this proposed rule, a person would not be presumed to be engaged in
the business requiring a license as a dealer when the person transfers firearms only as
bona fide gifts, or occasionally sells firearms only to obtain more valuable, desirable,
or useful firearms for their personal collection or hobby, unless their conduct also
demonstrates a predominant intent to earn a profit.