Do I need a manufacturer's license to make a prototype revolver?

[FlaBoy]

Hello all,

I am a mechanical engineer, and in the process of equipping my home shop with machine tools and such. I have had an idea for a gun bouncing around in my head for awhile, and in the near future was going to start drawing out plans and slapping together a prototype to see if my idea translates to real life. If my idea works out the way I hope, I think there could be a real market for it, and I am definitely doing this with an eye towards manufacturing these guns as a business eventually.

It is my understanding that it is completely legal to manufacture your own firearm without a manufacturers license so long as you are not engaged in the regular business of selling firearms. I am thinking that I would fall under this category, as I am not currently engaged in the business of selling/manufacturing firearms, and the first few iterations I make will obviously not be for sale (used as a test bed, proof of concept, demonstrator, etc). However, I know how strangely the ATF applies/interprets some of it's regulations (ie, adding non-factory sights to a gun counts as manufacturing, not gun-smithing) and want to make sure that I won't need a manufacturers license since I will be doing this not for personal use but eventually as a business (hopefully).

Any help from you guys is appreciated. I will probably talk to a lawyer about all this to be sure before I actually put mill to metal, but I wanted to get a general idea of what I am in for first. Thanks guys!

 

[rule303]

You should be fine, as long as you are not manufacturing that particular firearm for the purpose of resale. The ATF may see it differently, depending on who you talk to. If you do ask for an opinion from them, make sure to get the response in writing.

 

[Twmaster]

You can make your own guns with out a manufacturer's license. You cannot sell them. Also you would still be under the same restrictions as anybody else. IOW, you cannot make a machine gun etc.

 

[Bubbles]

Making guns for personal use is fine. Making them to sell w/o a license is a no-no.

Also, some states have their own requirements with respect to owning, posessing, registering, licensing, etc. handguns. Assuming you're not in a state like CA, NY, IL, etc. you should be fine.

 

[rainbowbob]

Incidentally....this is a good example of why banning guns makes zero "common-sense": They can be built in your garage.

 

[barnbwt]

Keep us posted if you decide to go for the brass ring, Flaboy!

I'm contemplating getting a rapid prototyper (or access to one) since I'm not a machinist, but still have ideas for stuff I'd like to try. I love hearing from people who actually try to build something that isn't a kit. Check out Jim March's Ruger mod journal; cool and inspiring stuff!

TCB

 

[Sam1911]

You are absolutely FINE to make guns for yourself, for whatever eventual goals. When you start making them TO SELL, that's when you need an type 07 FFL.

A few points...

(ie, adding non-factory sights to a gun counts as manufacturing, not gun-smithing)

That only applies to licensed dealer/gunsmiths who were buying guns and "product-improving" them with upgrades and reselling them. The BATFE declared that those guys need a different kind of license than what they had to be doing that.

 

[Sam1911]

You can make your own guns with out a manufacturer's license. You cannot sell them.

I wish this old truism would finally DIE.

You absolutely CAN sell a gun you made yourself. You cannot make guns FOR the purposes of selling them, but if you decide to sell one that you'd made, that is ok.

The ATF recommends that you first mark it (serial number and maker's name and location) following the guidelines by which you MUST mark Title II registered firearms.

 

[Jim K]

"You absolutely CAN sell a gun you made yourself. You cannot make guns FOR the purposes of selling them, but if you decide to sell one that you'd made, that is ok."

Hmmm. And if I decide to make, say 25,000 for my own use and then decide I don't want them and sell them? Is there a line there somewhere? And can a ruling or a court case be cited as to just where it is?

Also, note that per BATFE, if you make a gun for your own use, YOU MUST MAKE IT. If you farm out parts of the job or get someone to do the work for you, then you are not making it; someone else is and HE needs a manufacturer's license. Even if you have a license, if you get someone else to do the work, he also needs a license.

Jim

 

[Sam1911]

In theory...sure.

In practice, probably not. And no, there is no line in the sand. They aren't saying how many is OK to sell today, this year, ever. But they've left that ephemeral for maximum enforcement flexibility.

But that's not what the OP asked about. He wasn't asking about selling them, he was asking about making one as a prototype for what may at some point become a business venture. That's not even close to any line in the sand.

Also, note that per BATFE, if you make a gun for your own use, YOU MUST MAKE IT. If you farm out parts of the job or get someone to do the work for you, then you are not making it; someone else is and HE needs a manufacturer's license.

That sould be, you must make THE RECEIVER (or other part that is "the firearm"). You certainly can buy barrels, triggers, stocks and whatever other parts you want. Just not the "gun" part itself.

 

[Frank Ettin]

... And if I decide to make, say 25,000 for my own use and then decide I don't want them and sell them? Is there a line there somewhere? And can a ruling or a court case be cited as to just where it is?...

No court decision as far as I know. Of course all that means is that you may be the first to help define where that line is. And if you turn out to be on the wrong side, you won't be happy.

Under applicable law (18 USC 921(a)(21)(A)) "engaged in the business" means:

(21) The term “engaged in the business” means—

(A) as applied to a manufacturer of firearms, a person who devotes time, attention, and labor to manufacturing firearms 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;...​

Whether or not your particular activity falls within that definition will be decided in court by the totality of the circumstances, not necessarily by what you say. So, for example, you could say that you made 25,000 guns for your own use, but that's going to be too hard for anyone to swallow; and no one will believe.

You can also be found to be "engaged in the business" even if you're not actually making a profit. If you're not making money, it might just mean you're a lousy businessman.

...I have had an idea for a gun bouncing around in my head for awhile, and in the near future was going to start drawing out plans and slapping together a prototype to see if my idea translates to real life. If my idea works out the way I hope, I think there could be a real market for it, and I am definitely doing this with an eye towards manufacturing these guns as a business eventually...

Here's the problem. As the OP describes his intent, he's not making a gun for his own use. He's designing a gun and making a prototype with the expectation of engaging in the business of manufacturing the gun, if it works out.

Is that enough to bring his activity within the definition of "engaged in the business"? I don't know, and I don't know if a court or the ATF has looked at that exact question and reached a conclusion. I'd like to think that it's not enough, but I sure can't say for certain.

It might not be a bad idea to request, in writing, advice from the ATF.

 

[dprice3844444]

make sure you put your name and a serial number on it so the feds/states cannot get you for no serial number(just in case)

 

[bluethunder1962]

Good luck on your dream. Wish I had followed through on some of mine.

 

[barnbwt]

(21) The term “engaged in the business” means—

(A) as applied to a manufacturer of firearms, a person who devotes time, attention, and labor to manufacturing firearms 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;...

Wait, does that mean it's okay to sell as much as you like at a loss? I could make as many prototypes and designs as I wanted and sell them for 10$ less than my itemized costs? It'd be a sweet way to make a hobby less onerous...

TCB

VVVVV--Damn! You just can't win, can you?

 

[Carl N. Brown]

Uh, ATF has won "dealing without a license" cases where the seller claimed a loss. That was at the appellate court level. You get there your life savings are toast.

I suspect one is most likely to get attention from ATF if local police report that suspects tell them that so-and-so is a no-questioned-asked source of street weapons, if one is the so-and-so.

Making a Title I firearm (conventional rifle, shotgun, handgun of the type sold on a Form 4473) for your own use and maybe selling it a year or more later, probably won't draw attention. Making 25,000 and then selling them might get some attention, may be even from IRS.

 

[Frank Ettin]

...does that mean it's okay to sell as much as you like at a loss?...

No, you can be "engaged in the business" and lose money. Lots of businesses lose money, although then they don't exist for long.

...Damn! You just can't win, can you?

Well, no. Yon can't win if you insist on being silly about a serious subject.

 

[FlaBoy]

Here's the problem. As the OP describes his intent, he's not making a gun for his own use. He's designing a gun and making a prototype with the expectation of engaging in the business of manufacturing the gun, if it works out.

Is that enough to bring his activity within the definition of "engaged in the business"? I don't know, and I don't know if a court or the ATF has looked at that exact question and reached a conclusion. I'd like to think that it's not enough, but I sure can't say for certain.

It might not be a bad idea to request, in writing, advice from the ATF.

That is exactly the question that concerned me. The more i read the actual law:

(21) The term “engaged in the business” means—

(A) as applied to a manufacturer of firearms, a person who devotes time, attention, and labor to manufacturing firearms 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;...

The more I feel i would NOT need a license. This would by no means be a 'regular course of trade or business' for me at the time I make the prototype. I have a separate career that consumes the VAST majority of my time and labor. Furthermore my principal objective would not be livelihood or profit through the sale of the firearm at the time of constructing a prototype, but rather to determine the practicality and functionality of a particular design.

All that being said, I definitely think the best course of action will be get a written opinion from local BATFE office. Anyone know how to go about attaining such a thing? of course, any information I get from them will be shared here so we can all be enlightened. Thanks for the help so far guys!

 

[Jim K]

First, I obviously was not serious about making 25,000 guns "for my own use". But my intent was to show that the exemption would probably not be unlimited in practice even if it is in theory.

Second, do NOT EVER ask for an opinion on an important matter from an ATF agent or the local office. Write to BATFE headquarters (address on their web site www.atf.gov ), state the problem or question clearly and succinctly; one paragraph is often enough. And don't get carried away like some folks do on web sites; don't use 87 pages to tell them how evil they are, then ask a favor.

An opinion from an agent means nothing; an opinion from a local office applies only to that office. A written letter from HQ applies to all ATF agents and offices.

Jim

 

[Frank Ettin]

...The more I feel i would NOT need a license. This would by no means be a 'regular course of trade or business' for me at the time I make the prototype. I have a separate career that consumes the VAST majority of my time and labor. Furthermore my principal objective would not be livelihood or profit through the sale of the firearm at the time of constructing a prototype, but rather to determine the practicality and functionality of a particular design....

On the other hand --

1. The applicable regulation defining "engaged in the business" for a manufacturer doesn't require that one devote the majority of one's time to the activity, only that he devote:

   ...time, attention, and labor to manufacturing firearms as a regular course of trade or business...

   
   
2. The question becomes whether the initial step of business and testing a prototype is part of a regular course of trade or business manufacturing firearms as the first step. Designing, building and testing prototypes is certain a regular part of the business of manufacturing firearms.
   
   
3. And note also that the regulation doesn't require that the manufacture of firearms be one's sole trade. The regulation would certainly apply to someone with a side business.

So it's still a problem of the question not having a good, clear answer.

...Second, do NOT EVER ask for an opinion on an important matter from an ATF agent or the local office. Write to BATFE headquarters (address on their web site www.atf.gov ), state the problem or question clearly and succinctly; one paragraph is often enough. And don't get carried away like some folks do on web sites; don't use 87 pages to tell them how evil they are, then ask a favor.

An opinion from an agent means nothing; an opinion from a local office applies only to that office. A written letter from HQ applies to all ATF agents and offices.

Good advice. And also be very clear and accurate about describing what you want to do and what your plans and intentions are. You will be able to rely on an official opinion from BATF, but only with regard to exactly what you asked.