On 2 February 1994, there was issued an ATF encyclical placing 35 importers of "7.62 X 39mm steel core ammunition" and all Federal Firearms Licensees on immediate notice that those rounds were now considered "armor piercing." Quoting ATF Director, John W. Magaw, as stating "…(t)hese bullets are designed, when used in handguns, to pose a life-threatening risk to all law enforcement officers," the notification stated:
Recent production of handguns that are designed to fire 7.62 X 39mm steel core ammunition has resulted in the reclassification of that ammunition as armor piercing (which) can only be sold to law enforcement or governmental agencies. Prior to introduction of these handguns in the marketplace, 7.62 X 39mm ammunition was not considered armor piercing, because it was only used in rifles -- primarily SKS/AK rifles.
With this preemptive move, ATF struck a formidable blow at owners of between 7 and 8 million SKS rifles believed to be in this country, as well as those with AKs and sundry other shoulder-fired ordnance in that chambering. With a prime supply of "cheap ammo" suddenly gone, the cost of their shooting game had just gone up. As it was with the majority of small arms ammunition in the post-Brady Law hording frenzy, 7.62 X 39mm was already in extremely short supply, and the cost of an 1,100 round case of even lead core, available from over-stocked distributors during the summer of 1993 at $90/case, was suddenly selling in the $149 to $209 range… when it could be found! Ironically, the importation price of the restricted steel core ammunition was actually three dollars per case less expensive than the lead fodder from Norinco via China Sports, the country's largest importer of 7.62 X 39mm.
"You're not going to see numbers like those (of 1993) again," one Northeastern distributor said at the time. "The Chinese are really putting it to us now, probably to make up for the loss of their other market" (for steel core product).
An extensive investigation behind ATF's action revealed that the balloon went up in December 1993 when The Shotgun News ran Olympic Arms' advertising to promote their model OA-93 ("a true AR-15 pistol") chambered in 7.62 X 39mm, the announcement of which sent at least two importers scrambling to "buy" the rights to any such handgun to protect their future ammo market. Only the Washington-based gun-maker seemed not to have understood the far-reaching implications of their controversial product or anticipated any negative reaction.
After The Shotgun News advertisement, Robert C. Schuetz, President of Olympic Arms, was warned by both J.D. Jones and Century International Arms (importer of large quantities of the cheap, steel core 7.62 X 39mm ammo) that his promotion of a 7.62 X 39mm "pistol" would probably bring the ATF down on the Chinese steel-core rounds. Schuetz, however, went forward with his OA-93.
Public Law 99-408 of 1986, the infamous "cop killer bullet" legislation, now memorialized as §921(a)(17)(b), reads
"…a projectile or projectile core which may be used in a handgun and which is constructed entirely … of tungsten alloys, steel, iron, brass, bronze, beryllium copper or depleted uranium."
More simply, if there is no handgun chambered for a cartridge, it cannot fall within the definition of §921(a)(17)(b) because it is not a "projectile which may be used in a handgun."¹
"Nobody told me that this was a situation, and by the time I found out, it was too late." "I'm not in the ammunition business," Olympic Arms' Schuetz told the author in one of two interviews at that time. "I wasn't aware that there was a problem. Nobody told me that this was a situation, and by the time I found out, it was too late. I'm 65 years old, I go to church every Sunday, and I feel good about myself. If people are so ignorant as to blame me for what's happened, that's asinine and there's nothing I can do about it. Now when people send me letters on this I just ignore it. What do you want me to do?"
As stated, however, two different concerns had contacted Olympic Arms about the potential problem 1½ months before ATF issued its infamous memo.
Additionally, the author had discussed the matter with Schuetz in a face-to-face at SHOT Show '94.
