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Thread: Shut down FFL/SOT

  1. #1
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    Shut down FFL/SOT

    I did not want to hijack another thread with this question so I started my own thread...

    If you are a manufacturer and you build some FA receivers, but later you shut down your business. What happens to those receivers? Does the ATF confiscate them or do you get to keep them?

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    From what I've read, they must be transferred to another SOT blah whatever or destroyed/disabled.
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    Right off of the ATF website

    In general, any NFA firearm in inventory may be retained by the taxpayer upon the termination of the NFA business (meaning the person no longer pays the special tax and/or no longer has an FFL to import, manufacture, or deal in firearms) except for a machinegun for which its possession is restricted by the provisions of Title 18, U.S.C. § 922(o). A machinegun with this type of restriction on possession is commonly known as a ‘post-1986’ machinegun. As provided by 27 CFR § 479.105(f), a ‘post-1986’ machinegun must be disposed of prior to the discontinuance of the business as an importer, manufacturer, or dealer.

    However, if the business structure was other than a sole proprietorship, such as, for example, a corporation or partnership, and the corporation or partnership dissolves, then the NFA firearms in inventory must be transferred prior to the dissolution. A corporate officer or director or partner cannot retain the NFA firearms registered to the corporation or partnership without proper transfer.
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    Quote Originally Posted by markm View Post
    From what I've read, they must be transferred to another SOT blah whatever or destroyed/disabled.
    Correct. Transferred to LE/mil or destroyed. I talked to ATF today about upgrading to type 07 FFL and class 2 SOT manufacturer. While you're in business, you can have all you want! If you stick to M-4s, it's just the lower you have to trash.
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    Quote Originally Posted by Sparky5019 View Post
    Correct. Transferred to LE/mil or destroyed. I talked to ATF today about upgrading to type 07 FFL and class 2 SOT manufacturer. While you're in business, you can have all you want! If you stick to M-4s, it's just the lower you have to trash.
    I was going to go that route until they came up with ITAR requirements.
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    Quote Originally Posted by SteyrAUG View Post
    I was going to go that route until they came up with ITAR requirements.
    That should only give you problems if you're doing business internationally. How did you get tangled up with that?
    "An opinion solicited does not equal one freely voiced," Al Swearengen, Deadwood 1877.

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    They're requiring all Manufacturers to register with the State Dept. under ITAR now, regardless of whether the licensee intends to export, import or just sell domestically. They don't care if you tell them you will never do either. Frankly, I don't understand why they don't allow registration and fees only when you intend to engage in import/export. It seems like an excuse to rake money in from manufacturers and it is a hefty sum for small time shops.

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    Quote Originally Posted by Sparky5019 View Post
    That should only give you problems if you're doing business internationally. How did you get tangled up with that?
    That is the new "cost of doing business" for ANY 07.
    It's hard to be a ACLU hating, philosophically Libertarian, socially liberal, fiscally conservative, scientifically grounded, agnostic, porn admiring gun owner who believes in self determination.

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    Quote Originally Posted by Oreaopla View Post
    They're requiring all Manufacturers to register with the State Dept. under ITAR now, regardless of whether the licensee intends to export, import or just sell domestically. They don't care if you tell them you will never do either. Frankly, I don't understand why they don't allow registration and fees only when you intend to engage in import/export. It seems like an excuse to rake money in from manufacturers and it is a hefty sum for small time shops.

    Also eliminates a lot of those problematic 07s. And since on sight gunsmithing such as custom stocks, adding optics and such now qualifies as "manufacturing" there will be a lot less of that too. I think they finally got sick of the shop build AK, AR and FAL FFLs.
    It's hard to be a ACLU hating, philosophically Libertarian, socially liberal, fiscally conservative, scientifically grounded, agnostic, porn admiring gun owner who believes in self determination.

    Chuck, we miss ya man.

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  10. #10
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    Quote Originally Posted by SteyrAUG View Post
    Also eliminates a lot of those problematic 07s. And since on sight gunsmithing such as custom stocks, adding optics and such now qualifies as "manufacturing" there will be a lot less of that too. I think they finally got sick of the shop build AK, AR and FAL FFLs.
    That's all State Department bullshit. The ATF doesn't know if you ever register with the ITAR. Lots of local guys have 07/02's that don't have an issue as they don't do any international sales and stay well under $250,000 in sales.

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