Commerce Acts on Firearms "Pause"

Friday the Department of Commerce released an interim final rule amending the Department’s licensing policy for exports of firearms, ammunition, and related components under its jurisdiction.

Coming on the six-month anniversary of a controversial "90 day pause" in firearms export license approval, the new rule proposes significant changes.

"Too often, firearms exports fall into the wrong hands and end up being used in ways that directly undermine U.S. national security and foreign policy interests.," said Commerce Secretary Gina Raimondo, announcing the proposed rule.

"To combat this, we’re taking strategic, targeted actions, including restricting exports to commercial entities in high-risk countries and increasing scrutiny and tracking of all firearms exports,”

1. This rule identifies semi- automatic firearms under new Export Control Classification Numbers (ECCNs);
2. adds additional license requirements for Crime Control and Detection (CC) items, thereby resulting in additional restrictions on the availability of license exceptions for most destinations;
3. amends license review policies so that they are more explicit as to the nature of review that will accompany different types of transactions and license exception availability (including adding a new list of high-risk destinations);
4. updates and expands requirements for support documentation submitted with license applications; and
5. better accounts for the import documentation requirements of other countries (such as an import certificate or other permit prior to importation) when firearms and related items are authorized under a BIS license exception.

Industry Response

The National Shooting Sports Foundation (NSSF), representing American firearms manufacturers, objected to the proposed rules:

"This is deeply troubling the lengths to which this administration will go to turn the levers of government against a Constitutionally-protected industry in order to cozy up to special-interest gun control donors,” said Lawrence Keane, NSSF Senior Vice President & General Counsel. "This is a wholesale attack on the industry that provides the means for Americans exercising their Second Amendment rights.," 

"The total economic impact of the Interim Final Rule easily exceeds $250 million to U.S. manufacturers and exporters, far above the farcically low estimates BIS has been telling NSSF and the Hill," Keane continued.

According to The American Rifleman,  Turkey led the importing nations in 2020, with 1,478,464 firearms. Austria came in second at 1,284,785 followed by Brazil with 1,016,630. Rounding out the top five were Croatia (521,932) and Italy (360,557).  

None of the top export destinations were included in the list of restricted countries named in the proposed rule (see below).

More stringent review standards:

• BIS will increase scrutiny on a transaction-by-transaction level to help prevent firearms from ending up in the hands of foreign criminals, gangs, terrorists, or other malign actors. BIS is implementing regulations that list a clear set of national security and foreign policy factors to consider when reviewing a license application, including terrorism risks, human rights concerns, state fragility, corruption, the nature and capabilities of the firearm, and past instances of diversion and misuse.

Presumption of denial for commercial transactions in countries the State Department has identified as high-risk:

• BIS will apply a “presumption of denial” standard to applications involving nongovernmental recipients located in a destination where the State Department has determined there is substantial risk that firearm exports will be diverted or misused in a manner contrary to national security and foreign policy.
• The State Department’s methodology and country list are included in its Firearms Guidance Memorandum. The Guidance Memorandum identifies 36 destinations where there is a substantial risk that firearms and related items exported to non-government end users will be diverted or misused in a manner adverse to U.S. national security and foreign policy.
• This is in addition to BIS’s policy of denial for countries subject to U.S. arms embargoes and for applications linked to drug trafficking, terrorism, and organized crime.

Data collection and transparency:

• BIS will improve data collection on firearms exports by adopting new export control classification numbers (ECCNs) to track what kinds of firearms U.S. manufacturers are exporting abroad. These include new ECCNs for semi-automatic firearms and related items.

Additional documentation for license applicants:

BIS is implementing regulatory changes to licensing procedures that will help validate that firearms are only exported to trustworthy foreign entities.

• BIS is reducing the general license validity period from 4 years to 1 year, "which will ensure that BIS is able to adapt to an ever-changing global security environment. "
• Furthermore, for countries with less-developed export control regimes, BIS will require the submission of additional documents from licensees before approving a license, including a purchase order and import certification.

Current Licenses Revoked

In addition to the new rule, on July 1, 2024, BIS will revoke currently valid licenses that authorize exports of firearms to non-government end users in the destinations identified by the State Department. This change will align future exports to the new IFR. Those licenses have not been reviewed under the updated policy, but license holders are welcome to reapply so that their applications can be reviewed under BIS’s new standard.

The IFR is effective on May 30, 2024, and the Department will accept public comments on the rule until July 1.

On October 27, 2023, Commerce announced a 90-day pause of export license approvals for certain assault weapons and other firearms transferred by the Trump administration from the State Department’s jurisdiction to Commerce. That pause was scheduled to expire on January 25, 2024.

Less Export Promotion from ITA

In addition to the BIS IFR, Commerce's International Trade Administration (ITA) is implementing changes to its Client Eligibility Policy that will curtail promotion of firearms exports and exports of other items destined for commercial end users that could be misused by malign actors. Any request falling into this category will be declined except in cases consistent with U.S. foreign policy objectives, including national security and human rights.   

LIST OF COUNTRIES