As everyone in the world is acutely aware, we are presently faced with a public health crisis of epic proportions. Covid-19 has affected almost every aspect of our lives and is causing disruption to commercial activity in a manner not seen in decades. Some cities and states have experienced more disruption than others and most states have issued a statewide shutdown of “nonessential” businesses.
The firearms industry is not immune to the disruption caused by the novel coronavirus. The supply chain has seen impacts at every level; materials providers, parts and components suppliers, firearms manufacturers, importers, wholesalers, and dealers have all to some extent experienced a measure of difficulty in continuing operations. Yet, as the situation continues to evolve demand for firearms and ammunition continues to increase. In fact, the National Shooting Sports Foundation (NSSF) reports that the March 2020 NSSF-adjusted NICS figure represents an 80.4% increase in background checks compared to March 2019.
Although the situation we are in is constantly and rapidly evolving, the need to comply with firearms laws and regulations that control commerce in firearms remains constant. FFLs are still obligated to comply with federal and state firearms regulations that control their business amidst shutdowns, work from home orders, and social distancing mandates. The addition of city or statewide coronavirus-related restrictions on top of the always-present firearms regulations has left many FFLs scrambling to determine if and how they can continue to operate.
FFLs should start with looking to their local (city, county) governing authorities for any limitations or mandates. Although not widely reported in national media, local governments across the country can and have issued stay at home orders, closures of “nonessential businesses” and social distancing requirements.
If your local authorities allow you to remain open and operate you should look to any orders and limitations issued by the state. Even though most states have closed “nonessential” businesses, many states have identified firearms companies as “essential”. FFLs in states experiencing a shutdown should review state guidance on what it means to be “essential”. Although President Trump declared firearms and ammunition industry workers as an element of critical infrastructure, not all states have followed that declaration and some have ordered closures of FFLs. Many of these states have already reversed course and allowed FFLs to reopen after legal challenges brought by industry members. Other states have allowed FFLs to continue to operate, provided they comply with state mandates being issued to address the coronavirus.
The Bureau of Alcohol, Tobacco, Firearms and Explosives has also jumped into the foray and issued guidance to clarify that FFLs may operate on their licensed premises outside their brick and mortar stores provided all applicable regulations are followed. You can read ATF’s guidance letter at https://www.atf.gov/firearms/docs/open-letter/atf-business-premises-guidance-letter-4-10-2020/download.
For those FFLs who can and choose to continue to operate, the following suggestions will assist in keeping you compliant and aware of the ongoing situation:
- Review local and state coronavirus-related mandates on a daily basis to determine whether you can operate; these may change from one day to the next as states begin to ease restrictions so it is critical to look to the most up-to-date information.
- Review resources the NSSF has made available to the firearms industry. Federal and state news alerts, government guidance documents, and webinars on dealing with the current operating conditions have all been consolidated to assist industry members in determining how they can function.
- Although your local or state governing authority may not require it today, implementing social distancing measures at your store or facility today can assist in a situation where restrictions are eased by your city or state and then put back in place in full force if another spike in illnesses occur (which most experts at this point in time expect). Most often, these require spacing of customers in checkout lines (many stores have taped an “X” in their lines at 6 foot intervals), a limitation on quantity of customers in a store (variable across the country, but usually 6 or 10 people), a limitation on hours permitted to remain open, and wearing a facemask. Again, this is highly variable across the country so review state and local restrictions daily.
- If you are operating in an outdoor setting per ATF’s most recent guidance, some common-sense procedures should be put in place:
- Limit the quantity of firearms outside and keep them secured to the extent possible to reduce chance of theft.
- File all paperwork inside the premises immediately upon completion; do not wait until the end of the day and allow for loss of records due to unexpected inclement weather.
- If necessary and possible, retrain exterior cameras to focus on the specific area in which you are conducting business.
- Place identifying markers on the ground for customers in order to abide by applicable social distancing requirements in order to avoid be closed down by local authorities.
- Continue to abide by all ATF and state/local federal firearms regulations.
Although ATF has certainly slowed down its operations as has all other government organizations and private businesses, they indeed are continuing operations. Many Field Divisions and Satellite Offices are catching up on administrative backlogs that have accumulated, which may allow for an increase in compliance inspections upon the end of the current situation. Inspection Closing Conferences and Warning Conferences continue to take place – via teleconference if necessary. FFLs continue to receive letters of revocation.
While the epidemic continues to unfold and impact resources available to operate, it is likely that the surge in sales will continue providing for an imbalance in the resources available to perform all business functions at “pre-pandemic” levels. However, it will not provide an excuse for noncompliance with ATF or state and local firearms regulations and FFLs can expect inspections to resume in the future. As such, in addition to keeping customers and employees safe during ongoing operations, with the increase in sales and reduction in resource capacity it is also imperative to think ahead about how to continue to maintain your ever-present regulatory obligations.
Orchid Advisors provides GCA, NFA, ITAR and EAR compliance services to manufacturing, importing, distribution and retail FFLs. The firm offers FFL and Export licensing, importing assistance, record inspections, e4473 / NFA eForms, Electronic Bound Book software and delivers the largest online ATF and ITAR compliance training platform available. Together with its partners, Orchid delivers the only integrated firearm compliance, technology and legal solution. If you would like to speak with Orchid Advisors about your import needs, contact us today.