[Federal Register Volume 77, Number 23 (Friday, February 3, 2012)]
[Proposed Rules]
[Pages 5460-5463]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2012-2492]


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DEPARTMENT OF JUSTICE

Bureau of Alcohol, Tobacco, Firearms, and Explosives

27 CFR Part 478

[Docket No. ATF 32P; AG Order No. 3321-2012]
RIN 1140-AA38


Federal Firearms License Proceedings--Hearings (2008R-15P)

AGENCY: Bureau of Alcohol, Tobacco, Firearms, and Explosives (ATF), 
Department of Justice.

ACTION: Notice of proposed rulemaking.

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SUMMARY: The Department of Justice is proposing to amend the 
regulations of the Bureau of Alcohol, Tobacco, Firearms, and Explosives 
(ATF) regarding administrative hearings held as part of firearms 
license proceedings. This proposed rule clarifies that such hearings 
are held in an informal setting and that persons requesting a hearing 
will be afforded the opportunity to submit facts, arguments, offers of 
settlement, or proposals of adjustment for review and consideration. 
The proposed regulations are intended to ensure that federal firearms 
licensees and persons applying for a federal firearms license are 
familiar with the hearing process relative to the denial, suspension, 
or revocation of a firearms license, or imposition of a civil fine.

DATES: Written comments must be postmarked and electronic comments must 
be submitted on or before May 3, 2012. Commenters should be aware that 
the electronic Federal Docket Management System will not accept 
comments after Midnight Eastern Time on the last day of the comment 
period.

ADDRESSES: Send comments to any of the following addresses--
     Deborah G. Szczenski, Industry Operations Specialist 
(Regulations), Mailstop 6N-602, Enforcement Programs and Services, 
Bureau of Alcohol, Tobacco, Firearms, and Explosives, 99 New York 
Avenue NE., Washington, DC 20226; Attn: ATF 32P. Written comments must 
appear in a minimum 12-point size of type (.17 inches), include your 
mailing address, be signed, and may be of any length.
     (202) 648-9741 (facsimile).
     http://www.regulations.gov. Federal eRulemaking portal; 
follow the instructions for submitting comments.
    You may also view an electronic version of this proposed rule at 
the http://www.regulations.gov site.
    See the Public Participation section at the end of the 
SUPPLEMENTARY

[[Page 5461]]

INFORMATION section for instructions and requirements for submitting 
comments, and for information on how to request a public hearing.

FOR FURTHER INFORMATION CONTACT: Deborah G. Szczenski, Enforcement 
Programs and Services, Bureau of Alcohol, Tobacco, Firearms, and 
Explosives, U.S. Department of Justice, 99 New York Avenue NE., 
Washington, DC 20226; telephone: (202) 648-7087.

SUPPLEMENTARY INFORMATION:

I. Background

    The Attorney General is responsible for enforcing the provisions of 
the Gun Control Act of 1968 (``the Act''), 18 U.S.C. Chapter 44. He has 
delegated that responsibility to the Director of ATF, subject to the 
direction of the Attorney General and the Deputy Attorney General. 28 
CFR 0.130(a). ATF has promulgated regulations that implement the 
provisions of the Act in 27 CFR Part 478.
    The regulations in Subpart E of Part 478, sections 478.71-478.78, 
relate to proceedings involving federal firearms licenses, including 
the denial, suspension, or revocation of a license, or the imposition 
of a civil fine. In particular, Sec.  478.71 provides that the Director 
of ATF may issue a notice of denial on ATF Form 4498 (Notice of Denial 
of Application for License) to an applicant for a license if he has 
reason to believe that the applicant is not qualified, under the 
provisions of Sec.  478.47, to receive a license. The notice sets forth 
the matters of fact and law relied upon in determining that the 
application should be denied, and affords the applicant 15 days from 
the date of receipt of the notice in which to request a hearing to 
review the denial. If a request for a hearing is not filed within such 
time, the application is disapproved and a copy, so marked, is returned 
to the applicant.
    Under Sec.  478.72, an applicant who has been denied an original or 
renewal license may file a request with the Director of Industry 
Operations (DIO) for a hearing to review the denial of the application. 
On conclusion of the hearing and after consideration of all relevant 
facts and circumstances presented by the applicant or his 
representative, the Director (or his or her delegate) renders a 
decision confirming or reversing the denial of the application. If the 
decision is that the denial should stand, a certified copy of the 
Director's findings and conclusions are furnished to the applicant with 
a final notice of denial, ATF Form 4501 (now ATF Form 5300.13), Final 
Notice of Denial of Application or Revocation of Firearms License. In 
addition, a copy of the application, marked ``Disapproved,'' is 
furnished to the applicant. If the decision is that the license applied 
for should be issued, the applicant will be so notified, in writing, 
and the license will be issued.
    Section 478.73 provides that whenever the Director has reason to 
believe that a firearms licensee has willfully violated any provision 
of the Act or part 478, a notice of revocation of the license (ATF Form 
4500) may be issued. In addition, a notice of revocation, suspension, 
or imposition of a civil fine may be issued on ATF Form 4500 whenever 
the Director has reason to believe that a licensee has knowingly 
transferred a firearm to an unlicensed person and knowingly failed to 
comply with the requirements of 18 U.S.C. 922(t)(1), relating to a NICS 
(National Instant Criminal Background Check System) background check. 
Additionally, under 18 U.S.C. 924(p)(1)(A) and 922 (z), a notice of 
suspension or revocation of a license, or the imposition of a civil 
penalty, may be issued when a licensee sells, delivers, or transfers 
any handgun to any unlicensed person without providing a secure gun 
storage or safety device for the handgun.
    As specified in Sec.  478.74, a licensee who receives a notice of 
license suspension or revocation of a license, or imposition of a civil 
fine, may file a request for a hearing with the Director of Industry 
Operations. On conclusion of the hearing and after consideration of all 
the relevant information presented at the hearing, the Director renders 
a decision and prepares a brief summary of the findings and conclusions 
on which the decision was based. If the decision is that the license 
should be revoked or, in actions under 18 U.S.C. 922(t)(5) (or 924(p)), 
that the license should be revoked or suspended, or that a civil fine 
should be imposed, a certified copy of the summary is furnished to the 
licensee with the final notice of revocation, suspension, or imposition 
of a civil fine on ATF Form 4501. If the decision is that the license 
should not be revoked, or in actions under 18 U.S.C. 922(t)(5) (or 
924(p)), that the license should not be revoked or suspended, and a 
civil fine should not be imposed, the licensee will be notified in 
writing.
    Under Sec.  478.76, a firearms licensee or an applicant for a 
firearms license may be represented at a hearing by an attorney, 
certified public accountant, or other person recognized to practice 
before ATF, provided certain requirements are met. The Director may be 
represented in hearing proceedings by an attorney in the Office of 
Chief Counsel or authorized Division Counsel. Pursuant to Sec.  478.77, 
hearings concerning notification of license denials, suspensions, 
revocations, or the imposition of a civil fine must be held in a 
location convenient to the aggrieved party.
    Currently, ATF has procedures regarding administrative hearings 
held as part of firearms license proceedings (see ATF 36N, 75 FR 48362, 
Aug. 10, 2010).

II. Proposed Rule--Clarification of Hearing Proceedings

    As indicated above, the regulations provide certain information 
regarding hearings relative to firearms license proceedings, e.g., who 
can request a hearing, where the hearing is held, and that the person 
requesting a hearing is entitled to representation. ATF believes that 
other aspects of the hearing process should be clarified in the 
regulations. For example, hearings are informal in nature and adherence 
to civil court rules and procedures is not required. In addition, 
persons who request a hearing have an opportunity at that time for the 
submission and consideration of facts, arguments, offers of settlement, 
or proposals of adjustment. These provisions are being incorporated 
into the proposed regulations.
    The proposed regulations are intended to ensure that federal 
firearms licensees and applicants for a federal firearms license are 
familiar with the hearing process relative to the denial, suspension, 
or revocation of a firearms license, or imposition of a civil fine.

How This Document Complies With the Federal Administrative Requirements 
for Rulemaking

A. Executive Order 12866

    This proposed rule has been drafted and reviewed in accordance with 
Executive Order 12866, ``Regulatory Planning and Review,'' section 
1(b), Principles of Regulation. The Department of Justice has 
determined that this proposed rule is a ``significant regulatory 
action'' under Executive Order 12866, section 3(f), Regulatory Planning 
and Review, and accordingly this proposed rule has been reviewed by the 
Office of Management and Budget. However, this proposed rule will not 
have an annual effect on the economy of $100 million, nor will it 
adversely affect in a material way the economy, a sector of the 
economy, productivity, competition, jobs, the environment, public 
health or safety, or State, local or tribal governments or communities. 
Accordingly, this proposed rule is not an ``economically significant''

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rulemaking as defined by Executive Order 12866.
    The proposed amendments merely clarify that an administrative 
hearing, pursuant to a firearms license proceeding, is held in an 
informal setting where a federal firearms licensee or an applicant for 
a federal firearms license will have the opportunity for the submission 
and consideration of facts, arguments, offers of settlement or 
proposals of adjustment for review and consideration by the Director of 
ATF.

B. Executive Order 13132

    This proposed regulation will not have substantial direct effects 
on the States, on the relationship between the Federal Government and 
the States, or on the distribution of power and responsibilities among 
the various levels of government. Therefore, in accordance with section 
6 of Executive Order 13132, the Attorney General has determined that 
this proposed regulation will not have sufficient federalism 
implications to warrant the preparation of a federalism summary impact 
statement.

C. Executive Order 12988

    This proposed regulation meets the applicable standards set forth 
in sections 3(a) and 3(b)(2) of Executive Order 12988.

D. Regulatory Flexibility Act

    The Regulatory Flexibility Act (5 U.S.C. 605(b)) requires an agency 
to conduct a regulatory flexibility analysis of any rule subject to 
notice and comment rulemaking requirements unless the agency certifies 
that the rule will not have a significant economic impact on a 
substantial number of small entities. Small entities include small 
businesses, small not-for-profit enterprises, and small governmental 
jurisdictions. The Attorney General has reviewed this proposed rule 
and, by approving it, certifies that this proposed rule will not have a 
significant economic impact on a substantial number of small entities. 
The proposed amendments merely clarify that an administrative hearing, 
pursuant to a firearms license proceeding, is held in an informal 
setting where a federal firearms licensee or an applicant for a federal 
firearms license will have the opportunity for the submission and 
consideration of facts, arguments, offers of settlement, or proposals 
of adjustment for consideration by the Director of ATF.

E. Small Business Regulatory Enforcement Fairness Act of 1996

    This proposed rule is not a major rule as defined by section 251 of 
the Small Business Regulatory Enforcement Fairness Act of 1996, 5 
U.S.C. 804. This proposed rule will not result in an annual effect on 
the economy of $100 million or more; a major increase in costs or 
prices; or significant adverse effects on competition, employment, 
investment, productivity, innovation, or on the ability of United 
States-based companies to compete with foreign-based companies in 
domestic and export markets.

F. Unfunded Mandates Reform Act of 1995

    This proposed rule will not result in the expenditure by State, 
local, and tribal governments, in the aggregate, or by the private 
sector of $100 million or more in any one year, and it will not 
significantly or uniquely affect small governments. Therefore, no 
actions were deemed necessary under the provisions of the Unfunded 
Mandates Reform Act of 1995.

G. Paperwork Reduction Act

    This proposed rule does not impose any new reporting or 
recordkeeping requirements under the Paperwork Reduction Act.

Public Participation

A. Comments Sought

    ATF is requesting comments on the proposed rule from all interested 
persons. ATF is also specifically requesting comments on the clarity of 
this proposed rule and how it may be made easier to understand.
    All comments must reference this document docket number (ATF 32P), 
be legible, and include your name and mailing address. ATF will treat 
all comments as originals and will not acknowledge receipt of comments.
    Comments received on or before the closing date will be carefully 
considered. Comments received after that date will be given the same 
consideration if it is practical to do so, but assurance of 
consideration cannot be given except as to comments received on or 
before the closing date.

B. Confidentiality

    Comments, whether submitted electronically or on paper, will be 
made available for public viewing at ATF, and on the Internet as part 
of the eRulemaking initiative, and are subject to the Freedom of 
Information Act. Commenters who do not want their name or other 
personal identifying information posted on the Internet should submit 
their comment by mail or facsimile, along with a separate cover sheet 
that contains their personal identifying information. Both the cover 
sheet and comment must reference this docket number. Information 
contained in the cover sheet will not be posted on the Internet. Any 
personal identifying information that appears within the comment will 
be posted on the Internet and will not be redacted by ATF.
    Any material that the commenter considers to be inappropriate for 
disclosure to the public should not be included in the comment. Any 
person submitting a comment shall specifically designate that portion 
(if any) of his comments that contains material that is confidential 
under law (e.g., trade secrets, processes, etc.). Any portion of a 
comment that is confidential under law shall be set forth on pages 
separate from the balance of the comment and shall be prominently 
marked ``confidential'' at the top of each page. Confidential 
information will be included in the rulemaking record but will not be 
disclosed to the public. Any comments containing material that is not 
confidential under law may be disclosed to the public. In any event, 
the name of the person submitting a comment is not exempt from 
disclosure.

C. Submitting Comments

    Comments may be submitted in any of three ways:
     Mail: Send written comments to the address listed in the 
ADDRESSES section of this document. Written comments must appear in a 
minimum 12-point size of type (.17 inches), include your mailing 
address, be signed, and may be of any length.
     Facsimile: You may submit comments by facsimile 
transmission to (202) 648-9741. Faxed comments must:
    (1) Be legible and appear in a minimum 12-point size of type (.17 
inches);
    (2) Be on 8\1/2\'' x 11'' paper;
    (3) Contain a legible, written signature; and
    (4) Be no more than five pages long. ATF will not accept faxed 
comments that exceed five pages.
     Federal eRulemaking Portal: To submit comments to ATF via 
the Federal eRulemaking portal, visit http://www.regulations.gov and 
follow the instructions for submitting comments.

D. Request for Hearing

    Any interested person who desires an opportunity to comment orally 
at a public hearing should submit his or her request, in writing, to 
the Director of

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ATF within the 90-day comment period. The Director, however, reserves 
the right to determine, in light of all circumstances, whether a public 
hearing is necessary.

Disclosure

    Copies of this proposed rule and the comments received will be 
available for public inspection by appointment during normal business 
hours at: ATF Reading Room, Room 1E-062, 99 New York Avenue NE., 
Washington, DC 20226; telephone: (202) 648-8740.

Drafting Information

    The author of this document is Deborah G. Szczenski; Enforcement 
Programs and Services; Bureau of Alcohol, Tobacco, Firearms, and 
Explosives.

List of Subjects in 27 CFR Part 478

    Administrative practice and procedure, Arms and ammunition, 
Authority delegations, Customs duties and inspection, Domestic 
violence, Exports, Imports, Law enforcement personnel, Military 
personnel, Nonimmigrant aliens, Penalties, Reporting and recordkeeping 
requirements, Research, Seizures and forfeitures, and Transportation.

Authority and Issuance

    Accordingly, for the reasons discussed in the preamble, 27 CFR Part 
478 is proposed to be amended as follows:

PART 478--COMMERCE IN FIREARMS AND AMMUNITION

    1. The authority citation for 27 CFR Part 478 continues to read as 
follows:

    Authority:  5 U.S.C. 552(a); 18 U.S.C. 847, 921-930; 44 U.S.C. 
3504(h).

    2. Section 478.72 is amended by adding a new fifth sentence to read 
as follows:


Sec.  478.72  Hearing after application denial.

    * * * The hearing shall be informal and the applicant will have the 
opportunity to submit facts, arguments, offers of settlement, or 
proposals of adjustment for review and consideration. * * *
    3. Section 478.74 is amended by adding a new fourth sentence to 
read as follows:


Sec.  478.74  Request for hearing after notice of suspension, 
revocation, or imposition of civil fine.

    * * * The hearing shall be informal and the licensee will have the 
opportunity to submit facts, arguments, offers of settlement, or 
proposals of adjustment for review and consideration. * * *

    Dated: January 30, 2012.
Eric H. Holder, Jr.,
Attorney General.
[FR Doc. 2012-2492 Filed 2-2-12; 8:45 am]
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