[Federal Register Volume 79, Number 155 (Tuesday, August 12, 2014)]
[Proposed Rules]
[Pages 47033-47039]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2014-18874]
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DEPARTMENT OF JUSTICE
Bureau of Alcohol, Tobacco, Firearms, and Explosives
27 CFR Part 478
[Docket No. ATF 40P; AG Order No. 3459-2014]
RIN 1140-AA41
Commerce in Firearms and Ammunition--Reporting Theft or Loss of
Firearms in Transit (2007R-9P)
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 proposes amending Bureau of Alcohol,
Tobacco, Firearms, and Explosives (ATF) regulations that concern
firearms stolen or lost in transit. The proposed rule specifies that
when a Federal firearms licensee (FFL) discovers a firearm it shipped
was stolen or lost in transit, that sender/transferor FFL must report
the theft or loss to ATF and to the appropriate local authority. The
rule also reduces an FFL's reporting burden when a theft or loss
involves a firearm registered under the National Firearms Act (NFA) and
ensures consistent reporting to ATF's NFA Branch. In addition, the rule
specifies that transferor/sender FFLs must reflect the theft or loss of
a firearm as a disposition entry in their required records not later
than 7 days following discovery of the theft or loss, and specifies
that FFLs that report the theft or loss of a firearm and later discover
its whereabouts must advise ATF that the firearm has been located and
must re-enter the firearm into their required records as an acquisition
or disposition entry as appropriate.
DATES: Written comments must be postmarked and electronic comments must
be submitted on or before November 10, 2014. 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: You may submit comments, identified by docket number (ATF
40P), by any of the following methods--
Federal eRulemaking Portal: http://www.regulations.gov.
Follow the instructions for submitting comments.
Fax: (202) 648-9741.
Mail: Brenda Raffath Friend, Mailstop 6N-602, Office of
Regulatory Affairs, Enforcement Programs and Services, Bureau of
Alcohol, Tobacco,
[[Page 47034]]
Firearms, and Explosives, U.S. Department of Justice, 99 New York
Avenue NE., Washington, DC 20226; ATTN: ATF 40P.
Instructions: All submissions received must include the agency name
and docket number for this rulemaking. All comments received will be
posted without change to the Federal eRulemaking portal, http://www.regulations.gov, including any personal information provided. For
detailed instructions on submitting comments and additional information
on the rulemaking process, see the ``Public Participation'' heading of
the SUPPLEMENTARY INFORMATION section of this document.
FOR FURTHER INFORMATION CONTACT: Brenda Raffath Friend, Office of
Regulatory Affairs, 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) 648-7070.
SUPPLEMENTARY INFORMATION:
I. Background
The Gun Control Act of 1968 (GCA) requires each licensed importer,
licensed manufacturer, licensed dealer, or licensed collector of
firearms to report the theft or loss of a firearm from the licensee's
inventory or collection to ATF and to the appropriate local authorities
within 48 hours after the theft or loss is discovered. See 18 U.S.C.
923(g)(6) (requiring licensees to report thefts or losses to the
Attorney General); 28 CFR 0.130(a) (delegating the Attorney General's
authority to the Director of ATF).
The regulation that implements section 923(g)(6) is 27 CFR 478.39a.
This section provides that each Federal firearms licensee must report
the theft or loss of a firearm from the FFL's inventory (including any
firearm which has been transferred from the FFL's inventory to a
personal collection and held as a personal firearm for at least 1
year), or from the collection of a licensed collector, within 48 hours
after the theft or loss is discovered. FFLs must report such thefts or
losses by telephoning 1-888-930-9275 (nationwide ATF toll-free number)
and by preparing a Federal Firearms Licensee Firearms Inventory Theft/
Loss Report, ATF Form 3310.11 (Form 3310.11), in accordance with the
instructions on the form. The FFL must also report the theft or loss of
a firearm to the appropriate local authorities.
When there has been a theft or loss of a firearm registered under
the National Firearms Act (NFA), 26 U.S.C. 5801 et seq., such as a
short-barreled rifle or shotgun, silencer, machinegun, or destructive
device, 27 CFR 479.141 imposes a separate and additional reporting
requirement. Section 479.141 states that whenever any registered NFA
firearm is stolen or lost, the person losing possession thereof must,
immediately upon discovery of such theft or loss, make a report to the
Director of ATF showing the following: name and address of the person
in whose name the firearm is registered; kind of firearm; serial
number; model; caliber; manufacturer of the firearm; date and place of
theft or loss; and complete statement of facts and circumstances
surrounding such theft or loss. Accordingly, when an FFL loses
possession of an NFA firearm, it has reporting obligations under both
27 CFR 479.141 and 27 CFR 478.39a.
Currently, an FFL reporting the theft or loss of a registered NFA
firearm prepares and submits Form 3310.11 to ATF's National Tracing
Center (NTC), the receiving office designated on the form, to meet 27
CFR 478.39a requirements. In addition, the FFL must submit a separate
notification to the Director of ATF to meet the requirements of 27 CFR
479.141. Because no form is directly associated with this requirement,
FFLs typically submit a letter to the NFA Branch of ATF, as directed in
the ``Important Notice'' section of Form 3310.11. As a backup to this
requirement, when NTC receives a completed Form 3310.11 involving the
theft or loss of an NFA firearm, it currently forwards a copy of the
completed form to the NFA Branch, as the completed form often contains
more information than the letters FFLs submit to the NFA Branch. Form
3310.11 does not, however, address all required elements under 27 CFR
479.141 (i.e., the name and address of the person in whose name the
firearm is registered). Therefore, the NFA Branch may not currently be
receiving consistent and complete information regarding the theft or
loss of a registered firearm.
The instructions on Form 3310.11 also provide that FFLs must
reflect the theft or loss of a firearm as a disposition entry in the
Record of Acquisition and Disposition required by subpart H of 27 CFR
part 478. The disposition entry should indicate whether the incident is
a theft or loss, the ATF issued Incident Report Number, and the
Incident Number provided by the local law enforcement agency. The
instructions further state that should any of the firearms be located,
they should be re-entered into the Record of Acquisition and
Disposition as an acquisition entry. In addition, the ``Important
Notice'' section on Form 3310.11 provides that FFLs who report a
firearm as missing and later discover its whereabouts should advise ATF
that the firearms have been located.
Current regulations do not address reporting requirements arising
from firearms stolen or lost in transit between FFLs, including whether
the stolen or lost firearm is considered the inventory of the sending
or receiving FFL, or whether the sending or receiving FFL is
responsible for reporting the theft or loss of a firearm in transit.
These gaps in the regulations may result in no one reporting the
theft or loss of a firearm stolen or lost in transit. Clarifying this
responsibility is important to the effective administration of the GCA
and the NFA. Congress delegated the authority to prescribe rules and
regulations to carry out the provisions of the GCA and NFA to the
Attorney General, who has delegated to ATF the authority to
investigate, administer, and enforce those laws. 18 U.S.C. 926(a); 28
CFR 0.130(a).
II. Initial Notice of Proposed Rulemaking
On August 28, 2000, ATF published in the Federal Register a notice
proposing several amendments to the firearms regulations (Notice No.
902, 65 FR 52054). Among those amendments, ATF proposed specifying that
when a firearm is stolen or lost in transit between licensees, for
reporting purposes, the firearm is considered stolen or lost from the
transferor's/sender's inventory. ATF noted that, in Fiscal Year (FY)
1999, there were 1,271 crime gun traces in which an FFL claimed to have
never received the firearm shipped to it and no one reported the theft
or loss to ATF. As proposed in 2000, a firearm stolen or lost in
transit between licensees, for reporting purposes, would be considered
stolen or lost from the transferor's/sender's inventory. Further, as
proposed, the transferor/sender of the stolen or missing firearm would
have been required to report to ATF and to the appropriate local
authorities the theft or loss of the firearm within 48 hours after the
transferor/sender discovered the theft or loss. ATF determined that it
was more logical to put the reporting burden on the transferor/sender,
rather than on the transferee/buyer, because the transferor/sender was
more likely to know the circumstances of when and how a firearm is
shipped. Further, if a firearm is stolen or lost in transit, the
notation in the transferor's/sender's acquisition and disposition book
indicating the
[[Page 47035]]
firearm was disposed of to a particular transferee/buyer would be
inaccurate. Therefore, as proposed in 2000, a transferor/sender would
have been required to verify that the transferee/buyer received the
shipped firearm in order to fulfill his or her statutory responsibility
to maintain accurate records.
In addition, to enable the transferor/sender of the stolen or lost
firearm to obtain the knowledge necessary to comply with the theft or
loss reporting requirements, ATF proposed that the transferor/sender
must have or establish commercial business practices that confirm
whether the transferee/buyer of the firearm ultimately received the
firearm. Notice No. 902 addressed other issues as well.
With the comments received in response to various issues addressed
in the notice, the Department decided to study the issues further and
it subsequently withdrew these proposals. See 69 FR 37757 (June 28,
2004).
III. Current Notice of Proposed Rulemaking
Theft or loss of firearms in transit continues to be a problem. In
its earlier notice of proposed rulemaking on this issue, ATF stated
that in FY 1999, there were 1,271 crime gun traces in which an FFL
claimed to have never received the firearm shipped to it and no one
reported the theft or loss to ATF. More recent data from NTC show that
from FY 2008 through FY 2012, in an average of 1,525 crime gun traces
per year, an FFL claimed to have never received the firearm allegedly
shipped to it and no one reported the theft or loss to ATF. The
omissions in the regulations regarding reporting the theft or loss of a
firearm in transit adversely affect ATF's and local law enforcement's
investigative and tracing capabilities. Therefore, the regulations
should be amended to specify who is responsible for reporting the theft
or loss of a firearm in transit.
The Department has concluded that the transferor/sender of a
firearm should bear the responsibility of reporting the theft or loss
of that firearm when the theft or loss occurs in transit. This proposed
rule is consistent with the GCA, which regulates commerce in firearms
through FFLs. The GCA's scheme relies on firearms dealers to control
commerce in firearms. Huddleston v. United States, 415 U.S. 814, 824
(1975) (``The principal agent of federal enforcement is the dealer.'')
Section 923(g)(6), in particular, places the burden of reporting stolen
or lost firearms on licensees. Given that the statutory reporting
obligation rests with licensees, and not with the common or contract
carriers that transport firearms, it is reasonable to require by
regulation that licensees report thefts or losses that occur in
transit. The Department further believes that it should be the
transferor/sender licensees, not the recipients, who bear the reporting
obligations. The transferors/senders covered by this rule will be
licensees who are subject to the reporting requirement under section
923(g)(6)--but not every recipient in firearms transactions will
necessarily be a licensee. Placing the reporting obligation on the
transferor/sender licensee accordingly assures that, for every firearms
transaction covered by section 923(g)(6), there will be an FFL
responsible for reporting the theft or loss of a firearm in transit.
The Department believes that this will ensure consistent reporting of
stolen or lost firearms, thereby fulfilling the GCA's purpose of
``strengthen[ing] Federal regulation of interstate firearms traffic,''
H.R. Rep. 90-1577 (1968), reprinted in 1968 U.S.C.C.A.N. 4410, 4412.
Accordingly, this proposed rule specifies that, when a firearm is
stolen or lost in transit on a common or contract carrier, for
reporting purposes it is considered stolen or lost from the
transferor's/sender's inventory. Therefore, the transferor/sender of
the stolen or missing firearm must report the theft or loss to ATF and
to the appropriate local authorities within 48 hours after the
transferor/sender discovers the theft or loss.
With respect to firearms stolen or lost in transit between FFLs,
the Department considered but did not adopt the Uniform Commercial
Code's (UCC) variable approach to the transfer of title for risk of
loss purposes. In the absence of State law governing the transfer of a
firearm between seller and buyer, the UCC allows a seller and buyer to
establish contractually when title to items sold passes from seller to
buyer. If the sales contract requires the seller to deliver the goods
to a particular destination, the risk of loss passes to the buyer when
the buyer receives or is able to accept delivery of the goods. In this
situation, the seller assumes the risk of goods stolen or lost in
transit. If the contract does not require the seller to deliver the
goods to a particular destination, the risk of loss passes to the buyer
when the seller delivers the goods to a common or contract carrier for
shipment. In this situation, the buyer assumes the risk of goods stolen
or lost in transit. Had the Department chosen to adopt the UCC's
variable risk of loss approach, the seller of the firearms would
generally assume the risk of loss of firearms stolen or lost in transit
when the contract requires the seller to deliver the firearms to a
particular destination.
In any event, the Department has decided not to propose the
variable UCC approach, which governs risk of loss, in the different
context of allocating the responsibility for reporting to ATF the theft
of loss of firearms in transit. Adopting the variable UCC approach for
reporting firearms stolen or lost in transit would be problematic for
FFLs to apply and for ATF to enforce. Rather than following a single,
consistent rule holding the transferor/sender FFL responsible for
reporting stolen or lost firearms, an FFL would need to examine each
individual contract to determine who has reporting responsibility. For
this same reason, it would be impracticable for ATF to ensure
regulatory reporting compliance under the variable UCC approach. The
UCC approach focuses on the ownership of the goods being shipped and
allocating the risk of loss, but the primary focus of the GCA and its
implementing regulations is, instead, the acquisition and disposition
of firearms. Accordingly, the GCA theft or loss reporting and
recordkeeping requirements must be complied with regardless of whether
the seller or buyer has title to, or bears the risk of loss of, shipped
firearms stolen or lost in transit.
Therefore, the Department proposes to assign the theft/loss
reporting requirement to the transferor/sender FFL, who would know how
and when any firearms sent to the transferee were shipped. The
transferee has an incentive to notify the transferor about any
discrepancies because the transferee will not want to pay for an item
the transferee did not actually receive. Upon being contacted by the
transferee about a shipment discrepancy, the transferor is then in the
best position to verify the theft or loss by reviewing his or her
transaction records and the shipping information from the carrier the
transferor had utilized. The transferor may also discover that the
discrepancy is due to a recordkeeping or other human error. Whether the
transferee or transferor arranges the shipment, the transferor would
know how and when the firearms were shipped, and reporting of the theft
or loss remains with the transferor/sender FFL.
The proposed rule also applies to transfers from a licensee to a
nonlicensee, including interstate shipments for firearms repair and
replacement. In such transactions, the transferor/seller is the only
FFL involved in the transaction, and
[[Page 47036]]
accordingly the FFL must assume responsibility for reporting to ATF if
the shipment is lost or stolen in transit before the transferee
acquires possession.
The proposed rule allows a transferor/sender to rely on
notification from the transferee/buyer that the shipment was not
received, and such notification triggers the reporting requirement. To
ensure that a transferee/buyer receives a shipped firearm, the
Department is soliciting comment on whether a transferor/sender should
be required to obtain from the carrier that delivers the firearm a
written or electronic confirmation of the shipment and receipt of the
firearm showing the date, time, and place of receipt, and the name of
the individual who accepted receipt. In addition, the Department seeks
comments on whether the transferor/sender should be required to retain
the confirmation with the transferor's/sender's required records.
The Department is also soliciting comment on the costs and benefits
of requiring the transferor/sender to obtain from the carrier a
confirmation of the shipment and retaining the confirmation in their
records. How many shipments occur annually? To what extent do FFLs as
part of their regular business practices already arrange to obtain a
written or electronic confirmation from the common carrier or other
shipper for such shipments? How often do FFLs retain records of
confirmation currently? How might such requirements be developed so as
to minimize any additional burden by meshing with the FFL's regular
business practices?
The proposed rule retains most of the current procedures for
licensees reporting the theft or loss of firearms subject to the GCA,
in accordance with the instructions on Form 3310.11. For example,
instruction 7 on Form 3310.11 provides that FFLs must reflect the theft
or loss of a firearm as a disposition entry in the Record of
Acquisition and Disposition that is required by subpart H of part 478.
It also provides that the disposition entry should indicate whether the
incident is a theft or loss, the ATF Issued Incident Report Number, and
the Incident Number provided by the local law enforcement agency. The
proposed rule sets out these procedures in new paragraph (e) of 27 CFR
478.39a with two modifications: (1) It prescribes a time period to
reflect the theft or loss of a firearm as a disposition entry (i.e.,
not later than 7 days following discovery of the theft or loss; and (2)
it requires, rather than recommends, that the disposition entry include
specified information. The new, seven-day time-period for reporting is
similar to the firearms receipt and disposition reporting requirement
for licensed dealers in 27 CFR 478.125(e), which requires the ``sale or
other disposition of a firearm'' to be recorded not later than 7 days
following the date of such transaction. The Department considers a
theft or loss to be a disposition that must be reported within this
time period.
In addition, the ``Important Notice'' section of Form 3310.11
provides that licensees who report firearms as missing and later
discover their whereabouts should advise ATF that the firearms have
been located, and instruction 8 provides that licensees should re-enter
these located firearms into the Record of Acquisition and Disposition
as an acquisition entry. The proposed rule combines and sets out these
procedures in new paragraph (f) of 27 CFR 478.39a with three
modifications: (1) It changes the ``should advise ATF'' to ``shall
advise the [ATF] Director''; (2) changes the ``should re-enter'' to
``shall re-enter''; and (3) specifies that the re-entry could be an
acquisition or disposition entry as appropriate. Making mandatory both
the advising of ATF and the re-entry of the located firearm into the
Record of Acquisition and Disposition will help to improve the accuracy
of NTC data, which will greatly assist law enforcement in solving
violent crimes and enhancing public safety.
The proposed rule reduces a licensee's reporting burden to ATF for
the theft or loss of a registered NFA firearm by allowing submission of
one Form 3310.11 to meet the requirements of 27 CFR 478.39a and 27 CFR
479.141. Currently, as discussed in section I, if a licensee's
registered NFA firearm is lost or stolen, the licensee prepares and
submits Form 3310.11 to ATF's NTC to comply with 27 CFR 478.39a
requirements, which specify that Form 3310.11 be used. The licensee
also provides to ATF's NFA Branch a separate notification--typically in
the form of a letter--to comply with 27 CFR 479.141. This proposed rule
revises 27 CFR 478.39a to stipulate that a licensee's submission of a
completed Form 3310.11 to ATF for the theft or loss of a registered NFA
firearm satisfies the notification requirements pursuant to 27 CFR
478.39a and 27 CFR 479.141. This will reduce the licensee's reporting
burden and help to ensure that information about the lost or stolen
registered NFA firearm is consistently reported to the NFA Branch. As
part of this rulemaking process, ATF proposes to revise Form 3310.11,
and the corresponding instructions, to denote whether the firearm being
reported as lost or stolen is a registered NFA firearm and to include
the name and address of the person in whose name the firearm is
registered. The Office of Management and Budget will review the
proposed revisions to the form during the final rulemaking process,
during which the public will have opportunity to comment on the
paperwork burdens associated with the form.
IV. Statutory and Executive Order Reviews
A. Executive Orders 12866 and Executive Order 13563--Regulatory Review
This proposed rule has been drafted and reviewed in accordance with
Executive Order 12866, ``Regulatory Planning and Review,'' section
1(b), The Principles of Regulation, and in accordance with Executive
Order 13563, ``Improving Regulation and Regulatory Review,'' section
1(b), General 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), 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 or more; 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'' rulemaking under Executive Order 12866.
Executive Orders 12866 and 13563 both direct agencies to assess all
costs and benefits of available regulatory alternatives and, if
regulation is necessary, to select regulatory approaches that maximize
net benefits (including potential economic, environmental, public
health and safety effects, distributive impacts, and equity). Executive
Order 13563 emphasizes the importance of quantifying both costs and
benefits, of reducing costs, of harmonizing rules, and of promoting
flexibility. The Department has assessed the costs and benefits of this
proposed regulation and believes that the regulatory approach selected
maximizes net benefits.
Under section 923(g)(6) of the GCA and its current implementing
regulation, 27 CFR 478.39a, each FFL must report the theft or loss of a
firearm from the licensee's inventory or collection within 48 hours
after the theft or loss is discovered. The licensee must report the
[[Page 47037]]
theft or loss of a firearm to ATF and to the appropriate local
authorities. Current regulations do not address reporting and
recordkeeping requirements for firearms lost or stolen while in
transit. This proposed rule specifies that when a firearm is stolen or
lost in transit, for reporting purposes it is considered stolen or lost
from the transferor's/sender's inventory.
The GCA and the current implementing regulations have long required
that a licensee must report the theft or loss of a firearm. This
proposed rule specifies the licensee required to submit the required
report if a firearm is lost or stolen in transit on a common or
contract carrier from a licensee to another person. This proposed rule
retains most of the existing requirements under 27 CFR part 478,
subpart H, and the instructions for Form 3310.11 with respect to how
FFLs are to record the theft or loss of firearms from their inventories
in the Record of Acquisition and Disposition.
The proposed rule would reduce the current reporting burden on
licensees when the theft or loss involves a registered NFA firearm.
Currently, as discussed in section I, licensees submit Form 3310.11 to
NTC to comply with 27 CFR 478.39a, and, if the licensee is the person
who lost the firearm, provide additional notification to the NFA Branch
to comply with 27 CFR 479.141. In this proposed rule, a licensee, to
meet 27 CFR 478.39a requirements, completes and submits Form 3310.11 to
NTC. If the theft/loss involves a registered NFA firearm; NTC would
notify the NFA Branch. This would satisfy 27 CFR 479.141 notification
requirements; licensees would no longer have to submit additional
notification to ATF.
Although there is no definitive count of the total number of
firearms that were lost or stolen in transit, ATF can provide some
sense of volume based on tracing data. From FY 2008 through FY 2012,
there was an average of 1,525 crime gun traces per year where the
firearm was traced back to an FFL that claimed it never received the
firearm allegedly shipped to it, but no theft or loss was reported to
ATF. These numbers reflect only those cases in which a firearms trace
was initiated. The full count of firearms lost or stolen in transit
that are not being reported to ATF is likely significantly higher than
those traced. That ATF and local authorities do not have timely
information about lost or stolen firearms adversely affects their
investigation and tracing capabilities, and therefore poses public
safety risks.
Pursuant to the instructions on Form 3310.11, a separate form is
required for each theft/loss. ATF estimates that it takes an FFL 24
minutes to complete Form 3310.11; the postage cost to mail the form to
NTC is 49 cents. If an FFL completed a separate Form 3310.11 for each
of the average of 1,525 firearms that tracing data indicates are lost
or stolen yearly but are not currently being reported,\1\ ATF estimates
the total burden hours to be 610 (1,525 x 24/60), and the current
estimated cost is $20,005. (Cost of completing the form = 24 minutes at
$31.57 per hour x 1,525 = $19,258; Cost of mailing the form = $.49 x
1,525 = $747). ATF estimated the cost of the time for an FFL to
complete Form 3310.11 using employee compensation data for December
2013 as determined by the U.S. Department of Labor, Bureau of Labor
Statistics (BLS). See Bureau of Labor Statistics, Employer Costs for
Employee Compensation--December 2013, available at http://www.bls.gov/news.release/pdf/ecec.pdf. The BLS determined the hourly compensation
(which includes wages, salaries, and benefits) for civilian workers to
be $31.57.
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\1\ As noted above, the full count of firearms lost or stolen in
transit that are not being reported to ATF is likely significantly
higher than the number discovered through tracing data. ATF
nonetheless relies on the average of 1,525 firearms per year for
this cost calculation because it is the best information available.
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The instructions on Form 3310.11 also provide that FFLs must report
firearms thefts/losses by telephone to ATF. ATF estimates that it takes
an FFL 24 minutes to call and provide the requisite information to ATF.
If an FFL called ATF for each of the average of 1,525 firearms that
tracing data indicates are lost or stolen yearly but are not currently
being reported,\2\ ATF estimates the total burden hours to be 610
(1,525 x 24/60), and the current estimated cost is $19,258 (24 minutes
at $31.57 per hour x 1,525).
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\2\ See Footnote 1.
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Therefore, the combined total estimated burden hours for submitting
Form 3310.11 and calling ATF are 1,220 (610 + 610). The combined total
estimated costs for fulfilling those same two requirements are $39,263
($20,005 + $19,258).
Alternatives, such as the UCC variable approach discussed in
Section III of this SUPPLEMENTARY INFORMATION, are more burdensome than
the approach taken in this proposed rule. The UCC variable approach
would be more burdensome for FFLs because, in each case, the FFLs would
need to examine the terms of the individual contracts to determine how
the contract allocates the risk of loss as between the two parties. In
contrast, the proposed rule provides a simple, consistent rule so there
is no basis for uncertainty or a need for additional review. For
reporting purposes, the proposed rule assigns the theft/loss reporting
requirement to the transferor/sender.
In addition, this proposed rule alleviates reporting burdens on
licensees in that licensees need only report the theft or loss of a
registered NFA firearm once to ATF, instead of reporting separately to
NTC and the NFA Branch. As the licensee is basically providing the same
information for both reporting requirements, ATF estimates that it
takes the same amount of time and cost for postage, and uses the same
hourly compensation as listed above (i.e., 24 minutes for time, 49
cents for postage, and $31.57 for hourly compensation). Currently, the
NFA Branch receives notification on the theft/loss of a registered NFA
firearm from approximately 60 licensees annually. ATF estimates the
total burden hours to be 24 (60 x 24/60) and the total cost to be $787.
(Cost of submitting the notification = 24 minutes at $31.57 per hour x
60 = $758; Cost of mailing the notification = $.49 x 60 = $29.00).
Therefore, ATF estimates the savings to be these amounts.
B. Executive Order 13132
This proposed rule 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, ``Federalism,'' the Attorney General has
determined that this proposed regulation does not have sufficient
federalism implications to warrant the preparation of a federalism
summary impact statement.
C. Executive Order 12988
This proposed rule meets the applicable standards set forth in
sections 3(a) and 3(b)(2) of Executive Order 12988, ``Civil Justice
Reform.''
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
[[Page 47038]]
jurisdictions. The Attorney General has reviewed this proposed
regulation and, by approving it, certifies that this proposed rule will
not have a significant economic impact on a substantial number of small
entities.
Under section 923(g)(6) of the GCA and its implementing regulation,
27 CFR 478.39a, each FFL must report the theft or loss of a firearm
from the licensee's inventory or collection within 48 hours after the
theft or loss is discovered. The licensee must report the theft or loss
of a firearm to ATF and to the appropriate local authorities. This
proposed rule clarifies that when a firearm is stolen or lost in
transit, for reporting purposes, it is considered stolen or lost from
the transferor's/sender's inventory.
As discussed in section I, the current regulation requires that an
FFL report thefts/losses telephonically to ATF and complete and submit
to NTC a separate Form 3310.11 for each theft/loss. ATF estimates the
time to complete the form as 24 minutes; the time for the telephone
call as 24 minutes; and the postage cost as 49 cents. If an FFL called
ATF to report the theft/loss, and completed a separate Form 3310 for
each of the average of 1,525 firearms that tracing data indicates are
lost or stolen yearly but are not currently reported, ATF estimates the
total cost of completing and mailing the form and calling ATF to be
$39,263. See section IV.A. for a full discussion of these costs.
Therefore, this proposed rule will not impose a significant impact.
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 enterprises to compete with foreign-based enterprises 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. 2 U.S.C. 1532(a) and 1533(a).
G. Paperwork Reduction Act
This proposed rule would revise an existing reporting and
recordkeeping requirement under the Paperwork Reduction Act. It also
proposes to eliminate an existing reporting requirement. The current
regulation at 27 CFR 478.39a provides that each FFL must report the
theft or loss of a firearm from the licensee's inventory or collection
within 48 hours after the theft or loss is discovered. Licensees must
report to ATF such thefts or losses both telephonically and by
preparing Form 3310.11. The licensee must also report the theft or loss
of a firearm to the appropriate local authorities.
Pursuant to 27 CFR 479.141 and according to the instructions on
Form 3310.11, licensees reporting the theft or loss of a registered NFA
firearm must provide additional notification to ATF. As discussed
previously in section I, no form exists for this purpose, and the
person reporting typically submits a letter with the required
information to the NFA Branch. As part of this rulemaking, ATF is
proposing to revise Form 3310.11 to capture the information required by
27 CFR 479.141. Therefore, a licensee would be able to satisfy the
required notification to the NFA Branch by submitting Form 3310.11 to
NTC, and NTC will notify the NFA Branch. Submitting Form 3310.11 will
satisfy both requirements under 27 CFR 478.39a and 27 CFR 479.141 with
one notification.
In addition, Form 3310.11 instructions indicate that a licensee
must reflect the theft or loss of a firearm as a disposition entry in
the Record of Acquisition and Disposition required by subpart H of part
478. These instructions further state that the disposition entry should
indicate whether the incident is a theft or loss, the ATF-issued
Incident Report Number, and the Incident Number provided by the local
law enforcement agency. Finally, the instructions indicate that should
any of the firearms be located, they should be re-entered into the
Record of Acquisition and Disposition as an acquisition entry. The
proposed rule adds both sets of these instructions to the regulatory
text in 27 CFR 478.39a with modifications. See section III for full
discussion of these revisions.
The collections of information contained in 27 CFR 478.39a relate
to Form 3310.11 and have been approved by the Office of Management and
Budget under control number 1140-0039. This proposed rule specifies
that when a firearm is stolen or lost in transit, for reporting
purposes, it is considered stolen or lost from the transferor's/
sender's inventory.
ATF is submitting a request to revise currently approved OMB
control number 1140-0039. ATF requests public comments on all aspects
of this proposed revised collection, including comments that:
Evaluate whether the proposed collection of information is
necessary for the proper performance of the functions of the agency,
including whether the information will have practical utility;
evaluate the accuracy of the agency's estimate of the
burden of the proposed collection of information, including the
validity of the methodology and assumptions used;
enhance the quality, utility, and clarity of the
information to be collected; and
minimize the burden of the collection of information on
those who are to respond, including through the use of appropriate
automated, electronic, mechanical, or other technological collection
techniques or other forms of information technology, e.g., permitting
electronic submission of responses.
The estimated total annual burden hours and related information
(number of respondents, frequency of responses, costs, etc.) for the
proposed revisions to Form 3310.11 appear below.
OMB No.: 1140-0039.
Estimated total annual reporting and/or recordkeeping burden: 2,210
hours.
Estimated average burden hours per respondent and/or recordkeeper:
24 minutes.
Estimated number of annual respondents and/or recordkeepers: 1,525.
Estimated annual frequency of responses: 1.
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.
Comments submitted in response to ATF's previous proposed rule
relating to firearms stolen or lost in transit (Notice No. 902, August
28, 2000, 65 FR 52054), if applicable, must be resubmitted for purposes
of this rulemaking proceeding.
All comments must reference this document docket number (ATF 40P),
be legible, and include your name and mailing address. ATF will treat
all comments as originals and will not acknowledge receipt of comments.
[[Page 47039]]
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 in 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
minimum 12-point font size (.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 minimum 12-point font size (.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 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 Brenda Raffath Friend, Office of
Regulatory Affairs, 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, 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
0
1. The authority citation for 27 CFR part 478 is revised to read as
follows:
Authority: 5 U.S.C. 552(a); 18 U.S.C. 921-931; 44 U.S.C.
3504(h).
0
2. Revise Sec. 478.39a to read as follows:
Sec. 478.39a Reporting theft or loss of firearms.
(a)(1) Each licensee shall report the theft or loss of a firearm
from the licensee's inventory (including any firearm which has been
transferred from the licensee's inventory to a personal collection and
held as a personal firearm for at least 1 year), or from the collection
of a licensed collector, within 48 hours after the theft or loss is
discovered.
(2) When a firearm is stolen or lost in transit on a common or
contract carrier, it is considered stolen or lost from the
transferor's/sender's inventory for reporting purposes. Therefore, the
transferor/sender of the stolen or missing firearm shall report the
theft or loss of the firearm within 48 hours after the transferor/
sender discovers the theft or loss.
(b) Each licensee shall report the theft or loss by telephoning ATF
at 1-888-930-9275 (nationwide toll free number), and by preparing and
submitting to ATF a Federal Firearms Licensee Theft/Loss Report, ATF
Form 3310.11, in accordance with the instructions on the form. The
original of the report shall be retained by the licensee as part of the
licensee's required records.
(c) When a licensee submits to ATF a Federal Firearms Licensee
Theft/Loss Report, ATF Form 3310.11, for the theft or loss of a firearm
registered under the National Firearms Act, this also satisfies the
notification requirement under Sec. 479.141 of this chapter.
(d) Theft or loss of any firearm shall also be reported to the
appropriate local authorities.
(e) Licensees shall reflect the theft or loss of a firearm as a
disposition entry in the Record of Acquisition and Disposition required
by subpart H of this part, not later than 7 days following discovery of
the theft or loss. The disposition entry shall record whether the
incident is a theft or loss, the ATF-issued Incident Report Number, and
the Incident Number provided by the local law enforcement agency.
(f) Licensees who report the theft or loss of a firearm and later
discover its whereabouts shall advise the Director that the firearm has
been located, and shall re-enter the firearm in the Record of
Acquisition and Disposition as an acquisition or disposition entry as
appropriate.
Dated: August 4, 2014.
Eric H. Holder, Jr.,
Attorney General.
[FR Doc. 2014-18874 Filed 8-11-14; 8:45 am]
BILLING CODE 4410-FY-P