The below was taken from Arsenal Attorneys official comment of record to the proposal by the Obama Administration to create more red tape on the use of trusts for NFA firearms. Bear in mind, the proposal would allow the continued use of trusts for NFA firearms, particularly to allow possession by others and as an estate plan; however applications for new NFA firearms made by trusts after this proposal might come into effect might be required to satisfy extra requirements, such as obtaining a CLEO signature. As always, it is our recommendation that if you ever might want NFA firearms, create a trust and make those applications now to enjoy current conditions.
We encourage you to post your own comment regarding this proposed executive order. You can find guidance for doing so at this link.
Our comment to be submitted to the federal government follows:
Matthew J. Bergstrom, Esq. and Jeremiah L. White, Esq.
Comments in Opposition to Proposed Rule ATF 41P
Arsenal Attorneys™ is a law firm dedicated to gun owners and known for its solutions to help individuals own firearms safely and lawfully: the Arsenal Gun Trust™. Managing Attorney Matthew J. Bergstrom leads a team of in-house attorneys and a network of co-counsels to serve clients from many states, and is personally licensed in Virginia and the District of Columbia. The firm includes lawyers who are NRA-certified in firearms safety to help provide guidance to clients in the proper and safe handling of gun collections.
On September 9, 2013, the Bureau of Alcohol, Tobacco, Firearms, and Explosives (“ATF”) published a Notice of Proposed Rulemaking (“NPR”) in the Federal Register at Volume 78, pages 55014 through 55029. This rulemaking proceeding would implement new and burdensome regulations on firearms regulated by the National Firearms Act (“NFA”), 26 U.S.C. §§ 5801-5872.
As stated in the original abstract for the rule, as published repeatedly in the Unified Regulatory Agenda, the stated goals were alleged to be the following:
(1) add a definition for the term “responsible person”; (2) require each responsible person of a corporation, trust or legal entity to complete a specified form, and to submit photographs and fingerprints; (3) require that a copy of all applications to make or transfer a firearm be forwarded to the chief law enforcement officer (CLEO) of the locality in which the maker or transferee is located; and (4) eliminate the requirement for a certification signed by the CLEO.
The proposed rule does precisely that—at least regarding goals (1) thru (3). However, contrary to the abstract, the currently proposed version of the rule does not eliminate the requirement for a certification signed by the CLEO. Rather, it adds a certification requirement, and in fact would require a legal entity seeking to purchase an NFA firearm to:
1. Complete and submit proposed Form 5320.23 for each responsible person;
2. Submit fingerprints, photographs, and signed CLEO certificate for each responsible person; and
3. Submit a copy of the documentation that establishes the legal existence of the legal entity.
Arsenal Attorneys strongly opposes the proposed rule ATF 41P (with the exception of the proposed addition of § 479.90) for the following reasons:
First, the ATF explains few to no benefits that it anticipates resulting from the proposed rule—in fact, the few examples it does provide are so scant and marginally related to any type of crime-thwarting goal that they are truly nothing more than casuistries intended to justify additional limitations on otherwise legal activity. Further, while failing to show any significant role NFA firearms play in criminal activity, 41P fails to acknowledge the legitimate social value of NFA firearms—particularly self-defense and the hearing safety afforded by silencers. Thus, the proposed rule subjects NFA firearms to overly burdensome regulation without showing how they pose a greater threat than less regulated classes of firearms.
Second, the only firearms regulated by the proposed rules are legal, registered firearms. The proposed rules do nothing to target illegal firearms, which are incontrovertibly the overwhelming source of gun-related crimes. Oddly, the NFA system instead burdens people who are going to great lengths to register their firearms with BATFE, while at the same time paying a tax for the privilege to do so.
Third, the proposed rule is based on assumptions contrary to the long-standing purpose of Trusts: estate planning and protection for those who cannot protect themselves. The Romans used trusts for estate planning, and our own common law system stretches back 800 years to the English use of trusts to protect absentee property owners. Similarly, modern American gun owners, in a desire to preserve the heritage of gun ownership enshrined in the Second Amendment, increasingly use trusts to preserve guns for beneficiaries until their firearms may properly pass to the next generation. In fact, the idea of a specialized trust for firearms has become a mainstream legal solution, with numerous bar associations offering members training in the design of ‘gun trusts’.
Proposed Rule 41P would, therefore, seem to fly in the face of reality. It identifies beneficiaries of a trust as ‘responsible persons’ subject to fingerprinting, photographing, and the CLEO endorsement. Based on legal theory of the last millennia, if a beneficiary were truly a responsible person, there would be no reason for a trustee to act on their behalf. In that case, trusts never would have come into existence.
Today, many of the clients of Arsenal Attorneys™ name minor children as beneficiaries, and our Arsenal Gun Trust™ provides extensive contingency planning and guidance to ensure trustees and beneficiaries possess firearms in a safe and lawful manner, particularly with respect to BATFE regulations under the National Firearms Act. To deny people the ability to use a trust to help loved ones comply with the law, while concurrently increasing the legal risks of firearms ownership through increased regulations, such as 41P, is contradictory.
Fourth, the rule overlooks the legitimate interest of would be owners of NFA firearms in using gun trusts to avoid an illegal transfer between family members and their intimates. Indeed, constructive possession has become a familiar legal concept among those people interested in NFA firearms. Typical examples include military personnel deployed overseas who wish to entrust their firearms to someone at home for safe storage, or the farmer and his/her spouse who both work to protect livestock by using a suppressed rifle to stop predators, and family members who share a hunting camp. Instead, the proposed rule would increase the risks of lawful gun ownership by increasing the proportion of firearms registered to individual natural persons rather than trusts.
Fifth, the proposed rule underestimates the costs and burdens it will impose on the public and law enforcement authorities. To illustrate, a typical Arsenal Gun Trust may contain four persons deemed ‘responsible persons’, and each might have a different CLEO. Therefore, the rule would seem to require the signatures of all four CLEOs.
In summary, Rule 41P will exacerbate the existing loophole enabling CLEOs to refuse requests for their signatures on forms for NFA firearms. Indeed, a CLEO elected in a suburban Washington, D.C. county this month made a campaign promise to refuse all requests for her signature for NFA firearms. The proposed rule does nothing to address such arbitrary denials to persons having the right to own what are legal firearms. For these reasons, Arsenal Attorneys strongly opposes the proposed rule ATF 41P.
Matthew J. Bergstrom, Esq.
Jeremiah L. White, Esq.