Firearm Industry Crime and Trafficking Accountability Act
This bill outlines certain requirements (and establishes related penalties for failure to comply with these requirements) for manufacturers or importers of firearms. For example, the bill generally requires each manufacturer or importer to create a monitoring database to retain essential facts about the criminal diversion or potential misuse of their firearms.
[Congressional Bills 117th Congress]
[From the U.S. Government Publishing Office]
[H.R. 8740 Introduced in House (IH)]
<DOC>
117th CONGRESS
2d Session
H. R. 8740
To establish reasonable controls on firearms manufacturers and
importers, and for other purposes.
_______________________________________________________________________
IN THE HOUSE OF REPRESENTATIVES
August 23, 2022
Mrs. Carolyn B. Maloney of New York introduced the following bill;
which was referred to the Committee on the Judiciary
_______________________________________________________________________
A BILL
To establish reasonable controls on firearms manufacturers and
importers, and for other purposes.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ``Firearm Industry Crime and
Trafficking Accountability Act''.
SEC. 2. FINDINGS.
The Congress finds as follows:
(1) The firearm industry has engaged in dangerous business
practices, flooding American communities with weapons of war
like AR-15s and other semiautomatic weapons. Despite these
practices, the firearm industry is not required to monitor its
distribution to ensure that its products are not used for
unlawful purposes.
(2) A study conducted by the Bureau of Alcohol, Tobacco,
Firearms, and Explosives (ATF) found that 5 percent of licensed
dealers sell about 90 percent of guns used in crimes (also
known as ``crime guns''). Firearm manufacturers, through trace
data provided by the ATF, often know exactly which dealers and
distributors disproportionately sell these crime guns.
(3) Despite these indicators of diversion, firearm
manufacturers have failed to adequately curtail their
distribution practices and sought to evade any responsibility
for preventing the widespread misuse of their products--
rejecting ATF resources and failing to effect change at the top
of the distribution pyramid.
(4) Firearm manufacturers also sell dangerous firearms to
distributors and retailers who, according to ATF data, can fail
to comply with Federal firearms law. The trace analysis of
2,000 firearms dealers cited by the ATF found that half of the
dealers sold firearms to customers without conducting the
background checks required by Federal law. Firearms dealers
often flouted Federal laws and regulations, sold weapons to
convicted felons and domestic abusers, lied to investigators,
and falsified records.
SEC. 3. REQUIREMENT TO CREATE REASONABLE CONTROLS AND MONITORING
SYSTEM.
Each manufacturer or importer of firearms in or affecting
interstate commerce shall implement reasonable controls to prevent, and
create and maintain a monitoring database to retain essential facts
concerning, the criminal diversion or potential misuse of their
products.
SEC. 4. PROHIBITED ACTIVITIES.
It shall be unlawful for any manufacturer or importer of firearms
in or affecting interstate commerce to--
(1) supply a firearm to a distributor or retailer of the
firearm, knowing or having reasonable cause to believe that the
distributor or retailer has failed to implement reasonable
controls or engaged in distribution, sales, or other practices
likely to result in a high risk of criminal diversion or
misuse;
(2) fail to investigate or inquire as to the distribution
practices of such a distributor or retailer, knowing or having
reasonable cause to believe that the distributor or retailer
has failed to implement reasonable controls or engaged in
distribution, sales, or other practices likely to result in a
high risk of criminal diversion or misuse; or
(3) supply a quantity of firearms to a State or
distribution area, knowing or having reasonable cause to
believe that the quantity exceeds the lawful demand for
firearms in the State or distribution area.
SEC. 5. REQUIRED ACTIVITIES.
Each manufacturer or importer of firearms in or affecting
interstate commerce shall--
(1) report to the Director on any pattern, distribution, or
repeated instances of a distributor or retailer of a firearm
whom the firearm manufacturer or importer knows or has
reasonable cause to believe has failed to implement reasonable
controls or engaged in distribution, sales, or other practices
likely to result in a high risk of criminal diversion or
misuse;
(2) report to the Director annually, in such form and
manner as the Director shall prescribe, all instances of
criminal diversion or misuse of a product distributed or sold
by the manufacturer or importer, as the case may be, of which
the manufacturer or importer, as the case may be, is aware, and
shall include in the report an itemization of the firearms
involved by category; and
(3) keep for a period of 5 years all trace records,
relevant communications, and other relevant information
pertaining to the monitoring database of the manufacturer or
importer, as the case may be.
SEC. 6. EXEMPTIONS.
(a) In General.--Sections 3 through 5 shall not apply to a
manufacturer who manufactures fewer than 3,000 firearms per year.
(b) Waiver Authority.--The Director may waive the applicability of
such sections to a manufacturer who manufactures not more than 6,000
firearms per year, on finding that the provision of such a waiver will
not harm public safety, except that the Director may not provide such a
waiver to a manufacturer who manufactures a semiautomatic firearm or
any copy, duplicate, variant, or altered facsimile with the capability
of a semiautomatic firearm.
SEC. 7. DEFINITIONS.
In this Act:
(1) ATF.--The term ``ATF'' means the Bureau of Alcohol,
Tobacco, Firearms, and Explosives.
(2) Criminal diversion.--The term ``criminal diversion''
means the unlawful sale or distribution of a firearm by, to, or
through a firearm trafficker, straw purchaser, or person
prohibited by law from possessing a firearm, and any transfer
or possession of a firearm in violation of law.
(3) Director.--The term ``Director'' means the Director or
the Acting Director of ATF.
(4) Essential facts.--The term ``essential facts'' means
crime gun trace data, information on distributor or retailer
compliance with ATF inspections, information on distributor or
retailer compliance with State inspections, where applicable,
information concerning distributor or retailer compliance with
applicable background check requirements with respect to
firearms sold by the manufacturer or importer, and such other
information as the Director may deem useful in preventing
criminal diversion or misuse of firearms.
(5) Firearm.--The term ``firearm'' has the meaning given
the term in section 921(a)(3) of title 18, United States Code.
(6) Importer.--The term ``importer'' has the meaning given
the term in section 921(a)(9) of title 18, United States Code.
(7) Manufacturer.--The term ``manufacturer'' has the
meaning given the term in section 921(a)(10) of title 18,
United States Code.
(8) Monitoring database.--The term ``monitoring database''
means a system capable of incorporating and analyzing--
(A) information obtained from gun trace data, ATF
notifications, dealer inspections, and State and local
law enforcement notifications; and
(B) such other information as the Director may deem
important and useful.
(9) Reasonable controls.--The term ``reasonable controls''
means procedures or practices designed to prevent the unlawful
sale or distribution of a firearm, including by preventing such
a sale to a firearm trafficker, straw purchaser, person
prohibited by Federal or State law from possessing a firearm,
or person who the seller knows or has reasonable cause to
believe will use a firearm unlawfully or for self-harm.
(10) Semiautomatic firearm.--The term ``semiautomatic
firearm'' means any repeating firearm which utilizes a portion
of the energy of a firing cartridge or shell to extract the
fired cartridge case or shell and chamber the next round, and
which requires a separate pull of the trigger to fire each
cartridge or shell.
(11) Straw purchaser.--The term ``straw purchaser'' means a
person who, in connection with the acquisition or attempted
acquisition of a firearm, makes any false or fictitious oral or
written statement intended to conceal that the purchase is
being made on behalf of a third party, unless the acquisition
or attempted acquisition is for the purpose of making a bona
fide gift to a third party who is not prohibited by law from
possessing or receiving a firearm. For purposes of the
preceding sentence, a gift to a third party is not a bona fide
gift if the third party has offered or given the purchaser a
service or thing of value to acquire the firearm for the third
party.
SEC. 8. PENALTIES.
(a) Administrative Remedies.--With respect to each violation of
section 3, 4, or 5, the Director shall, after notice and opportunity
for hearing, subject the violator to a civil penalty, in an amount to
be determined by the Director which shall be--
(1) in the case of the 1st such violation by the violator,
not less than $150,000 and not more than 1 percent of the gross
annual revenue of the violator;
(2) in the case of the 2nd such violation, not less than
$300,000 and not more than 2 percent of the gross annual
revenue of the violator; or
(3) in the case of the 3rd or subsequent such violation,
not less than $1,000,000 and not more than 6 percent of the
gross annual revenue of the violator.
(b) Judicial Remedies in the Case of Knowing Violations.--
(1) In general.--In the case of a violation of section 4 or
5 that the Director determines was committed knowingly, the
Director shall also bring a civil action against the violator
in the United States District Court for the District of
Columbia. If the Director proves the violation by a
preponderance of the evidence, the court shall order the
Director to place the violator under an ATF monitoring system
to prevent criminal diversion of the products of the violator,
for not more than 5 years.
(2) License suspension for violation while subject to atf
monitoring system.--If the Director determines that, while
subject to such a monitoring system, the violator has knowingly
violated section 4 or 5, the Director may bring a civil action
in the United States District Court for the District of
Columbia. If the Director proves the violation by a
preponderance of the evidence, the court shall order the
Director to suspend for 3 months any license issued to the
violator under chapter 44 of title 18, United States Code.
SEC. 9. ADMINISTRATIVE PROVISIONS.
(a) Request for Records.--On request of the Director, a
manufacturer or importer of firearms shall provide the Director with
such records as the Director determines will assist the Director in
ensuring compliance with this Act.
(b) Availability of Trace Data.--The Director may make available to
a manufacturer or importer of firearms any data requested by the
manufacturer or importer, as the case may be, from the National Tracing
Center or the Director of Industry Operations.
(c) Provision of Information to Other Federal Law Enforcement
Agencies, or State or Local Governments.--On request of a Federal law
enforcement agency, the Director shall provide information obtained
under this Act to the agency, and may provide the information to State
and local law enforcement authorities.
SEC. 10. ANNUAL REPORT TO CONGRESS.
The Director shall submit to the Congress, and make easily
accessible to the public on the website of the ATF, annual reports
summarizing the information reported pursuant to section 5(2), which
shall include copies of the reports made pursuant to section 5(2) and
supporting economic analyses.
SEC. 11. TRADE SECRETS AND CONFIDENTIAL INFORMATION.
This Act shall not be interpreted to require the disclosure of
information that is exempt from public disclosure under section 552 of
title 5, United States Code (commonly known as the ``Freedom of
Information Act'').
SEC. 12. REGULATIONS.
Within 18 months after the date of the enactment of this Act, the
Director shall promulgate final regulations necessary to implement the
preceding provisions of this Act, including regulations necessary to
ensure that manufacturers and importers of firearms comply with
sections 3 through 5. In promulgating regulations to enforce section
4(3), the Director shall take into account factors such as population,
reports of lost and stolen firearms, types of firearms used in crimes,
firearms traced to distributors and retailers in other States, and
firearm traces.
SEC. 13. EFFECTIVE DATE.
The preceding provisions of this Act shall take effect on the date
final regulations are promulgated under section 11.
SEC. 14. REPEAL OF CERTAIN LIMITATIONS ON THE BUREAU OF ALCOHOL,
TOBACCO, FIREARMS AND EXPLOSIVES.
(a) Repeal of Certain Limitations on the Use of Database
Information of the Bureau of Alcohol, Tobacco, Firearms and
Explosives.--
(1) The matter under the heading ``Bureau of Alcohol,
Tobacco, Firearms and Explosives--Salaries and Expenses'' in
title II of division B of the Consolidated and Further
Continuing Appropriations Act, 2012 (18 U.S.C. 923 note; Public
Law 112-55; 125 Stat. 609-610) is amended by striking the 6th
proviso.
(2) The 6th proviso under the heading ``Bureau of Alcohol,
Tobacco, Firearms and Explosives--Salaries and Expenses'' in
title II of division B of the Consolidated Appropriations Act,
2010 (18 U.S.C. 923 note; Public Law 111-117; 123 Stat. 3128-
3129) is amended by striking ``beginning in fiscal year 2010
and thereafter'' and inserting ``in fiscal year 2010''.
(3) The 6th proviso under the heading ``Bureau of Alcohol,
Tobacco, Firearms and Explosives--Salaries and Expenses'' in
title II of division B of the Omnibus Appropriations Act, 2009
(18 U.S.C. 923 note; Public Law 111-8; 123 Stat. 574-576) is
amended by striking ``beginning in fiscal year 2009 and
thereafter'' and inserting ``in fiscal year 2009''.
(4) The 6th proviso under the heading ``Bureau of Alcohol,
Tobacco, Firearms and Explosives--Salaries and Expenses'' in
title II of division B of the Consolidated Appropriations Act,
2008 (18 U.S.C. 923 note; Public Law 110-161; 121 Stat. 1903-
1904) is amended by striking ``beginning in fiscal year 2008
and thereafter'' and inserting ``in fiscal year 2008''.
(5) The 6th proviso under the heading ``Bureau of Alcohol,
Tobacco, Firearms and Explosives--Salaries and Expenses'' in
title I of the Science, State, Justice, Commerce, and Related
Agencies Appropriations Act, 2006 (18 U.S.C. 923 note; Public
Law 109-108; 119 Stat. 2295-2296) is amended by striking ``with
respect to any fiscal year''.
(6) The 6th proviso under the heading ``Bureau of Alcohol,
Tobacco, Firearms and Explosives--Salaries and Expenses'' in
title I of division B of the Consolidated Appropriations Act,
2005 (18 U.S.C. 923 note; Public Law 108-447; 118 Stat. 2859-
2860) is amended by striking ``with respect to any fiscal
year''.
(b) Elimination of Prohibition on Processing of Freedom of
Information Act Requests About Arson or Explosives Incidents or Firearm
Traces.--Section 644 of division J of the Consolidated Appropriations
Resolution, 2003 (5 U.S.C. 552 note; Public Law 108-7; 117 Stat. 473)
is repealed.
(c) Repeal of Limitations on Imposition of Requirement That
Firearms Dealers Conduct Physical Check of Firearms Inventory.--The 5th
proviso under the heading ``Bureau of Alcohol, Tobacco, Firearms and
Explosives--Salaries and Expenses'' in title II of division B of the
Consolidated and Further Continuing Appropriations Act, 2013 (18 U.S.C.
923 note; Public Law 113-6; 127 Stat. 248) is amended by striking ``and
any fiscal year thereafter''.
(d) Elimination of Prohibition on Consolidation or Centralization
in the Department of Justice of Firearms Acquisition and Disposition
Records Maintained by Federal Firearms Licensees.--The matter under the
heading ``Bureau of Alcohol, Tobacco, Firearms and Explosives--Salaries
and Expenses'' in title II of division B of the Consolidated and
Further Continuing Appropriations Act, 2012 (18 U.S.C. 923 note; Public
Law 112-55; 125 Stat. 609) is amended by striking the 1st proviso.
<all>
Introduced in House
Introduced in House
Referred to the House Committee on the Judiciary.
Referred to the Subcommittee on Crime, Terrorism, and Homeland Security.
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