Biden administration issues rule clarifying definition of being ‘engaged in the business’ of selling guns

The Biden administration Thursday announced a new proposed rule to clarify the definition of being “engaged in the business” of dealing in firearms. 

The Justice Department’s rule would clarify who is engaged and thus is required to be a licensed firearms dealer and run background checks. It outlines what criteria people would have to meet, such as offering for sale any number of firearms and repetitively offering for sale multiple firearms of the same mark or model, or firearms that are in their original packaging. 

For people who have a gun they no longer need and want to sell it to a family member, they do not need a license to sell it, according to the rule. If someone buys and sells relics or “collectible” personal firearms as a hobby, they also do not need a license. 

But, if someone is offering a firearm for sale to make money and telling a customer that they can purchase and sell additional firearms, “they would presumptively need a license — and need to run background checks,” according to the new rule. And, a license and background check is needed if people are repetitively offering for resale firearms within 30 days of when they are purchased.

The rule also would clarify that an individual would be presumed to have the intent to “predominantly earn a profit” — meaning they are engaging in the business of dealing firearms — if they are creating a website or making business cards to advertise, maintaining records to document and track profits and losses, or purchasing business insurance or renting space at a gun show.

Those provisions are an effort to close the “gun show loophole” and “internet loophole” in the federal law, clarifying that dealers who engage in selling guns are required to obtain a license and run background checks even if it is at a gun show or online.

The announcement comes after Biden’s executive order that directed the Justice Department to undertake a review to increase the number of background checks conducted before gun sales. He announced the order in March in Monterey Park, Calif., following a mass shooting there.

The goal of that order was to move the U.S. as close to a system of universal background checks for all gun sales as possible without requiring legislation from Congress. 

Earlier this week, a gunman in Jacksonville, Fla., killed three Black Americans. The shooting is suspected to be racially motivated, and the gunman used an assault-style rifle and handgun.

Gun safety group Brady hailed the announcement Thursday and said that clarifying the definition of “engaged in the business” of selling firearms has been needed for decades.

“A clear definition will ensure that individuals selling firearms for profit will have to conduct background checks, getting us closer to universal background checks,” said Kris Brown, president of Brady.