If you’re looking to buy or sell guns in the US, you've probably heard the term “FFL” used. But what are FFLs, and how do they help gun buyers and sellers?
An FFL is a "federal firearm license." These licenses can be issued to either a person or a business. These people and businesses often refer to themselves colloquially as an FFL, like "We're an FFL."
As of 2019, there were just over 130,000 active FFLs in the US. Established by the Federal Firearms Act of 1938, FFLs are required for those looking to conduct business involving firearms and their ammunition. They also forbid dealers from transferring items to a customer unless certain conditions are met.
For example, one of the strict rules’ FFL dealers must abide by includes validating the customer’s identity. This step in the gun buying process works to minimize the number of illegal gun sales that happen and ensures only those allowed to legally own a gun and ammunition can get their hands on one.
FFLs also afford buyers a level of protection against online gun scams. As you can read in this article, asking for an FFL and verifying its legitimacy is the fastest and easiest way to ensure the gun you’re choosing is legit. In short, FFLs are designed to create a safer, more regulated space for all.
How many different types of FFL are there?
The Bureau of Alcohol, Tobacco, Firearms, and Explosives (BATF) licenses all those engaged in the business of dealing, manufacturing, or importing firearms. In general, FFL license types can be broken into four categories:
Dealer FFLs include license types 01, 02, and 09. Dealer FFLs allow those who possess them to purchase and sell guns as a business entity. This includes gunsmiths.
Manufacturing FFLs include license types 06, 07, and 10. Some of these FFL types include the manufacturing of both firearms and ammunition, while others will only cover ammunition manufacturing. Those with ammunition only FFLs are not allowed to act as a firearm manufacturer nor a dealer.
Importation authorization is covered by license types 08 and 11.
Other FFLs are generally firearm collectors. These have license type 03.
Exploring the FFL license types
Type 01: Dealer in Firearms / Gunsmithing (firearms repair)
With nearly 54,000 active Type 01 FFLs in the US today, this is by far the most used license type. Covering the buying and selling of firearms as a business and any related gunsmithing activities, this is an excellent option for those looking to get started in the gun business. This and Type 03 licenses are also typically the most common license types of buyers will interact with.
However, a Type 01 FFL does come with limitations, making it a less than perfect fit for everyone. For example, with a Type 01 license, you would not be allowed to manufacture any guns, even if you were assembling them from a kit. You also would be unable to sell silencers and other popular items legally. If you can live with those restrictions, this is likely the best option for you. It’ll cost you $200 to apply and comes with a $90 renewal rate every 3 years.
Type 02: Pawnbroker
A Type 02 FFL is nearly identical to a Type 01, only differing in who it was designed for. While Type 01 is more general, pawnbrokers will need a Type 02 to buy and sell firearms legally. The discrepancy results from the special rules forbidding pawnbrokers from taking guns as security on a loan.
One additional aspect to note about a Type 02 license: the BATF will typically inspect these license holders more often due to their business nature.
Type 03: Collector or Curios & Relics
For those who are only interested in collecting antique firearms, a Type 03 FFL is likely the best option. Second, only to Type 01 in terms of popularity, a Type 03 FFL is not a license to sell guns but is intended to allow private, personal gun owners to build a collection of older weapons. Typically, the ATF considers anything 50 years and older to fall under the “Curio and Relic” categorization. However, there are a few exceptions for newer military rifles and pistols.
Costing $30 to apply and another $30 every 3 years to renew, this license type is ideal for those interested in curating an antique collection.
Type 06: Manufacturer of Ammunition for Firearms
This license type is designed specifically for those looking to make common small arms ammunition with the intent to sell. However, a Type 06 FFL does not allow for any business activity related to firearms themselves. As a result, there are only about 1,000 active licenses of this nature in use today. If you’re interested in manufacturing both the firearms and the ammo, you will likely want to look at our next license type: type 07.
Type 07: Manufacturer of Firearms & Ammunition
Another common FFL license type, a Type 07, allows you to buy, sell, and repair firearms like you would with a Type 01, with the additional ability to manufacture both guns and ammunition. If you add a class 03 SOT to this license, you can also even manufacture items like silencers and even machine guns.
Giving you by far the most ability of any license type available, many gun dealers will choose a type 07 because it allows them to meet the majority of their customers’ needs. It will set you back $150 to apply and the same amount to renew the license every three years.
Type 08: Importer of Firearms/Ammunition
While relatively rarer than some other options on this list, a Type 08 FFL is important for those who are looking to import guns and ammunition from overseas. However, it can take a lot of time to get this and other related paperwork in order, so be sure you fully understand what’s involved before deciding to pursue this license type.
Type 09: Dealer in Destructive Devices
The next three license types are all very rare and would not be commonly used by dealers other than those selling to government agencies. “Destructive Devices” is a broad group covering everything from non-sporting guns with over a half-inch bore, grenades, artillery, semi-automatic weapons, and even some kinds of exploding ammunition.
Requiring a special license type, dealing in destructive devices is allowed in most states. For instance, military contractors, law enforcement, and government agencies buy destructive devices from dealers across the country. Unless you’re buying or selling any of these types of weapons, you likely will never come across a Type 09 FFL as it is the rarest license of all. This isn’t all that surprising, though, as it costs $3,000 just to apply.
Type 10: Manufacturer of Destructive Devices, Ammunition for Destructive Devices, or Armor Piercing Ammunition
Similar to the other manufacturing license types, a Type 10 FFL allows you to make destructive devices and their ammunition. It also allows you to restore certain kinds of vintage military arms for collectors.
Type 11: Importer of Destructive Devices, Ammunition for Destructive Devices, or Armor Piercing Ammunition
Finally, a Type 11 FFL allows you to import destructive devices but not manufacture them yourself. This license type is suited for those who deal with government agencies or those who work with rare kinds of collectible military arms for museums and highly affluent private collectors.
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