H.R. 4222: Fire Sale Loophole Closing Act of 2025

This bill, known as the Fire Sale Loophole Closing Act of 2025, aims to amend existing U.S. laws regarding the transfer of business inventory firearms, particularly in cases where a federal firearms license is revoked or denied. Here’s a breakdown of the key provisions and implications of the bill:

Short Title

The bill may be referred to as the Fire Sale Loophole Closing Act of 2025.

Congressional Intent

The bill expresses the sense of Congress that the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF) has the authority to regulate how federal firearms licensees (FFLs) can discontinue their firearms businesses. It seeks to clarify the requirements concerning firearms that remain with a former license holder when their license is terminated.

Restrictions on Firearms Transfers

The bill introduces specific restrictions on the transfer of business inventory firearms under two main conditions:

• After Notice of License Revocation or Denial:
  • It is unlawful for an individual notified by the Attorney General of a license revocation or denial to transfer their business inventory firearms to themselves or their employees.
  • Receiving a firearm that was part of their business inventory at the time of notice is also prohibited.
• After License Revocation or Expiration:
  • It is unlawful to engage in similar conduct as mentioned above if a license has been revoked or expired.
  • Also unlawful is the transfer of inventory firearms to any person other than a licensed dealer or law enforcement agency during a specified period post-revocation or expiration.

Transfer Restrictions

Furthermore, once a business inventory firearm has been transferred into a personal collection, it cannot be transferred again within one year of that initial transfer.

Definition of Business Inventory Firearm

The bill defines a business inventory firearm as any firearm that must be recorded in the acquisition and disposition logs of a firearms business, clarifying which firearms are subject to these restrictions.

Penalties for Violations

Violating these provisions can result in fines, imprisonment for up to one year, or both. For willful violations, the imprisonment term could extend to five years.

Notice Requirements

The bill also mandates that any notice of license revocation or denial provided to an individual must include information about the laws prohibiting unlicensed dealings in firearms and the new restrictions related to the transfer of business inventory firearms.

Relevant Companies

• None found