H.R. 624: Reining In Federal Licensing Enforcement Act of 2025

The "Reining In Federal Licensing Enforcement Act of 2025" is a proposed bill aimed at reforming how the Bureau of Alcohol, Tobacco, Firearms, and Explosives (ATF) regulates federal firearms licensees. Below is a summary of its main components:

Graduated Penalties for Violations

The bill introduces a system of graduated penalties for federal firearms licensees who violate regulations. Key points include:

• If a violation is not willful, the Attorney General must notify the licensee and help them correct it.
• For willful violations, the Attorney General can impose penalties, such as suspending a license for up to 30 days or revoking the license altogether, depending on the licensee's compliance history.
• Violations will be classified to avoid harsh penalties for minor infractions, and the Attorney General has a three-year limit to take action after discovering a violation.

Procedure for License Denials

The bill establishes a process for handling firearms license applications that the Attorney General wants to deny:

• Applicants must be informed in writing of the reasons for denial and can request a hearing to discuss their application.
• A hearing will be held at a convenient location for the applicant.
• The Attorney General cannot deny an application based on prior violations if more than five years have passed since previous infractions, with some exceptions.

Definition of "Willfully"

The term "willfully" is defined to clarify when a violation is considered intentional. For someone to be found willful, they must:

• Have knowledge of their legal obligations.
• Understand those obligations.
• Act with disregard for those obligations.

Opportunity for Remedy

The act gives former firearms licensees whose licenses were revoked or denied in the past the ability to have their cases reconsidered based on the new definition of willfulness.

Standards for ATF Investigations

The bill mandates the establishment of formal standards for how the ATF conducts inspections and investigations, focusing on:

• Consistency in how violations are measured.
• Including mitigating factors to consider before imposing penalties.

Confidentiality of Purchaser Information

Restrictions are placed on the sharing of information concerning firearms purchasers. The ATF cannot disclose information about purchasers who are not prohibited unless specific certifications are in place.

Business Liquidation Rights

Entities with expired, surrendered, or revoked licenses will be allowed 90 days to liquidate their inventory before losing their license status. They can also transfer firearms to personal collections under certain conditions.

Transferee Protections

When a licensed business is transferred due to circumstances like the death of the licensee, the new owner will not be presumed to commit any violations found prior to the transfer.

Standards for Recordkeeping Violations

The bill adjusts the criteria for criminal violations related to recordkeeping, requiring evidence of a "materially false entry" rather than any false entry.

Website Establishment

A website titled "gunrightsrestored.gov" will be created to facilitate claims related to the reimbursement of legal fees for individuals whose licenses were unfairly revoked.

Reports on Implementation

The Attorney General and the Inspector General must complete reports on the implementation of these changes within six months of the bill's enactment.

Relevant Companies

• Ruger (RGR) - A major firearms manufacturer that could be affected by the changes in licensing enforcement and penalties.
• Smith & Wesson Brands (SWBI) - As a prominent gun producer, they may experience changes in regulatory compliance and customer licensing issues due to the bill.
• American Outdoor Brands (AOUT) - Might face impacts relating to their firearms business and compliance obligations under the new rules.